Cerullo v The Queen

[2004] HCATrans 277

[2004] HCATrans 277

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S469 of 2003

B e t w e e n -

TONI CERULLO

Applicant

and

THE QUEEN

Respondent

Application for special leave to appeal

KIRBY J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 6 AUGUST 2004, AT 11.07 AM

Copyright in the High Court of Australia

MR O.P. HOLDENSON, QC:   May it please the Court, I appear in this matter on behalf of the applicant.  (instructed by Tully & Co)

MR G.J. BELLEW:   May it please the Court, I appear for the respondent.  (instructed by Commonwealth Director of Public Prosecutions)

KIRBY J:   Yes, Mr Holdenson.

MR HOLDENSON:   The Crown led evidence at the trial of this matter in the form of exhibit J of a telephone conversation between the applicant’s then co‑accused, Soukoulis, and a male by the name of Alex.  Earlier on in the trial, defence counsel had unsuccessfully objected to the Crown leading that evidence.  An extract of that telephone conversation is to be found in the application book at page 39, and if I might take your Honours to that page in order to identify some aspects and consequences of that which were said.

Your Honours will see in the application book at page 39 the conversation down the page.  This represents about a third of the telephone conversation – it is an extract – and M1 is the man Soukoulis, and M2 is Alex.  If I could take your Honours on page 39 to line 30 where Alex says “You know do you know what I want”.  A couple of lines further down “it must be white”.  Just pausing there, the cocaine, the subject of the importation in this case, was white.  Below that Soukoulis says he understands.  Alex asks whether or not it exists.  There is some conversation about what occurred in Sydney.  Over the page to page 40, line 10, Alex says:

But the colour of it must be nice.

M2     Okay there’s no problems but not now not now.

M1     Not yet hey.

M2     Nope no.

Then in the last two lines, if any turns up “telephone me”.  That is the effect of that.

Now, that is clearly a conversation concerning the supply of a drug.  Alex states that he wants some of it, it being white.  Soukoulis says that he understands what it is that Alex says he wants.  Alex says it must be of good quality.  Soukoulis is indicating that he has the capacity to supply it but just not yet, and Soukoulis then indicates that when he has some he will telephone Alex.

Now, Soukoulis having said “Not yet” renders it very open to the jury, in my submission, to consider this evidence to the evidence that the applicant’s co‑accused, Soukoulis, was a person who very much had the capacity to supply drugs and he could do so in the foreseeable future.  That analysis of the conversation is effectively the construction of the conversation adopted by his Honour Justice Hulme in the court below, the conversation taking place on 23 November, three weeks before the cocaine in this case was sent from overseas to Australia.  Alex is a person who was not said by anybody at the trial to have, in any manner whatsoever, been some sort of a participant in this importation, and I say “participant” in any sense of the word. 

So exhibit J, in those circumstances, can only be described as inadmissible evidence of propensity, that is, a propensity of Soukoulis to supply a prohibited drug to another or perhaps others.  In that regard, the holding – or perhaps I should say to be accurate and fair – an alternative holding of Justice Buddin in the application book at page 66, and in that regard, if I could take your Honours to page 66, at paragraph 90 in the judgment of his Honour Justice Buddin, with whom Chief Justice Spigelman expressly, and in one paragraph agreed, at line 11:

If on the other hand however, the conversation was indeed about a prospective drug supply but was not related in any way to the drugs to be imported, then in my view it could not rise above being anything other than mere propensity evidence.

So in those circumstances, in the very next paragraph, paragraph 91, it was held by Justice Buddin, with whom the Chief Justice agreed, that the evidence “was inadmissible”.  Just pausing there, before I move on to what this case is really about, namely, whether or not the proviso was correctly applied, there is one other matter with which your Honours ought, in my respectful submission, be familiar.

The entirety of the evidence led in this trial by the Crown was held to have been admissible against both accused persons.  So this conversation between Soukoulis and Alex – Alex not being in any way a participant in any sense of the word with respect to this importation of cocaine – not only is it propensity evidence, and the majority so held in the court below, but it was held by the learned trial judge to have been admissible against Cerullo and the jury was so directed.

So moving on to the question of the application of the proviso, your Honours will see in paragraph 91 that the learned judge there turns to its application, having determined that this evidence was inadmissible, and jumping a couple of pages to page 67 ‑ ‑ ‑

KIRBY J:   You are not going to forget the points that are made in paragraph 92?

MR HOLDENSON:   I will come back to them.

KIRBY J:   They appear to demonstrate an extremely strong circumstantial case against your client.

