CEO Customs v Labrador Liquor Wholesale & Ors

[2002] HCATrans 251

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B69 of 2001

B e t w e e n -

CHIEF EXECUTIVE OFFICER OF CUSTOMS

Applicant

and

LABRADOR LIQUOR WHOLESALE PTY LTD

First Respondent

LAWRENCE ERIC WRIGHT

Second Respondent

JEFFREY ANDREW JOHN BRYCE

Third Respondent

Application for special leave to appeal

GAUDRON J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON WEDNESDAY, 26 JUNE 2002, AT 11.11 AM

Copyright in the High Court of Australia

MR D.F. JACKSON, QC:   If the Court pleases, I appear with my learned friend, MR F.W. REDMOND, for the applicant.  (instructed by the Australian Government Solicitor)

MR J.S. DOUGLAS, QC:   May it please the Court, I appear with my learned friend, MS J. BRASCH, for the respondents.  (instructed by Forde Lawyers)

GAUDRON J:   Yes, Mr Jackson.

MR JACKSON:   Your Honours, as is apparent from the papers, this case gives rise, in our submission, to an important question concerning the operation of two Commonwealth enactments, the Customs Act and the Excise Act, and the decision also of the Court of Appeal is not consistent with other decisions of intermediate appellate courts in Australia and, indeed, has not been followed by other courts in Australia since it has been given.

CALLINAN J:   Mr Jackson, can you refer me to what is the clearest instance of a conflicting decision, please?

MR JACKSON:   Yes, certainly, your Honour.  Could I take your Honours to the supplementary volumes, if I may do so.  There are four, your Honour, to which I wish to refer.  The first is in New South Wales, one of two, I think, New South Wales cases.  It is No 7 in the supplementary materials behind tab 7.  It is the Court of Appeal New South Wales decision in Evans v Button, and your Honour will see, in particular, at page 73 – I think your Honours may have some tags on them.  It is a blue tag.

GAUDRON J:   That is before the decision that you are seeking ‑ ‑ ‑

MR JACKSON:   Yes, I am sorry.

GAUDRON J:   Yes.

MR JACKSON:   What I was going to do, your Honours, was refer really to two groups of decisions, the first being ones in answer to your Honour Justice Callinan, decisions that conflict in intermediate appellate courts.  The second was indicate three decisions where a contrary view has been adopted since the decision.  They are, it is right to say, single judge cases, I think, in each case.

Your Honours, page 73 between B and D your Honours will see in – this is Justice Mahoney speaking for the Court of Appeal – particularly C and D:

His Honour applied the appropriate civil standard of proof appropriately understood –

and so on.  Then I would refer your Honours to the paragraph immediately above that, about the last six lines, “The submission was, however”, and then a more positive conclusion on page 74 between E and F:

It was, in my opinion, the purpose of that provision –

referring to section 247 –

relevantly to assimilate customs prosecutions to proceedings of a civil nature.

The second is in Trade Practices Commission v Abbco Iceworks, which your Honours will see behind tab 9.

CALLINAN J:   This is Justice Burchett, is it?

MR JACKSON:   Yes, your Honour, although his was the principal judgment in the proceedings, I think it is right to say.  Your Honours will see in particular there the red and blue tabs, saying between C and D on page 111:

The close affinity . . . a criminal prosecution is plainly penal . . . but the converse will not always hold; a civil action for a penalty is not a criminal proceeding –

and some cases are referred to.  Then, your Honours, the yellow tab ‑ ‑ ‑

GAUDRON J:   Now, Mr Jackson, save for one aspect, we are minded at this stage to call on Mr Douglas, but the one aspect I would like you to comment on is that these were preliminary proceedings in a sense and they are not necessarily determinative of the outcome of the prosecutions and the Court has said on many occasions that the prosecution process should not be split in this way.

MR JACKSON:   Yes.  Your Honour, may I say in relation to that, first of all, the course of events which has taken place was that at the request of the other side, saying these were issues that needed to be determined in advance, we agreed to the statement of these four questions.

Now, your Honour, the course that has been taken in a sense in the decisions that have followed this indicate that there are issues that do arise – I am sorry, when I say the decisions that have followed it, I mean in terms of time as distinct from actually following it – indicate, in our submission, that the question of the standard of proof is one potentially of importance.  So too is the question of the admissibility of evidence.  That is referred to, I think, particularly in Justice Thomas’ reasons where he adverts to the fact that a question which arises is whether section 92 or section 93 of the Evidence Act 1977 of the State will be applicable.

CALLINAN J:   Mr Jackson, just explain to me why the Commonwealth Evidence Act did not apply.  Was it before it was enacted?

MR JACKSON:   I think that is so, your Honour.  I think that is the reason for it.

