Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd and Ors B46/2002
[2002] HCATrans 623
•11 December 2002
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Brisbane No B46 of 2002
B e t w e e n -
CHIEF EXECUTIVE OFFICER OF CUSTOMS
Appellant
and
LABRADOR LIQUOR WHOLESALE PTY LTD
First Respondent
LAWRENCE ERIC WRIGHT
Second Respondent
JEFFREY ANDREW JOHN BRYCE
Third Respondent
GLEESON CJ
McHUGH J
GUMMOW J
KIRBY J
HAYNE J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON WEDNESDAY, 11 DECEMBER 2002, AT 10.15 AM
Copyright in the High Court of Australia
MR A. ROBERTSON, SC: May it please the Court, I appear with my learned friends, MR F.W. REDMOND and MR G.A. HILL, for the appellant. (instructed by Australian Government Solicitor)
MR T.D.O.J. NORTH, SC: May it please the Court, I appear with my learned friend, MS J. BRASCH, for the respondent. (instructed by Forde Lawyers)
MR A. ROBERTSON, SC: Your Honours, I also appear with MR F.W. REDMOND and MR G.A. HILL intervening on behalf of the Attorney-General of the Commonwealth. (instructed by Australian Government Solicitor)
GLEESON CJ: To support yourself or to oppose yourself?
MR ROBERTSON: To support the appellant in relation to the Constitution.
GLEESON CJ: Yes, Mr Robertson.
MR ROBERTSON: If it is convenient to the Court, what I discussed briefly with my learned friend was that I would leave the bulk anyway of the constitutional question until after the respondents have made their submissions.
GLEESON CJ: Yes.
MR ROBERTSON: Your Honours, two questions of statutory construction arise from the judgment and answers to questions given by the Queensland Court of Appeal. They centre upon the provisions in Part XIV of the Customs Act 1901 and the corresponding provisions of the Excise Act 1901.
GLEESON CJ: Does this legislation contain any provision about averments?
MR ROBERTSON: Yes it does, your Honour. Perhaps I can answer your Honour shortly. It is in Part XIV section 255 of the Customs Act.
GLEESON CJ: Thank you.
MR ROBERTSON: And there are some other provisions referred to in footnote 15 of our written submissions. The key sections of the Customs Act, in the appellant’s submission, are 244, 245 and 247. Do your Honours have reprint No 11? That is the Act as in force at the relevant time.
GLEESON CJ: Yes.
MR ROBERTSON: Those sections appear on pages 366 and 367.
KIRBY J: They appear under Part XIV, “Customs prosecutions”.
MR ROBERTSON: Quite so, your Honour, yes.
KIRBY J: With the Acts Interpretations Act, remind me, is that part of the Act or can it be used in construing the provisions?
MR ROBERTSON: I will have to look that up, your Honour.
KIRBY J: Yes.
MR ROBERTSON: I think not, but I will have that checked. In any event, 244 provides that:
Proceedings by the Customs for the recovery of penalties ‑
and then there is an exception ‑
other than a pecuniary penalty referred to in section 243B ‑
and section 243B ‑ ‑ ‑
GLEESON CJ: How are the penalties structured? Are they structured by relation to the tax unpaid or by reference to fixed ‑ ‑ ‑
MR ROBERTSON: Some of them in the Act are fixed. Some of them relate to the amount of duty in question. So that, for example, one of the sections in issue in this case is section 33, which is on page 33, and the penalty that appears under section 33(1) is $50,000.
Another of the provisions relevant to this case is of the other nature that your Honour the Chief Justice asked me about and that is 234, which appears on page 327 of that reprint, and one of the provisions is 234(1)(a) on page 327, another of them is 234(1)(d) and then, if your Honours go over the page, your Honours will see at the end, say, of paragraph (2)(a):
a penalty not exceeding 5 times the amount of that duty and not less than 2 times that amount; or
(ii) where the Court cannot determine the amount of that duty, a penalty not exceeding $50,000;
So the short answer, your Honour, is that they have two bases of calculation, if that is the right expression, one, a flat amount – when I say a flat amount, I should refer your Honours as well to section 5 of the Act on page 18, which provides that:
The penalty, pecuniary or other, set out:
(a) at the foot of a section of this Act; or
(b) at the foot of a subsection . . .indicates that a contravention of the section or of the subsection, as the case may be . . . is . . . punishable upon conviction by a penalty not exceeding the penalty so set out.
GLEESON CJ: Thank you.
KIRBY J: But the discretionary penalty is a more significant fact than the fact that some of the penalties are multiples of the unpaid customs duty, because the fact that some of the penalties are not variable in accordance with the duty suggests that the element of punishment is in there. You cannot really get away from the fact that these are punishment provisions.
MR ROBERTSON: I would accept, your Honour, that they are penal provisions. I am not sure whether that is saying the same thing.
KIRBY J: Well, what is the difference? You are punishing people.
MR ROBERTSON: Well, I would not accept that they are ‑ ‑ ‑
KIRBY J: Their reputation and, in some cases, their liberty, their pocket. It is all standard punishment, called civil, by Parliament, the punishment.
MR ROBERTSON: Certainly the language in which some of these sections is cast includes expressions such as “offences” and “conviction”. I will obviously have to return when I get to that point to the relevance, if any – we would say it has no relevance – to the issue that your Honour Justice Kirby has raised with me.
KIRBY J: It has relevance in this sense, that, as Mr North points out in his submissions, just three weeks ago we delivered Daniels and we said if Parliament wants to change standard time‑honoured ancient principles it has to do it very clearly. You are going to be trying to say, “Well, if we go into this and we go into that we can construct it”. That is not what the Court unanimously did in Daniels or it has not done since Potter v Minahan.
MR ROBERTSON: Part of our submissions, as your Honour would have seen from the written submissions, is that the standard of proof is of a different origin and nature to what was being dealt with in Daniels which is a legal professional privilege.
HAYNE J: But more significantly than that, there is 300 years of history to which there is scant reference in the submissions of either side. Customs prosecutions cannot be understood, I would suggest, without understanding the history which underpins them.
MR ROBERTSON: Quite so, your Honour, and we would ‑ ‑ ‑
HAYNE J: And that involves going back into the history of the revenue side and the like.
MR ROBERTSON: Quite so, your Honour, and the learned trial judge did that.
HAYNE J: To an extent.
MR ROBERTSON: To an extent. The earliest we have gone back is, I think, perhaps 150 years but certainly we would accept what your Honour puts to me that the history of both – to be particular – Customs penalties but also the history of civil penalties is ‑ ‑ ‑
HAYNE J: Well, it is penal provisions in the Exchequer.
MR ROBERTSON: Yes.
HAYNE J: Penal provisions designed to secure the revenues of the Crown.
MR ROBERTSON: Exactly so, your Honour.
HAYNE J: Penal provisions that are reflected the perhaps unduly tender regard in which the revenues of the Crown were regarded.
MR ROBERTSON: And we would submit – and I will develop this in a little while – that if one looks at how that history to which your Honour has referred stood as at 1900, 1901, one can see, in our respectful submission, that, although there had been some debate as to the nature of the actions, there was a choice open to the Parliament and the Parliament chose civil actions for the recovery of these penalties.
McHUGH J: Yes, but the problem is that, as Justice Else‑Mitchell pointed out in Rieken’s Case in New South Wales back in 1964, the amendments introduced the concept of a fine which was the foreign to the original Act and you then get into a different area of discourse. I mean, what once began as an action for the King’s debt is now in many respects a source of serious criminal punishments.
