Calleija v Regina - [2012] NSWCCA 37

Court of Criminal Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Calleija v Regina [2012] NSWCCA 37
Hearing dates: 14 February 2012
Decision date: 22 March 2012
Before: Beazley JA at [1];
R A Hulme J at [132];
Garling J at [133]
Decision:
1. Leave to appeal is granted;
2. The appeal is dismissed.

Catchwords: CRIMINAL LAW - appeal - application for permanent stay of prosecution - general principles governing grant of permanent stay of criminal proceedings - whether the proceedings are an affront to the public conscience - abuse of process - duplicity - oppression and undue hardship - Criminal Appeal Act 1912, s 5F
Legislation Cited: Crimes Act 1900
Crimes Act 1914 (Cth)
Criminal Appeal Act 1912
Criminal Code Act 1995 (Cth)
Evidence Act 1995
Cases Cited: Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336
Chu Piu-wing v Attorney-General [1984] HKLR 411
Darwiche v R [2011] NSWCCA 62
Dupas v The Queen [2010] HCA 20; 241 CLR 237
Hakim v Waterways Authority of New South Wales [2006] NSWCCA 376; 149 LGERA 415
House v R [1936] HCA 40; (1936) 55 CLR 499
Jago v District Court of NSW [1989] HCA 46; 168 CLR 23
Mackay v R [1977] HCA 22; 136 CLR 465
Moevao v Department of Labour (1980) 1 NZLR 464
Moti v The Queen [2011] HCA 50; 283 ALR 393
Petroulias v R [2007] NSWCCA 154; 176 A Crim R 302
R (Cth) v Petroulias (No. 1) [2006] NSWSC 788; 177 A Crim R 153
R v Croydon Justices, Ex parte Dean [1993] QBD 769
R v Edwards & Anor [2009] HCA 20; 255 ALR 399
R v Giam [1999] NSWCCA 53; 104 A Crim R 416
R v Glennon [1992] HCA 16; 173 CLR 592
R v Hamzy (1994) 74 A Crim R 341
R v King [2003] NSWCCA 399; 59 NSWLR 472
R v M [2010] NSWDC 200
R v Mohi [2000] SASC 384; 78 SASR 55
R v Petroulias [2005] NSWCCA 75; 62 NSWLR 663
Regina v Moussad [1999] NSWCCA 337; 152 FLR 373
Stanton v Abernathy (1990) 19 NSWLR 656
Taylor v The Queen (1997) 93 A Crim R 1
Vuckov and Romeo (1986) 22 A Crim R 10
Walton v Gardiner [1993] HCA 77; 177 CLR 378
Williams v Spautz [1992] HCA 34; 174 CLR 509
Category: Principal judgment
Parties: Michael Joseph Calleija (Applicant)
Regina (Respondent)
Representation: R Bonnici (Applicant)
P Staehli SC (Respondent)
Colleen V Donnelly (Applicant)
Commonwealth Director of Public Prosecutions (Respondent)

File Number(s): 2009/235383
Decision under appeal

Date of Decision:

2011-08-11 00:00:00

Before:

Frearson DCJ

File Number(s):

2009/235383

Judgment

BEAZLEY JA: Michael Joseph Calleija faces trial on the following two charges of alleged fraudulent taxation deductions between 1997 and 2006 against the Commonwealth:

Between about 1 January 1997 and about 23 May 2001 at Sydney, New South Wales, did defraud the Commonwealth, in that he participated in a scheme by which false claims for tax deductions were made, contrary to the Crimes Act 1914 (Cth), s 29D;

And that he:

Between about 24 May 2001 and about 30 June 2006 at Sydney, New South Wales, did participate in a scheme by which false claims for tax deductions were made with the intention of dishonestly causing a loss to the Commonwealth, contrary to the Criminal Code Act 1995 (Cth), s 135.1(3).

The scheme in which Mr Calleija allegedly participated involved two aspects: first, falsely inflating otherwise legitimate tax deductible expenses of his company, Outboard World Pty Limited (OBW), thus dishonestly reducing the amount of income tax properly payable; and secondly, by disguising OBW's income as loans from an overseas entity upon which interest was paid, also reducing the amount of income tax otherwise payable by the company. Although the scheme allegedly involved Mr Calleija and his company, it is not necessary in these reasons to differentiate between their alleged participation in the scheme, save occasionally for the purposes of clarity.

Following an Australian Taxation Office (ATO) audit of Mr Calleija's books and records, Mr Calleija voluntarily approached the Australian Federal Police (AFP) in June 2006. Over the succeeding months, he gave three separate induced statements to the AFP. However, he was not charged with any offences arising from his participation in the scheme until October 2009 and the indictment was not filed until 15 February 2011.

On 28 February 2011, Mr Calleija applied for a permanent stay of the prosecution. That application did not proceed to completion and a second application for a permanent stay was made on 27 May 2011. On 11 August 2011, Frearson DCJ refused the application.

Mr Calleija now seeks leave to appeal from his Honour's determination pursuant to the Criminal Appeal Act 1912, s 5F. Section 5F provides as follows:

"5FAppeal against interlocutory judgment or order

(1)This section applies to:

(a)proceedings (including committal proceedings) for the prosecution of offenders on indictment in the Supreme Court or in the District Court ...

(3)Any other party to proceedings to which this section applies may appeal to the Court of Criminal Appeal against an interlocutory judgment or order given or made in the proceedings:

(a)if the Court of Criminal Appeal gives leave to appeal ..."

The grant or refusal of an application for a permanent stay has been held by this Court to fall within the meaning of the words "interlocutory judgment or order" in s 5F: see R v King [2003] NSWCCA 399; 59 NSWLR 472 at 477 [22] per Spigelman CJ. As the decision to refuse or grant a stay is discretionary, the principles in House v R [1936] HCA 40; (1936) 55 CLR 499 apply to the determination of an appeal from any such decision which is discretionary in nature: see Jago v District Court of NSW [1989] HCA 46; 168 CLR 23 at 31 per Mason CJ.

Given the importance of the matter to Mr Calleija and the serious nature of an application for a permanent stay, I am of the opinion that leave should be granted. My reasons hereafter deal with the appeal.

Mr Calleija's notice of grounds of appeal contained the following seven grounds:

"Main ground:

1.That the proceedings are an affront to the public conscience.

Supported by sub-grounds:

2.That [Mr Calleija] has discharged the required onus upon him.

3.That the indictment is bad for duplicity.

4.That the Crown has used [Mr Calleija's] induced statements in a derivative manner.

5.That oppression and undue hardship has been caused to [Mr Calleija] by the delay in bringing the prosecution.

6.That the Commonwealth Prosecution Guidelines have not fairly been adhered to.

7.[Mr Calleija] seeks leave to introduce new materials being 'Initial Briefing Paper to Australian Federal Police re Vanuatu Based Scheme Promoter' dated 11 November 2005 on the basis that it would have affected the decision of his Honour in relation to grounds 1, 2, 4 and 5 above."

Background facts

Mr Calleija was introduced to the scheme by his accountant and tax agent Owen T Daniel & Co (Owen T Daniel). Another alleged key participant in the scheme was a Mr Robert Agius. Insofar as Mr Calleija's participation is concerned, it is alleged that payments of approximately $2,350,000 were made from various of his company's bank accounts to three nominated New Zealand bank accounts during the period specified in the charges. The transfers were characterised in the books of the company as "interest, management or consultancy fees", or were subsumed in expenses of the company when there had been no real expenditure. Over the same period, funds of approximately $2,300,000 were transferred to the company's bank account and to Mr Calleija's personal bank account from a number of different New Zealand companies. The incoming transactions were usually close in time to the outgoing transactions. The Crown case is that the outgoing and incoming transactions constituted a series of round robins involving the circulation of similar amounts of money, supported by a document trail intended to create a false impression that the incoming and outgoing transactions were unconnected.

Mr Calleija came to the attention of the ATO in the course of an investigation which has become known as Project Wickenby. On 29 April 2003, the ATO wrote to Mr Calleija's accountants requesting information in respect of transactions involving Vanuatu and offshore superannuation arrangements. The accountants drafted the replies to the ATO on Mr Calleija's behalf, assuring Mr Calleija that everything was in order. In September and October 2004, the accountants provided documents to the ATO relating to Mr Calleija's involvement with the Vanuatu scheme. According to Mr Calleija's solicitor, Mr Calleija had not seen these documents prior to their being provided to the ATO. Subsequently, the ATO commenced an audit at Mr Calleija's company's office.

Mr Calleija made two further monetary transfers in November and December 2004 respectively. At the time of making the transfer in November 2004, Ms Abi Badra, an employee within the accountant's office working on Mr Calleija's accounts, assured him that everything was above board and legally covered by their lawyers. The Crown contends that in December 2004, Mr Calleija received the round robin return transfer, although the amount received was $20,000 less than he expected.