CALLINAN J:   Because ordinarily, and indeed perhaps now, why would not the ‑ ‑ ‑

GAUDRON J:   It does not apply to State courts, does it?

MR JACKSON:   Sorry, your Honour?

GAUDRON J:   It does not apply to State courts unless ‑ ‑ ‑

MR JACKSON:   Yes, I am sorry, your Honour.  Yes, I think that is the short answer, yes.  It is applicable in federal courts.

CALLINAN J:   Even in the exercise of federal jurisdiction ‑ ‑ ‑

MR JACKSON:   And the State law is picked up by a combination of – sorry, your Honour – section 24 and also the Judiciary Act provision.  Yes, I am sorry, your Honour.  So that is the issue that arises in that regard, and that is one of considerable importance.

GAUDRON J:   That is of importance in this matter and perhaps in Queensland, is it, but that is not an issue that is involved in the conflicting decisions, or perhaps it is, is it?

MR JACKSON:   Your Honour, there are two – I am sorry, I will put it this way.  Because the terms of the Customs Act and Excise Act operate distributively amongst the States, there will always be various issues arising at the interface, as it were, of criminal and civil proceedings.  Now, there are some differences in some States.  But the question of which is applicable is an issue which arises in every jurisdiction and, your Honours, it arises in every such case.  Could I just give your Honours a reference to – I said this decision had not been really followed.  It has been referred to, as I understand it – the courts have been referred to it in each of the three cases to which I am about to advert.

If I could take your Honours to the case behind tab 17.  It is a decision of the Supreme Court of Western Australia, again one of these types of cases.  At the top of the page numbered 6 where the blue tag is your Honours will see the reference to the civil proceedings, the reference to this case in the Court of Appeal, and he refers to the contrary line of authority.  His Honour, in fact, followed the contrary line of authority. 

Your Honours will see in the case behind tab 19 a recent decision of Justice Levine in the New South Wales Supreme Court where, in paragraph 17, with the red marker , there is a reference to:

The weight of authority seems to be that the civil standard of proof –

arises and that he could indicate that he would apply the Briginshaw test otherwise.  But, your Honours, that issue is one that keeps arising.  Also behind tab 16, a decision of Justice McDonald in Victoria, at page 16 in paragraph [60]:

required to conclude, as I do, that the standard of proof in the present proceedings is that enunciated by the High Court in Briginshaw v Briginshaw –

having regard to the earlier decisions in the previous paragraph, referring to the standard being that in civil jurisdiction.

GAUDRON J:   Mr Jackson, your client really does have a very important interest in determining this for the whole of Australia, I should think, and in a sense it may be a reasonable case – what would you do about costs, given that it may be a civil case?  Does your client wish to make an offer in that regard?

MR JACKSON:   Your Honour, if the Court were minded to grant special leave on terms that we had to pay the costs of the respondent, we would be in that situation where we would have to accept it.

GAUDRON J:   Yes, thank you.  Perhaps we will hear from Mr Douglas now.

MR DOUGLAS:   May it please the Court, in our submission there are three reasons why special leave should be refused.  First, the decision of the majority in the Court of Appeal was clearly right.  Second, the true solution to the issue is legislative, something that has been asserted by the Court for many years, and, thirdly, this is an interlocutory matter where the issue may not arise for determination after a trial, if, for example, the applicant can prove its case to the necessary standard according to the relevant rules of evidence.

May I address the first issue.  In our submission, the nature of a proceeding, not the mode of procedure, is the appropriate way to determine the standard of proof.  Witham v Holloway in this Court, in establishing that the requirement of proof beyond reasonable doubt was not limited to trials of criminal charges conducted in accordance with ordinary criminal procedure, established a principle which applies to these proceedings.

GAUDRON J:   You may well be right, but it seems in other jurisdictions that is not the view that is taken.  You say, “Well, let them appeal in other jurisdictions.”

MR DOUGLAS:   Well, there are differing views taken in differing jurisdictions – I would have to concede that – but we would submit that the main relevant decisions are clearly distinguishable from this particular case.

CALLINAN J:   Mr Douglas, I must say there are aspects of the majority’s reasoning which looked to me at first sight to be very persuasive.  Nonetheless, it is undisputably a very important question Australia wide.

MR DOUGLAS:   It is a significant issue Australia wide.  This Court has, in refusing special leave in one of the cases which adopted a similar approach to the standard of proof as this case, refused special leave on the basis that really the solution was legislative.

CALLINAN J:   What year was that?

MR DOUGLAS:   1996.  The Chief Justice, Sir Gerard Brennan emphatically made it clear, in effect, to the Chief Executive Officer for Customs that ‑ ‑ ‑

GAUDRON J:   Had Holloway v Witham been then decided?  I know it was in 1995 but ‑ ‑ ‑

MR DOUGLAS:   No, it would have been decided because this special leave application was in 1996.

