CEO Customs v CHS Enterprises Pty Ltd & 3 Ors
[2007] NSWSC 1133
•12 October 2007
Reported Decision:
70 ATR 285
New South Wales
Supreme Court
CITATION: CEO Customs v CHS Enterprises Pty Ltd & 3 Ors [2007] NSWSC 1133 HEARING DATE(S): 16-20 & 23 July, 3 August 2007
JUDGMENT DATE :
12 October 2007JUDGMENT OF: Smart AJ at 1 DECISION: See paras 373-376 CATCHWORDS: Customs prosecutions for pecuniary penalties - proof of Customs charges beyond reasonable doubt - shipping of honey from Shanghai to Singapore and then from Singapore to Australia - re-export of honey from Australia to USA - origin of goods mis-stated in Entries for Home Consumption and EXIT declarations - no Australian duty avoided - whether aiding and abetting of substantive offences had occurred. LEGISLATION CITED: Commerce (Trade Descriptions) Act 1905 (C'th)
Customs Act 1901 (C'th)
Customs Tariff ActPARTIES: CEO Customs v CHS Enterprises Pty Ltd & 3 Ors FILE NUMBER(S): SC 20304/04 COUNSEL: (P) P Roberts SC (Customs)
(D) Bateman (CHS Enterprises & Hu)SOLICITORS: (P) Australian Government Solicitor (Customs)
(D) Galloways (CHS Enterprises & Hu)
J Law (Unicargo & Lam)
IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
COMMON LAW LISTSMART AJ
20304/2004:Friday, 12 October 2007
CHIEF EXECUTIVE OFFICER CUSTOMS (Customs)
v
CHS ENTERPRISES PTY LTD (CHS), Robin HU, HUI Min Jing, AK UNICARGO INTERNATIONAL PTY LTD (Unicargo) and Pia LAM
JUDGMENT
Introduction1 These Customs prosecutions arise out of the importations during the period from about 1 July 2001 until about 1 June 2002 of 125 container loads (each container housing 68 x 200 litre drums) of Chinese honey into Australia, mostly declared as Singaporean honey in the Entries for Home Consumption and the subsequent export of the honey, often within a short period of its arrival, to many destinations in the United States of America under the description of Australian honey or words to that effect. The imports and exports each involve 1.7 million litres of honey having a value for Customs purposes of about $5,027,289. Between July 2001 and May 2002 there were 28 separate consignments to Australia of Chinese honey, many of the consignments consisting of more than one container load. There were 39 separate export consignments comprising 125 container loads. The increase in the number of export consignments over import consignments was due in part to the export consignments going to different ports and parts of the United States. Broadly, and with some exceptions Customs claimed, in summary, that material false and misleading statements were made in the documents lodged both in relation to the imports and exports and that false descriptions were applied to the goods imported and exported. The detailed charges are discussed later.
2 Requiring consideration are some disputed late proposed amendments to the voluminous Statement of Claim (exceeding 150 pages). Initially, it is sufficient to proceed on the basis that the owner and consignee of the honey the subject of the first shipment and importation was CHS and that the owner and consignee of the subsequent shipments and importations of honey was Ms Jing using her (apparently unregistered) business name of JHM Trading Company except that Import Shipment 2 will require separate treatment.
3 CHS was a registered company controlled by Mr Hu and primarily carried on a printing business. There was an issue whether from about May 2001 it also carried on an importing business but I do not think it did so. Ms Jing, Mr Hu’s former wife, was the moving spirit behind the import/export of the honey and she controlled the operations in Australia. She had the contact and dealings with the Chinese supplier. She was a shrewd and very intelligent lady with considerable managerial and business skills. She had a keen eye for financial matters. Her English expression and comprehension were limited. They appeared to be poor. Her language was Mandarin and she dealt with those who could speak that language. While she called on her husband to utilize his contacts to point towards those who could supply the right assistance she ran the honey importation/exportation business and made the decisions. He was quiet and somewhat retiring. She used the company’s facilities such as the telephone and the FAX as well as its printing equipment to print labels and other documents. She also enlisted the help of Holly, a staff member of CHS, to help with the operation of the computer and the printing of documents. Mr Hu took messages for his wife if she was away from the premises at Petersham and answered those queries to which he knew the answers.
4 Unicargo was a freight forwarding company and was controlled by Mr Lam who spoke some Mandarin. Mr Lam was its general manager and a director. Mr Hu had had previous dealings with Unicargo and Mr Lam when earlier importing some printing machinery for the printing business. Mr Hu introduced Ms Jing to Mr Lam. Ms Jing held a discussion with Mr Lam as to the importing and exporting of Chinese honey. Mr Hu was present. Mr Lam preferred to treat Mr Hu and Ms Jing as business partners and one party but she was the controller and the person who unilaterally made the decisions. Mr Lam was reluctant to dismiss or sideline Mr Hu. Eventually, Ms Jing retained Unicargo to arrange to have the imported honey cleared through Customs but did not retain Unicargo to act as freight forwarder from Singapore to Sydney. Mr Lam and Unicargo retained a Customs broker to clear the goods through Customs etc. Unicargo and Mr Lam arranged for the containers to be collected from the wharf and delivered to a storage facility or warehouse where the drums of honey were unpacked and repacked into different containers for their journey to the USA. Unicargo was retained to attend to exporting the honey to the USA. This involved arranging for space on a ship, the collection of the containers from the storage facility and their delivery to the wharf and lodging documents with Customs.
5 There are serious charges arising out of the imports and the exports and the manner in which they were effected. Customs lost no revenue as a result of the imports and exports. No duty is imposed on honey. Nor were there any restrictions on the importation of honey from either China or Singapore. Customs contended that statements as to the origin of goods were always highly material to Customs not only in respect of imposing duties but also for quarantine and “policing” purposes. Customs also contended that the origin of goods exported or re-exported from Australia was of material concern to Customs. False labelling of goods as Australian produce, especially when the non-Australian goods differ in quality from Australian produce, can have adverse trade ramifications on Australia as a trading nation as well as on individual Australians engaged in the export of similar goods
6 Customs initially alleged that the exports of honey to the USA were carried out in the names of CHS as to Export Shipments 1, 2, 3 and 4, JW International Trading Pty Ltd or Jing Wei International Trading Pty Ltd or a similar name as to the remainder of the Export Shipments. The position as to Import Shipments 2, 3 and 4 is a little unusual and is dealt with later.
7 Ms Jing pleaded guilty to all the charges against her arising out of the imports and exports. She sought a reduction in the penalties imposed, offering to give evidence against the other defendants. She did so in the proceedings which I have heard . The proceedings against her instituted by the subject statement of claim are presently part-heard before Howie J. This was not regarded as an obstacle to these proceedings being heard and determined. She lives with and cares for the young daughter of Mr Hu and herself. She has no paid employment.
8 The first import shipment was taken by the carrier to the warehouse premises of AAMAC. Each of the subsequent shipments was taken to the warehouse premises of White Heavy Haulage (White’s), a general transport company with a bond store at its premises at Sydenham. Some of the containers were nominated for inspection by the Australian Quarantine Inspection Service. (AQIS). They were inspected at the warehouse and after the steps required by AQIS were carried out they were cleared by Customs.
9 At the warehouses the containers were unpacked by the warehouse staff and the drums were cleaned by Ms Jing and helpers who had been enlisted for the task. AQIS required every drum to be labelled showing, amongst other things, the origin of the contents. Subsequently the drums were relabelled with labels indicating the contents were produce of Australia. There was no modification of the honey imported nor any blending with Australian honey. The drums as re-labelled were packed into a container ready for export to the USA.
10 As at August 2001 – May 2002 Chinese honey attracted anti-dumping duties in the USA in the range of 34 per cent to 184 per cent whereas Australian produced honey was duty free. By falsely claiming that the honey was of Australian origin, USA anti-dumping duties were avoided. Further, Chinese honey had been found to contain chloramphenicol, an antibiotic which is a carcinogenic agent linked to the rare blood disease aplastic anaemia. The antibiotic chloramphenicol was banned in food products in the United States. China is probably the largest honey producing country in the world. Australian honey tends to be of premium quality and attracts a higher purchase price.
11 Customs alleged that it was an integral part of the overall scheme in which the defendants participated that false entries for home consumption be lodged. They would not have wanted it officially recorded that the honey being imported was Chinese honey.
Section 234(1) of the Customs Act provided (as at 2001-2):Relevant Legislation
The penalty for these offences is/was in s 234(2)(c) and s 234(3) of the Customs Act as follows:
“(1) A person shall not:
…
(d) either:(ii) intentionally omit from a statement made to an officer any matter or thing, reckless as to the fact that without the matter or thing the statement is misleading in a material particular; or(i) intentionally make a statement to an officer, reckless as to the fact that the statement is false or misleading in a material particular; or
… …”
“(2) A person who contravenes subsection (1) is guilty of an offence punishable upon conviction:
…
(c) subject to subsections (3) and (4), in the case of an offence against paragraph (1)(d), by a penalty not exceeding 100 penalty units; or
…Section 236 of the Customs Act provided:(3) Where a person is convicted of an offence against paragraph (1)(d) in relation to a statement made, or an omission from a statement made, in respect of the amount of duty payable on particular goods, a Court may, in relation to that offence, impose a penalty not exceeding the sum of $5000 and twice the amount of the duty payable on those goods.”
“For the purposes of a Customs prosecution (within the meaning of section 244), whoever aids abets counsels or procures or by any act or omission is in any way directly or indirectly concerned in the commission of any offence against this Act shall be deemed to have committed such offence and shall be punishable accordingly.”
Section 255 of the Customs Act provided:
The current prosecutions are Customs prosecutions within the meaning of s 244 as they are proceedings by the Customs for the recovery of penalties under the Customs Act and do not fall within the exception.
Section 257 of the Customs Act provided:
(2) This section shall apply to any matters so averred although:“(1) In any Customs prosecution the averment of the prosecutor or plaintiff contained in the information, complaint, declaration or claim shall be prima facie evidence of the matter or matters averred.
(b) the matter averred is a mixed question of law and fact, but in that case the averment shall be prima facie evidence of the fact only.(a) evidence in support or rebuttal of the matter averred or of any other matter is given by witnesses; or
(4) The foregoing provisions of this section shall not apply to:(3) Any evidence given by witnesses in support or rebuttal of a matter so averred shall be considered on its merits and the credibility and probative value of such evidence shall be neither increased nor diminished by reason of this section.
(5) This section shall not lessen or effect any onus of proof otherwise falling on the defendant.”
(b) proceedings for an indictable offence or an offence directly punishable by imprisonment.(a) an averment of the intent of the defendant; or
“(1) Where, in a Customs prosecution in respect of any conduct engaged in by a body corporate, it is necessary to establish the state of mind of the body corporate, it is sufficient to show that a director, servant or agent of the body corporate, being a director, servant or agent by whom the conduct was engaged in within the scope of his or her actual or apparent authority, had that state of mind.
(2) Any conduct engaged in on behalf of a body corporate:
shall be deemed, for the purposes of this Act, to have been engaged in also by the body corporate.
(b) by any person at the direction or with the consent or agreement (whether express or implied) of a director, servant or agent of the body corporate, where the giving of such direction, consent or agreement is within the scope of the actual or apparent authority of the director, servant or agent.(a) by a director, servant or agent of the body corporate within the scope of his or her actual or apparent authority; or
(3) Where, in a Customs prosecution in respect of any conduct engaged in by a person other than a body corporate, it is necessary to establish the state of mind of the person, it is sufficient to show that a servant or agent of the person, being a servant or agent by whom the conduct was engaged in within the scope of his or her actual or apparent authority, had that state of mind.
(4) Any conduct engaged in on behalf of a person other than a body corporate:
(b) by any other person at the direction or with the consent or agreement(a) by a servant or agent of the person within the scope of the actual or
apparent authority of the servant or agent; or
(whether express or implied) of a servant or agent of the first-mentioned
person, where the giving of such direction, consent or agreement is
within the scope of the actual or apparent authority of the servant or
agent;
shall be deemed, for the purposes of this Act, to have been engaged in also by the first-mentioned person.
(5) A reference in this section to the state of mind of a person includes a reference to the knowledge, intention, opinion belief or purpose of the person and the person’s reasons for his or her intention, opinion, belief or purpose.”