MR HOLDENSON:   I will deal with them in just a few moments, your Honour.  I will not jump them, and I have discussed their content, by the way, with my learned friend here today.  Your Honours will see in paragraph 94 which commences at the foot of page 67, two lines from the foot of the page:

No evidence was called on behalf of either of them in answer to the Crown case.

Just pausing there that, in a sense, is incorrect because defence counsel cross‑examined a number of Crown witnesses, in particular the Australian Federal Police Officer Critchlow and adduced quite an amount of evidence from him and in so doing tendered evidence in the form of exhibits through him and also evidence was led from the accountant, Caracoussis, he being a Crown witness.  Continuing on:

As against that, I do not believe that the inadmissible material would have occasioned any real prejudice to the appellants because as I have indicated earlier – 

and I will come back to the “earlier” in a moment – 

the jury is likely to have been quite confused about the meaning to be attributed to the conversation and would, in all likelihood, have placed little or no reliance upon it.

Just pausing there, that is wrong, and it is wrong because the meaning of the conversation is, with respect, quite clear.  I have indicated to the Court the meaning of the conversation.  There could be no doubt it.  Mr Justice Hulme had no doubt about it, and the construction I have placed upon it is more or less his construction.

That passage there – and I will go back to that paragraph that your Honour Justice Kirby identified for me – that paragraph there that I have just read at the top of page 68 of the application book indicates, in my submission, that there has been an error in the application of the proviso.  It is, to use the words we use with respect to discretions, it is vitiated, it is wrong.  He says it is unclear what its meaning is.  That is the passage in the second line, “as I have indicated earlier”.  I will take your Honours to the “earlier” now.  That is back at page 65 ‑ ‑ ‑

KIRBY J:   Yes, but the question would remain for this Court whether, even if you extracted that sentence and took the view that you are urging, namely, that the conversation was reasonably clear, whether the circumstantial evidence in paragraph 92 is so strong that your client did not lose a real chance of acquittal.

MR HOLDENSON:   I will come to that in about 30 seconds, but can I say this, there is ‑ ‑ ‑

KIRBY J:   I think you make a fair point, talking about “cappuccino” and “must be white” and so on.  I think most jurors today would understand what all that meant.

MR HOLDENSON:   Could I just take your Honours to page 68, second line “because as I have indicated earlier”.  Could I could go back now to the “earlier” bit.  That is on page 65, line 36, part way through paragraph 88 and I quote:

Having read the transcript of the conversation a number of times I am still left in considerable doubt as to what the conversation was actually about.  The conversation was of very short duration and “Alex” was not otherwise referred to in the proceedings.

Wrong, he was.  There was cross‑examination about it by one of the defence barristers of the police officer, Critchlow, and it was put to Critchlow who it was, where he was from, Critchlow could not assist, but then went on to say “We don’t have time to chase every rabbit down every burrow”.  He was referred to in the conversation, that is, this exhibit, exhibit J, and the man Alex was referred to twice in final addresses.

HEYDON J:   Not otherwise usefully referred to in the proceedings?  Just because it is in a question, the answer to which is “I don’t know” or something to that effect.

MR HOLDENSON:   I understand that, but it went on.  The question was:

It’s impossible to follow every bunny down a hole in this type of investigation, your resources are limited, but you have got thousands of phone calls to analyse and you have got to make a reasonable assessment as to who and what it is you’re chasing?

A.       Yes, that’s correct.

So the evidence became, albeit not identified by way of an answer except by way of…..and I understand that the question is not the evidence.  The evidence went on, “Well, we have not chased every rabbit down every burrow”.  So it left it, to some extent, in the air, but then referred to in final addresses.  So the passage at page 65, in my submission, supports the contention that the application of the proviso is vitiated.  But your Honour Justice Kirby is correct, I must deal with the dot points in paragraph 92, and the dot points commence at the foot of page 66, and there is the first dot point or Roman numeral:

her presence at the “Flight Centre” –

Upon a proper reading of the evidence and the material before the Court below, she was present at that time as he, Szelenczy, made arrangements for himself and his wife, and she then paid $100 deposit, and it was not her phone number that was provided, notwithstanding the fact that ‑ your Honours will recall that was a ground of appeal in the court below - it was admitted at trial, but that was wrong.  It was Szelenczy’s phone number that was provided, but she certainly paid the $100 deposit.  There is the fax, that is (ii) but not as to what the meeting was about.  Her travel - just with respect to that, there was evidence in the case that Frankfurt is a major international airport in Europe.  There was also – and it was expressed in this way – there was no evidence that the applicant and Cerullo met in Frankfurt.  That was a matter of, at best, inference.  Over the page, (iv) ‑ ‑ ‑

KIRBY J:   Was it accepted that the drugs had come through Frankfurt?