Mr Calleija sought legal advice in early 2005. The advice he was first given would appear to have been entirely inappropriate and Mr Calleija did not act upon it. In about mid-2005, Mr Calleija heard news reports about Project Wickenby. He subsequently obtained professional advice from new accountants and legal advisers, including a barrister, Mr Michael Inglis, who is a tax specialist.

As a result of this new legal advice, Mr Calleija made contact with both the AFP and the ATO. He offered to repay any moneys owing and to provide assistance to the AFP in relation to the Vanuatu scheme. Mr Calleija subsequently paid the outstanding tax in full together with interest and penalties. He was required to sell his house in order to do so. He also paid in excess of $350,000 in legal fees to his then solicitor and Mr Inglis. Leaving aside the payment of tax in the amount of approximately $1M, the financial burden on Mr Calleija has been significant.

In fulfilment of his offer to provide assistance to the AFP, Mr Calleija made three induced statements. Each induced statement commenced with the following series of questions and answers:

"Q1.Mr CALLEIJA, do you agree that prior to this taped record of conversation being commenced I explained the procedure of what would be happening today?

AYes.

Q2.Okay. Mr CALLEIJA, this record of conversation is being conducted on the basis that it will not be used in evidence against you in any court proceedings other than proceedings in respect of the falsity of any evidence you may give during this record of conversation. Do you understand this?

AYes. Yeah.

Q3.Further, this record of conversation is made on the basis that it will be used to support an application to the Commonwealth Director of Public Prosecutions for an indemnity for you from prosecution for any offences disclosed herein. Do you understand this?

AYes.

Q4.Michael, do you acknowledge that no insurances or guarantees have been given to you in relation to the grant for such an indemnity?

AYes, I do.

Q5.Okay. And Mr CALLEIJA, are you prepared for this record of conversation to be used as the basis for the preparation of an induced statement?

AYes.

Q6.Okay. Do you agree that you have decided to participate in this taped record of conversation of your own free will?

AYes, I do."

Following the first induced statement, the AFP executed search warrants on the business premises of Owen T Daniel and subsequent search warrants were conducted on most of the 19 clients of the accountants, who had been identified as being involved in the scheme.

On 20 April 2010, Detective Superintendent Moerman of the AFP provided a letter containing an "Assessment of Assistance" in respect of the AFP's dealing with Mr Calleija for the purposes of use in any criminal proceedings brought against Mr Calleija. The letter briefly outlined the operation of the scheme; recorded that in June 2006, Mr Calleija approached the AFP; stated that he provided induced statements to the AFP; and noted that during the interviews, Mr Calleija provided "a full and frank admission regarding his involvement in the scheme". Detective Superintendent Moerman added that Mr Calleija also "provided valuable information as to how the scheme was promoted, how it was marketed to him, and how it worked in practice".

Detective Superintendent Moerman recorded that as a result of the information given to the AFP during the first induced statement, the police shifted the focus of their investigations from the clients of Owen T Daniel to the accountants of that firm as being the persons instrumental in facilitating the scheme. He said that:

"The information provided by [Mr Calleija] contributed significantly to the success, to date, of the AFP investigation."

Detective Superintendent Moerman evaluated the assistance provided by Mr Calleija as follows. He reiterated that the AFP used the information provided to focus the direction of the investigation and stated the AFP were intending to use the information in the briefs of evidence in the prosecutions of Mr Agius and a number of accountants from Owen T Daniel. He reported that Mr Calleija was willing to give evidence in court if required and expressed the view that Mr Calleija had provided all the information that he had to the AFP. Detective Superintendent Moerman rated Mr Calleija's assistance "as being of a high level of assistance". The letter concluded that it had been "prepared for consideration by the court in sentencing" Mr Calleija.

Evidence on the application for a permanent stay

Detective Superintendent Moerman confirmed the matters he had discussed in his letter of 20 April 2010 in his evidence on the hearing of the application for a permanent stay. It is relevant, for the purposes of the arguments advanced on behalf of Mr Calleija, to have regard to that evidence in some detail.

Detective Superintendent Moerman first gave evidence in March 2011. That application did not proceed. However, the transcript of that evidence was tendered in evidence on the hearing of the application before Frearson DCJ. Relevantly, Detective Superintendent Moerman's evidence dealt with the following topics which were essentially interrelated, namely, the assistance he had provided to the police; the AFP's wish, if possible, to use Mr Calleija as a witness in the trial of Mr Agius; the AFP's application made to the DPP that Mr Calleija be provided with an indemnity from prosecution; and the fact that and reasons why Mr Calleija was not charged until 2009.

Detective Superintendent Moerman reiterated in his evidence that the information provided by Mr Calleija in the induced statements had been of assistance in relation to the whole investigation. In this regard, Mr Calleija's first induced statement was of particular assistance to the AFP as it explained how the whole scheme worked. This made it possible for the AFP to link the way in which the scheme operated.

Detective Superintendent Moerman gave evidence that in his view Mr Calleija would be "invaluable as a witness against Mr Agius". Given his view of Mr Calleija's value as a witness, Detective Superintendent Moerman gave evidence that he considered Mr Calleija should be granted an indemnity from prosecution and informed the Court he made an application to that effect to the DPP. He said that he supported the grant of indemnity:

"Because of the amount of assistance that [Mr Calleija] had provided to [the AFP] throughout the investigation that resulted in the success of the investigation that took place ..."

Detective Superintendent Moerman also explained why there had been a delay in charging Mr Calleija:

"Q.Okay, then any reason why [Mr Calleija] wasn't charged in 2008?

A.Because we had only decided to charge the others. We weren't going to charge him in relation to this matter, until the matter had been put before the Commonwealth Director of Public Prosecutions.

Q.Yes, but why charge the others and not him? He was first in line.

A.Because, at that point of time, he had come to us and provided an induced statement, and I had agreed that I would use that to make an application for an indemnity. So therefore I had to wait until that application could be considered by the Commonwealth DPP before any matters could proceed."

He was asked further questions about this, as well as questions relating to grant of indemnity:

"Q.All along I think you said that it was not your job to give him or guarantee him any immunity, is that correct?

A.That's correct.

Q.However, he was not charged by the Federal Police at all?

A.That's correct.

Q.Of course you had authority to charge him if you wanted to, didn't you?

A.Yes.

Q.You didn't charge him, did you?

A.No.

Q.Why?

A.Because that was a decision where I was asking for him to be used as a witness in the matter of the promoters.

Q.Did you think he was an important witness?

A.I believed he was, yes.

...

Q.But he was the first in line and his scheme was over a longer time, and certainly did you ever give him - in fact I suggest to you that what you said you didn't charge him and were there conversations where you believed - you believed he wouldn't be charged, didn't you?

A.No, there was conversations saying that I would apply to the DPP. They were the ones who would make that decision. But the AFP was not charging him in relation to this matter at that time.

...

Q.You never gave him the impression that he wouldn't be charged or told him that he wouldn't be charged, did you?

A.I informed him that it would be a decision to be made by the Commonwealth DPP, not by us.

Q.But certainly you indicated to him that the Federal Police were not going to charge him?

A.That's correct.

Q.That everything you were taking from him was to be used on the basis that he was to be a witness for the prosecution, is that correct?

A.It was on the basis that we would make application to the Commonwealth DPP for him to be used as a witness, yes.

...

Q.Just in relation to the chronology, you initially - how was it that you requested formally an indemnity or an immunity from the DPP? So far as the AFP was concerned, was it a written application?

A.It was a written application, yes.

Q.Was that at a time when a brief of evidence had been prepared in respect of Mr Calleija's alleged involvement himself?

A.It was at the time we submitted his statement and that we wished for him to be used.

...

Q.That being in 2009 at some stage, is that right?

A.Yes.

Q.Whereas he'd seen you on a number of occasions before 2009?

A.That's correct.

...

Q.During that period from the time when he made his first induced record of conversation, that was about late 2006, is that right?

A.He first came to us June/July 2006 and the first interview was September 2006, yes.

Q.So from that time, 2006 until some time in 2009, it was the Federal Police's intention or idea that he would be used as a witness, is that right?

A.It was, yes.

Q.Rather than that he would be charged?

A.That's correct.

Q.But when the formal request for a decision as to whether or not he would be charged was made, that only occurred in 2009, is that right?

A.That's correct.

Q.In the meantime, what had happened in relation to the investigation and/or charging of other people?

A.We had gone to resolution at the end of April 2008 where there was 13 - I think 17 people charged at that point of time.

Q.Some of them being clients of [Owen T Daniel's] practice?

A.That's correct.

Q.The accountants as well?

A.And the accountants and Mr Agius, and they were charged, yeah, April 28th [2008].

...

Q.What about between that time and when the request was made for Mr Calleija's indemnity or immunity some time in 2009? What was happening during that period?

A.We were preparing all the briefs of evidence, all the submissions of the statements, and then finalising the statement of Mr Calleija, which we then submitted at the end.

Q.With the request for him to be indemnified?

A.Yes, that's correct.

Q.That request was rejected it seems?

A.Yes.