CALLINAN J:   The suggestion of a legislative remedy, looking at the reality, to numbers in the Parliament, priorities in legislation, and issues that arise, I think is sometimes overstated, Mr Douglas.

MR DOUGLAS:   My learned friend’s client is in a more powerful position than most clients to suggest to Parliament what legislation might be enacted.  There have also been Law Reform Commission reports discussing these issues.

CALLINAN J:   The practical difficulties in legislating and the priorities involved in legislating can often be very great, I think.

MR DOUGLAS:   I can understand that, your Honour, and I know that it can be difficult to put things into process in Parliament, but the Parliament has known for many years that this is an issue and one that really does require legislative change.

CALLINAN J:   The Commonwealth and the States, for that matter, are entitled to come along, all other things being established, to seek to vindicate the legislation and their view of it.  The notion that simply because interpretation in a statute is involved and is questionable can be met by legislation or by a submission that the matter can be legislated away, I do not find attractive I must say, speaking for myself.

MR DOUGLAS:   It has been used as a reason for refusing special leave in the past.

CALLINAN J:   I know it has, but I do not find it attractive, personally.  I find it not always persuasive.

MR DOUGLAS:   Now, looking at reasons why the decision is said to be in conflict with this one can be distinguished, there are two decisions in particular, Evans v Button and Wong v Kelly – and my learned friend has taken you to Evans v Button.  It is relevant there that the judge, or judges, were satisfied on the criminal standard even though they appear to have accepted that the civil standard was the appropriate one. 

Reference is also made to Naismith v McGovern, an earlier decision of this Court, which my learned friend took you to – it is behind tab 5 of his bundle – but when you look at pages 340 to 341 of that decision, it is apparent that earlier single judge decisions are referred to which proceed on the basis that the proceedings must for many purposes “be considered in the nature of a civil action”.  That is at about point 8 on page 340.  Their Honours then go on to discuss those decisions and an earlier decision of this Court in Mallan v Lee and say at about point 6 on page 341:

We are here primarily concerned with the sections in Pt VII relating to the procedure laid down for the recovery of pecuniary penalties for offences and not with the nature of the offences themselves and nothing that was held in Mallan v Lee throws any doubt upon the remarks of Williams J and Fullagar J in the cases cited.  The most

that can be said is that the proceedings being for the recovery of penalties are of a penal nature –

which, we submit, is at least equivocal and at least arguably consistent with the view that these are, in fact, criminal proceedings, or they are tried pursuant to civil procedures, such as contempt proceedings – are treated since Witham v Holloway.

Now, in our submission the Court of Appeal was perfectly justified in, in effect, adopting the approach in Witham v Holloway, adapting it to these circumstances and saying that they are criminal proceedings subject to the rules of civil procedure, but when evidentiary issues arise under section 92 or section 93 of the Queensland Evidence Act they should be treated as criminal proceedings for the purpose of section 92.

I have said what I need to say about the legislative solution.  The special leave argument in D’Aquino is the case to which I refer, and it is in our bundle, and the decision of the court expressed by the Chief Justice is at page 7 of that decision.  His Honour said that he thought there was little advantage in granting special leave to appeal simply to construe provisions of inherently uncertain meaning and, in effect, said the legislature should provide a remedy.

As to the fact that it is an interlocutory decision, it may be theoretical to take this vehicle up if, for example, the applicant is able to prove its case to the standard and applying the rules of evidence said to be appropriate by the Court of Appeal.  So, in our submission, this is not an appropriate vehicle to canvass the issues.  Unless there is anything else I can say, they are our submissions.

GAUDRON J:   Thank you, Mr Douglas.  Yes, Mr Jackson.

MR JACKSON:   Your Honours, may I just say in relation to my learned friend’s submission about the first two points, the correctness and the legislative solution, your Honours, it is really with respect ‑ ‑ ‑

GAUDRON J:   All you have to say is that a number of years have now passed and there has been none, have you not?

MR JACKSON:   Yes, I am happy to say that, and no more, but could I just say one thing, and that is that if one looks at the terms of section 247, it says that every such prosecution may be proceeded with:

in accordance with the usual practice and procedure of the Court in civil cases.

Your Honour, the convenient place to start is the statute.

GAUDRON J:   Mr Jackson, we do not think we need to hear you further.  We would grant special leave but on terms that you not seek to disturb the costs ordered below and that you pay the respondents’ costs of the appeal in any event.

MR JACKSON:   Thank you, your Honour.

GAUDRON J:   Yes, thank you.

AT 11.29 AM THE MATTER WAS CONCLUDED