MR ROBERTSON: There is no doubt, your Honour, that the concept, or the word, perhaps I should say, “fine” was introduced at a later stage and I think it is true to say more particularly in the Excise Act than in the Customs Act, but our submission is that that does not alter the nature of the proceedings. By “nature of the proceedings” I mean the type of the proceedings or the form of the proceedings and the sections that I am dealing with: 244, 245:
Institution of prosecutions
by action, information or other appropriate proceeding –
but, more particularly 247:
Every Customs prosecution . . . may be commenced prosecuted and proceeded with in accordance with any rules of practice (if any) established by the Court for Crown suits in revenue matters or in accordance with the usual practice and procedure of the Court in civil cases –
So that anything, in our submission, that is a proceeding by the Customs for the recovery of penalties or for the condemnation of ships, aircraft, or goods seized as forfeited, the Parliament has by 247, said to be clear, the practice and procedure of the various courts in 245 “in civil cases” is to apply. Our submission will be that that is a clear indication of the answers to the two sets of questions in this case.
KIRBY J: Does evidence fall naturally within that phrase “practice and procedure”. Does onus of proof fall naturally within practice and procedure?
MR ROBERTSON: Standard of proof, yes.
KIRBY J: I could see that issues of whether you pay the costs would fall within practice and procedure but query whether a thing so fundamental as the burden of proof, the standard of proof, would do so.
GUMMOW J: You have the phrase “in civil cases”.
MR ROBERTSON: Yes.
GUMMOW J: Section 247 has been more or less in this form since 1901, I think.
MR ROBERTSON: Yes, there have been some consequential amendments because in 1989 there was an amendment of some substance dealing with Local Courts, Courts of Petty Sessions. Before 1989 they were separately dealt with in 245 and now they are, as your Honours concede – when I say now, I mean at the time relevant to these proceedings – they were in 245(1), but certainly in substance. Could I answer ‑ ‑ ‑
HAYNE J: But also since 1901 and until today Parliament has contemplated prosecution and procedure in accordance with any rules of practice established by the court for Crown suits in revenue matters, not a practice that has been taken up, but obviously I would have thought, harking back to what then was happening on the revenue side.
MR ROBERTSON: Yes, I would accept that, your Honour. Could I answer two of your Honour Justice Kirby’s outstanding questions. One is section 13(1) of the Acts Interpretation Act says that:
The headings of the Parts . . . shall be deemed to be part of the Act.
KIRBY J: So they are part of the Act.
MR ROBERTSON: Part of the Act.
KIRBY J: I, like you, thought they were not. There does not seem to be a lot of rationality in some of those provisions because I think marginal notes ‑ ‑ ‑
MR ROBERTSON: Marginal notes, footnotes, and end notes and headings to a section are not to be taken to be part of the Act. As long as Parliamentary Counsel knows what the rule is, then they can proceed accordingly, your Honour.
The other matter I wish to draw your Honours’ attention to as a matter of detail is section 263 deals specifically with the question of costs. I know it does not deal directly with what your Honour Justice Kirby raised with me but 263 deals directly with costs.
KIRBY J: What does it say? Do you pay costs?
MR ROBERTSON: It says:
In a Customs prosecution . . . a court may award costs against a party ‑ ‑ ‑
and it has some more words.
HAYNE J: So it is costs to and from the Crown?
MR ROBERTSON: Yes.
GLEESON CJ: Mr Robertson, there is a reference to onus of proof in this part and it is in section 255(5). It does not directly touch the present matter, but to what is section 255(5) referring? It is talking about the onus of proof on the defendant.
MR ROBERTSON: Yes. In my submission, your Honour, it talks about any onus of proof otherwise falling on the defendant.
GLEESON CJ: Yes.
MR ROBERTSON: It seems to be saying that the provision that it has earlier made as to ‑ ‑ ‑
GLEESON CJ: That is the provision about the averments being prima facie evidence.
MR ROBERTSON: Prima facie evidence and limitations on the scope of averments, that is in subsection (4), do “not lessen or affect”, as it says, “any onus of proof”.
GLEESON CJ: I am just trying to relate section 255, which is of large practical importance to anybody who is actually conducting one of these cases, to the issue that we are concerned with.
MR ROBERTSON: It seems to be proceeding on the basis, your Honour, that if there is any onus of proof on a particular matter falling on the defendant, then this section does not affect it.
GLEESON CJ: Could you give an example.
MR ROBERTSON: I cannot at the moment. If I can think of one, maybe ‑ ‑ ‑
HAYNE J: At the risk of sounding like a broken record, look back into the history. Look back at proceedings on the revenue side. There I think you will find that in certain circumstances it was for the defendant to demonstrate that the amount claimed was not recoverable. I may be quite wrong, but I think you will find the answer there. I have said it now repeatedly, Mr Robertson, and I will not say it again.
MR ROBERTSON: If your Honour pleases.
McHUGH J: One illustration is 233(2), is it not, that where – has it not been held that the onus is on the defendant? It provides:
It shall not be lawful for any person to convey or have in his possession without reasonable excuse (proof whereof shall lie upon him) any smuggled goods or prohibited imports.
MR ROBERTSON: That would be an example within the four corners of the Act, certainly, your Honour.
McHUGH J: Yes.
KIRBY J: Could you at some time, even if not necessarily today, let me know what the section looked like in 1901 and when the Act introduced fines and when it introduced imprisonment, because I think imprisonment came even later.
MR ROBERTSON: Imprisonment, it did not come later. If one looks at Dr Wallaston’s book, there were provisions even in the 1901 Act for imprisonment.
GUMMOW J: Yes, I know, but for smuggling, for example.
MR ROBERTSON: Dr Wallaston makes the point that those proceedings, for example, 232 and 235 of the Act as it then stood, were outside the scope of Customs prosecutions because they were not proceedings by Customs for the recovery of penalties.
GLEESON CJ: This contrast between civil actions for the recovery of penalties and prosecutions for offences appears in Part VI of the Trade Practices Act.
MR ROBERTSON: Yes, it does.
GLEESON CJ: Has there been any decision on standard of proof in relation to a civil action for recovery of penalties under the Trade Practices Act?
MR ROBERTSON: I will have to check that, your Honour.
HAYNE J: While doing so, would you look, too, at the Corporations Law, which has like provisions?
MR ROBERTSON: Yes.
KIRBY J: And I thought I read somewhere that the Income Tax Assessment Act had some provision.
MR ROBERTSON: That certainly does, and I will be taking your Honours to those which we would characterise as revenue decisions in a little while. There is certainly a decision of Justice Fullagar, as a judge of the Supreme Court of Victoria, and a decision of four Judges of this Court in Naismith v McGovern, which was an income tax case dealing with civil procedures, not directly with the standard of proof.
GLEESON CJ: It is amazing, if it is the case that nobody has had to decide whether in a civil action for the recovery of penalties under the Trade Practices Act the standard of proof is the civil standard or the criminal standard. I really do find it difficult to accept that that proposition has not been addressed.
MR ROBERTSON: In Dr Miller’s Annotated Trade Practices Act, 23rd Edition, page 641, there is a note under section 78, being the section which says:
Criminal proceedings do not lie against a person by reason only that the person:
(a) has contravened –
Part IV, Part V. There is a reference – and this is the only reference that Dr Miller gives – to a decision of Justice Pincus in a case called Heating Centre Pty Ltd v Trade Practices Commission (1986) 9 FCR 153. Justice Pincus at page 160 – may I read it to your Honours? It is a sentence or two:
“Whatever may be the reason for the distinction, the position is that the Act clearly characterises proceedings under s 76 as civil: see s 78 and contrast with s 79, while equally clearly characterising proceedings for a penalty in respect of a breach of Pt V of the Act as criminal proceedings. In so doing, Parliament must be taken to have intended that the court would apply the respective standards of proof applicable to each category. It is, of course, an attribute of civil proceedings that the necessary facts must be proved on the balance of probabilities, but, of course, taking into account the gravity of the matters alleged” –
referring to Briginshaw and Helton v Allen.