Q.Then the Federal Police sought to discuss that with the Director of Public Prosecutions and his officers, is that right?

A.That's right.

Q.Was that opportunity provided?

A.Yes.

Q.Did you believe that your views were taken into account?

A.I gave my views to the Commonwealth DPP, yes.

Q.They were listened to, at least, is that right?

A.Yes.

...

Q.Then charges were laid sometime around that time, is that right?

A.Yes."

Mr Calleija's wife also gave evidence. She said that she and Mr Calleija were "very much under the impression that nothing further would happen", given that Mr Calleija had worked with the police and helped them. She said that the pressures on Mr Calleija and his family had been tremendous and had "blown [the family] apart". In this regard, Mr Calleija's first wife had died tragically, leaving him with four children. He and his second wife had another child, aged about one and a half at the time of her giving evidence.

Application refusal

Frearson DCJ found that Mr Calleija had not demonstrated that the prosecution was an abuse of process and thus dismissed the application for a permanent stay. However, in a passage upon which Mr Calleija's counsel placed considerable emphasis on the appeal, his Honour added:

"I accept that any decision made by the DPP not to prosecute [Mr Calleija] in all the circumstances would have been perfectly reasonable and there was much to recommend that course. Indeed many people would think that was an appropriate course. But that is not the test. The Director made a different decision. It was his decision. It is not my task to directly review his decision. I do not have that power of course. But I am entitled to look at the consequences of the decision and to examine and have regard to the circumstances that prevailed when the decision was made.

It seems to me that the circumstances and the consequences do not justify the court in declining to exercise jurisdiction in the matter and accordingly the stay is refused."

It will be necessary to return to this and other aspects of his Honour's reasons later in this judgment.

General principles as to the grant of a permanent stay of criminal proceedings

It is well established that the grant of a permanent stay of criminal proceedings is one that should be ordered only in an extreme case. The central principle governing the granting of a stay was stated by Mason CJ in Jago v District Court of NSW, at 34, in the following terms:

"To justify a permanent stay of criminal proceedings, there must be a fundamental defect which goes to the root of the trial 'of such a nature that nothing that a trial judge can do in the conduct of the trial can relieve against its unfair consequences'." (citation omitted)

Mason CJ considered that underlying the power of the court to grant a permanent stay was the court's inherent jurisdiction to prevent abuses of process. In this regard, his Honour adopted the reasoning of Richardson J in Moevao v Department of Labour (1980) 1 NZLR 464 at 482, where his Honour stated:

"It is not the purpose of the criminal law to punish the guilty at all costs. It is not that that end may justify whatever means may have been adopted. There are two related aspects of the public interest which bear on this. The first is that the public interest in the due administration of justice necessarily extends to ensuring that the Court's processes are used fairly by State and citizen alike. And the due administration of justice is a continuous process, not confined to the determination of the particular case. It follows that in exercising its inherent jurisdiction the Court is protecting its ability to function as a Court of law in the future as in the case before it. This leads on to the second aspect of the public interest which is in the maintenance of public confidence in the administration of justice. It is contrary to the public interest to allow that confidence to be eroded by a concern that the Court's processes may lend themselves to oppression and injustice."

Mason CJ had noted, at 33, that "the touchstone in every case is fairness". His Honour pointed out that the relevant test of fairness involved a balancing process having regard to the interests of the accused, as well as the community's right to expect that persons charged with criminal offences are brought to trial. In this regard, an essential consideration in the balancing exercise is the need to maintain public confidence in the administration of justice: see Walton v Gardiner [1993] HCA 77; 177 CLR 378 per Mason CJ, Deane and Dawson JJ at 395-396. See also Petroulias v R [2007] NSWCCA 154; 176 A Crim R 302 per Ipp JA at [17].

In Moti v The Queen [2011] HCA 50; 283 ALR 393 the plurality (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ) identified three basic considerations necessary to determine before making a decision as to abuse of process. Their Honours observed, at [57]:

"The third basic proposition is that, as pointed out in the joint reasons of four members of this Court in Williams v Spautz, two fundamental policy considerations affect abuse of process in criminal proceedings. First, 'the public interest in the administration of justice requires that the court protect its ability to function as a court of law by ensuring that its processes are used fairly by State and citizen alike'. Second, 'unless the court protects its ability so to function in that way, its failure will lead to an erosion of public confidence by reason of concern that the court's processes may lend themselves to oppression and injustice'. Public confidence in this context refers to the trust reposed constitutionally in the courts to protect the integrity and fairness of their processes. The concept of abuse of process extends to a use of the courts' processes in a way that is inconsistent with those fundamental requirements." (citations omitted)

In Australia the common law has not recognised the existence of a right to a speedy trial, or even to a trial within a reasonable time based upon any concept of presumptive prejudice. However, there may be circumstances when delay is such that a permanent stay should be granted. When the question of delay is in issue, matters that need to be considered include the length of the delay, the reasons for it, the accused's responsibility for asserting his or her rights and any prejudice suffered by the accused. However, even when those factors are taken into account, "a permanent stay should be ordered only in an extreme case and the making of such an order on the basis of delay alone will ... be very rare": per Mason CJ in Jago at 34. In Jago, Mason CJ observed at 33:

"Because there is no constitutional guarantee of a speedy trial, the remedies are discretionary and necessarily relate to the harm suffered or likely to be suffered if appropriate orders are not made."

In Jago Brennan J, at 47, commented upon the obstacles to a fair trial that are often encountered in the administration of criminal justice, such as adverse publicity, witnesses becoming unavailable and the lack of competent representation. His Honour observed, however, that those matters did not give rise to the need for proceedings to be permanently stayed. As his Honour noted, "[u]nfairness occasioned by circumstances outside the court's control does not make the trial a source of unfairness". When an obstacle to a fair trial occurs, a trial judge has the responsibility to the parties to avoid the unfairness. However, that responsibility was not discharged by the court refusing to exercise jurisdiction. Rather, it was the trial judge's responsibility to control the procedures of the trial so as to ensure that the trial was ultimately fair.

Brennan J also acknowledged, at 47, that "[m]ore radical remedies may be needed to prevent an abuse of process". His Honour then defined an "abuse of process" as occurring when:

"... the process of the court is put in motion for a purpose which, in the eye of the law, it is not intended to serve or when the process is incapable of serving the purpose it is intended to serve. The purpose of criminal proceedings, generally speaking, is to hear and determine finally whether the accused has engaged in conduct which amounts to an offence and, on that account, is deserving of punishment. When criminal process is used only for that purpose and is capable of serving that purpose, there is no abuse of process."

The category of case in which a stay may be granted is not closed. In Walton v Gardiner at 392-393, Mason CJ, Deane and Dawson JJ, in the context of an application for a stay of civil proceedings, observed that the court has jurisdiction to grant a stay where its processes and procedures are converted into instruments of injustice or unfairness contrary to their intended purpose of administering justice with fairness and impartiality. Their Honours stated that the categories of cases where a stay may be granted included proceedings which were doomed to failure and the employment of the court's processes in a manner which gave rise to unfairness. Their Honours rejected the notion that a permanent stay may only be ordered where an improper purpose was established or there was no possibility of a fair trial: see Williams v Spautz [1992] HCA 34; 174 CLR 509 at 519-520.

These principles were confirmed by the High Court in Dupas v The Queen [2010] HCA 20; 241 CLR 237. The Court confirmed, at 250, [35], that there was "no definitive category of extreme cases in which a permanent stay of criminal proceedings will be ordered": see R v Glennon [1992] HCA 16; 173 CLR 592. Their Honours reconfirmed the need to consider, in the balance, the substantial public interest in having those charged with criminal offences brought to trial. As the plurality (Mason CJ, Dawson, Toohey and McHugh JJ) had stated in Williams v Spautz, the confidence in the proper administration of justice requires that the court protect its ability to function as a court of law by ensuring the processes are used fairly by State and citizen alike. In Dupas, the Court, at 251, [37], characterised a permanent stay as "tantamount to a continuing immunity from prosecution". It followed that fairness to the accused alone was not the only relevant consideration when determining whether a trial should proceed. Rather, the Court pointed out that the decision whether to prosecute requires an evaluation of the particular circumstances of the case weighed in the context of a number of public interest considerations including public confidence in the administration of justice: see Walton v Gardiner at 395-396; Dupas at 251, [37]; Darwiche v R [2011] NSWCCA 62 at [172].

The grounds of appeal

Ground 1: that the proceedings are an affront to the public conscience

The principles governing the grant of a permanent stay are entrenched in notions of "abuse of process", of there being "a fundamental defect that goes to the root of the prosecution" and in "fairness" involving a balancing of considerations relevant to the accused person and the public interest, particularly in having persons charged with criminal offences being brought to trial. However, counsel for Mr Calleija invoked different terminology, namely, that the proceedings are an "affront to the public conscience", a phrase used by Cox J in the Supreme Court of South Australia in R v Vuckov and Romeo (1986) 22 A Crim R 10.