MR HOLDENSON:   Yes, from Frankfurt, yes.

KIRBY J:   Well?

MR HOLDENSON:   I do not want to be heard to say to your Honours, because I would mislead you if I was to say anything other than this was a strong Crown case, but we see many many ‑ ‑ ‑

KIRBY J:   You got a reasonable point on exhibit J, and I understand that point, but it is just these items in 92.

MR HOLDENSON:   If I could just interrupt my reading, and I have some pretty good points to make about Roman numerals ‑ ‑ ‑

KIRBY J:   You always do, Mr Holdenson.  You work your cases out well.

MR HOLDENSON:   I am indebted to your Honour, but can I say this; this at the end of the day, in my submission, notwithstanding the way in which the draft notice of appeal has been drafted, special leave to be granted and remitted.  Let the court below work out whether or not the proviso should be applied ‑ ‑ ‑

HEYDON J:   You cannot grant special leave and remit it.

MR HOLDENSON:   Allow the appeal, because the proviso has been vitiated.  The Court has done that on other occasions over the years.  I remember it happened in a case I was in Palmer v The Queen (1992) 106 ALR 1.

KIRBY J:   That was such a glorious day.  You have that written in your mind, on your heart.

MR HOLDENSON:   It has only happened on one other occasion.  I am hoping it can happen on 6 August.

KIRBY J:   It does not.  It is not something we would normally do.  We have to pay respect to the Court of Criminal Appeal.

MR HOLDENSON:   I understand that.

KIRBY J:   That would be reserved to a very very clear case.

MR HOLDENSON:   Yes.  Continuing on with the Roman numerals at the head of 67:

(iv)     her conversation with Caracoussis and the subsequent transfer of monies overseas;

three points to be made about that because, with respect, in my submission, it again is misleading.  First, the money arrived overseas after Szelenczy had left and after the cocaine had been sent.  So the money got there after, but Caracoussis gave evidence of his conversations with the applicant, Cerullo, and the evidence was to this effect – and I have not got it wrong – months earlier she openly asked him about how one sends money to Germany, it might be $20,000 or $30,000 or $50,000, and how it was that she proposed to meet in Germany her father, and then travel with her father from Germany to Italy from where she came and from where she had family, and there was also in the court below, expressly made, a concession by the respondent Crown that there was no evidence that Szelenczy knew anyone associated with the transfer of money, and there was evidence about from where it was transferred, how it was transferred and who was present at the time and who was doing the sending, and it was conceded – it came from Adelaide – and there was no suggestion that in any way Szelenczy knew any of them.  Conversations, yes:

(vi)     being in the company of Soukoulis and Szelenczy . . . at which time the arrival of the “parcel” was discussed -

There were other matters discussed as well and it was not said that in any of those conversations that it was anything along the lines of her parcel or a parcel in which she had some sort of interest.  The next paragraph is important:

(vii)    her presence in Szelenczy’s premises at the time of the delivery of the parcel.

Wrong, that was an inference only.  The parcel had a listening device in it.  It picked up some voices.  Apart from the deliverer of the parcel, who was a police officer in disguise, it picked up Szelenczy’s and Soukoulis’ voice, not hers.  She was, however, near the premises but not in the apartment, but ‑ ‑ ‑

KIRBY J:   I think that point is made in the respondent’s submissions.

MR HOLDENSON:   It is a point for an inference, but there are two other ‑ ‑ ‑

KIRBY J:   It does not really attack the essence of the point being made.

MR HOLDENSON:   No.

KIRBY J:   She was out and about and nearby when the delivery was happening and therefore the inference is that she knew that it was coming and had a keen interest in its arrival.  That is the inference.

MR HOLDENSON:   Yes, but there is some other evidence that went in which is not identified there, and I hesitate to use words like “that is a simplistic analysis”, but could I identify two other pieces of evidence?  Defence counsel in cross‑examining Police Officer Critchlow, led evidence of some telephone calls.  They went into evidence.  Two of those telephone calls were as follows.  Szelenczy had a lengthy telephone conversation with a female in which he indicated that he was expecting the parcel and it was late, and where was it, and he was concerned about it, expecting it for himself, no suggestion of “for us”, and it was the right parcel.  He used the words “in the right book”.

KIRBY J:   Why would he be discussing it?

MR HOLDENSON:   There is another conversation that comes with it, “in the right books of significance”, because your Honours will recall that it was in a bible.  Twenty minutes before the police raid, there is a telephone call to Szelenczy’s premises from a man called Retima, and the telephone call went into evidence, and it is a conversation with Retima in which Retima says he will be there in 30 minutes to pick up the parcel and to take it away.