GLEESON CJ: But civil actions for the recovery of pecuniary penalties under the Trade Practices Act constitute a routine form of litigation in the Federal Court, and have done for years. What standard of proof do they apply?
MR ROBERTSON: In civil actions for the recovery of penalties, there being no other reference here, at the least, then one assumes that they are applying the civil standard, taking into account, where applicable, the Briginshaw considerations.
GUMMOW J: I think that is right.
MR ROBERTSON: It does not seem to have been a matter of controversy ‑ ‑ ‑
GLEESON CJ: We seem to be sitting here inventing the wheel.
KIRBY J: The problem is that there are a number of wheels that have appeared in the courts below.
MR ROBERTSON: Well, your Honours, perhaps I shall not enter into that debate, because what we do submit is that – and perhaps the two groups of answers that the Court of Appeal gave fall into a slightly different category – but, in essence, what we submit as to the standard of proof is that the Court of Appeal did not act upon the history to which Justice Hayne has referred, or the history as acted upon by the Parliament in 1901 in enacting section 247 of the Customs Act.
GUMMOW J: They also seem – and this is the fault of the questions, I think – to have assumed the Queensland Evidence Act of its own force applied. Questions (c) and (d).
MR ROBERTSON: Well, in a sense, that is a different issue, and perhaps I can go to that directly because, in a real sense, it is a more important practical question because it dictates many more procedural aspects of the case than does the standard of proof, which is something that, no doubt, is important but something that occurs in assessing the evidence. We submit that the correct question posed by section 247 is this: what is the usual practice and procedure of the Supreme Court of Queensland in civil cases? I should say, your Honours, that, of course, Part XIV, in particular, and the Customs Act in general, was introduced before the Judiciary Act.
GUMMOW J: Yes, 1901.
MR ROBERTSON: 1901 as opposed to 1903.
GUMMOW J: Yes.
MR ROBERTSON: Now, I do not recall whether the 1901 Claims Against the Government Act had anything like section 79 of the Judiciary Act in it, but I think it did not.
GUMMOW J: No, it did not.
MR ROBERTSON: That would mean that some of these provisions are perhaps more ornate than now they would have to be. The focus of attention in the Court of Appeal was on section 92 of the Queensland Evidence Act. At first instance, if I can take your Honours to it, the learned judge at page 30 of the appeal book dealt with it, really, only in paragraph [101], as part of her Honour’s conclusion and said – this is the last line of paragraph [101] on page 30:
the prosecutions are not criminal proceedings for the purposes of the Evidence Act 1977.
Now, the way – and this is picking up what your Honour Justice Gummow said a moment ago – the Court of Appeal dealt with it ‑ ‑ ‑
GUMMOW J: Wait a moment. There is a definition of “criminal proceedings”, is there not, in the Evidence Act?
MR ROBERTSON: There is a definition and it was that definition that the majority in the Court of Appeal applied, because if one goes to section 92 of the Queensland Evidence Act, which was the section that was the subject of debate so far as the form ‑ was the subject of debate in the Court of Appeal. Section 92 says ‑ and this is about the admissibility of documentary evidence:
In any proceeding (not being a criminal proceeding) where direct oral evidence of a fact would be admissible, any statement contained in a document . . . be admissible ‑
as distinct from section 93, which deals with admissibility of documentary evidence in criminal proceedings. But the point taken by the majority, and if I could turn, your Honours, to page 60 of the book, your Honours will recall that Justice Byrne agreed with Justice Thomas in this respect ‑ I need only go to what Justice Thomas said ‑ the President dissented on this point and found in favour of the present appellant. But the question posed by Justice Thomas at paragraph [70] is where the discussion begins:
The point in which the parties are primarily interested is whether s 92 of the Evidence Act 1977 applies to these proceedings.
And then in ‑ ‑ ‑
GUMMOW J: Well, that is an elliptical statement.
MR ROBERTSON: Yes, [72] and following is where his Honour concludes that these Customs prosecutions ‑ I will put it the other way around – that section 92 does not apply to these Customs prosecutions. His Honour says in paragraph [72]:
Section 247 of the Customs Act expressly permits prosecutions of the present kind to be conducted “in accordance with the usual practice and procedure of the court in civil cases”. The usual practice and procedure of the court in civil cases in this state calls for application of the Evidence Act 1977. Many provisions in that Act apply to criminal proceedings while others (such as s 92) expressly do not.
And then this is the important two sentences:
The question then is whether each of the present prosecutions is a “criminal proceeding” within the meaning of the Evidence Act.
Now, in our respectful submission, the proper question is not that question but what is the usual practice and procedure of the Supreme Court of Queensland in civil cases, because that is what section 247 asks. Then his Honour goes on:
If it is ‑
that is, dealing with it entirely as a matter of the definition to which your Honour Justice Gummow has referred, in section 3 of the Queensland Evidence Act, his Honour then says:
If it is ‑
that is, a “criminal proceeding” within the meaning of the Evidence Act ‑
the proper application of the relevant Queensland law for the conduct of civil proceedings expressly excludes the application of s 92.
GUMMOW J: That is turning things back to front.
MR ROBERTSON: Exactly so, your Honour.
GLEESON CJ: How does section 254(2) of the Customs Act operate in practice?
MR ROBERTSON: The first step – and I know this is not what your Honour the Chief Justice has in mind – is to see whether the proceeding that one has is not a proceeding from an indictable offence or for an offence directly punishable by imprisonment. Then one is told that the defendant shall be compellable to give evidence but ‑ ‑ ‑
GLEESON CJ: What, evidence for the prosecution? Compellable by whom?
MR ROBERTSON: Well, one assumes it must mean by the only person interested in compelling him.
GLEESON CJ: Well, it does not mean compellable by the defendant.
MR ROBERTSON: No.
GLEESON CJ: So it must mean compellable by the prosecution.
MR ROBERTSON: Whether it means no more than that one can in accordance with the civil procedures issue a subpoena requiring, say, an individual to attend, one would not have thought it meant more than that.
HAYNE J: Oh? Do you really say that that is the sole effect of it, that you can get in there and not ask the question?
MR ROBERTSON: Well, you can ask him questions but I suppose in the ordinary ‑ ‑ ‑
HAYNE J: And cannot compel him to answer?
MR ROBERTSON: Well, you could compel an answer subject to, I suppose, any immunity that the defendant might have.
GLEESON CJ: Are the proceedings with which we are concerned proceedings that would fall within section 254(2)?
MR ROBERTSON: Yes.
GUMMOW J: But when 247 uses the phrase “Customs prosecution”, does that include prosecutions for indictable offences?
MR ROBERTSON: We submit not.
GUMMOW J: Why?
MR ROBERTSON: Because ‑ ‑ ‑
GUMMOW J: I mean, the distinction is drawn in 254(2). The subclass is explained.
MR ROBERTSON: Yes.
GUMMOW J: There is no subclass in 247, on its face.
MR ROBERTSON: That is quite so. There is a tension between the detail, perhaps, or the specificity of 254 and the generality of 244 but in 244 one has to ask the question, “Is it a proceeding for the recovery of penalties”? If I could give ‑ ‑ ‑
GUMMOW J: Wait a minute. I was talking about 247.
MR ROBERTSON: I am sorry, your Honour.
GUMMOW J: What I am trying to find out is, does the general phrase in 247, “Every Customs prosecution”, include both of the subclasses outlined in 254?
MR ROBERTSON: Yes. We would submit that – I am sorry, I missed a step.
GUMMOW J: Yes.