Vuckov and Romeo involved an application for a stay based on alleged entrapment of the accused by police. Cox J stated, at 30-31, that if the grant of a permanent stay could be used where police had acted illegally to bring a defendant before the court, there did not seem to be a basis to refuse to grant a stay in other cases of serious police oppression. His Honour acknowledged that such circumstances would be rare, but considered that there was no good reason in principle for denying the court's power to order a permanent stay in an entrapment case. His Honour noted that a trial judge could properly exclude evidence obtained as a result of entrapment and thus effectively bring the case to an end. There seemed no reason in that circumstance not to grant a permanent stay where, as his Honour stated:

"...the evidence shows that it would be unfair to the defendant or an affront to the public conscience to permit the prosecution to proceed."

In the present case, the Court questioned Mr Calleija's counsel as to the principle he was seeking to invoke in relying upon the notion of "affront to the public conscience". Counsel accepted that this was no more than a different way of stating that a stay of proceedings will only be granted in an exceptional case. Counsel's argument then proceeded to explore what was meant by an "exceptional case". He submitted that such a case would be identified having regard to the following factors: what a fair-minded and reasonable person would think; the administration of justice being brought into disrepute; maintaining public confidence in the legal system; oppression and hardship to the accused; a fair trial; avoiding detriment to the accused; and weighing up the competing interests between prosecuting an allegedly guilty person and deciding not to prosecute such a person in the interests of justice, if and when circumstances commended that course. Counsel then submitted that the "practical test to be applied" was:

"... 'what a sound-minded and right-thinking person would reasonably consider to be 'an affront to the public conscience' in the context of the interests of justice, provided the circumstances were determined to be exceptional enough so as to warrant such a consideration."

Mr Calleija's counsel submitted that when regard was had to the way that Mr Calleija was treated by the prosecuting authorities, a sound-minded and right-thinking person would consider his prosecution to be an affront to the public conscience. In support of this submission, counsel relied upon the following undisputed facts. Mr Calleija had approached the AFP. In other words, it was not the case that the AFP had sought him out. He had provided them with induced statements upon which the AFP had acted in their investigations and in the prosecution of other participants in the scheme. The AFP had indicated to Mr Calleija that he would be used as a witness in the case, such that his hopes were built up that he would not be prosecuted. Notwithstanding this, the police had charged him and steps have been taken to prosecute him to trial. In short, the submission was that the prosecuting authorities had used Mr Calleija and then, in the face of his reasonable expectation that he would not be charged, proceeded to charge him.

The present case is not one of entrapment, as was the position in Vuckov v Romeo, or of illegally obtained evidence. Nor are the prosecuting authorities able to use information obtained from the induced statements in the prosecution of Mr Calleija. Some confusion in the case arose when the DPP served Mr Calleija's legal representatives with an overview and summary of evidence, which expressly referred to and incorporated information from the induced statements. It appears that this summary had been effectively copied from the summary prepared for the trial of Mr Agius. Whilst the service of this summary can only be described as inept, it was withdrawn by the DPP when this matter was brought to their attention. Shortly thereafter, the DPP served a fresh overview and summary of evidence in which the prohibited material from the induced statements was removed. The new summary was based entirely on information obtained other than from Mr Calleija's induced statements. In my opinion, there is nothing in the manner in which the Crown proposes to adduce evidence at trial that constitutes an abuse of process.

Nor can Mr Calleija's hopes or expectation that he would not be charged amount to an exceptional case such that the prosecution ought to be stayed. This question is dealt with in more detail below, under ground 4. However, in circumstances where Mr Calleija was told expressly that no assurances or guarantees were being given that he would be granted an indemnity, there is no affront to the public conscience or any abuse of process in bringing the present prosecution.

Ground 1 should be rejected.

Ground 2: Mr Calleija has discharged the required onus upon him

There was no dispute that Mr Calleija bears the onus of establishing that there has been an abuse of process or that the circumstances are such that a permanent stay should be granted: see Williams v Spautz at 529. In his written submissions, counsel for Mr Calleija made reference to comments that have been made in certain authorities that the onus on a defendant seeking a permanent stay is a heavy one. He suggested that more judicial guidance is needed to clarify the standard of proof required to discharge the necessary "heavy onus" and the evidence that must be adduced to meet that threshold.

There are two problems with this ground of appeal. First, Mr Calleija's counsel has not pointed to any aspect of the trial judge's reasons in respect of which his Honour made an error in relation to the question of onus. Accordingly, he has not demonstrated error in accordance with the principles in House v R.

Secondly, the manner in which the question of onus operates in circumstances such as these has been well articulated in the case law. In R v Petroulias [2005] NSWCCA 75; 62 NSWLR 663 Mason P, at [103], 688, noted an accused seeking a permanent stay of proceedings, assumes "the high burden of seeking to establish irremediable abuse of process". This statement was made in the context of the proposition that a permanent stay will only be exercised in the most exceptional circumstances: see Jago at 34.

Statements such as "heavy onus" and "high burden" are well grounded in the judicial understanding of what is required when proof of a serious matter is in issue. It was explained by Dixon J in Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336, at 361-362, in the following terms:

"The truth is that, when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in its reality. No doubt an opinion that a state of facts exists may be held according to indefinite gradations of certainty; and this has led to attempts to define exactly the certainty required by the law for various purposes. Fortunately, however, at common law no third standard of persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters 'reasonable satisfaction' should not be produced by inexact proofs, indefinite testimony, or indirect inferences."

Dixon J then referred to comments made that an issue such as fraud must be proved "clearly", "unequivocally", "strictly" or "with certainty". His Honour pointed out, at 363, that this did not mean there was some intermediate level of satisfaction required, floating somewhere between the criminal and the civil standard of proof. Rather, it meant that "the nature of the issue necessarily affects the process by which reasonable satisfaction is attained".

In my opinion, it is clear what the courts have meant when making such comments and more judicial guidance is not needed.

For the reasons I have given, the fact that Mr Calleija gave assistance to the police does not render this an exceptional case. The fact that a decision not to prosecute would have been reasonable does not alter what I have said. The trial judge was not reviewing the decision of the DPP to prosecute. His Honour had no power to review that decision, as he pointed out in his reasons. More fundamentally, it is simply not correct to state that it is an abuse of process to prosecute where assistance has been provided. The fact of assistance in such cases is appropriately taken into account on sentence.

I would reject ground 2.

Ground 3: that the indictment is bad for duplicity

The terms of the indictment have been set out above.

Mr Calleija contended that the indictment is bad for duplicity, as it wrongly pre-supposes that he was knowingly part of the conspiracy with the accountants, Robert Agius and others, to commit an illegal act even though Mr Calleija has not been charged with the offence of conspiracy.

This submission confronts two problems. The first is that duplicity is not a ground for granting a stay. Rather, even assuming that the indictment was bad for duplicity, this could be remedied by the Crown being put to its election as to the charge to be preferred: see Stanton v Abernathy (1990) 19 NSWLR 656 at 668 per Gleeson CJ; Mackay v R [1977] HCA 22; 136 CLR 465 at 471-472 per Jacobs J. In other words, it would be within the power of the trial judge to make orders in relation to the indictment that would relieve against any unfairness to the accused: see Jago v District Court of NSW at 34. That alone is sufficient to dispose of this ground.

In any event, I am of the opinion that the counts in the indictment are not duplicitous. The Crown case alleges a continuing offence, the essential nature of which is the entry into a number of transactions involving payment for fictitious services and interest payments for amounts said to be in respect of loan transactions, where there was no legitimate underlying transaction to support the claim for interest. The Crown case is that this is a classic round robin, the effect of which was to create the opportunity for illusory taxation deductions in circumstances where Mr Calleija knew the transactions did not represent the true position. In short, what is alleged is a single criminal enterprise: see Regina v Moussad [1999] NSWCCA 337; 152 FLR 373.

In Moussad the charged offence was in relation to moneys received by the accused pursuant to claims she submitted to the Department for the nine individual financial quarters commencing in 1991 and ending in April 1993, contrary to the Crimes Act, s 29D. Section 29D provided: "a person who defrauds the Commonwealth ... is guilty of an indictable offence". This is the same section with which Mr Calleija was charged in the first count on the indictment.

The accused in Moussad had contended before the trial judge that the count was duplicitous. The trial judge rejected that application. His Honour accepted that each of the quarterly returns claiming Childcare Fee Relief constituted an individual offence. Nonetheless, the trial judge was satisfied that there was a single criminal enterprise of a continuing kind. Notwithstanding that each claim was lodged separately and was in a different amount, the claims for Fee Relief were linked by a common purpose. His Honour considered that it would present an unreal picture of the activities of the accused if the acts were broken up into nine different counts. His Honour was also satisfied that it was not unfair to allow evidence of the nine quarterly fee relief claims and the supporting documentation to be led as evidence supporting that continuing enterprise. His Honour held, therefore, that the indictment was not bad for duplicity.