Section 2 of the Commerce (Trade Descriptions) Act 1905 (C’th) provided:
“This Act shall be incorporated and read as one with the Customs Act 1901.”
Section 9 of the Commerce (Trade Descriptions) Act1905 (C’th) provided:
Section 12 of that Act provided:
“(1) A person shall not import any goods to which a false trade description is applied.
Penalty: $10,000.
(2) In a prosecution for an offence against subsection (1) it is a defence if the defendant proves that he did not intentionally import the goods in contravention of that subsection.”
(a) … …
(1) No person shall:
(2) A person who contravenes subsection (1) is guilty of an offence and is punishable on conviction by a fine not exceeding $10,000."
(b) intentionally export or enter for export or put on any ship or boat for export any goods to which a false trade description is applied.
“Trade description” and “false trade description” which were defined in s 3 of that Act provided:
“ Trade description , in relation to any goods, means any description, statement, indication, or suggestion, direct or indirect:
… …False trade description means a trade description which, by reason of anything contained therein or omitted therefrom, is false or likely to mislead in a material respect as regards the goods to which it is applied, and includes every alteration of a trade description, whether by way of addition, effacement, or otherwise, which makes the description false or likely to mislead in a material respect."(b) as to the country or place in or at which the goods were made or produced; or
… …
The Charges
13 21 of the 28 imports have given rise to a false/misleading statement charge based on the Entries for Home Consumption lodged by Woodford whom Customs described as an innocent Customs broker. Imports 6, 7, 8, 15, 16, 27 and 28 have not given rise to such a charge as the country of origin was shown as China. There is a difficulty in import shipment 6 in that the copy Entries for Home Consumption obtained from Mr Woodford differ. That purporting to be prepared on 4 January 2002 states the origin as unknown whereas that prepared on 7 January 2002 states the origin as "China". In both instances the supplier is shown as "New World Food Co Ltd." Both entries contain similar particulars. I assume that the later entry was probably the one lodged with Customs. This discrepancy was not noticed at the hearing. There are similar but not identical problems with some of the other imports. In each of the false/misleading charges, Customs alleged that the relevant false/misleading statement was made in the Entry for Home Consumption for the particular importation. In relation to most, but not all, of the imports there is also a charge under s 9 of the Commerce (Trade Descriptions) Act . The false trade description alleged is as to the origin of the goods which was contained in the Entries for Home Consumption, that is, the same statement which is the subject of the false statement charge under the Customs Act .
14 Customs explained that as to the exports, charges of false/misleading statements under s 234(1)(d)(i) of the Customs Act have been laid in respect of some 17 exports and that charges of false trade description have been laid in respect of all 39 exports under s 12(1)(b) of the Commerce (Trade Descriptions) Act . Customs stated that in each of the 39 exports, the false statement and false description were alleged to be contained within the details transmitted to Customs to generate an Export Clearance Number (ECN), that is in the EXIT declaration and/or within the bill of lading. The false statements and descriptions relate to the origin of the honey as Australia(n).
15 Customs explained that the person on whose behalf the particular clearance was alleged to have been made was charged with a substantive offence. That applies to export shipments 1, 5-39. As to export shipments 2, 3 and 4 Customs sought to achieve the same result when it applied to further amend the Statement of Claim. There were problems with that application. These are dealt with later when the further amendment application is resolved. Initially CHS was charged with a substantive offence in respect of export shipments 1, 2, 3 and 4. It became clear that Ms Jing not CHS should be charged with a substantive offence in respect of export shipments 2, 3 and 4. As later appears as to export shipments 5-39 there were various entities alleged to have committed a substantive offence. All were controlled by Ms Jing.
CHS
16 As to import shipment 1, entry on 2 August 2001 CHS has been charged under s 234(1)(d)(i) of the Customs Act of intentionally making a false statement to an officer reckless as to the fact that the statement was false or misleading in a material particular in that the Entry for Home Consumption stated that the country of origin was Singapore whereas it was China. As to import shipment 1 CHS was also charged under s 9(1) of the Commerce (Trade Descriptions) Act of importing goods to which a false trade description was applied in that the Entry for Home Consumption stated that the country of origin of the honey being imported was Singapore whereas it was China.
17 As to import shipment 2, Entry on 10 October 2001, CHS was charged under s 234(1)(d)(ii) of intentionally omitting from a statement made to an officer a matter or thing reckless as to the fact that without the matter or thing the statement was misleading in a material particular in that the Entry for Home Consumption stated that the country of origin was stated to be unknown whereas it was known it was China.
18 18 charges under s 234(1)(d)(i) were preferred against Ms Jing in that on the following 18 occasions a false statement was made in each Entry for Home Consumption that the country of origin of the goods (honey) being imported was stated as Singapore whereas it was China:Ms Jing
Import Shipment 3, Entry on 15 November 2001
4, 19 December 2001
9, 17 January 2002
10, “
11, 8 February 2002
12, 27 February 2002
13, 27 February 2002
14, 11 March 2002
17, “
18, 13 March 2002
19, “
20, 19 March 2002
21, 26 March 2002
22, “
23, “
24, “
25, 6 May 2002
26, “19 A charge under s 234(1)(d)(ii) was preferred against Ms Jing as to import shipment 5, entry on 31 December 2001 of an intentional omission so that without the matter omitted the statement made was misleading in a material particular in that the country of origin was stated to be unknown whereas it was known and was China.
20 Ms Jing was charged with being directly concerned in the commission by CHS of the offence under s 234(1)(d)(i) as to import shipment 1. She was also charged with being directly concerned in the commission by CHS of the offence under s 234(1)(d)(ii) as to shipment 2. As to each of the 18 import shipments listed above Ms Jing was charged with the offence of importing goods to which a false trade description was applied contrary to s 9(1) of the Commerce (Trade Descriptions) Act 1905 in that it was stated that the country in which the goods were produced was Singapore whereas the true country of origin was China.
Mr Hu, Unicargo and Mr Lam
22 Mr Hu was charged with being directly concerned in the commission of the import offences by:21 I have referred to the charges against CHS and Ms Jing first because they face substantive charges. Mr Hu, Unicargo and Mr Lam face charges of aiding and abetting. As to the first and second shipments Customs alleged that Mr Hu managed the activities of CHS and that whatever was done by CHS was done by Mr Hu or under his direction. Customs alleges that Mr Hu and Ms Jing used their corporate structures and registered and unregistered business names to carry out the deception practised. Customs also alleges that, acting on behalf of Mr Hu and Ms Jing, Mr Lam using Unicargo gave instructions to an innocent Customs broker to clear the honey through Customs and, on the instructions of Mr Hu and Ms Jing have the Customs broker documentation include documents from a fictitious Singaporean supplier. The evidence established that the suppliers named in the Commercial invoices supplied with some of the shipments did not exist nor did the addresses stated on the Invoices.
(a) CHS - shipments 1 and 2 – s 234(1)(d)(i) & (ii)
(b) CHS - shipment 1 – S 9(1) of Commerce (Trade
Descriptions) Act(d) Ms Jing - being the further 18 offences earlier specified against s9(1)(c) Ms Jing - being the 18 offences earlier specified against s 234(1)(d)(i) of the Customs Act , and being the offence earlier specified against s 234(1)(d)(ii) of the Customs Act – shipment 5
Commerce (Trade Description) Act
24 The links between the imports and exports were as follows:23 Unicargo and Mr Lam were each charged with being directly concerned in the commission of the same import offences as Mr Hu.
Import Shipment Export Shipment 1 (1 container) 1 (1 container) 2 (10 containers) 2 (4 containers)
3 (3 containers)
4 (3 containers)3 (4 containers) 5 (4 containers) 4 (2 containers) 6 (2 containers) 5 (3 containers) 7 (3 containers) 6 (10 containers) 8 (9 containers)
10 or 11 (1 container)7 (3 containers) 9 (3 containers) 8 (7 containers) 10&11 (7 containers to which 1 container from Import Shipment 6 was added) 9 (5 containers) 12 (5 containers) 10 (3 containers) 13 (3 containers) 11 (4 containers) 14 (4 containers) 12 (2 containers 15 (2 containers) 13 (3 containers) 16 (3 containers 14(2 containers) combined with 12 containers from 15, 16 & 17 17,18,19 & 20 (14 containers in total) 15 (6 containers) combined with 8
containers from 15, 16 & 1717,18,29 & 20 (14 containers in total) 16 (2 containers) combined
with 12 containers from 14,15 & 1717,18,19,20 (14 containers in total) 17(4 containers) combined with 10 containers from 15, 16 & 18 17,18,19 & 20 (14 containers in total) 18(6 containers) combined with 7 containers from 19 & 20 21,22,23 & 24 (13 containers in total) 19(3 containers) combined with 10 containers from 18 & 20 21,22,23 & 24 (13 containers in total 20 (4 containers) combined with 9 containers from 18 & 19 21,22,23 & 24 (13 containers in total 21(3 containers) combined with 12 containers from 22 & 23 25,26,27 & 28 (15 containers in total) 22 (6 containers) combined with 9 containers from 21 & 23 25,26,27&28 (15 containers in total) 23 6 containers combined with 9 containers from 21 & 22 25,26,27 & 28 (15 containers in total) 24 (4 containers) 29 & 30 25(4 containers) combined with 18 containers from 26,27 & 28 31,32,33,34,35,36,37,38&39
(22 containers in total)26(8 containers) combined with 14 containers from 25,27 & 28 31,32,33,34,35,36,37,38&39
(22 containers in total27(5 containers) combined with 17 containers from 25,26& 28 31,32,33,34,35,36,37,38&39
(22 containers in total)28(5containers) combined with 17 vcontainers from 25, 26 & 27 31,32,33,34,35,36,37,38&39
(22 containers in total)
Export Charges
26 There are six charges against Ms Jing under s 234(1)(d)(i) of the Customs Act of intentionally making a statement to an officer, reckless as to the fact that the statement was false or misleading in that for each of these 6 Export Clearances she stated that the honey being exported was Australian bees honey whereas the honey was Chinese.25 17 of the 39 exports gave rise to a false/misleading statement charge based on the Export Clearances lodged by Unicargo. In the Statement of Claim filed on 27 August 2004 CHS was charged under s 234(1)(d)(i) of the Customs Act as to export shipments 1, 2, 3 and 4 of intentionally making a false statement to Customs, reckless as to the fact that the statement was false or misleading in a material particular namely that the honey being exported was Australian bees honey, whereas the honey was Chinese. In the Amended Statement of Claim handed up during the hearing these charges against CHS remained. It was during the final address of Customs and in the proposed Further Amended Statement of Claim that CHS was only so charged as to export shipment 1. As to export shipments 1, 2, 3 and 4 both in the Statement of Claim and the Amended Statement of Claim CHS was also charged with intentionally exporting goods to which a false trade description was applied contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act 1905 in that CHS exported the honey having intentionally procured a Bill of Lading for its transport stating that the country of origin of the honey was Australia whereas it was China. Again, during the final address of Customs and in the proposed Further Amended Statement of Claim CHS was only so charged as to export shipment 1. These matters are further considered later when I deal with the application to file the Further Amended Statement of Claim.
Shipment 6 Export Clearance 31 December 2001
“ 7 “ 31 December 2001
“ 9 “ 21 January 2002
“ 12 “ 21 January 2002
“ 13 “ 21 January 2002
“ 14 “ 12 February 2001
27 There are 7 charges against Ms Jing under s 234(1)(d)(i) and s 236 of the Customs Act that she as to each of the Export Clearances for each of the following seven exports directly concerned herself in the commission of an offence of the then registered company Jing Wei International Trading Pty Ltd which intentionally made a statement to an officer reckless as to the fact that the statement was false and misleading in a material particular in that the company for each of those seven Export Clearances shipments made a statement that the honey being exported was Australian bees honey whereas the honey was Chinese:
Shipment 5 Export Clearance 21 November 2001
“ 8 “ 16 January 2002
“ 10 “ 16 January 2002
“ 11 “ 16 January 2002
“ 15 “ 1 March 2002
“ 16 “ 4 March 2002
“ 17 “ 14 March 2002
28 There are 6 charges against Ms Jing that, contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act 1905 , she exported honey having intentionally procured six respective Bills of Lading for the following exports of the honey to which a false trade description was applied stating the country of origin of the honey was Australia whereas it was China:
Shipment 6 Export Bill of Lading 8 January 2002
“ 7 “ “
“ 9 “ 23 January 2002
“ 12 “ 6 February 2002“ 13 “ 21 January 2002
“ 14 “ 2 February 2002
29 There are 29 charges against Ms Jing that as to each of the following 29 Export Bills of Lading, contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act and s 236 of the Customs Act she directly concerned herself in the commission of an offence by the then registered company Jing Wei International Trading Pty Ltd which intentionally exported goods to which a false trade description was applied in that the company exported the honey having intentionally procured Bills of Lading which stated the country of origin in which the honey was produced was Australia whereas it was China.