MR ROBERTSON: We would submit that 244 suggests that the question is, is it a:
Proceedings by the Customs for the recovery of penalties . . . or for the condemnation of ships ‑ ‑ ‑
KIRBY J: Except that 244 uses capital “C”, capital “P” for “Customs Prosecutions”. Section 247 uses capital “C”, small “p”. I do not know whether that is significant.
MR ROBERTSON: I do not think it is significant, your Honour.
KIRBY J: You are saying it is a definition in 244 that is picked up in 247.
MR ROBERTSON: Yes.
KIRBY J: I see the force of that and the structure of the part may give some strength to it but it has been used with a capital “C” and a capital “P” in 244.
MR ROBERTSON: Yes. Could I give your Honours an example of what, in our submission, is not a ‑ ‑ ‑
KIRBY J: I notice in 245, 249 and perhaps elsewhere, it is capital “C”, small “p”.
MR ROBERTSON: Yes. I do not know that typographically, your Honour, there is any repeat of the capital “P” in “prosecutions”.
KIRBY J: In the Victorian age they were more inclined to use capitals than we are in this more email‑driven age.
MR ROBERTSON: I think that is true, your Honour. I was going to take your Honours to perhaps an example of what, in our submission, is not a Customs prosecution. That is section 232 on page 322, it is not part of the Act but I will refer to it for convenience, “Collusive seizures and bribes offered to officers” and it says:
shall be guilty of an indictable offence and shall be liable to imprisonment with or without hard labour for any term not exceeding 5 years.
KIRBY J: Can that be imprisonment for “Customs Prosecutions” as referred to in 244?
MR ROBERTSON: In my submission, that is not an action for the recovery of penalties and therefore would not be “Customs Prosecutions” within 244.
KIRBY J: It is a way of recovering penalties by a sanction which is the most serious one known to our law.
MR ROBERTSON: There is no recovery of a penalty.
KIRBY J: It rather helps and aids and speeds up the payment.
MR ROBERTSON: What I am submitting, your Honour, is that 232 as an example - and I think 233B is another example – a proceeding under 232 would not be a proceeding by the Customs for the recovery of penalties.
HAYNE J: Does the expression, on your submission, “recovery of penalties” extend beyond recovery of monetary sums and forfeiture of items forfeit?
MR ROBERTSON: No, it does not, and as to the latter group it may well fall within the last line and a half of section 244 rather than the first half because of the relationship between “Proceedings . . . for the condemnation of . . . goods” and the relationship of that action to forfeiture.
HAYNE J: That being so, you say that “recovery of penalties” when used in the first line of 244, extends in any respect beyond recovery of money sums?
MR ROBERTSON: No, we do not.
GUMMOW J: Why is 254(2) there?
MR ROBERTSON: That is what I referred to earlier, your Honour, as the tension between 244 on the one hand and the detail - we would submit unnecessary detail - of 254(2). It would have the same meaning, in our respectful submission, if it said “in every Customs prosecution referred to in section 244”.
KIRBY J: Could you help me to get clear in my mind the extent to which 247, as it were, covers the field of the procedures and therefore does not allow for the operation of the provisions of the Judiciary Act? Is it your contention that 247 globally and specifically and particularly deals with the issue that is before the Court, as seems to have been assumed in the Court of Appeal, or is there any residual function of the Judiciary Act to pick up and apply to proceedings in federal jurisdiction other State laws?
MR ROBERTSON: It certainly has not been an issue in the proceedings thus far.
KIRBY J: I realise that, but unfortunately I have to tell you, we have had so many cases where people have not noticed the Judiciary Act. They have just assumed that State law applies of its own force. And here we have, as you say, for probably historical reasons, a complication that there is the particular provision of 247, but how does that live with the provisions of the Judiciary Act, which pick up and apply State laws in federal jurisdiction?
MR ROBERTSON: It does not deal with other State laws.
GUMMOW J: Section 79 talks about other Commonwealth laws otherwise providing, does it not?
MR ROBERTSON: And it also talks about a wider class of State laws, that is wider than practice and procedure.
GUMMOW J: Yes, that is right. So this would be a partial exclusion of section 79, by reason of an express other more specific federal law.
McHUGH J: It is a Dao point, is it not? Dao’s Case ‑ ‑ ‑
KIRBY J: Justice McHugh’s famous decision in Dao.
McHUGH J: This Act deals with the particular provision and excludes the Judiciary Act, just as in Dao the State Limitation Acts could not apply to Commonwealth prosecutions for taxations or recovery for taxation.
GUMMOW J: And Moorebank.
McHUGH J: And Moorebank.
MR ROBERTSON: Yes. In the High Court, not in the Court of Appeal.
McHUGH J: Yes.
KIRBY J: That seems to be the way it has been argued below. Can I take it that that is common ground or do you so submit, in this Court, that we do not have to worry at all about the Judiciary Act? This is federal jurisdiction, but there is a particular provision and that governs the field and only governs the field. There is no work for the Judiciary Act left to do.
MR ROBERTSON: There is no work for the Judiciary Act in the present proceedings. The work is done by section 247, in our submission.
GLEESON CJ: How do the concluding words of section 247 operate?
MR ROBERTSON: There has been some discussion of those words in the cases and I think, in particular, in Naismith v McGovern 90 CLR 336. Perhaps while your Honours have that I can – because I was going to come to this case in ‑ ‑ ‑
McHUGH J: Just before you do, it may not be strictly accurate to say that the Judiciary Act does not apply, because the defendant would be entitled to discovery in interrogatories against the Customs and that would only be because of section 64 of the Judiciary Act, would it not?
GUMMOW J: Unless there was a direction under this section.
MR ROBERTSON: I think I follow what your Honour is putting to me. Certainly that was ‑ ‑ ‑
McHUGH J: Because you equate the Crown with subject and subject.
MR ROBERTSON: Yes.
McHUGH J: Because is it not Commonwealth v Miller that decides that you can get discovery and interrogatories?
MR ROBERTSON: Closer to home, there is Justice Isaacs’ decision in ‑ ‑ ‑
McHUGH J: Coal Vend.
MR ROBERTSON: ‑ ‑ ‑ in Coal Vend, where ‑ ‑ ‑
McHUGH J: Yes, although that is a State case, is it not? No, it is a Commonwealth case.
GLEESON CJ: It is action to recover damages.
McHUGH J: Yes.
MR ROBERTSON: No, it is Australian Industries Preservation Act. Now, admittedly by then the Judiciary Act had been enacted.
McHUGH J: It had been.
MR ROBERTSON: It had been, because that was in 1910.
McHUGH J: Yes.
GUMMOW J: Yes, but these concluding words of 247 have always been there. They were there in 1901 and they had to be before you had section 64.
MR ROBERTSON: Section 247, your Honour is ‑ ‑ ‑
GUMMOW J: Yes, the concluding words of 247 about directions to the Court. They had to be there in 1901 because you did not have section 64. Now you do have 64.
MR ROBERTSON: You did not have section 64, your Honour, but you did have the 1901 Act, the name of which I cannot remember, the Claims Against the CommonwealthAct.
McHUGH J: Yes, but you could not get discovery or interrogatories in the revenue cases, could you? You certainly could not get discovery or interrogatories against the Crown – sorry, yes, I do not think you could get it against the Crown, you certainly could not get it against the defendant in a Customs proceeding in the last century in the revenue courts.
MR ROBERTSON: Certainly, Miller decided that the work that section 64 did included discovery against the Crown and that was an issue as well in the tax cases in the 1930s and 1940s which I will come back to. But, if my memory serves me right, the words “as nearly as possible” were also found in the ‑ ‑ ‑
GUMMOW J: Section 3 of the Claims Against the Commonwealth Act 1902.
MR ROBERTSON: Thank you, your Honour.