On appeal, the accused argued that three consequences flowed from the trial judge's ruling. First, the Crown was not required to elect upon which act of dishonesty it relied to prove that element of the charge. Secondly, the ability of the Crown to adduce evidence of the nine individual claims potentially constituted prejudicial evidence of tendency and/or coincidence contrary to the Evidence Act 1995, Pt 3.6. Thirdly, it was impossible to deduce from the jury's verdict convicting the accused of the offence whether they found dishonesty on the basis of one act, or the total number of claims or any number in between.

Smart AJ (Wood CJ at CL and Bell J agreeing) made the following observations in respect of an offence under s 29D, which are particularly useful, as they specifically address a number of matters that Mr Calleija's counsel raised in the present case. His Honour said, at 377, [25]:

"Section 29D of the Crimes Act 1914 (Cth) uses words of general import, namely, 'Any person who defrauds the Commonwealth'. That does not indicate that the section is dealing with a single act. In many cases of social security fraud, medical benefit fraud, nursing home fraud, family benefit fraud and child care fraud practised on the Commonwealth, all of which come before the courts with frequency, there is often an initial agreement or arrangement between the Commonwealth and the recipient governing an ongoing position under which the Commonwealth makes payments, often in advance and there is a periodical accounting and acquittal under which adjustments are made. What is telling in such circumstances is not the odd error which may be due to an honest mistake but the pattern which emerges and makes it plain that there is in existence a fraudulent enterprise. Sometimes the individual acts relied upon involve small sums of money. This is such a case. To take the individual acts one by one does not reveal the true overall situation."

Smart AJ in Moussad noted it has been accepted in New South Wales that "enterprise" counts have their place in fraud cases where the overall criminality is the central allegation. His Honour considered that the allegation against Ms Moussad was of systematic defrauding over a period of time, such that separate counts were not appropriate. Smart AJ concluded that the acts complained of and particularised formed part of the same criminal enterprise and were linked by a common purpose. It followed that there was no unfairness to the accused being charged with one count only and his Honour held that the duplicity point failed.

The basis for and permissibility of charging one offence where a number of separate acts have been considered is well established. In R v Hamzy (1994) 74 A Crim R 341, Hunt CJ at CL (Abadee and Simpson JJ agreeing) after reviewing the authorities stated, at 349:

"I see no reason why the concept of the one criminal enterprise or one criminal activity should be interpreted narrowly. Obviously enough, the fewer the number of individual acts, the fewer people and the shorter the period of time involved, the less likely that there could be any unfairness to the accused, but the issue of unfairness is dealt with separately from the issue as to whether the individual acts could fairly and properly be so identified. In the present case, it would have presented a totally unreal picture of the activities alleged against the appellant if anything less than the total picture had been presented to the jury. According to the evidence, the appellant was constantly involved in the one criminal enterprise of dealing in heroin. Even if the individual acts of supply had been divided up into different counts, each count relating to the acts of supply to a different Crown witness, there would have been no real justification for separate trials relating to each count. Again, a totally unreal picture would have been presented. And, as the defence was one of denial of any involvement in the supply of heroin, the evidence of similar facts may well have been admissible in any event to meet the attempted exculpatory explanations by the appellant for the presence of the different Crown witnesses at his home."

Hamzy has been consistently followed in this Court in appropriate cases.

In Moussad, Smart AJ observed that "duplicity is a matter of form, not evidence". In this regard, the decision in Taylor v The Queen (1997) 93 A Crim R 1 is instructive. That case involved three charges under s 29D covering separate periods. In each, the allegation was that the accused obtained payment of a sole parent pension to which she was not entitled. The Crown relied on 31 separate occasions of making false claims. Underwood J observed that s 29D does not create a separate offence for each payment. However, in that case, the indictment and the particulars provided did not allege a continuous deceitful failure to disclose the correct state of affairs. Rather the indictment, as a matter of form, related to each alleged false representation, each made with the intention of obtaining a benefit. In other words, as the indictment was framed, the jury was required to decide whether each statement was false at the time it was made. As the Crown had alleged 31 separate instances of defrauding conduct, there should have been a separate charge for each occasion. It followed that the indictment was bad for duplicity.

Counsel for Mr Calleija contended that this is a completely different case from Moussad. He submitted that in Moussad, the accused was the instigator and had control over her deceptive conduct in relation to the Centrelink fraud. This case was different, in that it was the accountants who initiated and controlled the scheme and who prepared the relevant documentation, including Mr Calleija's tax returns in each of the years covered by the alleged offending. For this reason, he submitted it would be impossible for a jury to discern the relevant intent required for it to be satisfied that Mr Calleija was guilty of the offence charged and also difficult, if not impossible, for the jury to be properly directed in relation to intent.

Counsel submitted that as Mr Calleija's participation in the scheme was reliant upon him signing a tax return prepared for him by his accountant each year, his intention in claiming the allegedly false deductions could only be inferred from each document on a yearly basis. In raising the difficulty with the jury being properly directed as to intent, counsel raised the rhetorical question:

"... how is the jury to be directed if some believe that there is no required intent for the first year 1997 but there is the required intent for the last transaction in 2004, when more information was available after the [ATO] audit."

Counsel contended that the unfairness of this position was patent by posing the further rhetorical question:

"... what does a jury do if it is satisfied only of a guilty intent for one year, but not for the other years."

Counsel submitted that the unfairness was of such a nature that a permanent stay should be granted.

The question whether, in circumstances where an alleged fraud involves more than one transaction, a person may be charged with one offence or, as a matter of fairness should be charged with an offence relating to each transaction depends on at least the following two matters. The first is the specific terms of the offence with which the person is charged. The second is, as already discussed, the form of the indictment. There are fraud offences which, it has been held, only relate to a single transaction. The Crimes Act 1900, s 178BB is an example. That section provided:

"Whosoever with the intent to obtain for himself or herself or another person any money or valuable thing or any financial advantage ... which he or she knows to be false or misleading in a material particular ... shall be liable to imprisonment ..." (emphasis added)

In R v Giam [1999] NSWCCA 53; 104 A Crim R 416, Spigelman CJ, Abadee and Adams JJ agreeing, held that s 178BB related to an offence in respect of each transaction. The language of the section and, in particular, the use of the word "any" indicated a degree of singularity. By contrast, it has been long accepted that pursuant to s 29D, it is legitimate for the Crown to allege a case of a criminal enterprise constituted by a number of specific transactions, entered into on different occasions, with different amounts of money involved, on the basis that the transactions were linked by a common purpose. In such a case, the relevant intention is the entry into the overall scheme or enterprise. More importantly, for the arguments raised on behalf of Mr Calleija, particularly relating to the question of intent, it does not matter if, within the totality of transactions, there is an occasional honest mistake. Nor is it relevant that Mr Calleija may not have had an intent to defraud in respect of one particular income tax return. What is relevant is the pattern of transactions which makes it plain that, taken as a whole, the transactions were entered into as part of a fraudulent enterprise.

The approach in Moussad has been approved and followed in New South Wales: see R (Cth) v Petroulias (No. 1) [2006] NSWSC 788; 177 A Crim R 153 at 246 per Johnson J; Hakim v Waterways Authority of New South Wales [2006] NSWCCA 376; 149 LGERA 415, especially at [83] per Spigelman CJ (Grove and Bell JJ agreeing).

It follows that I would reject ground 3.

Ground 4: that the Crown has used the induced statements in a derivative manner

This ground of appeal requires an examination of the procedural history in the matter.

The DPP advised Mr Calleija's solicitors by letter dated 8 December 2010, that his application for the charges against him be "no billed" had been rejected. The DPP also advised that it proposed to proceed upon 11 separate charges. This was in contrast to an earlier position taken by the DPP when Mr Calleija's then legal representatives were engaged in plea negotiations with the DPP. It appears at that time, it was indicated that only two counts were to be preferred.

The DPP provided, in draft form, the proposed indictment containing 11 charges. At about the same time, the DPP provided Mr Calleija's solicitors with an overview and summary of evidence. This was the summary that was based upon and expressly referred to Mr Calleija's induced statements. A second overview and summary of evidence was then served. This document contained no reference to the induced statements. Nor was it based upon information obtained by the prosecuting authorities from the induced statements. At the same time, the Crown advised that it intended to rely upon the evidence of 11 further witnesses.

By letter dated 23 February 2011, Mr Calleija's solicitors objected to the proposed reliance upon these witnesses. The solicitors contended that Mr Calleija was severely prejudiced by the late service of the witnesses' statements and that, in any event, the proposed evidence of the new witnesses was irrelevant and prejudicial and of no direct probative value in the prosecution of Mr Calleija. The DPP did not withdraw its intended reliance upon the 11 witnesses. However, Frearson DCJ ruled that the evidence of those witnesses was inadmissible. There has been no challenge by the Crown to that ruling.

Mr Calleija complains that although there will be no direct reliance upon the material in the induced statements, that material is to be used in a derivative way and he submitted that was unfair, giving rise to an abuse of process. In essence, Mr Calleija contended that the DPP's preparation and its proposed manner of conducting the prosecution has been fashioned having regard to the information contained in Mr Calleija's induced statements. Counsel submitted that the Crown case has been derived from the information in the induced statements so that the Crown was now aware of Mr Calleija's defence, namely, that he believed his accountants when they told him the scheme was legal.