(i) Shipment 5, Export Bill of Lading dated on or about 21 November, 2001
(ii) Shipment 8, Export Bill of Lading dated 22 January 2002
(iii) Shipment 10, Export Bill of Lading dated 25 January 2002
(iv) Shipment 11, Export Bill of Lading dated 25 January 2002
(v) Shipment 15, Export Bill of Lading dated 19 March 2002
(vi) Shipment 16, Export Bill of Lading dated 19 March 2002
(vii) Shipment 17, Export Bill of Lading dated 2 April 2002
(viii) Shipment 18, Export Bill of Lading dated 5 April 2002
(ix) Shipment 19, Export Bill of Lading dated 2 April 2002
(x) Shipment 20, Export Bill of Lading dated 2 April 2002
(xi) Shipment 21, Export Bill of Lading dated 2 April 2002
(xii) Shipment 22, Export Bill of Lading dated 2 April 2002
(xiii) Shipment 23, Export Bill of Lading dated 2 April 2002
(xiv) Shipment 24, Export Bill of Lading dated 2 April 2002
(xv) Shipment 25, Export Bill of Lading dated 16 April 2002
(xiv) Shipment 26, Export Bill of Lading dated 16 April 2002
(xvii) Shipment 27, Export Bill of Lading dated 12 April 2002
(xviii) Shipment 28, Export Bill of Lading dated 10 April 2002
(xix) Shipment 29, Export Bill of Lading dated 12 April 2002
(xx) Shipment 30, Export Bill of Lading dated 12 April 2002
(xxi) Shipment 31, Export Bill of Lading dated 31 May 2002
(xxii) Shipment 32, Export Bill of Lading dated 31 May 2002
(xxiii) Shipment 33, Export Bill of Lading dated 24 May 2002
(xxiv) Shipment 34, Export Bill of Lading dated 24 May 2002
(xxv) Shipment 35, Export Bill of Lading dated 24 May 2002
(xxvi) Shipment 36, Export Bill of Lading dated 24 May 2002
(xxvii) Shipment 37, Export Bill of Lading dated 31 May 2002
(xxviii) Shipment 38, Export Bill of Lading dated 31 May 2002
(xxix) Shipment 39, Export Bill of Lading dated 31 May 2002.
30 In the Statement of Claim and the Amended Statement of Claim Ms Jing was charged with being directly concerned in the commission of the offences by CHS as to export shipments 1, 2, 3 and 4 contrary to s 234(1)(b)(i) of the Customs Act and see also s 236 of the Act. In those pleadings Ms Jing was also charged with being directly concerned in the commission of the offences by CHS as to Export Bills of Lading for those export shipments contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act . During the final address of Customs and in the proposed Further Amended Statement of Claim Ms Jing was only so charged in both instances as to export shipment 1. While I am not dealing with the charges against Ms Jing, they and her conduct are at the core of the prosecution.
32 Mr Hu, Unicargo and Mr Lam have each been charged with being directly concerned in the commission of:31 In the Statement of Claim and the Amended Statement of Claim Mr Hu, Unicargo and Mr Lam were each charged with being directly concerned in the commission of the offences by CHS as to export shipments 1, 2, 3 and 4 contrary to s 234(1)(d)(i) of the Customs Act . See also s 236 of that Act. Each was charged with the further offence of being directly concerned in the commission of offences by CHS as to each of such four export shipments contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act . See also s 236 of the Customs Act. In the proposed Further Amended Statement of Claim (which was not allowed) they were each charged with being concerned in the commission of the offences by CHS as to export shipment 1, Export Clearance of 7 August 2001 contrary to s 234(1)(d)(i) of the Customs Act and in the offence by CHS as to export shipment 1 contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act . As to export shipments 2, 3 and 4 it was proposed in the proposed Further Amended Statement of Claim to charge them with similar offences save that Ms Jing was nominated as the principal offender.
(a) 6 false statement offences by Ms Jing contrary to s 234(1)(d)(i) of the Customs Act (Shipments 6, 7, 9, 12,13 and 14) and the related Export Clearances.
(b) 6 false trade description offences by Ms Jing contrary to s 12 (1)(b) of the Commerce (Trade Descriptions) Act . This applies especially to the related 6 export Bills of Lading.
(c) 7 false statement offences by the then registered Jing Wei International Trading Pty Ltd contrary to s 234(1)(d)(i) of the Customs Act (Shipments 5, 8, 10, 11, 15, 16 and 17 and the related Export Clearances).
(e) 29 false trade description offences by the then registered Jing Wei International Trading Pty Ltd contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act. This applies to Export Shipments 5, 8, 10, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38 and 39 and the related export Bills of Lading.(d) 7 false trade description offences by the then registered Jing Wei International Trading Pty Ltd contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act . This applies especially to the related 7 export Bills of Lading.
33 In addition to substantial evidence from a number of witnesses Customs’ case was supported by four volumes of documentary material including as to the Imports the many Entries for Home Consumption, Invoices, Packing Lists, Packing Declarations, Australian Quarantine Inspection Service documents and Bills of Lading. Customs had obtained possession of documents held by Woodford (Customs broker), Unicargo and Whites. As to exports the documents obtained by Customs included Standard Export Record Advices, Commercial Invoices, Interim Receipts – Bills of Lading. Customs had obtained possession of export documents held by Unicargo, Fine Quality Master Print (CHS) and Whites. An examination of the documents was helpful. They enabled amongst other things, the identification of the various alleged offences.
34 Defences of CHS and Hu
Both filed long detailed defences. These put many matters in issue. At the trial the issues were somewhat narrower.35 Defences of CHS
As to import shipment 1, the false statement offence CHS submitted that Customs had failed to establish beyond reasonable doubt that it (CHS) intentionally made or caused to be made a statement to an officer, reckless as to the fact that `the statement was false or misleading in a material particular contrary to s 234(1)(d)(i) of the Customs Act . As to import shipment 2 and the false statement by omission charge CHS submitted that Customs had failed to establish beyond reasonable doubt that it, (CHS) intentionally omitted or caused to be omitted from a statement to an officer any matter or thing, reckless as to the fact that without the matter or thing, the statement was misleading in a material particular contrary to 34(1)(d)(ii) of the Act.36 As to import shipment 1 and the false trade description charge CHS submitted by way of defence in reliance upon s 9(2) of the Commerce (Trade Descriptions) Act that it did not intentionally import the honey in contravention of s 9 (1) of that Act, namely that a person shall not import any goods (honey) to which a false trade description is applied.
37 CHS’ defence was based on Mr Hu not having the requisite knowledge or intent and therefore in the circumstances, CHS did not have the requisite knowledge to have committed the offence alleged.
38 Exports
As to Export Shipment 1 and Export Clearance on 7 August 2001 CHS submitted that Customs had failed to establish beyond reasonable doubt that CHS intentionally made or caused to be made a statement to an officer, reckless as to the fact that the statement was false or misleading in a material particular.39 As to export shipment 2, export clearance on 12 October 2001, export shipment 3, export clearance on 15 October 2001, export shipment 4, export clearance on 16 October 2001 Customs did not press its case against CHS in its final address on 23 July 2007, contending that the reference in each of the sub-paragraphs (i) of the allegations as to these shipments to the First Defendant should read the Third Defendant. This is reflected in the Amendments included in the proposed Further Amended Statement of Claim. Senior Counsel for Customs explained the position at T250. Similar considerations apply to the false trade description charges allegedly against CHS following those shipments and the related Bills of Lading. These charges were also not pressed as at 23 July 2007, Customs anticipating that it would be given leave to further amend its statement of claim.
Defences of Mr Hu40 However, in the event of such leave being refused Customs pressed the case it originally made against CHS as to export shipments 2, 3 and 4. It also contended that s 251 of the C ustoms Act applied to cure any defect or variance, but I did not agree as different principal offenders were being nominated and different intentions were involved. See later where I have discussed the proposed amendments. I subsequently made findings as to those export shipments.
41 Counsel for Mr Hu contended:
“Principally, the allegations against Mr Hu are aid and abet charges, Therefore they require knowledge. His defence is that he did not have the knowledge of the particular matters.”
42 This was described as a fairly global approach.
43 Imports
As to import shipments 1 and 2 Mr Hu submitted that as CHS did not commit an offence therefore he did not aid and abet the commission of an offence by CHS.44 As to import shipments 3, 4, 9, 10, 11, 12, 13, 14, 17, 18, 19, 20, 21, 22, 23, 24, 25 and 26 and the 18 charges against Ms Jing arising from these 18 shipments of a false statement in each Entry for Home Consumption that the country of origin of the honey was Singapore Mr Hu submitted that he had no specific knowledge of the 18 particularised Import shipments or any statements made by Ms Jing to an officer in relation to such shipments. It was further submitted that there was no established criminal act or criminal intent of Mr Hu in relation to any statement made by Ms Jing to an officer in relation to such shipments.
45 As to import shipment 5 and the offence alleged under s 234(1)(d)(ii) – false statement by omission – Mr Hu said that he had no specific knowledge of import shipment 5 or any intentional omission from a statement of Ms Jing to an officer as to such shipment. Mr Hu denied any established criminal act or intent on his part as to any statements made by Ms Jing to an officer as to such shipment.
46 Further, Mr Hu denied that CHS intentionally imported the honey in contravention of s 9(1) of the Commerce (Trade Descriptions) Act and denied aiding and abetting the commission of an offence by CHS.
47 As to the 18 shipments 3, 4, 9, 10, 11, 12, 13, 14, 17, 18, 19, 20, 21, 22, 23, 24, 25 and 26 and the 18 false trade description charges under s 9(1) of the Commerce (Trade Descriptions) Act Mr Hu denied any specific knowledge of the 18 import shipments to which a false trade description was applied in the Entry for Home Consumption. Mr Hu also denied aiding and abetting Ms Jing’s importation of the 18 import shipments in contravention of s 9(1) of the Commerce (Trade Descriptions) Act . Although no reference is made to s 9(2) of that Act in Mr Hu’s written submissions on this point, I have assumed that this is covered in his denial, but whether an aider and abettor can rely on s 9(2) is debatable.
48 Exports
As to Export Shipments 6, 7, 9, 12, 13 and 14, the related Export Clearances and the charges that Mr Hu was directly concerned in the commission by Ms Jing as to each such Export Clearance of intentionally making a statement to an officer reckless as to the fact that the statement was false and misleading in a material particular contrary to s 234(1)(d)(i) of the Customs Act in that Ms Jing made a statement to Customs that the honey was Australian bees honey whereas the honey was Chinese, Mr Hu denied that he had any specific knowledge of such export shipments or of any intentional statement made by Ms Jing to an officer in relation to such shipment; Mr Hu denied any established criminal act or criminal intent on his part in relation to any statements made by Ms Jing to an officer in relation to such shipments.49 As to Export Shipments 5, 8, 10, 11, 15, 16 and 17, the related Export Clearances and the 7 charges that Mr Hu was directly concerned in the commission by the then registered Jing Wei International Trading Pty Ltd as to each of such export clearances, of intentionally making a statement to an officer, reckless as to the fact that the statement was false or misleading in a material particular contrary to s 234(1)(d)(i) of the Customs Act in that Jing Wei International Trading Pty Ltd for each shipment stated to Customs that the honey was Australian bees honey, whereas the honey was Chinese
Mr Hu denied that he had any specific knowledge of such shipments or of any intentional statement made by Ms Jing (acting on behalf of Jing Wei International Trading Pty Ltd) to an officer in relation to such shipments. Mr Hu denied any established criminal act or criminal intent on his part in relation to any statements made by Ms Jing to an officer in relation to such shipments. I interpolate that any statement, ostensibly made by Jing Wei International Trading Pty Ltd was probably made by Ms Jing acting on its behalf. Mr Hu was asserting that he had nothing (or virtually nothing) to do with what Ms Jing told Customs even if via Unicargo and Mr Lam.