GUMMOW J: But that was people making claims in contract or a tort against the Commonwealth. It would not work this way.
MR ROBERTSON: Yes, that may not have covered it so the work ‑ ‑ ‑
GUMMOW J: They could get discovery because of section 3(2).
MR ROBERTSON: Yes. So what your Honour Justice Gummow puts to me is that one of the functions of the last half dozen words of section 247 may have permitted a court or a judge to give directions as to discovery.
GUMMOW J: Yes, and is that not what Naismith v McGovern is about?
MR ROBERTSON: Well, of course, Naismith v McGovern ‑ ‑ ‑
GUMMOW J: It relies on 64.
MR ROBERTSON: On 64, exactly. But if I could take your Honours to that, if your Honours have 90 CLR 336, and the decision, of course, was that the defendant was entitled to an order of discovery for documents against the Commissioner. That was the ultimate decision. But the Court said, if I can take your Honours to page 339, Justice Williams, Justice Webb, Justice Kitto and Justice Taylor. In the middle of the page their Honours speak of Part VII of the Assessment Act – this is three lines down from there –
Section 237 provides that: “Every taxation prosecution in the High Court of Australia or the Supreme Court of any State or Territory of the Commonwealth may be commenced prosecuted and proceeded with in accordance with any rules of practice established by the Court for Crown suits in revenue matters or in accordance with the usual practice –
In other words, it is the same as 247 of the Customs Act.
There are in this Court no rules of practice established by the court for Crown suits in revenue matters and the present proceeding is being prosecuted in accordance with the usual practice and procedure of the Court in civil cases.
Then over the page, at about point 5 of the page, there is a reference to “Robertson, Civil Proceedings by and against the Crown”, if your Honours see that. It is stated:
that informations for penalties are to be regarded rather as civil than as criminal proceedings.
GUMMOW J: Now, that assisted the citizen at one stage because it assisted the citizen because it brought appeals into a civil structure when there was no criminal structure of any sophistication.
MR ROBERTSON: Yes, before the early part of the last century.
GUMMOW J: Yes.
MR ROBERTSON: And then in Attorney‑General v Freer ‑ I will not read that. Then there is a reference to Justice Williams’ decision as a member of this Court in McStay, and another decision of Justice Williams in McGovern v Hillman:
“Accordingly, proceedings must, for many purposes, be considered as being in the nature of a civil action.”
Then there is a reference to Jackson v Butterworth ‑ ‑ ‑
GUMMOW J: The devil is in the phrase, “must for many purposes”. What purposes?
MR ROBERTSON: Well, we would submit ‑ ‑ ‑
GUMMOW J: I have just mentioned one, which was to assist citizens to appeal.
MR ROBERTSON: Yes.
GUMMOW J: You say the boot is on the other foot?
MR ROBERTSON: The boot is on both feet.
GUMMOW J: In other words, citizens are worse off because of the standard, you say?
MR ROBERTSON: If I can put it slightly more kindly, your Honour. There are civil proceedings for one purpose, there are civil proceedings for another purpose.
GUMMOW J: Yes.
GLEESON CJ: I am just not sure about that. A number of the submissions seem to proceed upon the assumption that there is a strict dichotomy between civil proceedings and criminal proceedings and that you are either fish or fowl for all purposes.
MR ROBERTSON: Well, we ‑ I am sorry, did I interrupt your Honour?
GLEESON CJ: This seems to recognise that these proceedings are hybrid in nature, and whether they ought to be characterised in one way or another way for a particular purpose might vary depending upon the purpose in question.
MR ROBERTSON: We would quite accept that, your Honour. One of the criticisms we make of the decision of the Court of Appeal in Queensland is that they relied on cases dealing with, for example, whether or not Customs penalty proceedings were within a schedule to the Judicial Review Act, which is quite a distinct question, as indeed, we would submit, is your Honour Justice Kirby’s decision in the Court of Appeal in Jack Brabham. We are quite content to accept that for the purposes of whether or not a stay should be granted of proceedings, a different question arises. But what that comes down to, in our submission, is whether…..relevantly civil proceedings, civil procedure, whether one can say that the standard of proof can exist outside the type of action that you are speaking of, and our submission is that it does not.
GLEESON CJ: Well, what you have just been referring to in Naismith demonstrates, at the bottom of page 339, for example, that the fact that proceedings are civil proceedings does not permit the moving party in the proceedings to obtain discovery against the defendant. What is it ‑ ‑ ‑
MR ROBERTSON: I am sorry. Is your Honour ‑ ‑ ‑
GLEESON CJ: I am looking at the bottom of 339.
MR ROBERTSON: This is what the Deputy Crown Solicitor said?
GLEESON CJ: Yes.
He added that the proceedings were penal in their nature, though civil in form, and it has never been the practice to allow discovery or interrogatories in panel actions against the defendant ‑ ‑ ‑
MR ROBERTSON: That is the Deputy Crown Solicitor?
GLEESON CJ: Yes. Now, that is just an example of a question arising which is not answered simply by saying these are civil or these are criminal. When the question arises as to the standard of proof, what is it that produces an answer to the question beyond merely saying civil or criminal? What if there are hybrid proceedings that are civil for some purposes or criminal for some purposes? How do you then answer the question: what should be the standard of proof?
MR ROBERTSON: We answer the question in this way: that is, 247 says the proceedings are civil, step 1.
GUMMOW J: Wait a minute. Section 247 does not say that, does it?
MR ROBERTSON: I am sorry, your Honour, I was using the shorthand.
GUMMOW J: I know you were.
McHUGH J: That is very dangerous.
MR ROBERTSON: In accordance with the usual practice and procedure of the Court in civil cases.
GLEESON CJ: As one possibility?
MR ROBERTSON: As one possibility, yes.
GLEESON CJ: Well, could the judge direct what the standard of proof was to be, pursuant to the concluding words of section 247?
MR ROBERTSON: I have been a long time answering what your Honour the Chief Justice asked me ten minutes ago. Could I take your Honours to why it was I took you to Naismith v McGovern in the first place, which is the indication at the foot of 343, last six lines:
In our opinion, no valid objection has been raised to the making of an order for discovery in the present case.
So that is contrary to the views of the Deputy Crown Solicitor that your Honour the Chief Justice was taking me to. We only wish to add that the third limb of 237, which is the ‑ ‑ ‑
GUMMOW J: I know, but that does not answer the Chief Justice’s question.
MR ROBERTSON: Your Honour is right; it is the only indication, in this Court anyway, of the content of the third limb. It:
could make any procedural order either in favour of the plaintiff or the defendant to meet the special circumstances of any particular case.
GUMMOW J: There might be Chapter III problems in empowering a judge to determine a matter of that importance.
MR ROBERTSON: Another of the decisions has referred to this, that the third limb certainly could not sustain a direction as to how a case could be commenced, so the third limb must be more limited in its scope than the second limb.
GLEESON CJ: Now, I think you have done the Deputy Crown Solicitor a serious injustice.
MR ROBERTSON: I am sorry, your Honour.
GLEESON CJ: If you back again to the bottom of 339 and the top of 340 his argument was that because you could not get discovery against the defendant, therefore it was inappropriate to order discovery against the plaintiff.
MR ROBERTSON: Yes.
GLEESON CJ: I would like to focus on the first part of that proposition. This case does not cast doubt on the proposition that you cannot get discovery against the defendant. It says that the fact that you cannot get discovery against the defendant is not a reason for not ordering discovery against the plaintiff.
MR ROBERTSON: Yes, it certainly says that.
GLEESON CJ: Yes. Let us just focus on the first part of that proposition. These are civil proceedings but you cannot get discovery against the defendant, right?
MR ROBERTSON: The ones in Naismith v McGovern?