Mr Calleija asserted that the Crown has thus derived an advantage from its knowledge of the content of the induced statements, which it would not have, had those statements not been made. He contended that the Crown, being so armed with this material, has a tactical advantage over him, particularly in relation to knowing what his defence will be. Mr Calleija contended that no fair-minded person would consider this to be "fair play".

The trial judge accepted that the induced statements had expedited and focused the investigation into the tax fraud. His Honour also accepted that the induced statements assisted the police and the DPP in understanding how the scheme had operated. However, his Honour concluded it had not been demonstrated that the prosecution had derived some unfair advantage resulting from the use of the induced statements such that any trial would be unfair.

I have already referred to the ineptness of the Crown in serving a statement based on information contained in Mr Calleija's induced statements. It undoubtedly caused very real dismay and concern to Mr Calleija and his legal representatives. However, the position has been remedied and the present overview and summary of facts has been prepared from documentation and material upon which the Crown is legitimately entitled to rely in the prosecution of Mr Calleija.

Counsel for Mr Calleija submitted that this would not overcome the prejudice. Mr Calleija argued that if he was called to give evidence in his defence, the Crown would have the advantage of the material in his induced statements for the purposes of cross-examination. He referred, by way of example, to paras (254) and (255) of the abandoned summary, which refers to information provided by Mr Calleija in his induced statement that he thought that one of the companies within the scheme, was a bogus company set up by Mr Agius. He also said that to him it was all a sham. He also admitted, in his induced statement of 20 April 2009, that he had initially given false answers to the ATO when they first questioned him about the matter.

The Crown accepted that the prosecution cannot use any information from the induced statements in any trial of Mr Calleija. It also accepted that the first overview and summary of facts was wrongly served on Mr Calleija. It submitted, however, that that overview and summary of facts, upon which the Crown now relies, is based upon information, none of which has been derived from the induced statements. The fact that the Crown is in possession of information from Mr Calleija, obtained from the induced statements does not render, by that fact alone, the prosecution against him an abuse of process. Mr Calleija's counsel conceded as much. However, he relies upon an accumulation of factors relating to and flowing from the making of the induced statements to support his argument. In this regard, he raised five specific points.

First, there was not one but three induced statements given over a period of two and a half years. Secondly, Mr Calleija was the first person of those involved in the scheme to provide information to the authorities. Other persons in the scheme were charged using the material obtained from the induced statements. In that regard, of the 11 persons linked to the scheme, nine had been successfully prosecuted and two had been granted an indemnity from prosecution. Thirdly, as late as April 2009, Mr Calleija, on the assumption that he was to be a witness in the trial of Mr Agius, had provided a statement preparatory for use in that trial. Fourthly, in October 2009, when his reasonable expectation was that he would not be charged, he was informed that charges were to be brought against him. Finally, Mr Calleija's counsel also reiterated that the first summary of facts although abandoned, had nonetheless been used to structure the Crown case against Mr Calleija.

Mr Calleija's counsel submitted that these factors demonstrated this was a very unusual case. He submitted that the taking of an induced statement was not meant for a case like this, where a person had assisted the prosecution authorities in a way that had enabled them to mount other prosecutions.

As is apparent from the summary of facts to be used at trial, the case against Mr Calleija is based upon documentation including Mr Calleija's personal and company tax returns, bank documentation of entities alleged to be involved in the scheme and other documentation which has come into the Crown's possession in the course of the investigation. In other words, it is a circumstantial case. The Crown does not and cannot rely upon any information or documentation that was obtained in the course of Mr Calleija giving the induced statements.

Mr Calleija's counsel next contended that the documentation upon which the Crown proposes to rely cannot speak for itself. Counsel reiterated that Mr Calleija had linked the various aspects of the case together for the police. Counsel contended it was as a result of that linkage that the prosecuting authorities were able to "[prepare] a game plan" for Mr Calleija's prosecution. It was submitted that without the understanding of the scheme that Mr Calleija had provided, the Crown would not be able to successfully prosecute him.

Mr Calleija's counsel re-emphasised that the induced statements had allowed the Crown to look at the whole of the defence case, so it would know every aspect that Mr Calleija might raise in his defence. He submitted that the Crown was therefore in a far superior tactical position in the preparation of its case than Mr Calleija. Mr Calleija's counsel was not able to point to any specific disadvantage arising from the Crown being in possession of his induced statements, other than that the information was used to structure the prosecutions against the other participants and must have been used to structure the case against Mr Calleija.

Mr Calleija's counsel submitted that prejudice of this type had been recognised as giving rise to unfairness: see R v M [2010] NSWDC 200. In that case, Berman DCJ stated, at [74], that one of the most obvious factors in determining whether an accused person was prejudiced or would otherwise suffer a detriment by having given an induced statement was whether the person gave the police information beyond that which they already knew. His Honour stated:

"In other words, the question of detriment or otherwise could only really be determined by comparing what the accused said in his induced statement with the other evidence the Crown had available against him."

His Honour observed that in the case he was determining, neither the Crown nor the accused had provided him with material that would enable that comparison to be made.

The Court requested Mr Calleija's counsel to identify any information in the induced statements that was replicated in the summary of facts upon which the Crown proposes to rely at trial. Not only did counsel not do so for the benefit of this Court, he had not done so in the course of the application before Frearson DCJ. I infer that there was no such replication of material.

Mr Calleija's counsel refocussed his submission to point out that as a result of information provided to them by Mr Calleija in the course of the first induced statement, the police were able to execute search warrants upon the accountant's premises. Mr Calleija had drawn a plan of the premises including of a shed in which documents were stored. In effect, Mr Calleija had directed the police to where the books could be found. However, Mr Calleija's counsel was not able to inform the Court whether Mr Calleija was the only client who knew where the books were kept.

Mr Calleija's counsel further submitted that when regard was had to the present summary of facts, which he accepted was a factual expose of the documents proposed to be used in Mr Calleija's trial, Mr Calleija had explained each of those documents "chapter and verse" in his induced statement, indicating that he had transferred the funds and how and why he had done so. The Court sought to test this submission by having Mr Calleija's counsel deal with a number of the asserted factual statements in the overview and summary of facts. This was done by reference to the following statement in the summary of facts:

"Between 13 May 1997 and 26 October 2004, fifteen (15) outgoing payments totalling $2,349,298 were made from OBW's various bank accounts, mainly from the OBW account between May 1997 and June 2000, and then from the OBW Overdraft account between September 2000 and September 2002, to the NZ accounts of UNITON, BILLBURY and SECURITY LIFE. A total of $1,110,000 was transferred to the UNITON account, $475,000 to the BILLBURY account - and $753,493.72 to the SECURITY LIFE account. These were characterised in the books of OBW, most likely by [Owen T Daniel], as interest, management or consultancy fees, or subsumed in expenses of OBW when there had been no real expenditure ..." (emphasis added)

Mr Calleija's counsel eventually conceded that the characterisation, "interest, management or consultancy fees" were either statements derived directly from the books of account or, alternatively, inferred from entries in the books of account. Counsel submitted, however, that the derivative use for which he contended arose from the fact that prior to Mr Calleija's induced statements, the police were not making the necessary links in the documentation and thus had not been able to work out how the scheme operated.

Mr Calleija's counsel finally appeared to accept that the trial will be conducted by the Crown on the basis of the material that was known to it before Mr Calleija gave his first induced statement or which came into its possession during the course of the ongoing investigation, from sources other than Mr Calleija. He then reverted to his submission as to the unfairness of the Crown in prosecuting Mr Calleija when he had provided it with such valuable information in circumstances where he believed he would be granted an indemnity.

In my opinion, Mr Calleija has not made out ground 4. The Crown is confined in the evidence that can be adduced in the prosecution to material obtained other than from the induced statements. It will also be constrained in any cross-examination of Mr Calleija should he decide to give evidence. To the extent that the prosecuting authorities may seek to prepare for any defence Mr Calleija may advance, any prosecutor in a case like this would anticipate a number of possible defences. These would include an accused's contention that he did not sign the documentation that was integral to the operation of the scheme or that he relied upon the advice of his accountants, a defence which might be thought to be contestable in any event. Another possible and even more likely scenario is that an accused might rely upon putting the Crown to proof especially given that in this case, the relevant income tax returns were filed electronically.

These possible defences will each involve different considerations for the Crown. For my part, I cannot see that the Crown has any unfair advantage in having been provided with information in the induced statements. This is particularly so when Mr Calleija's counsel was not able to point to any material in the summary of facts that was derived from the induced statements. Nor do I consider that the Crown has been shown to have a tactical advantage in being able to anticipate any defence Mr Calleija may seek to raise.

I consider that ground 4 should be rejected.