50 As to Export Shipment 1, the related Bill of Lading and the false trade description charge against CHS contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act that the country of origin of the honey was Australia whereas it was China and the charge that Mr Hu was directly concerned in the commission of that alleged offence, Mr Hu asserted that CHS did not intentionally procure a Bill of Lading for the transport of that shipment stating that the country of origin of the honey was Australia whereas it was Chinese. Mr Hu denied that he aided and abetted the commission of an offence by CHS.
51 As to Export Shipments 6, 7, 9, 12, 13 and 14 and the related Export Bills of Lading and the 6 false trade description charges contrary to s 12(1)(b) of the Commerce Trade Descriptions) Act against Ms Jing and the 6 charges against Mr Hu of being directly concerned in the commission of the offences by Ms Jing, Mr Hu denied that he had any specific knowledge of such shipments or any intentional statement made by Ms Jing to an officer in relation to such shipments. Mr Hu denied any established criminal act or criminal intent on his part in relation to any statement made by Ms Jing to an officer in relation to such shipments.
52 As to the 29 Export Shipments 5, 8, 10, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38 and 39 and the associated Export Bills of Lading and the 29 alleged false trade description offences contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act committed by the then registered Jing Wei International Trading Pty Ltd and the 29 charges against Mr Hu that he was directly concerned in the commission of the 29 alleged offences by Jing Wei International Trading Pty Ltd, Mr Hu denied that he had any specific knowledge of such shipments or Ms Jing's intentional procurement of Bills of Lading for the transport of such export shipments. This defence proceeds on the basis that the intention of Ms Jing and that of her company Jing Wei International Trading Pty Ltd were identical or at least substantially identical. Mr Hu further denied that there was any established criminal act or criminal intent on his part in relation to Ms Jing's intentional procurement of Bills of Lading for the transport of such export shipments. Mr Hu denied having any actual knowledge of Ms Jing's contraventions of s 12(1)(b) of the Commerce (Trade Descriptions) Act 1905 .
53 Defences of Unicargo
It was contended that it was merely an agent or conduit for passing the documents supplied by the importing defendants to the Customs broker. As to the application of false trade description charges, Unicargo contended it had nothing to do with the preparation or the application of the labels applied to the goods (drums of honey). Unicargo contended it had no knowledge of the alleged illegal activities of the honey importers and so could not have aided and abetted such activities.54 As to the charges against it under the Customs Act relating to the exports, Unicargo's case was that it was acting as the agent of the honey exporters and made declarations to Customs on the basis of documents provided by the honey exporters.
56 In its closing submissions Unicargo contended that it was the innocent dupe of the importers and exporters of the honey and so could not have:55 As to the charges against it under the Commerce (Trade Descriptions) Act relating to the exports Unicargo contended it had nothing to do with the preparation or application of the labels and did not aid or abet false descriptions being applied to the goods. It also contended that it had no knowledge of the alleged illegal activities of the honey exporters and so could not have knowingly been a part of the exporters' alleged illegal activities.
(b) aided and abetted any false commerce markings being applied to the imported or the exported goods.(i) aided and abetted any false declarations to Customs by the importers (or exporters) of the honey when the honey was imported (or exported) and
58 Unicargo denied the claims for conviction of Unicargo of these alleged aiding and abetting offences:
57 Unicargo denied that it was directly concerned in the commission of each of the 29 alleged offences by the then registered company Jing Wei International Trading Pty Ltd contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act – false trade description in Export Bills of Lading stating the country of origin of the goods (honey) was Australia (Australian) whereas it was China.
(See para 4 of Unicargo's defence and para 116 of the A/S/C)
(a) of the alleged false statement offence by CHS contrary to s 234(1)(d)(i) of the Customs Act - import shipment 1;
(See para 4 of Unicargo's defence and para 114 of the Amended Statement of Claim – "A/S/C")(c) of the alleged 18 false statement offences by Ms Jing contrary to s 234(1)(d)(i) of the Customs Act – import shipments 3, 4, 9, 10, 11, 12, 13, 14, 17, 18, 19, 20, 21, 22, 23, 24, 25 and 26;(b) of the alleged false statement by omission offence by CHS contrary to s 234(1)(d)(ii) of the Customs Act – import shipment 2;
(See para 4 of Unicargo's defence and para 115 of the A/S/C )
(d) of the alleged false statement by omission offence by Ms Jing contrary to s 234(1)(d)(ii) of the Customs Act – import shipment 5;
(See para 4 of Unicargo's defence and para 117 of the A/S/C)( See para 4 of Unicargo's defence and para 118 of the A/S/C)
(e) of the alleged false trade description offence by Ms Jing contrary to s 9(1) of the Commerce (Trade Descriptions) Act - import shipment 5
( See para 4 of Unicargo's defence and para 122 of the A/S/C)
(f) of the 18 alleged trade description offences by Ms Jing contrary to 9(1) of the Commerce ( Trade Descriptions) Act – import shipments as stated in sub-para (c) above;
( See para 4 of Unicargo's defence and para 119 of the A/S/C)(g) of the alleged 4 false statement offences by CHS contrary to s 234(1)(d)(i) of the Customs Act – (export shipment 1, 2, 3 and 4 (1 alleged false statement offence in the proposed Further Amended Statement of Claim – export shipment 1)
(See para 4 of Unicargo's defence and para 120 of the A/S/C)(i) of the 7 alleged false statement offences by Jing Wei International Trading Pty Ltd contrary to s 234(1)(d)(i) of the Customs Act export shipments 5, 8, 10, 11, 15, 16 and 17 and the related export clearances;(h) of the 6 alleged false statement offences by Ms Jing contrary to s 234(1)(d)(i) of the Customs Act – export shipments 6, 7, 9, 12, 13 and 14 and the related export clearances;
(See para 4 of Unicargo's defence and para 121 of the A/S/C).
(j) of the 4 alleged false trade description offences by CHS contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act – export shipment 1, 2, 3 and 4 (1 alleged false trade description offence in the proposed Further Amended Statement of Claim – export shipment 1);
(See para 4 of Unicargo's defence and para 123 of the A/S/C)
(k) of the alleged 6 false trade description offences by Ms Jing contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act – export shipments as stated in sub-para (h) above and related Bills of Lading;
(See para 4 of Unicargo's defence and para 124 of the A/S/C)
(l) of the 29 alleged false trade description offences by Jing Wei International Trading Pty Ltd contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act – Export Shipments 5, 8, 10, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38 and 39 and the related Bills of Lading.
(This duplicates an earlier paragraph)
(See para 4 of Unicargo's defence and para 125 of the A/S/C)
59 In the above list I have briefly referred to the number of alleged offences by CHS, Ms Jing and the then Jing Wei International Trading Pty Ltd. Unicargo was charged with aiding and abetting each such offence.60 While paragraph 4 in Unicargo's defence denied each of the claims to relief in paras 114 -125 of the A/S/C I have taken them to also be a denial that it was directly concerned with the commission of the alleged offences. That was the basis on which the trial was conducted. In para 7 of Unicargo's defence it is stated, "Further each and every allegation that is not specifically admitted is deemed denied. …".
61 Unicargo also denied Customs claims to penalties against it not exceeding $1.002,000 and an order for costs.
62 Defences of Mr Lam
In both his opening and closing submissions the solicitor for Mr Lam stressed that Mr Lam had no knowledge of the alleged illegal activities of the honey importers and exporters and so could not have knowingly been a part of any of the importers' and exporters' alleged illegal activities and could not have knowingly aided and abetted any of the actions of the principals engaged in importing and exporting the honey.63 It was further submitted that any actions of Mr Lam were in the normal course of his employment with Unicargo and so it was vicariously liable for any actions of Mr Lam and so Mr Lam could not be found guilty of the charges laid against him. This submission must be rejected. An employee is not relieved of liability for his acts simply because his employer is vicariously liable. The terms of s 236 of the Customs Act also render the submission unsustainable.
64 The formal Defence of Mr Lam is in the same terms as that of Unicargo, subject to different paragraph numbers. He faces the same charges of aiding and abetting and being directly concerned in the commission of the alleged offences by CHS, Ms Jing and the then Jin Wei International Trading Pty Ltd. He resists the claim for penalties not exceeding $1,002,000 and an order for costs being made against him.
65 The Evidence
There was no dispute that the various imports and exports of honey alleged occurred and the relevant details of these were averred in the A/S/C. Electronic Entries for Home Consumption were submitted to Customs by the Customs Broker. Instructions were given by Ms Jing to Mr Lam along with the relevant documents, Mr Lam arranged for members of Unicargo, principally Mr Cho to forward the necessary information and materials to the Customs broker so that the goods could be cleared through Customs. Instructions were given by Ms Jing to Mr Lam to obtain an Export Clearance from Customs and this was arranged by Unicargo. No Customs broker was employed to procure an Export Clearance. The requisite documents were prepared.66 What was principally in issue in these proceedings was the knowledge and intention of Mr Hu, Unicargo and Mr Lam. Mr Hu's knowledge and intention played a major role in determining the knowledge and intention of CHS. However, in the case of the two imports and four exports where it was nominated there are further factors to be considered.
67 Mr Hu and Ms Jing married on 8 June 1998. In 2001 and previously he and his company (CHS) were running a printing business which traded under various names. Ms Jing said that she attended the business/factory and assisted with tasks such as packaging and folding. Ms Jing visited her family in Kunshan China in early 2001. The verified statement attached to her affirmation conveys the impression (mistakenly) that this visit occurred in mid-2001. She returned to Australia in late March 2001.
68 Ms Jing said that during that visit her brother introduced her to his friend, Tony Xiao Gang, the general manager of a Chinese Government-owned food corporation, Kunshan Xinlong Food Company (Kunshan Food). Mr Jing also met a woman called Ni Ping, its Vice-President. Mr Gang outlined a proposal to send honey from Asia to Australia and then to re-export it to the USA labelled as Australian honey. Although Mr Gang was not specific about where the honey was produced Ms Jing gathered that the honey was of Chinese origin. Mr Gang referred to the USA's anti-dumping laws against Chinese honey and said that USA importers were also involved in the venture and knew all about it.
69 She said that she was not involved in discussions for the shipments of honey to the USA as the arrangements were made directly between Kunshan Food and importers in the USA. She said that she was to receive $50 per day for her participation in the venture. Her role was to make arrangements in Australia for the importation of the honey and to arrange for its export to the USA in the quantities and to the consignees and destinations which Kunshan Food had arranged and nominated. She was to seek out and obtain assistance in Australia in the importing and exporting of the honey. Ms Jing said that she was told by the "Chinese side" that what was proposed was just a normal re-export business and that she understood that it was not an unlawful enterprise. She did not believe that the Chinese Government would ask her to do anything that was illegal. She said that she did not immediately agree to take part in the scheme.
70 On her return to Australia, initially fixed by her in about mid-2001 but subsequently shown to be in late March 2001, she said that she discussed with Mr Hu what had been proposed by Kunshan Food about importing and exporting honey. Ms Jing agreed that she told Mr Hu that she may have a chance of doing an import/export job because of the good contact with China through her brother's friend who worked for the Chinese Government doing export/import work. She was worried about her lack of English language skills and never having done previously the kind of work proposed. Ms Jing told Mr Hu that the job involved importing goods from Asia to Australia and then exporting them to the USA, labelled as Australian honey. She said that she did not tell Mr Hu that the proposal was designed to avoid paying extra fees in the USA. She had been told by the Chinese side that the reason for the proposal was to obtain "the tax refund from the Government."
71 Ms Jing said that she told Mr Hu that the Chinese side would be responsible for sending the goods (honey) to Australia, she would receive the goods and go through the Customs agent for all the paperwork and the Chinese would be responsible for all contacts with the clients in the USA. Ms Jing agreed that Mr Hu said that this sounded like a good job and she should have a try. He said that she could certainly handle such a business. Ms Jing stated Mr Hu said that he could help her, that it might be difficult, that slowly she would get used to the work and that she may obtain experience and increase her work skills. She told Mr Hu that she wished to engage in the import/export business but it would be difficult for her to make arrangements because of her very limited English.