GLEESON CJ: Yes.
MR ROBERTSON: Yes.
GLEESON CJ: Why? Why, even though they are civil proceedings, can you not get discovery against the defendant?
McHUGH J: The reason was because you could not get discovery or interrogatories at common law, could you, except under statute and the Court of Equity would not make an order for discovery or for administering interrogatories in proceedings for a penalty of forfeiture.
MR ROBERTSON: That is, I think, what Justice Isaacs said in Associated Northern Collieries.
GLEESON CJ: Exactly, so that tells you that the fact that the proceedings are civil does not deny the significance of the fact that they are proceedings for a penalty which produces a certain consequence. Now, when you come to the question of onus of proof, does the fact that the proceedings are civil deny the possibility that the onus of proof is beyond reasonable doubt? I do not know what the answer to the question is but it is an open question.
McHUGH J: There is a problem about describing civil proceedings because it says under 247:
they may be proceeded with in accordance with any rules . . . established . . . civil cases –
But Justice Gummow earlier pointed out to you that the classification of “civil” for some purposes in England helped a right of appeal because the relevant statute had something about otherwise than in a criminal cause and so it was held that you could bring an appeal. But this Act, which is a bit schizoid in personality, turned that on its head because it provides that you have an appeal along the criminal path.
MR ROBERTSON: When you say “this Act” ‑ ‑ ‑
McHUGH J: Yes, the Customs Act. Look at 248, for example. It says that ‑ ‑ ‑
MR ROBERTSON: That is summary proceedings.
McHUGH J: Yes, I know, but, nevertheless, you take the criminal law path. It is the path that is provided for on appeals for convictions.
MR ROBERTSON: But 248 would only apply to those courts in 245(1) in relation to which summary proceedings were commenced.
KIRBY J: Yes, but the point is it would be an unusual thing to send a civil case up the criminal path, very unusual. Never heard of it. I sat in the Court of Criminal Appeal for years and never saw a civil case there.
GLEESON CJ: Does this send civil cases up the criminal path or does it send summary proceedings up the ‑ ‑ ‑
McHUGH J: It sends summary proceedings.
MR ROBERTSON: It sends summary proceedings, yes.
GLEESON CJ: So, to translate this into the procedure in New South Wales, if you went before that special federal magistrate and dealt with this as a summary proceeding for an offence, the appeal would be by the criminal path. But if you went to the Supreme Court of New South Wales seeking to recover a penalty you would go to the Court of Appeal, not the Court of Criminal Appeal.
MR ROBERTSON: Yes, because of ‑ ‑ ‑
KIRBY J: More significant than the fact that it can go up the civil path is the fact that it can go up the criminal path, because that is just not something you normally do with a civil proceeding. That was the point I was making.
GUMMOW J: It is just another example of the various purposes in that statement from Justice Williams in McGovern.
MR ROBERTSON: Yes. I am not sure, perhaps ‑ ‑ ‑
GUMMOW J: It is schizoid.
MR ROBERTSON: Can I say this, your Honour ‑ ‑ ‑
GUMMOW J: Courts have been complaining about the Customs Act for the best part of the century, in that it gives rise to these tensions.
KIRBY J: If Parliament wants to be schizoid, it can, but if it wants to get these provisions applied in the way you want, it seems to me it is not unreasonable for a court to say, “Well, take a pill, get rid of your schizophrenia, and make it clear”. It is not unreasonable to say that to citizens.
MR ROBERTSON: Well, one is construing the legislation, your Honour. That is certainly so.
GUMMOW J: No, but it is important, Mr Robertson, because the three limbs in 247 have to be on a parity, and you have to say that it would be permissible, on a construction of 247, for the judge to give directions as to the onus of proof. Do you say that? As to the standard of proof.
MR ROBERTSON: I do not accept at the moment, your Honour, that they would have to be on a parity. I mean, if one of the reasons ‑ ‑ ‑
GUMMOW J: They are expressed as three alternatives.
MR ROBERTSON: They are expressed as alternatives and, no doubt, it is true to say that the third limb would give a wide discretion to make a procedural order but, as I earlier submitted, it would be hard to see how the third limb would cover ‑ ‑ ‑
GUMMOW J: Well, the third limb does not say, “In accordance with 1 or 2, or by variation of 1 or 2, in accordance with directions”. That is the way it should be drafted, if that is the idea.
GLEESON CJ: Could the judge direct discovery against the defendant?
MR ROBERTSON: Certainly, that could happen. To go back to the question of characterisation and purposes, I would fully accept that, as Naismith v McGovern shows, the purpose of the question is important to the answer that one might arrive at, but the submission we make in answer to your Honour the Chief Justice’s question is that if one is looking at, in 247:
the usual practice and procedure of the Court in civil cases –
then the standard of proof is an incident of the proceedings in which the matters in question are to be proved. One can see that, in our submission, looked at, no doubt, from a different perspective, in the decisions of this Court to which we have given reference, such as Neat v Karajan, where the Court has held – and it has been a view repeated by the Court. Neat v Karajan Holdings (1992) 67 ALJR 170 at 171, I do not think was on our list of authorities.
We have reproduced the relevant paragraph at page 3 of our submissions in reply. The point is summarised in the decision of the Full Federal Court that we also refer to, Australian Securities Commission v Kippe (1996) 67 FCR 499 at 507, where their Honours of the Full Court say:
A proceeding which has as its object the imposition of a penalty and which may result in the imposition of such a penalty is penal in nature –
and their Honours refer to Naismith v McGovern and Associated Northern Collieries. Their Honours go on to say:
Proceedings to recover or enforce such a penalty may be either civil or criminal proceedings depending upon the nature of the procedure used to initiate them ‑
And they refer to Sir Frederick Jordon’s paper, if that is the right word, on the General Principles of the Administration of Justice in New South Wales, where his Honour makes precisely that point. Then their Honours go on to say:
When the proceeding to recover a penalty is a civil proceeding it remains a civil proceeding notwithstanding that it is penal in nature.
Their Honours again refer to Justice Isaacs in Associated Northern Collieries.
GLEESON CJ: What is the reference to that?
MR ROBERTSON: 67 FCR 499 and the passage I was reading was at page 507C to D.
KIRBY J: I notice that the Minister, Senator Vanstone, in support of the Law And Justice Legislation Amendment (Application of Criminal Code) Bill 2000, which is in your collection at tab 9, says that these are anomalous provisions:
While this anomaly is not logical, and the status of these offences is currently being reviewed by the Australian Law Reform Commission ‑
and that meanwhile all the provisions of the Criminal Code are going to apply to them.
MR ROBERTSON: Yes but, your Honour, he goes on to say:
For example, the fundamental difference between criminal and civil matters ‑ the burden and standard of proof ‑ will be left to the existing law . . . As is the case now, the standard of proof will depend on the court in which the matter is heard. If it is dealt with as a criminal matter, the standard of proof will remain beyond reasonable doubt.
So that that reflects ‑ it may seem anomalous, your Honour ‑ ‑ ‑
KIRBY J: That is what she said. I am using the Minister’s words, not my own.
MR ROBERTSON: I am sorry, your Honour.
KIRBY J: She says at 595:
While this anomaly is not logical ‑ ‑ ‑
MR ROBERTSON: That is the explanatory memorandum.
KIRBY J: Yes.
MR ROBERTSON: Yes, I am reading from the same ‑ ‑ ‑
KIRBY J: Paragraph 595.
MR ROBERTSON: I was reading the same paragraph, your Honour.
KIRBY J: Yes, I know you were.
MR ROBERTSON: I am sorry. They were all the Minister’s words.
KIRBY J: Yes; a lot of good sense in them really.