Ground 5: that oppression and hardship has been caused to Mr Calleija by the delay in bringing the prosecution

Mr Calleija contended that in circumstances where he was charged three years after he went to the police, it was oppressive for the prosecution to proceed and it should be permanently stayed. I have already referred to the principles that apply when a permanent stay is sought based on delay: see at [32]-[36]. These principles were confirmed in more recent times by the High Court in R v Edwards & Anor [2009] HCA 20; 255 ALR 399. That case involved a delay of two years and three months before the complaints were laid. It was argued that that delay had occasioned prejudice in that the applicants had lost the opportunity to obtain the early recollection of witnesses. The High Court (Hayne, Heydon, Crennan, Kiefel and Bell JJ) held, at [34], that there was no feature of the delay that justified the extreme step of permanently staying the proceedings. The plurality also noted, at [34], that it had not been established that any prejudice arising by reason of the delay could not be addressed by an appropriate direction by the trial judge.

In my opinion, there is no substance in the complaint based on delay.

Mr Calleija's counsel next submitted that the police had made an implied representation to Mr Calleija that he would not be charged. Mr Calleija's counsel acknowledged that this submission was advanced notwithstanding the express statements to the contrary (the disclaimer) made to Mr Calleija at the commencement of each induced statements. However, counsel submitted that, for the Crown to rely upon the disclaimer was "to fly in the face of what was really happening in the real world": see R v Mohi [2000] SASC 384; 78 SASR 55.

In Mohi, the applicant sought a permanent stay of the prosecution brought against him in respect of the offence of "Assist Offender". The assistance allegedly provided was to two persons who had been charged with murder. A permanent stay of the prosecution was granted in circumstances where the interviewing police officer had said to the applicant, "you are a witness, you are not going to get charged". Further, prior to taking a statement from the applicant, the police officer told him that he was a witness and any statement he gave to the police would not be used in evidence against him.

In Mohi, the DPP had resisted the application for a permanent stay on the basis that the Director had not given these assurances and ought not to be bound by the conduct of the police, who it submitted, were not authorised to give any such assurances.

Martin J referred to R v Croydon Justices,Ex parte Dean [1993] QBD 769. In that case, the applicant was formally charged with an offence approximately five weeks after he had given a statement to the police in which he admitted the offence. Throughout that period, he had been treated by the police as a witness and had made three further statements in respect of which he was neither cautioned, nor offered legal advice, nor told that he was to be charged. The police had told the applicant he was to be used as a prosecution witness and he would not be prosecuted for offences associated with the murder.

Staughton LJ, with whom Buckley J agreed, stated, at 778, that:

"... the prosecution of a person who has received a promise, undertaking or representation from the police that he will not be prosecuted is capable of being an abuse of process."

His Lordship considered, at 779, that the representations made to the applicant over a five week period, during which he gave repeated assistance to the police, in circumstances where he was not given an appropriate warning or legal assistance, was quite exceptional and the Court was bound to treat it as an abuse of process.

The Court in R v Croydon Justices emphasised the statement made by the Hong Kong Court of Appeal in Chu Piu-wing v Attorney-General [1984] HKLR 411 where the Court observed, at 417-418:

"... there is a clear public interest to be observed in holding officials of the State to promises made by them in full understanding of what is entailed by the bargain."

Martin J accepted there were some circumstances in which the DPP would not be bound by an unauthorised undertaking given by investigating police officers. His Honour also considered, at [44], that the mere fact a person was initially treated as a witness by investigating police officers and given assurances to that effect, but was later charged after evidence unfolded over the course of an investigation, would not, in ordinary circumstances, successfully ground a claim that the continuation of the prosecution was an abuse of process.

His Honour considered, however, that the combination of facts and circumstances in the case before him made it both unusual and exceptional. It is not necessary to refer to all the circumstances that his Honour considered relevant. It is sufficient for present purposes that the case was one where the applicant was expressly told he would not be charged and that any statement he gave to the police would not be used in evidence against him. It was only after he received those assurances that the applicant cooperated and provided a detailed statement. He was not cautioned before giving his statement. After having given his initial statement, the police officers reconsidered the status of the applicant and decided to continue to treat him as a witness. The argument advanced by the police, that they had not made a final decision as to whether to use him as a witness, was no answer to the exceptional unfairness in subsequently charging the applicant.

This case is strikingly different from Mohi. Here, Mr Calleija was expressly told that no guarantee could be given as to whether he would be charged. The statements made to him were clear, unambiguous and given prior to each occasion he made an induced statement. One can readily accept that Mr Calleija would have been disappointed when he learned that he was to be charged. Indeed, he may have been profoundly disappointed having regard to the assistance he had provided and the application made to the DPP by the investigating police that he be granted immunity. Profound disappointment does not, however, constitute a basis for establishing that there has been an abuse of process. The matters that have led to his disappointment and, in particular, his assistance to the police, would be a powerful consideration on sentence, should Mr Calleija be found guilty of the two offences upon which he is to be tried. Delay may also be relevant to sentence in this case. That will be a matter for the sentencing judge, should Mr Calleija fall to be sentenced. However, there was no promise, express or implied, made to Mr Calleija that he would not be charged and there are no other circumstances in the case that constitute an abuse of process.

In my opinion, ground 5 should be rejected.

Ground 6: that the Commonwealth prosecution guidelines have not been fairly adhered to

The Commonwealth has a published "prosecution policy" (the policy). The policy was first presented to Parliament in February 1986. It was revised in 1990 and further revised in 2008. The 2008 revised policy remains the prosecution policy of the Commonwealth. In his forward to the current policy, Mr McClelland, then Attorney-General of Australia, noted that it would continue to serve two main purposes: first, to promote consistency in the decision-making involved in the institution and conduct of prosecutions and secondly, to inform the public of the principles upon which the DPP performs its statutory functions.

In its statement of general principles, the policy states:

"The Policy is a public document based on the principles of fairness, openness, consistency, accountability and efficiency that the Office of the Director of Public Prosecutions (DPP) seeks to apply in prosecuting offences against the laws of the Commonwealth.

The Policy does not attempt to cover all questions that may arise in the prosecution process and the role of the prosecutor in their determination. It is sufficient to state that throughout a prosecution the prosecutor must conduct himself or herself in a manner which will maintain, promote and defend the interests of justice. In the final analysis the prosecutor is not a servant of government or individuals - he or she is a servant of justice."

Chapter 2 of the policy relates to the decision to prosecute. Under the heading, "Criteria governing the decision to prosecute", cl 2.10 specifies factors which may arise for consideration in determining whether the public interest requires the bringing of a prosecution. Counsel for Mr Calleija said that the factors the DPP may consider under cl 2.10 include that the person concerned had no criminal record; whether there had been an oppressive delay of time; and the degree of culpability of the alleged offender. It appears that these factors would fall under cls 2.10(d), (e), (f), which provide, respectively:

"(d)the alleged offender's antecedents and background;

(e)the passage of time since the alleged offence when taken into account with the circumstances of the alleged offence and when the offence was discovered;

(f)the degree of culpability of the alleged offender in connection with the offence ..."

Counsel for Mr Calleija conceded that these factors may not be enough to suggest that the DPP had not adhered to its own guidelines. However, he submitted that cl 2.10(r) puts this case into a different category. Clause 2.10(r) states:

"... whether the alleged offender is willing to co-operate in the investigation or prosecution of others, or the extent to which the alleged offender has done so ..."

Counsel for Mr Calleija submitted that the evidence of Detective Superintendent Moerman, the history of the matter and the more important prosecutions of Mr Agius and the other accountants was such that it could not be said from a public point of view that the guideline had been truly followed. Counsel directed attention to cl 2.12, which refers to the existence of an enforcement mechanism as an alternative to prosecution. Mr Calleija's counsel submitted that the Commissioner of Taxation could have brought enforcement proceedings against Mr Calleija for the recovery of the tax evaded. However, that had been unnecessary, as Mr Calleija has paid his tax in full, together with all interest and penalties in a total amount of $2.4M and had sold his house in order to do so.

Counsel pointed out that Mr Calleija had taken this action notwithstanding that at the time he did so, he had not been charged with any offence, nor had any enforcement proceedings been taken against him by the Commissioner of Taxation. Mr Calleija's counsel submitted that in proceedings to prosecute him, the Crown was distancing itself from the fact that Mr Calleija had voluntarily offered assistance to the police. This submission concluded with the rhetorical question: "With great respect, if that is not an 'affront to the public conscience', what is?".

I have already dealt with the notion of "affront to the public conscience" and do not need to say anything further on it. It must be borne in mind, that there are other factors which are relevant to the discretionary decision of the DPP to charge or not charge for alleged offences. Those other considerations include the seriousness of the alleged offence: cl 2.10(a); the effect on community harmony and public confidence in the administration of justice: cl 2.10(g); the need for deterrence; cl 2.10(k); whether the alleged offence is of considerable public concern: cl 2.10(m); the necessity of public confidence in the rule of law and the administration of justice through the institutions of democratic governance, including the Courts: cl 2.10(u); and the need to give effect to regulatory or punitive imperatives: cl 2.10(v). Clause 2.10 concludes with the statement:

"The applicability of and weight to be given to these and other factors will depend on the particular circumstances of each case."