72 Ms Jing said that she asked Mr Hu to look for some Customs agent to help them. He replied that he knew someone who was his agent for importing/exporting printing machinery and that this gentleman could also speak Mandarin and that this would be good for her. Mr Hu called him Mr Ling but later on she realised that Mr Ling was Gordon Lam. Ms Jing said that she agreed to see Mr Lam.
74 I interpolate the following which emerged during Ms Jing's cross-examination:73 Ms Jing said that about a week later Mr Hu took her to Mr Lam's premises and introduced her to Mr Lam. She had a conversation with Mr Lam, Mr Hu sitting beside her in the small room. Ms Jing said that she explained the proposal to Mr Lam in Mandarin, that is, that honey was to be shipped from China to Australia and that it was to be re-labelled in Sydney as Australian honey before being sent to the USA. The Chinese side said that one container should be imported first as a trial. Mr Lam said that this was a good idea. She said that Mr Lam said to her, "One way you can export this honey as Australian honey is that you can buy some local honey and blend it with the Chinese honey." Ms Jing stated that Mr Lam said that he would use a storage depot where the incoming containers could be unloaded and their cargoes re-containered and sent for export. She later learned that the depots were AAMAC for the first import/export shipment and White Heavy Haulage for all subsequent imports and exports.
(a) She was not aware of Mr Hu getting any money out of the 12 months importation and exportation of honey.
(b) Mr Hu was engaged in the business of printing and not that of importing.
(d) She opened several accounts (about six) at the HSBC Branch in George Street Haymarket and dealt there with a person who spoke Mandarin. She used an accountant who spoke Mandarin.(c) Mr Lam spoke Mandarin (Mr. Ling was the better pronunciation of his name in Mandarin).
75 Ms Jing said that the instructions regarding the import/export of the honey from the Chinese side came either by telephone or by FAX and that sometimes Mr Hu received a telephone call or FAX and sometimes she received FAXES and telephone calls. She also said that she was not aware whether Mr Hu gave instructions to Mr Lam.
76 Ms Jing said that the instructions she received by FAX were written in Chinese. Telephone instructions received were relayed in Mandarin.
77 Ms Jing agreed that about mid-2001 she said to Mr Hu words to this effect, "I don't have a company", adding "What should I do?" She said that Mr Hu replied, "You can use my company." She said "he introduced CHS company for me to use that company." She added that, as she promised, she had her company registered very soon and then she used her company instead of his. She was to use CHS until her company was registered.
78 She said that she did not know why the staff of Gordon Lam's company (Unicargo) continued to use CHS after her company had been registered. CHS was the importer and exporter for the first importation of honey. It was after the first importation of honey that she had her company registered.
79 Ms Jing said that she understood that in Australia she had to have more than one person involved in a company. She said that she asked Mr Hu if she could put him down as a minority shareholder in her company. Some time later she recorded Mr Hu's name as a shareholder in Jing Wei International Trading Pty Ltd.
80 Ms Jing said that she asked Mr Hu to help her find honey locally so they could blend the Australian honey with the imported Chinese honey. Ms Jing said that her husband made some telephone calls but there was no Australian honey available to them. Bushfires and drought had caused a shortage of Australian honey.
81 Ms Jing said that when the first shipment arrived in Sydney about 2 August 2001 she was advised by Mr Lam that AQIS (Australian Quarantine Inspection Service) required labels showing the country of origin to be attached to each of the drums and that the containers and drums should be very clean. She told Mr Hu of these requirements. She said that she ensured that labels "Made in China" were attached to the drums. She said that accompanying commercial documentation referred to Singapore (or Port Kelang) as the country of origin.
82 Ms Jing stated that after the first shipment arrived she telephoned Vice President Ping at Kunshan Foods and asked her to confirm that the honey was Chinese. Ms Ping told her that she should not be concerned about the source of the honey because it was "normal transit trade" (that is a normal part of trade to import goods into one country on their way to another). Ms Ping told Ms Jing not to be "nosey" and just follow the Chinese instructions. Ms Jing said that she also mentioned to Ms Ping "mixing the imported honey with Australian honey" and that Ms Ping agreed that she (Jing) should try to get hold of some Australian honey.
83 Ms Jing said that she spoke to Mr Lam on the telephone and at a meeting about the unsuccessful inquiries to obtain Australian honey.
84 Ms Jing first said that she, Hu and Lam had a meeting at a coffee shop near Mr Hu's factory. She subsequently corrected this statement by deleting the reference to Mr Hu being present at the meeting. He was not present. She said that she told Mr Lam that there was no chance of obtaining Australian honey and asked him what she should do. She said Lam replied, "There's another way to do this. If all the costs of the importation together are over 30 per cent, in other words, if the costs like shipping, transport, Customs duties, clearance costs, storage and cleaning costs are taken together and are more than 30 per cent of the original price, you can say that it's Australian honey." She said that they did not discuss whether the imported Chinese honey would or could meet these criteria.
85 Ms Jing said that from 2 August 2001 onwards, the shipments of honey began to steadily arrive, that she did not mention the question of payment and costs as to the containers to Mr Lam at any stage, that she did not check the costs but left all that to Mr Lam, paying him what he asked from the money received for the exports to the USA. She was aware that Mr Lam used the Customs broker, Woodford, to clear the containers through Customs. She never met Mr Woodford. She said that Mr Lam organised the clearances, quarantine inspections and the later exports of the 125 container loads of honey and that he assisted her with everything which needed to be done.
86 She said that she provided Mr Lam with copies of all the commercial documents for the containers of honey and that she usually received these documents in the post from Kunshan Foods. Mr Lam notified her of a time when she could attend at White's to put the Australian origin labels on the drums of honey. She said that Mr Lam made arrangements for the export of the honey to the USA leaving sufficient time after the goods arrived so that Mr Hu and she could remove the existing "Made in China" labels on the drums and replace them with labels stating that it was Australian honey. In her unsigned statement she said that Mr Hu had these labels printed up. She said in paragraph 4 of her affirmation of 18 June 2007 that this statement was not true and correct and should be deleted.
87 Ms Jing said that Mr Lam organised for the exportation of the honey on suitable vessels in accordance with the instructions she received from China and passed on to Mr Lam including as to the split-up of the drums in incoming containers. If she did not hear from Mr Lam when she thought she should she telephoned his office. Her assertion that she never spoke to anyone at Unicargo other than Mr Lam on major matters is probably correct having regard to the language difficulties, and Mr. Lam speaking some Mandarin. Ms Jing said that on occasions she met Mr Lam at White's when Mr Hu and she were putting Australian labels on drums of honey.
88 Ms Jing said that the only physical work she did as to the Chinese honey was washing any leaking honey and other dirt from the outside of the drums, detaching the "Made in China" labels and putting the new ones on. She said that in this task she was always helped by Mr Hu who drove her to Sydenham each time that word was received from Mr Lam that a new consignment had arrive at White's. She added that on occasions Mr Hu hired someone to help with the cleaning and re-labelling.
90 She said in her unsigned statement that as to the exportations of honey Mr Hu and she used the names Jing Wei International Trading Pty Ltd, JW International Trading Pty Ltd, JHM Trading Co and CHS Enterprises as owners of the goods (para 21). In paragraph 5 of her affirmation she said that paragraph 21 was incorrect and should read:89 Ms Jing was aware that millions of dollars were paid into the various bank accounts from the USA. She said that she remitted moneys from these accounts at HSBC to China as requested.
"In relation to the exportations of honey, my ex husband and I used the name Jing Wei International Trading Pty Ltd (or abbreviated as, and also known as, International Trading Pty Ltd) and CHS Enterprises Pty Ltd, the first defendant, which belongs only to my ex-husband. As to the importations, JHM Trading Co which belongs to me was used and CHS Enterprises Pty Ltd was used."
91 I gathered from some of the documents that the abbreviated name of Jing Wei International Trading Pty Ltd was JW International Trading Pty Ltd92 Ms Jing said that she went to China about 17 August 2002. There Ms Ping told her that similar honey import and export ventures set up in Thailand and Malaysia had been raided by Customs authorities in those countries. Ms Jing said that she was encouraged by Ms Ping to stay in China and she (Jing) stayed there for about 18 months. Ms Jing said that in late August 2002 Mr Hu telephoned her in China stating that Australian Customs had executed warrants at his commercial premises. She returned to Sydney from China about 29 March 2004.
93 Ms Jing said that Mr Hu was not in charge of the importing and exporting of honey during the period mid 2001 - mid 2002, that she was in charge but he assisted her. He drove her to Sydenham because she did not drive her motor vehicle as she was too scared to drive. She said that he not only transported her but he also assisted in detailed work. Generally Mr Hu would stay with her, do the tasks with her and they would leave together. Ms Jing said that the FAX and telephone services used by her when dealing with the Chinese side were located at Mr Hu's business premises. Generally she received the telephone calls and FAXES from China but when she was not present at Mr Hu's business premises Mr Hu passed these on to Ms Jing to whom they were directed.
94 It was pointed our that the statement of claim was filed on 27 July 2004, that Ms Jing and Mr Hu separated on 17 August 2004 and that they were divorced in March 2006.
95 At the hearing on 17 July 2007 there was some confusion as to the labelling of the drums. Cross-examining counsel endeavoured to clarify this matter early on 18 July 2007. Ms Jing said that when the drums of honey came in from China there were labels on those drums, sometimes the labels did not mention the place of manufacture or the manufacturer. AQIS required the importer to "put on the place of the product". She put labels on drums when AQIS required them to carry further information. The first set of labels was put on the drums on the same day as she cleaned the drums. She had a second set of labels stating the Australian origin of the honey. Such labels were put on the drums after they had been cleaned and on a different day.
96 Ms Jing agreed that it was she who gave instructions to Unicargo about anything that was to happen with the movement of the imported honey when it arrived in Australia and that she instructed Unicargo to have the imported drums of honey stored until she was ready to export them.
97 Ms Jing said that Mr Lam was not present at the warehouse for the first shipment of the goods (honey) but he was present once or twice at the warehouse when she put labels on other shipments. Ms Jing said that after she received instructions from the Chinese as to the export of containers to various places in the USA she sent a FAX to Mr Lam.
98 Ms Jing agreed that she provided all the documents to Mr Lam which were used to make her import declarations to Customs and that she provided the documents to Mr Lam to make her export declarations to Customs including the commercial invoices for her exports to the USA which stated that the goods were of Australia origin. She denied telling Mr Lam that the honey would be processed in Australia before it was exported to the USA.
99 Ms Jing was adamant that Mr Lam told her that if she wanted to import honey and then export to another country as Australian honey the imported honey had to be mixed with local Australian honey and also that if the total cost of exporting the honey is 30 per cent more than the import price the honey could be claimed to be of Australian origin. Ms Jing denied that at her first meeting with Mr Lam he told her it was necessary to have 50 per cent Australian content for the honey to be classed as Australian honey.
100 Ms Jing said that she was planning to mix Australian and Chinese honey but no Australian honey could be obtained and that she told Mr Lam about that. Ms Jing said that she told Mr Lam that the honey "should be all ready" because the Quarantine inspections always inspect the honey and they would take some samples and check the product and that the department always provided me the testing report, check the report, … that means the imported honey has already met the Australian requirements." She said Mr Lam then told her, "There should not be any problem, I am an honest man and I will not do any illegal things." This alleged conversation was in issue and I am unable to make a finding as to it.
101 Ms Jing, when asked whether she had told Mr Lam that when she put Australian origin on the export commercial invoices that that was not the truth replied that "because 'we' once mentioned about it."
102 Ms Jing agreed that she did not tell Mr Lam that she was not mixing or did not mix Chinese and Australian honey.
103 Ms Jing said that all the dealings with Whites were conducted by Mr Hu and that he came to White's once. None of Mr Lam's staff went to Whites to help her work on the drums.
104 After Ms Jing gave evidence before Howie J on her plea of guilty there was a telephone conversation between Ms Jing and Mr Lam. She stated that he said, "I hope you can say that I didn't know anything about this." However, Mr Lam stated that he said, "I hope that you are not going to distort the facts." She denied that and maintained that her version of what was said was correct. Ms Jing said that Mr Lam did not threaten her during the conversation. Both Mr Lam and Ms Jing impressed me as strong and determined. Mr Lam appeared to be blunt and forceful and Ms Jing as wily and manipulative and anxious to have her share of responsibility and wrong-doing reduced. I am not able to determine even on the balance of probabilities what was said.