That conversation comes 24 hours after an earlier conversation with Retima in which there is again discussion about the parcel and Retima said that he, Retima, had a person who could take it tomorrow, that being the day of the conversation, 30 minutes before the raid and, of course, the raid only occurred because the listening device emitting the sounds to police officers nearby caused the police officers nearby to think that the parcel was being opened.  It was not and, of course, if it was opened the listening device would be found.  So the parcel is not opened, Soukoulis is gone, Retima is on his way to pick it up and take it away, because he has an arrangement to get rid of it, hence, he was described in the final address of defence counsel as the luckiest man in Sydney in some 38 or 40 years, ever since the man threw the £10 notes from the top of the grandstand at Rosehill after his horse won the Golden Slipper, described as the luckiest man in Sydney, because Retima, of course, by the time he got there, the raid had taken place, so he did not turn up and so on.

Now, it is a strong Crown case, but it is not that strong, and when one looks at these matters in a little more context rather than just Roman numerals (i) to (vii), it is really not that strong a case, and in circumstances where the application of the proviso is, with respect, just flawed because the conversation clearly had a meaning, and the jury were clearly directed that all the evidence was admissible against each of the two then accused, and it is a conversation about “white”, “not now”, “Not yet”.  I have a theory, and I am yet to get an appellate court to accept the theory in a judgment, and it is this ‑ ‑ ‑

KIRBY J:   Try us.

MR HOLDENSON:   The stronger the Crown case, the more sensitive the appellate court should be to the application of the proviso.  I am not talking about the absolutely overwhelming case, but the stronger the Crown case, the more sensitive the Court should be because it may be that that little piece of inadmissible evidence – assuming the Court has determined that the evidence is inadmissible and not something inadmissible as inconsequential as if there had been some evidence here that someone barracked for a certain football club, clearly inadmissible but could not be of any consequence whatsoever – the Court should be more sensitive because the inadmissible evidence might truly be – and I can put this two ways:  one, the straw that breaks the camel’s back, but perhaps another way, it is just like something which has the effect of turning the kaleidoscope just

that little bit and changing the pretty picture that one sees at the end of the kaleidoscope to just a jumble.

KIRBY J:   Probably the reason you have not succeeded is that it does not seem to stand very well with the language of the section or the historical purpose of it, which was the concern in colonial days when the Criminal Appeal Act was being bruited, that clever lawyers would come along and defeat convictions and people would not be hanged as they should be on the basis of the conviction of the jury on highly technical and unimportant factual points.  That was what the debates were about the Criminal Appeal Act.

MR HOLDENSON:   The argument I have put today does not fall into that category.  It is a case about the facts, and ‑ ‑ ‑

KIRBY J:   That is true, and I think we understand the way you put it and you have made a few blows, so we understand it, but it is just a question of whether the ultimate order, which is what the appeal is from, is wrong.

MR HOLDENSON:   Yes.  I have made the submissions and otherwise ‑ ‑ ‑

KIRBY J:   I see the red light is on.

MR HOLDENSON:   Yes, and I have married the two judgments or the three judgments and created the point, otherwise adopt the written outline, if your Honours please.

KIRBY J:   Thank you, Mr Holdenson.  Mr Bellew, we do not need your assistance. 

In this case, in the Court of Criminal Appeal of New South Wales, there was a division of opinion on a point of law.  However, there was unanimity in the ultimate order of that court.  The court dismissed the applicant’s appeal against her conviction of an offence against the Customs Act 1901 (Cth) section 233B. Now the applicant seeks special leave to appeal to this Court.

In our view, the better approach expressed in the court below was that of Justice Buddin, with whom Chief Justice Spigelman agreed.  It is very strongly arguable that exhibit J at the trial, a recording of a telephone conversation between persons other than the applicant, ought not to have been admitted into evidence against the applicant.  Even if Justice Buddin was incorrect in suggesting that the conversation in exhibit J was relevantly ambiguous, the circumstantial case against the applicant was a powerful one. 

The case for the application of the proviso to section 6(1) of the Criminal Appeal Act 1912 (NSW) was very strong. Properly, counsel accepted that this was a strong Crown case at trial, although he said that it was “not that strong”. We, however, detect no error in the decision of the majority to apply the proviso, even if different reasons might have been given for that course.

We do not consider that an appeal to this Court would enjoy sufficient prospects of success.  Nor are we convinced that a miscarriage of justice has occurred.  It follows that special leave must be refused. 

AT 11.31 AM THE MATTER WAS CONCLUDED