Clause 2.11 is also of particular importance. It provides:

'As a matter of practical reality the proper decision in many cases will be to proceed with a prosecution if there is sufficient evidence available to justify a prosecution. Although there may be mitigating factors present in a particular case, often the proper decision will be to proceed with a prosecution and for those factors to be put to the Court at sentence in mitigation."

Clause 2.11 also states that where an alleged offence is "not so serious as plainly to require prosecution", the prosecutor should consider whether the public interest requires prosecution to be pursued.

It could not be said that the offences with which Mr Calleija is charged and the systematic nature of the alleged fraud over a period of four and a half years and the substantial tax thereby avoided were "not so serious" such as not to call for prosecution. As cl 2.11 expressly states, there may be mitigating factors in a particular case, although falling within one of the sub-clauses in cl 2.10, where prosecution is still warranted, albeit that those same matters will be relevant on sentence.

In my opinion, there has been nothing advanced on behalf of Mr Calleija which shows that the decision to prosecute, having regard to the policy, was not clearly available to the DPP and not otherwise an abuse of process. In my opinion, ground 6 as discussed above should be rejected.

Mr Calleija, as an additional submission under ground 6, contended that the Crown's "procedural approach" to the case had been one of "non-adherence". This term appears to make reference to timetabling and evidentiary considerations that Mr Calleija asserted the Crown had not complied with. Mr Calleija referred amongst other things to: the Crown's service of the indictment two weeks after the date identified by Blanch J's order; the withdrawal of the first overview and summary of evidence after stay papers had been served; service of 11 new statements; continual production of volumes of material from the trial of Mr Agius, which is currently being conducted in the Supreme Court; and service of the "Initial briefing paper to Australian Federal Police re Vanuatu based scheme promoter dated 11 November 2005" five days after Frearson DCJ's decision on 11 August 2011.

Mr Calleija submitted that the instances listed above have caused him unfairness and disadvantage in the form of additional expense and stress. The submission concluded with the statement that the Crown's conduct of the case constituted "an abuse of the rights of any accused" and brought "the administration of justice into disrepute". As previously stated, the authorities emphasise a balancing process when determining whether a permanent stay should be granted. Delay and unfairness to the accused person are not the only relevant factors when making this decision: see Walton v Gardiner; Petroulias v R. The instances identified by Mr Calleija are in a similar vein to his earlier submissions and do not raise anything new. In my opinion, Mr Calleija has failed to demonstrate, on the basis of this argument, that this was an exceptional case where a permanent stay ought to be granted. This aspect of ground 6 should also be rejected.

Ground 7: application to rely upon new material

Mr Calleija seeks leave to introduce new material being a document from the Australian taxation office entitled "Initial Briefing Paper to Australian Federal Police re Vanuatu Based Scheme Promoter". The document was prepared by an accountant, James Walton, and is dated 11 November 2005. The document was served upon Mr Calleija's solicitors under cover of letter dated 16 August 2011.

Mr Calleija's counsel submitted that the service of this document was typical of the modus operandi of the prosecution in this case, namely, the late service of material and, in this case, its service after the determination of the application for a permanent stay. It was submitted the importance of the material in this document was that it revealed that after the ATO had audited Mr Calleija's records, it had identified as early as November 2005, aspects of the Vanuatu scheme and the involvement of Mr Agius and the accountants in the office of Owen T Daniel.

Counsel drew attention to the statement at page 13 of the document which stated:

"Whilst [Owen T Daniel] is the Australian link between each of the participants, the evidence in regard to his involvement is limited."

Counsel submitted that it was apparent from the audit that Mr Calleija "did not know too much about what was going on". However, with the professional assistance of a new accountant and the tax barrister Mr Inglis, Mr Calleija made the first and then the subsequent induced statement. Counsel repeated the submissions as to the practical value of the information Mr Calleija provided.

Counsel said that what was "extremely interesting about this document" was that:

"... the paper trail does not speak for itself in that the missing links had to come from direct evidence which came from the induced statements ..."

No particular part of the document is referred to in support of this submission. In any event, it overlooks the fact that this was an ongoing investigation that continued well after Mr Calleija provided his first induced statement.

Counsel made the further submission that:

"What amounts to abuse of process on this aspect is that what has been derived from Mr Calleija's own induced statement has been used indirectly against him now."

This issue has already been dealt with.

Counsel next submitted that "[a]nother important aspect of this 'new paper' is that it shows the relatively inordinate delay in ultimately charging [Mr Calleija]". It was submitted that the "oppressive delay" was "even more obvious". I have already dealt with the question of delay. Reference was also made to the intended use of Mr Calleija as a witness and to the application that he be granted an immunity from prosecution. Those issues have already been dealt with.

The final submission made in respect of the application to rely upon this material was as follows:

"124Surely after reading all the induced statements, not only of [Mr Calleija], but also of the other eleven persons, if they are believed, there is no doubt who the real culprits and masterminds of the tax evasion schemes were, the rogue accountants.

125Yet, for reasons which seem to mystify even the Federal police investigators, the DPP would rather try to convict [Mr] Calleija, than use him to help convict the real criminals in this whole scenario.

126If such an approach does not bring the system of justice into disrepute, it is hard to imagine what would."

This is a repetition of Mr Calleija's essential grievance in the case. For the reasons I have already given, this is not sufficient to establish that the case is of an exceptional nature such as to require the grant of a permanent stay. There was no error in the trial judge refusing the application.

I would refuse leave to adduce this "new material". It does not demonstrate anything not already known in the course of making the application. It follows that ground 7 should also be refused.

The orders I propose are:

1.Leave to appeal is granted;

2.The appeal is dismissed.

R A HULME J: I agree with Beazley JA.

GARLING J: I agree with Beazley JA.

**********

Decision last updated: 06 August 2013

Medium Neutral Citation:	Calleija v Regina [2012] NSWCCA 37
Hearing dates:	14 February 2012
Decision date:	22 March 2012
Before:	Beazley JA at [1]; R A Hulme J at [132]; Garling J at [133]
Decision:	1. Leave to appeal is granted; 2. The appeal is dismissed.
Catchwords:	CRIMINAL LAW - appeal - application for permanent stay of prosecution - general principles governing grant of permanent stay of criminal proceedings - whether the proceedings are an affront to the public conscience - abuse of process - duplicity - oppression and undue hardship - Criminal Appeal Act 1912, s 5F
Legislation Cited:	Crimes Act 1900 Crimes Act 1914 (Cth) Criminal Appeal Act 1912 Criminal Code Act 1995 (Cth) Evidence Act 1995
Cases Cited:	Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336 Chu Piu-wing v Attorney-General [1984] HKLR 411 Darwiche v R [2011] NSWCCA 62 Dupas v The Queen [2010] HCA 20; 241 CLR 237 Hakim v Waterways Authority of New South Wales [2006] NSWCCA 376; 149 LGERA 415 House v R [1936] HCA 40; (1936) 55 CLR 499 Jago v District Court of NSW [1989] HCA 46; 168 CLR 23 Mackay v R [1977] HCA 22; 136 CLR 465 Moevao v Department of Labour (1980) 1 NZLR 464 Moti v The Queen [2011] HCA 50; 283 ALR 393 Petroulias v R [2007] NSWCCA 154; 176 A Crim R 302 R (Cth) v Petroulias (No. 1) [2006] NSWSC 788; 177 A Crim R 153 R v Croydon Justices, Ex parte Dean [1993] QBD 769 R v Edwards & Anor [2009] HCA 20; 255 ALR 399 R v Giam [1999] NSWCCA 53; 104 A Crim R 416 R v Glennon [1992] HCA 16; 173 CLR 592 R v Hamzy (1994) 74 A Crim R 341 R v King [2003] NSWCCA 399; 59 NSWLR 472 R v M [2010] NSWDC 200 R v Mohi [2000] SASC 384; 78 SASR 55 R v Petroulias [2005] NSWCCA 75; 62 NSWLR 663 Regina v Moussad [1999] NSWCCA 337; 152 FLR 373 Stanton v Abernathy (1990) 19 NSWLR 656 Taylor v The Queen (1997) 93 A Crim R 1 Vuckov and Romeo (1986) 22 A Crim R 10 Walton v Gardiner [1993] HCA 77; 177 CLR 378 Williams v Spautz [1992] HCA 34; 174 CLR 509
Category:	Principal judgment
Parties:	Michael Joseph Calleija (Applicant) Regina (Respondent)
Representation:	R Bonnici (Applicant) P Staehli SC (Respondent) Colleen V Donnelly (Applicant) Commonwealth Director of Public Prosecutions (Respondent)
File Number(s):	2009/235383
Decision under appeal	Date of Decision: 2011-08-11 00:00:00 Before: Frearson DCJ File Number(s): 2009/235383