105 Mr J S Woodford, Customs broker stated that he had dealt with Unicargo since 1989 and on a daily basis in 2001/2002. He described the procedure as to the processing/clearing of goods on Unicargo's behalf. When a shipment of goods is to be lodged Unicargo sent him a FAX stating the relevant information as to the shipment to be cleared. This FAX included at least copies of the commercial invoices, bill of lading for the shipment, an instruction sheet, packing list if held, packing declaration and, if needed, fumigation certificate and certificate of origin. He registered the documents internally, created a Customs Nature 10 Entry and electronically lodged this entry on behalf of Unicargo's client with Customs. If there was a query from Quarantine he notified Unicargo as to what had to be done and the created an electronic JEMS entry and they would deal directly with Quarantine. If there were no problems with the shipment once it had arrived and the status had been cleared by Customs, he made the appropriate payment to Customs.
106 Prior to this the consignee of the goods had received an arrival notice and Ms Jing advised Unicargo.
107 Mr Woodford agreed in cross-examination and as is evident from the Entry for Home Consumption that the Customs Entry declares the tariff heading from Schedule 3 of the Customs Tariff Act and the amount of duty and GST to be paid. Mr Woodford indicated that the Customs broker accepts the invoices supplied to him at face value unless he sees something that he feels is not correct. If he has no reason to query the value or description etc he does not make any checks.
108 Ms A Patrick was the owner and manager of White's Heavy Haulage. White's is a general transport company, one of whose clients is Unicargo. She dealt with Gordon Lam on major matters and David Cho , the office manager on operational matters. She said that in August 2001 Mr Lam contacted her about transporting and handling cargo on behalf of Unicargo's client, JHM Trading Company. She was advised that it would be importing and re-exporting drums of honey in 20 foot shipping containers. On the containers being transported to White's storage facility White's unpacked the drums from the containers, stored them in its warehouse, repacked the drums into new designated 20 foot shipping containers and transported the containers to the wharf for export.
109 Ms Patrick said that in the period August 2001 to May 2002 she met with Gordon Lam on about three occasions at White's Sydenham warehouse with such meetings being in response to telephone calls to him complaining about the messy and dirty state of the drums and the containers. He said that he would get on to the owners. He stated that the owners would arrange for the drums to be cleaned. He asked her to tell him when the drums were unpacked and said he would tell the owners. Shortly after her first complaint, Mr Lam attended with Mr Hu and Ms Jing (introduced as Robin Hood and Corina) whom Mr Lam said were the owners of JHM Trading Company. Ms Patrick had difficulty in understanding the English expression of Mr Hu and Ms Jing.
110 From time to time thereafter either Ms Jing or Mr Hu or one of them attended at White's premises and brought with them about five to six helpers. On most occasions it was Ms Jing who attended. She supervised the cleaning of the drums and cleaned some herself. This process took place from about 6pm to 9pm at least three times per week and sometimes on weekends in the period August 2001 – May 2002. Ms Patrick said that except when she was off site the owners came to see her. During the period mentioned and to date White's premises have always been secured by a locked gate when no-one was working there and by guard dogs. Some of the drums were stored in an unlocked shed and from time to time when there was insufficient room in the shed some drums were stored in the yard outside the shed. It was not suggested that there had been any outside interference.
111 In cross-examination Ms Patrick agreed that Ms Jing was usually driven to White's premises by Mr Hu. On some occasions Mr Hu dropped Ms Jing off and drove away. On other occasions he attended with her. He was not there as much as she was. Ms Patrick did not keep a record. She was unable to say whether he stayed on but about four occasions. She was aware that he operated a printing business.
113 Mr M Hollis, a Customs officer, said that while assisting in the execution of a search warrant at the Petersham premises on 22 August 2002 he saw Mr Hu enter the premises. A little later he saw a black steel drum on the top row of a pallet rack. Mr Hollis drew a sample of the contents of the drum. In the afternoon he attended, again with other officers, at White's premises. A warehouse was full of black drums which bore labels which read:112 Ms Patrick said that she did not deal with Mr Lam on an operational basis but with Unicargo's staff. She said it was not unusual for imported containers to be brought to White's premises and unpacked, the contents stored and then exported within a short period.
NW 290 KGS" CMS
GW 311.50 KGS
Expiry Date July 2004
Made in China"
115 On 4 September 2002 Mr M L Murray, a Customs Officer assisted by Mr Hollis conducted a lengthy interview with Mr Hu. Mr Murray told Mr Hu of the allegations he was investigating, namely, that :114 The date "22 August 2002" may need to read "23 August 2002".
(b) JHM Trading, CHS Enterprises Pty Ltd, JW International Trading Pty Ltd, Jing Wei International Trading Pty Ltd and Mr Hu or other persons using names on behalf of such bodies intentionally applied a false trade description to goods intended or entered for export etc.(a) JHM Trading, CHS Enterprises Pty Ltd, JW International Trading Pty Ltd, Jing Wei International Trading Pty Ltd and Mr Hu or persons using names on behalf of those bodies knowingly or recklessly made a statement to an officer of Customs that is false or misleading in a material particular.
116 I have listened to the tapes at length. There are parts which are not easy to follow and parts where it is not possible to ascertain what is being said. The latter are described in the tapes transcript as "indecipherable". There are frequent "beeping" sounds on the tapes and sometimes the various noises obscure what is being said. The transcript is substantially accurate and generally the differences between the transcript and what I thought was being said are too minor to trouble about. There is one matter I would mention. On p 24 of the transcript this is recorded:
The interview reveals that Mr Hu's English comprehension and expression are restricted but sufficient to do business and generally get by
Hood: I think was called (indecipherable) or something.""Murray: Okay, so who is the company in Singapore that your wife might be dealing with
In lieu I thought Mr Hu's response was:
316 As to these 18 shipments Customs alleged and averred that Mr Lam acting on instructions from Mr Hu and Ms Jing and using Unicargo gave instructions to Woodford to clear the honey through Customs and on the instruction and advice of Mr Hu and Ms Jing, Unicargo gave Woodford documentation to clear the goods through Customs including documents from a fictitious Singaporean supplier. I am satisfied that Mr Hu did not give instructions as averred. Customs asserted and averred, correctly, that Ms Jing, Unicargo and Mr Lam knew that the honey was not Singaporean, but Chinese. Mr Hu was in a different position. He was not concerned with the preparation of the Entry for Home Consumption and the making of a false statement or a false trade description. While he knew that the honey being imported by Ms Jing came from China he was not directly or indirectly involved in organising those imports. However, he frequently took Ms Jing to White's and collected her, sometimes stayed with her and helped her and, on occasions, engaged and paid students to help her. While the assistance he provided is useful evidence as to his knowledge that Chinese honey was being imported and exported as Australian honey and that Customs procedures had to be followed he was not directly or indirectly concerned in making false statements to Customs or importing any goods to which a false trade description was applied nor did he realise that this was occurring.
317 Customs has proved beyond reasonable doubt that in respect of each of the 18 shipments specified when a false entry was produced to Customs Ms Jing intentionally made a statement to an officer, reckless as to the fact that the statement was false or misleading in a material particular contrary to s 234(1)(d)(i) of the Customs Act in that each Entry for Home Consumption produced to Customs, whether in the name of CHS or JHM Trading Company (Ms Jing) stated that the country of origin of the honey being imported was Singapore, whereas the true country of origin in each case was China. Again Ms Jing caused documents to be transmitted to Mr Lam and he caused Unicargo to transmit documents to Woodford which led to him submitting the false Entries in question.
318 In dealing with Import Shipment 1, I referred to the defences of Unicargo and Mr Lam and rejected them. Unicargo and Mr Lam relied on the same defences in respect of all the 18 import charges mentioned. For substantially the reasons given earlier I would reject such defence to these 18 import charges.
319 Customs has proved beyond reasonable doubt that Unicargo and Mr Lam were directly concerned in the commission of the 18 specified offences by Ms Jing contrary to s 234(1)(d)(i) of the Customs Act . (See also s 236 of that Act). While Mr Hu exercised the functions which I have previously outlined both initially and during the import shipments and notwithstanding the averments I am satisfied that Mr Hu was not involved in or concerned with the submission of incorrect or incomplete documentation to Woodford or the making of the false entries which have been proved in respect of the 18 specified shipments. He was not directly or indirectly concerned in the commission of the 18 specified offences by Ms Jing. She in conjunction with Kunshan Foods arranged those shipments and arranged with Mr Lam, acting via Unicargo, for the submission to Woodford of the documents to clear the honey through Customs, including documents from a fictitious Singaporean supplier. Mr Hu was not a party to what Ms Jing did. I have not overlooked that she used the facilities of CHS. I would not convict Mr Hu of any of the offences charged.
320 Customs has proved beyond reasonable doubt each of the false trade description charges in respect of the 18 specified Import shipments, namely that Ms Jing imported goods (honey) to which a false trade description was applied, contrary to s 9(1) of the Commerce (Trade Descriptions) Act 1905. The Entry for Home Consumption produced to Customs, whether in the name of CHS or JMH Trading Company (Ms Jing) for each of the 18 specified importations stated as to the country in which the goods were produced, and in a manner likely to lead to the belief that that statement described the imported goods, that the country of origin of the honey being imported was Singapore whereas its true country of origin was China.
321 I reject the defences of Unicargo and Mr Lam to these charges for the reasons given earlier. Customs has also proven beyond reasonable doubt that Unicargo and Mr Lam were directly concerned in the commission of the 18 specified offences by Ms Jing contrary to s 9(1) of the Commerce (Trade Descriptions) Act 1905. I repeat that while Mr Hu exercised the functions and did the acts both initially and during the import shipments previously outlined and notwithstanding the averments I am satisfied that Mr Hu was not involved in or concerned with the submission of incorrect documentation to Unicargo, Mr Lam or Woodford or the making of the false entries which have been proved in respect of the 18 specified shipments. Mr Lam was not acting on the instructions of Mr Hu but those of Ms Jing. Mr Hu was not concerned in the commission of the 18 specified offences by Ms Jing. I would not convict Mr Hu of any of the alleged offences.
Import Shipment 5
322 Customs alleges and avers that on or before 31 December 2001 and acting on instructions from Mr Hu and Ms Jing, Mr Lam, using Unicargo gave instructions to Woodford to clear the honey (204 drums in 3 containers) through Customs and on the instruction and advice of Mr Hu and Ms Jing, Unicargo gave Woodford documentation from which Woodford declared to Customs that the origin of the honey was not known. I am satisfied that Mr Hu did not give any instructions. Mr Hu, Ms Jing, Unicargo and Mr Lam knew that the origin of all honey imported was not unknown but Chinese. On 31 December 2001 Woodford, on behalf of Ms Jing produced to Customs a Nature 10 Entry for Home Consumption for the 3 containers imported, stating the owner of the honey as JHM Trading Company, the contents as "204 (drums) of natural bees honey" and the origin of the goods as unknown. Customs asserted that Ms Jing's statement to Customs as to the origin of the goods was false. Mr Lam, Unicargo and Woodford were not acting on instructions from Mr Hu but solely on those of Ms Jing.
323 Customs has proved beyond reasonable doubt that on or about 31 December 2001, for import shipment 5, when a false entry was produced to Customs, Ms Jing intentionally omitted from a statement made to an officer a matter or thing reckless as to the fact that without the matter or thing the statement was misleading in a material particular contrary to s 234(1)(d)(ii) of the Customs Act in that the Entry for Home Consumption produced to Customs in the name of Ms Jing for that shipment stated that the country of origin of the honey being imported was unknown whereas the country of origin was known, and was China.
324 I reject the defence of Unicargo and Mr Lam to the charge in respect of import shipment 5 for the reasons earlier given. Customs has also proved beyond reasonable doubt that each of Unicargo and Mr Lam was directly concerned in the commission of the offence as to import shipment 5 and the misleading entry by Ms Jing contrary to s 234(1)(d)(ii) of the Customs Act . See also s 236. Notwithstanding the averments and the conduct of Mr Hu, I am satisfied that Mr Hu was not involved in or concerned directly or indirectly with the submission of incorrect documentation to Unicargo, Lam or Woodford or the making of the misleading entry which has been proved in respect of import shipment 5. He was not concerned in the commission of the offence by Ms Jing. I would not convict Mr Hu of the alleged offence.