MR ROBERTSON: Your Honour, it depends on ‑ one can call it an anomaly but that is only if one does not look at it historically. In our submission, if one looks at it historically, and I will have to come to this - at the risk of repetition, if one looks at it historically and in particular in light of the United States cases, there were decisions which said it is enough if the proceedings are referred to as an action to characterise them as civil proceedings. The nature of recovery of penalties is civil proceedings.
KIRBY J: Yes, but there is a lot of constitutional law behind that, as I think you fairly pointed out in your submissions for the Commonwealth. This is all to get out of the jury trial provisions of the Constitution.
MR ROBERTSON: No, Your Honour. It was decided at the turn of the century and shortly after, I will come back to this, but it was decided in the United States Supreme Court before the turn of the last century and afterwards that in actions for the recovery of civil penalties by Customs, as one of the examples, the standard of proof was the civil standard notwithstanding ‑ and the Sixth Amendment did not affect that question. So that it stood outside ‑ and it is still the law in the United States that actions to recover penalties under the customs legislation fall outside the opening words of the Sixth Amendment in all criminal prosecutions.
KIRBY J: So that the Congress can, by calling them “civil”, walk itself out of the constitutional protection. It seems a very dubious doctrine to me.
MR ROBERTSON: And the Seventh Amendment, yes, but both the Sixth and the Seventh Amendment as your Honour has seen. Certainly, the answer to your Honour Justice Kirby’s question is, yes, the Parliament, the Congress, can, and in our respectful submission has, by making the choice that one can see in 247, adopted the “practice and procedure . . . in civil cases” and we would submit that that includes the standard of proof relevant to the conduct of civil cases.
KIRBY J: It can call it “Customs prosecutions”, it can call it penalties, it can impose fines, it can send people to gaol.
MR ROBERTSON: No, your Honour, gaol is not part of what we are talking about.
KIRBY J: Fines are.
MR ROBERTSON: Fines are. Penalties which are referred to ‑ ‑ ‑
KIRBY J: You can send them in certain circumstances up to the Court of Criminal Appeal, but it is still civil.
MR ROBERTSON: It is civil for the purposes ‑ ‑ ‑
KIRBY J: That is like a ‑ ‑ ‑
MR ROBERTSON: Your Honour, if, and I am not sure that 248 has any application since 1989 in real terms, but if the proceedings are an action for the recovery of customs penalties, be they twice the duty, three times the duty – and three times the duty is, if one looks, as we say correctly, at the historical aspect of this ‑ a procedure which Chief Justice Dixon referred to in Redfern v Dunlop as a means of enforcing compliance with the legislation, well known at the time of the Australian Industries Preservation Act which I think was 1904 and, of course, the Sherman Act before them so the fact that the penalties are twice or three times or some multiple of a duty ‑ ‑ ‑
KIRBY J: But, as you pointed out some of them are not related to the quantum of the customs duty.
MR ROBERTSON: Some of them are, as it says, a penalty of $5,000 or $10,000 or whatever it might be, and then one is left to the discretion of the court as to what the appropriate penalty ‑ ‑ ‑
KIRBY J: Just like in any other criminal fine ‑ nothing to do, no relevance, or only some passing relevance to the amount of the duty not paid.
GUMMOW J: Do you say you get any advantage in your case out of 255(1)?
MR ROBERTSON: In terms of construing 247, your Honour?
GUMMOW J: Yes, and as to the standard of proof question.
HAYNE J: Or even if standard of proof is not to be found rooted in 247.
MR ROBERTSON: I am willing to accept that it does assist, but it seems to be to do with the onus of proof rather than the standard of proof.
HAYNE J: How does averment sit with proof beyond reasonable doubt? It may, but at some point I would like to know what you say the accommodation of averment provisions with the concept of proof beyond reasonable doubt is.
MR ROBERTSON: We submit, of course, that 255 sits in the context of a civil standard of proof not a criminal standard of proof, but I understand your Honour’s question to be perhaps how could you have an averment operating as prime facie evidence if the standard of proof was the beyond reasonable doubt standard.
McHUGH J: Well, you can, can you not? I mean you can under the Commonwealth Crimes Act. It was dealt with extensively by Justice Evatt in his judgment in, what was the name of it, R v Devanny; Ex parte Hush he deals with it. He regarded it as an abuse of process. In that case, it took three hours to read the averments, I think, from recollection.
MR ROBERTSON: Yes, but it does deal more with the onus of proof. At the moment I cannot see any inconsistency between the standard of persuasion and where you start, in a sense, which is the purpose of the averment provisions.
HAYNE J: Well, it means that the defendant to the suit is called on to make answer. If the averments are complete, the defendant is called on to make answer, which is an unusual set of circumstances to find yourself in, in what might be regarded as the classical criminal procedure. Now, does that present attention? If it does, what is it? If it does not, if you point to none, so be it.
MR ROBERTSON: Perhaps it goes more to this aspect of it, that it tends to confirm that what the Parliament had in mind was a civil action rather than a criminal action. I am not sure that I could put it any higher than that.
McHUGH J: But if you are right, the defendant cannot call character evidence.
MR ROBERTSON: That would have to be so.
McHUGH J: Yes.
MR ROBERTSON: Yes, that would have to be so. I am not sure, your Honours, I have ‑ ‑ ‑
GLEESON CJ: We do not need to speculate about whether what Parliament had in mind was a civil action. All we have to do is read section 247, but where does that take you? Do you answer the question of standard of proof just by saying, “It is an action in accordance with civil practice and procedure”?
GUMMOW J: In other words, is the principle about standard of proof a matter of practice and procedure? For example, the New South Wales Supreme Court Act, and the Federal Court Act too, gives those courts power – and we have it too – to make rules of court about matters of practice and procedure. Now, do those sections empower in the judges a rule‑making power to change or specify a standard of proof? I think there are cases that say those phrases in the rule-making section, “practice and procedure”, are construed widely, but I do not think they have ever been construed that widely.
MR ROBERTSON: We submit that – I am not sure that this directly answers your Honour Justice Gummow’s question ‑ ‑ ‑
GUMMOW J: But that is where you have to hang your hat, is it not?
MR ROBERTSON: Yes, we do. That is that that phrase, which I will not read again, has as its consequence that the ‑ ‑ ‑
GUMMOW J:
usual practice and procedure . . . in civil cases ‑ ‑ ‑
MR ROBERTSON: ‑ ‑ ‑ standard of proof which operates in civil cases applies to these prosecutions, these proceedings.
GLEESON CJ: We know, do we not, that the rules of discovery that apply to civil cases do not operate in these proceedings or, perhaps more accurately, the civil practice and procedure allows a qualification in relation to discovery and interrogatories.
MR ROBERTSON: Yes.
GLEESON CJ: Does it allow a similar qualification in relation to standard of proof?
MR ROBERTSON: No, in our submission, because they have different origins, that is, that the standard of proof is, as I have submitted, an incident of the nature of the proceedings, whereas matters of immunity, if that is the right expression, are not founded in or limited to the form of the action. The context in which the words “practice and procedure” appear in 247 would support their application to the standard of proof.
KIRBY J: Justice Atkinson at the end of her reasons referred to the fact that the Australian Law Reform Commission had made recommendations. Was that after Senator Vanstone’s speech or ‑ ‑ ‑
MR ROBERTSON: I am sorry, your Honour, which page is that?
KIRBY J: It is page 30, paragraph [101].