325 There was no false trade description charge for Import Shipment 5.
Amendments to Statement of Claim
326 At the start of the hearing Customs sought to amend its Statement of Claim by amending sub-para (v) in para 26 as to each of Import Shipments 1, 2, 3, 4, 5, 9, 11-14, 17-26 by deleting the words "the Fifth Defendant told Woodford that the honey was Singaporean and gave him documents on the letterhead of a fictitious Singaporean supplier" and substituting "the Fourth Defendant gave Woodford documentation to clear the goods through Customs, including documents from a fictitious Singaporean supplier".
327 These amendments which had been earlier foreshadowed were not opposed and I granted Customs leave to make the amendments. Because the Statement of Claim was so lengthy and a substantial number of paragraphs needed to be amended it took some days to produce an Amended Statement of Claim, but one was handed up at the start of proceedings on 23 July 2007. I did not regard this as unreasonable. The opposed amendments relate to some of the export shipments.
328 In the closing written submissions of Customs (p.11) it was pointed out that as to the first export, the principal was alleged to be CHS and that as to the remaining exports the principal was alleged to be Ms Jing because the exports were made in the name of JW International Trading Pty Ltd which was not the registered name of her company which was Jing Wei International Trading Pty Limited. Customs intimated that each of the remaining defendants was charged with being directly concerned in the commission of the substantive offences.
329 During her address (T 258) counsel for CHS said that she understood that the claims against CHS had been amended to some extent, in that there was an allegation in relation to four exports but that was reduced only to the first export. Counsel for CHS said that she understood that sub-paras (ii), (iii) and (iv) of para 72 (p138 of the Amended Statement of Claim) and sub-paras (ii), (iii) and (iv) of para 59 (pp133 -134 of the Amended Statement of Claim) were to be deleted. There were minor consequential amendments. (Para 59 deals with false statement charges and para 72 with false trade description offences – s 12(1)(b) of the Commerce (Trade Descriptions) Act .
330 Counsel for Customs (T258) confirmed that it was alleging that CHS was involved in one shipment, namely Export Shipment 1.
331 In his closing submissions in reply counsel for Customs stated (T273) the changes which Customs wished to make to the Amended Statement of Claim as to the position of CHS. These are set out at TT274-276. Counsel for Customs stated that there were consequential changes that needed to be made as to offences alleged against the aiders and abettors etc.
332 Counsel for Customs explained that CHS was nominated as the principal for Export Shipments 2, 3 and 4 because CHS was nominated presumably by Mr Lam and/or Unicargo as being the exporter whereas the commercial documents were in the name of JW International Trading Pty Ltd and that made Ms Jing the principal.
333 Counsel for CHS and Mr Hu did not oppose the allegations against CHS being dropped, but she did oppose suggested amendments to para 60 (p134 of Amended Statement of Claim) and para 73 (p138). Customs was directed to serve a proposed Further Amended Statement of Claim on the defendants appearing before me setting out all the amendments it desired.
334 On 23 July 2007 I reserved my decision on the substantive merits and indicated that if, after the proposed Further Amended Statement of Claim was served there was no agreement, the question of amendments should be argued. There was no agreement and the question of the further amendments desired by Customs was argued on 3 August 2007. CHS did not oppose the proposed amendments deleting the charges against it as to the second, third and fourth exports. Mr Hu opposed the proposed amendments. Unicargo and Mr Lam neither consented nor opposed the amendments sought by Customs. Ms Jing was not a party to the application of Customs. That does raise a problem as further offences by her are being alleged. The proceedings against her are part heard before Howie J so that even if she had been given notice of Customs' application I doubt if it would be correct for me to deal with it so far as it affects her. It was not suggested that she had been given notice of Customs application. Its attitude was that she should be treated as a witness in the proceedings before me.
335 Counsel for Customs reminded me that as the evidence emerged there were some possible differences between the evidence and how Customs had pleaded the matter as to the second, third and fourth exports of honey. Unicargo and/or Mr Lam had shown CHS as the exporter whereas the exporter was Ms Jing according to the documents. She was responsible and therefore should be the principal in the offences arising out of the second, third and fourth exports. Because of the length and complexity of the Amended Statement of Claim the amendments desired were intricate and took some time to effect and check.
336 Customs relied on s 251 of the Customs Act 1901 . That provides, inter alia, that no objection shall be allowed to any originating process for any variance between such originating process and the evidence and that the Court shall at all times make any amendment necessary to determine the real question in dispute or which may appear desirable. The section envisages the defendant being given an adjournment to meet the position arising from the amendment.
337 Customs pointed out that in a case such as this and particularly with these exports the facts were peculiarly within the knowledge of the defendants. The facts were within the knowledge of Ms Jing but probably not within the knowledge of Mr Hu. Unicargo and Mr Lam apparently relied on what had happened previously, that is, with Export Shipment 1.
338 Customs submitted that as the amendments were required to fit in with the evidence, the Court was required to make the amendments sought. Customs conceded that if an adjournment was required by any of the defendants, that should be granted.
339 Customs submitted that Mr Hu could not reasonably oppose the amendments as Customs relied on the same factual matters as to the commission of the offences albeit by Ms Jing (his then wife) rather than CHS (his company) and the same matters are put as to how he was concerned in the offence.
340 Counsel for Mr Hu said that essentially the basis of the objection to the amendments was the very late stage at which they were sought to be made. Counsel submitted that after the close of both Customs' case and the cases of the defendants it was too late for amendments that prejudice a defendant. Counsel pointed out that not only had the cases of the parties closed, but addresses had finished, the hearing had concluded and judgment had been reserved. Counsel submitted that the time had been reached where s 251 could no longer have effect. Counsel contended that the prejudice to Mr Hu was that he was "being asked to meet a different charge, certainly different particulars as to those charges, once the whole case is over." Counsel urged the Court not to speculate whether the defence would be run in a different way.
341 I enquired of counsel for Mr Hu whether, if I were to allow the amendments sought, there would be any additional evidence to be called. Counsel replied that she would have to turn her mind to that, but probably not. She did not wish to close off the opportunity. She stated that the submissions in relation to those extra charges would be very similar to those in relation to the other charges. Counsel stressed the penal consequences attached to those charges found proved and that they involve convictions.
342 Customs submitted that Mr Hu was seeking to read into s 251 a limitation which does not exist. The Court was required "at all times" to make any amendment necessary. Customs contended that no prejudice would be suffered by Mr Hu as these were not new charges, that it was exactly the same charge on exactly the same evidence. The amendments just nominated a different principal.
343 Customs stated that if the Court thought that the presently proposed amendments should not be allowed then Customs withdrew the amendments previously made and adhered to the position as in the Amended Statement of Claim, that is Customs would not delete the sub-paragraphs as to Export Shipment 2, 3 and 4 alleging that CHS was the principal and that Mr Hu aided and abetted CHS. Customs contended that in such a case Mr Lam's (or Unicargo's) representation that the principal for the second, third and fourth Export Shipments was CHS would be sufficient. Customs also submitted that s 251 of the Customs Act would require the Court to ignore the differences between the charges and the evidence.
344 While Customs submitted that it was better for the amendments it now sought to be made because the charges and the evidence would fit together and the result would be tidier, Customs further submitted that the amendments sought would not, because of s 251, make any difference to the final outcome. It contended that Ms Jing, who was not a party as she has pleaded guilty, was the only person "who loses out" but she was not affected. Her proceedings are before Howie J.
345 It is necessary to return to the words of the sections creating the offences. Section 234(1)(d)(i) of the Customs Act makes it an offence for a person to intentionally make a statement to an officer reckless as to the fact that the statement is false or misleading in a material particular.
346 That involves looking at the intention of the person making the statement. Did that person intentionally make a statement to an officer? It also involves asking whether the statement made to the officer was reckless as to the fact that the statement is false or misleading in a material particular. The question is whether CHS made such a statement or Ms Jing (or both) made such a statement. If CHS intentionally made such a statement reckless as to the fact that the statement is false or misleading in a material particular that is one offence. If Ms Jing intentionally made such a statement reckless as to the fact that the statement is false or misleading in a material particular that is another. The intentions may differ and what may be reckless in one instance may not be reckless in another. It is a different offence to aid and abet etc an offence by CHS than to aid and abet etc an offence by Ms Jing.
347 Section 12(1)(b) of the Commerce (Trade Descriptions) Act makes it an offence for a person to intentionally export or enter for export etc any goods to which a false trade description is applied. The intention of the person exporting or entering for export etc the goods has to be ascertained. Did he, she or it intentionally export or enter for export the goods to which a false trade description is applied. The question is whether CHS or Ms Jing or both did so. If CHS did so that is one offence. If Ms Jing did so that is another. It is a different offence to aid and abet etc an offence by CHS than to aid and abet etc one by Ms Jing.
348 The curative effect of s 251 applies to any variance between any information, summons or other originating process and the evidence. The Court is required at all times to make any amendment necessary to determine the real question in dispute or which may appear desirable. It is one thing to have a variance between the originating process and the evidence on such matters as the destination of the containers, the dates of the export clearances and other matters of detail. It is another matter where there is a different substantive offence that is the subject of the alleged aiding and abetting etc. In my opinion s 251 cannot be used to support or justify the amendments now being sought. Nor can general common law principles be relied upon to justify the proposed amendment. I am not unsympathetic to the difficulties faced by Customs in dealing with the many matters which have arisen, their complexity and the mass of detail. The proposed amendments are sought at a very late stage of the proceedings in respect of matters that involve convictions and financial penal consequences . The maximum penalties which may be imposed are substantial.
349 Reference should also be made to the whole of s 257 of the Customs Act , the terms of which have been set out earlier. Amongst other matters, that facilitates proof of the state of mind of a body corporate and deems certain conduct by specified people to be engaged in on behalf of a body corporate or other person for the purposes of the Customs Act . Section 257 does not provide any direct or indirect warrant for the amendment sought.
350 In my opinion Customs should not be given leave to further amend its statement of claim as it proposes involving the substitution of Ms Jing as the principal offender as to Export Shipments 2, 3 and 4 and consequential amendments.
351 This means that Customs relies on its Amended Statement of Claim and CHS being shown as the principal offender as to Export Shipments 2, 3 and 4 and the related export clearances.
352 In my opinion Customs is not entitled to rely on s 251 of the Customs Act 1901 nor general common law principles to have the Court treat the different offences with different principal offenders as a variance between the charge or originating process and the evidence.
Export Shipments 2, 3 and 4
353 Ms Jing was only authorised to use CHS as the vehicle for the first export clearance. As to the second, third and fourth export shipments and the related export clearances Ms Jing was not authorised to use CHS as the vehicle for the export shipments and the related Export Clearances, nor were Unicargo and/or Mr Lam authorised to lodge Exit Declarations and arrange export clearances on behalf of CHS. Unicargo and Mr Lam appear to have carried on from Export Shipment 1 and to have assumed that that arrangement continued to apply to Export Shipments 2, 3 and 4.
354 As to each of Export Shipments 2, 3 and 4 it appears that Unicargo was supplied with a Commercial Invoice on the letterhead of JW International Trading Pty Ltd showing it as the exporter of drums of Australian Bee's Honey, the number of drums being specified. Each such invoice bore the signature of Corina Jing as Director and contained instructions as to payment. As to Export Shipment 2, the Bill of Lading showed the shipper as JW International Trading Pty Ltd. The Bill of Lading for Export Shipment 3 and that for Export Shipment 4 showed the shipper as Unicargo.
355 The statement of Ms K E Lathlean explains the Customs Export Clearance System. The reporting of exports can be electronic and exporters must utilise the Customs G & T system, Exporters may choose to register with Customs to connect to EXIT and communicate export entries to Customs directly, or may utilise the service of a third party or agent to communicate information about exports on their behalf. If the party lodging the export entry meets the minimum reporting requirements for an export entry, Customs will issue the party lodging the entry with an Export Clearance Number (ECN). A clear ECN is the legal authority to export goods from Australia. The Entry must contain the Commodity Classification Code, the Origin Code (specifying the State or Territory in Australia and goods of foreign origin re-exported) a Goods Description and the Owner's ABN/Name, inter alia. The person completing the Declaration declares whether he is the owner (including an employee of the owner) or agent of the owner and that the information provided is complete and correct.
356 The Entries for Export Shipments held by Customs reveal that on 12, 15 and 16 October 2001 export entries were lodged with the owner shown as CHS and the consignee as DF International (USA) Inc. The Goods Description given is "Australia Bee's Honey" . These are in addition to similar entries held and lodged on 7 August 2001 except that the consignee is National Food Products Inc. The entries lodged on 12, 15 and two on 16 October appear to correspond with Export Shipments 2 and 3 as they involve the same consignee. One of the entries on 16 October 2001 appears to correspond with Export Shipment 4, although the consignee should be Natural Food Products Inc according to the Commercial Invoice. In the averment as to Export Shipment 4 in the Amended Statement of Claim (para 58) it is stated that on 16 October 2001 Mr Lam on behalf of CHS and on the instructions of Mr Hu and Ms Jing, used Unicargo to access EXIT and by transmitting purported details of the consignment to Customs generated an ECN for the goods in specified containers being 204 drums of Chinese honey.
357 It is beyond argument that the description "Australian Bee's Honey" was false and known to be false by Ms Jing, Unicargo and Mr Lam.
358 In inserting "CHS" as the owner of the drums of honey Mr Lam and Unicargo made a mistake to which neither Mr Hu nor Ms Jing contributed. Unicargo and Mr Lam had no authority to insert the name of CHS as the owner of Export Shipments 2, 3 and 4. In each instance Ms Jing caused a Commercial Invoice to be sent to Mr Lam and Unicargo showing the owner as JW International Trading Pty Ltd. While Mr Hu was aware that the honey Ms Jing was importing and exporting was Chinese honey he did not issue any instructions to Mr Lam. Ms Jing did. She arranged for the export of the honey covered by Export Shipments 2, 3 and 4.
359 I would not convict Mr Hu of the offences with which he has been charged as to export shipments 2, 3 and 4 in the Amended Statement of Claim. The position of Unicargo and Mr Lam is somewhat different. They caused the wrong principal to be shown on the EXIT declaration, but in my opinion they were not directly or indirectly concerned with the commission of an offence by CHS. It did not commit the offence charged. The evidence suggests that Ms Jing did. The peculiar situation which has arisen as to these three charges as against Unicargo and Mr Lam was not argued before me as I doubt if the ramifications of the view I have taken were fully appreciated.
360 It will be apparent from what I have previously written that Customs has proved beyond reasonable doubt that as to this export shipment:Export Shipment 1
(ii) Mr Hu, Mr Lam and Unicargo were directly concerned in the commission of the offences by CHS mentioned in the previous sub-paragraph. (I had not included Ms Jing as she is being dealt with by Howie J).(i) CHS was guilty of the offence under s 234(1)(d)(i) of the Customs Act and the offence under s 12(1)(b) of the Commerce (Trade Descriptions) Act. Mr Hu specifically agreed to CHS being used by Ms Jing to effect this export and with his concurrence used the facilities of CHS to do so. Ms Jing gave instructions to Mr Lam and sent the documents to him and Unicargo caused the EXIT declaration to be made, which falsely stated that the honey being exported was Australian bees honey whereas the honey was Chinese honey. Mr Hu, Unicargo and Mr Lam knew that the honey being exported was Chinese. At the very least they were reckless as to whether the statement made was false. The chain extends from CHS, through Mr Hu and Ms Jing to Mr Lam and Unicargo and thence to the EXIT declaration which was false in a misleading particular. As to the offence under s 12(1)(b) CHS exported the honey having intentionally procured a Bill of Lading for its transport stating that the country of origin of the honey was Australia whereas it was China.
Export Shipments 6, 7, 9, 12, 13, 14361 As earlier mentioned there are 6 charges against Ms Jing under s 234(1)(d)(i) of the Customs Act of intentionally making a statement to an officer reckless as to the fact that the statement was false or misleading in that for each of the Export Clearances she stated that the honey being exported was Australian bees honey whereas the honey was Chinese.
362 Again as earlier mentioned there are 6 charges against her as to these shipments that contrary to s 12(1)(b) of the Commerce (Trade Descriptions Act she exported honey having intentionally procured six respective Bills of Lading to which a false trade description was applied, stating the country of origin of the honey was Australia whereas it was China.
363 Ms Jing has pleaded guilty to these charges. I am satisfied on the evidence before me that the Crown has proved its case against her beyond reasonable doubt. This is of consequence because Mr Hu, Mr Lam and Unicargo have been charged with being directly concerned in the commission of these offences. As to Mr Hu I am satisfied that he was neither directly or indirectly concerned in the preparation and submission of documents (including electronically) or instructions containing false statements to Customs nor was he aware that this was happening. Likewise he was not directly or indirectly concerned with the application of false trade descriptions being applied to the goods in the related Bills of Lading nor was he aware that this was happening. As to Unicargo and Mr Lam I am satisfied that Customs has proved its case against each of them on each charge beyond reasonable doubt. Each was aware of the statement being made and the description being applied to the honey and each knew it was false.
Export Shipments 5, 8, 10, 11, 15 16 and 17
364 Mr Hu, Unicargo and Mr Lam have each been charged with being directly concerned in the commission of 7 false statement offences by the then registered Jing Wei International Trading Pty Limited contrary to s 234(1)(d)(i) of the Customs Act and 7 false trade description offences by the then registered Jing Wei International Trading Pty Limited contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act . The latter applies to the related 7 export Bills of Lading. Again I am satisfied that Mr Hu was neither directly or indirectly concerned in the preparation and submission of documents (including electronically) or instructions containing false statements to Customs nor was he aware that this was happening. Ms Jing ran the business and communicated directly with Mr Lam and issued instructions. She did not tell Mr Hu what she was doing. I am satisfied beyond reasonable doubt that Customs has proved its case against Unicargo and Mr Lam as to each of the 14 charges mentioned. Each of Unicargo and Mr Lam was aware of the statement being made and description being applied to the honey and each knew the statement and the description were false. The honey came from China as each well knew. The statements were deliberately and intentionally made.
Export Shipments 5, 8, 10, 11, 15 to 39 (both inclusive)
365 Export Shipment 5 and the false description charge have been mentioned previously. Mr Hu, Mr Lam and Unicargo have each been charged with being directly concerned in the commission of 29 false trade description offences by the then registered Jing Wei International Trading Pty Limited. Nobody can be convicted twice of the charges as to export shipment 5.
367 In paragraph 17 of his statement of 6 September 2002 Mr Lam stated that after White's were instructed to store the drums of honey on their premises Unicargo would then arrange all necessary requirements for export of the drums of honey. Mr Lam continued:366 While Mr Hu became aware about halfway during the course of the exports that labels were being attached to the drums stating in effect that the honey was a product or produce of Australia, he was not concerned either directly or indirectly in having intentionally procured a Bill of Lading in any instance for the transport of the drums of honey which was produced in a manner likely to lead to the belief that the statement described the country of origin of the honey was Australia whereas it was China. I would not convict Mr Hu of any of the 29 charges.
"This included; arranging and procuring shipping containers for export, generating bills of lading, processing Customs export clearances, issuing instructions to Whites about transport and arranging shipping with a shipping company."
368 In paragraph 48 of his affidavit of 29 June 2006 Mr Lam stated that the commercial invoices to their overseas clients were produced by CHS. This work was done by Ms Jing mostly in the name of the entities she used and not by CHS. Mr Lam said that the invoices would be sent to rhe Unicargo export section "for actioning the export via a vessel". Mr Lam continued:
"An export entry would be made and the cargo would be booked on a vessel to be exported. I was also involved in the export as I would negotiate the carriage rate with the shipping line and I would sign the export bills of lading also. After the vessel had been booked we would input the Australian origin on to the export declaration as per the invoice. This situation and pattern continued for quite some time."
369 Mr Lam stated that after some time "Australian did not appear on the invoices and Unicargo did not declare Australian origin on the export declarations if Australian origin was not declared on the commercial invoice."
370 By way of example, taking Export Shipment 17, the commercial invoice on the letterhead of JW International Trading Pty Limited and faxed to Unicargo on 27 March 2002 apparently using the FAX of Fine Quality Masterprint and signed by "Corina Jing" does not state that the honey was of Australian origin. However, the Bill of Lading describes the honey as "Australia Bees Honey" and "Product of Australia." Unicargo and Mr Lam knew that the honey was of Chinese origin. What was put on the Bills of Lading as to the produce was false and false to their knowledge.
371 In paragraph 81 of the Statement of Claim and Amended Statement of Claim reference is made to "Jing Wei International Trading Pty Limited" exporting the honey but in many of the Commercial Invoices the abridged name of JW International Trading Pty Limited is used. I regard that as a variation to which s 251 of the Customs Act should be applied, if necessary. That section should also be applied as to paras 83 and 84 of both the Statement of Claim and the Amended Statement of Claim.
372 On the evidence I am satisfied beyond reasonable doubt that as to these 29 export shipments Customs has established that each of Unicargo and Mr Lam was directly concerned in each of these instances in the commission of the offence by the then registered Jing Wei International Trading Pty Limited (abridged to JW International Trading Pty Limited) of intentionally exporting goods to which a false trade description was applied contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act 1905 in that Jing Wei International Trading Pty Ltd (as abridged) exported the honey the subject of those 29 export shipments having intentionally procured Bills of Lading for their transport which stated as to the country in which the goods were produced, and in a manner likely to lead to the belief that that statement described the country of origin of the honey as Australia whereas it was China.
373 In summary I would convict:Import Shipment Convictions
(1) CHS as to import shipment 1 of an offence contrary to s 234(1)(d)(i) of the Customs Act and of an offence contrary to s 9(1) of the Commerce (Trade Descriptions) Act .
(2) CHS as to import shipment 2 of an offence contrary to s 234(1)(d)(ii) of the Customs Act.
(3) Mr Hu as to import shipment 1 of an offence contrary to s 234(1)(d)(i) and s 236 of the Customs Act and of an offence against s 9(1) of the Commerce (Trade Descriptions) Act allied with s 236 of the Customs Act.
(5) Each of Unicargo and Mr Lam as to each of import shipments 2 and 5 of an offence contrary to s 234(1)(d)(ii) and s 236 of the Customs Act .(4) Each of Unicargo and Mr Lam as to each of import shipments 1, 3, 4, 9-14 (both inclusive), 17-26 (both inclusive) of an offence contrary to s 234(1)(d)(i) and s 236 of the Customs Act and of an offence contrary to s 9(1) of the Commerce (Trade Descriptions) Act allied with s 236 of the Customs Act .
374 In summary I would convict:Export Shipment Convictions
(1) CHS as to export shipment 1 of an offence contrary to s 234(1)(d)(i) of the Customs Act and of an offence contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act.
(2) Mr Hu as to export shipment 1 of an offence contrary to s 234(1)(d)(i) and s 236 of the Customs Act and of an offence against s 12(1)(b) of the Commerce (Trade Descriptions) Act allied with s 236 of the Customs Act .
(4) Each of Unicargo and Mr Lam as to each of export shipments 5, 8, 10, 11, 15-39 (both inclusive) of an offence contrary to s 12(1)(b) of the Commerce (Trade Descriptions) Act allied with s 236 of the Customs Act .(3) Each of Unicargo and Mr Lam as to each of export shipments 1, 5 -17 (both inclusive) of an offence contrary to s 234(1)(d)(i) and s 236 of the Customs Act . (There were different principal offenders as to some of the charges).
376 I propose to stand these proceedings over for further hearing for these purposes:375 I propose to dismiss the other charges against CHS and Mr Hu. I am prepared to hear further argument if desired from Customs, Unicargo and Mr Lam as to export shipments 2, 3 and 4 consequent upon my refusal to allow the Amended Statement of Claim to be further amended.
(a) to allow the parties to consider the reasons including pointing out any matter that may appear to have been omitted
(b) to hear any further argument as to export shipments 2, 3 and 4
(d) to hear argument on the question of costs(c) to hear argument on the issue of penalties
377 I will list these proceedings for further hearing on a date to be mutually arranged with my Associate being not later than the week commencing 3 December 2007.
**********
0
3