MR ROBERTSON: I think what her Honour is referring to there is - if your Honour were to go back to her Honour’s judgment at page 20 of the book, paragraph [74]:
In its report on Customs and Excise, the Australian Law Reform Commission said that the present situation with regard to customs prosecutions was unsatisfactory . . . the commission was of the view that it was desirable to put an end to the . . . uncertainty on this issue had generated and said that that would be achieved if the true criminal nature of the proceedings were recognised. The Law Reform Commission recommended that the offences be prosecuted summarily. This was designed to avoid the effect of s 80 of the Constitution . . . the Commission, however, said that it recognised that the current state of the law at the time of the report was that the standard of proof was on the balance of probabilities subject to the rule of prudence that the court must examine the evidence with great care and caution –
MR ROBERTSON: We certainly will give your Honours copies of the sections but there is no – apart from removing the jurisdiction of the High Court in these sections that were under discussion, 244, 245, 247, there really has been no material change since 1901, apart from, I say, taking the jurisdiction from the High Court and rearranging in 1989 the lower courts’ jurisdiction.
In answer to a question your Honour Justice Hayne asked me this morning about 254, Dr Wallaston at page 169 does say that it enables the Customs to force the defendant to give evidence, evidently a great advantage to the prosecution. So although perhaps there would be an immunity available, at least in certain circumstances, nevertheless that step would seem to be contemplated by the terms of 254(2).
McHUGH J: I thought it was Dr Wallaston rather than Sir Robert Garran who was responsible for drafting this Act, or am I wrong about that?
KIRBY J: I thought I read in…..v The Commonwealth that it was Sir Robert Garran who was very proud of his ‑ if you import one ‑ ‑ ‑
MR ROBERTSON: Yes. Well, Dr Wallaston says the work of revision was undertaken by the Minister personally, which was Mr Kingston. So I am not sure where the truth would be. Certainly, Dr Wallaston says the language used throughout the Act is terse, modern, comprehensive and free from ambiguity. Mr Kingston ‑ perhaps this is an exercise of mutual self‑congratulation, but in the second reading speech Mr Kingston says that it is the work of all the collectors, including Dr Wallaston.
HAYNE J: Drafting by committee, Mr Robertson.
MR ROBERTSON: Yes. Your Honour the Chief Justice asked about Justice Pincus’ decision in The Heating Centre Case. The only place that we found that had been considered on this point is in Justice Atkinson’s judgment in the first instance in this case that the appeals come to your Honours. At pages 18 and 19 of the appeal book her Honour sets out the relevant paragraphs from Justice Pincus’ decision.
GLEESON CJ: I find it very puzzling, particularly having regard to the propensities of some of the advocates who argue these cases, that this point has never been raised for decision in any proceeding in relation to the Trade Practices Act and the recovery of civil penalties under that Act.
MR ROBERTSON: If it is so, it is certainly surprising. Your Honours, my learned friend took you to Mallan v Lee and if I can give your Honours the page reference to Naismith v McGovern which I took your Honours to, 90 CLR at 341 point 6. It is said that nothing in Mallan v Lee cast any doubt on what Justice Fullagar had said or Justice Williams had said. Then your Honour the Chief Justice also asked about when these differing standards became established. We have attempted some history in our submissions in reply. We have given your Honours references to what Sir James Stephen wrote in 1883. Certainly, the issue in relation to matrimonial causes, as your Honour pointed out, was still a topic of debate, at least in Australia, up to and including but not beyond British ‑ ‑ ‑
McHUGH J: I think the House of Lords held in Preston v Jones in 1952, if I remember rightly, that adultery had to be proved beyond reasonable doubt, and the English cases also held, I think, if I remember rightly, that civil fraud had to be proved beyond reasonable doubt as well.
MR ROBERTSON: I think, your Honour, they have now perhaps recanted. There is a more recent decision of the House of Lords in a child welfare care – I think it is called In re H – which is adopting what really appears to be the Briginshaw test, although I am not sure by that name, but in footnotes ‑ ‑ ‑
GLEESON CJ: What is the reference to that? I thought Briginshaw had never been taken up in the United Kingdom.
MR ROBERTSON: I do not know that it has been taken up by name, but certainly – I will find it shortly – it is referred to in 2000 edition of Phipson on Evidence, and set out at some length there. I have a note of it ‑ ‑ ‑
GLEESON CJ: Do the English now have to conform to some European requirement in relation to questions of this kind?
McHUGH J: There is no presumption of innocence, is there, in the Continent, or at least in some parts of it?
MR ROBERTSON: Can I answer it in this way, your Honours, and this is perhaps trespassing into the area of the constitutional question, but it is not insignificant in that respect that the International Covenant on Civil and Political Rights deals with the burden of proof but not the standard of proof and that is article ‑ ‑ ‑
GLEESON CJ: Do not let us keep you from getting into that constitutional question.
MR ROBERTSON: No, I shall, your Honours, but article 14 of the Covenant on Civil and Political Rights talks about the presumption of innocence but not about the standard of proof. I have the reference now, I think, to the House of Lords decision. It is called In re H [1996] AC 563, and it is discussed in the 15th edition of Phipson, which is the year 2000, at pages 80 to 82, and we have included in those footnotes references to earlier editions of Phipson and to the work of Sir James Stephen and as to the debate even leading to articles in the Law Quarterly Review in 1949 as to the standard of proof of adultery which was still then – the standard of proof was an issue at that stage.
Also, of course, as we point out, in DPP v Woolmington – and this goes perhaps to the constitutional question – the speech referred to statutory exception to the contrary, or unless there is statutory exception to the proposition of ‑ ‑ ‑
McHUGH J: Well, Sodeman’s Case decides that at common law, the onus is on the accused to prove insanity.
MR ROBERTSON: And also in statutory re-enactments, in the New South Wales Crimes Act, at the civil standard. Your Honour Justice Gummow asked for copies of the relevant statutes, but I think it would be better perhaps if we just filed those in the Registry together with the pleadings rather than hand them up now, if that is convenient.
KIRBY J: When you are sending matter in, you might give thought to providing us with anything that any text writers have said – for example, in the Trade Practices Act texts – about the standard of proof, because it does seem remarkable that this matter has not been elaborated by court decisions.
MR ROBERTSON: Yes. Well, certainly, as I say, Dr Miller’s annotations take it no further than Justice Pincus’s judgment in that ‑ ‑ ‑
KIRBY J: There may be a distinction between Customs prosecutions and civil penalties under the Trade Practices Act, given the place that these provisions find themselves in, the heading, the use of the language, the context and the criminal indicia…..the old provisions of the Act that Justice McHugh referred to.
MR ROBERTSON: Certainly the language is more modern, obviously, in the Trade Practices Act, but ‑ ‑ ‑
KIRBY J: Are there any academic writings on this that you have found - any Law Review articles or anyone commenting ‑ ‑ ‑
MR ROBERTSON: Certainly not on the Customs Act, and very few decided cases dealing with this issue.
KIRBY J: But every time there is a proceeding, and there must have been thousands of them since Federation, a judge has to decide what the standard is. Maybe they all satisfy themselves by saying, “Well, I’m satisfied on the criminal standard and therefore I don’t have to consider whether I was satisfied on the lower standard”. It is the easy way out.
MR ROBERTSON: We have given your Honours references to all the cases and, of course, the judge at first instance gives references to all the cases which have been decided in relation to the Customs Act which have mentioned this issue.
KIRBY J: That is the compilation, is it?
MR ROBERTSON: No, the compilation is the more recent cases, and I think most of the cases that her Honour mentions have been ‑ ‑ ‑
KIRBY J: But there would have been thousands of cases where barristers have stood on their feet and said, “Well, your Honour can’t be satisfied beyond reasonable doubt. Steady on, the principle is the civil onus.” It is the way cases are run, one would have thought.
MR ROBERTSON: It may be they are, your Honour, but they do not seem to be reported, apart from the ones that we found and some of those, of course, are unreported. But certainly we will give your Honour what we can find in relation to – my attention has been drawn certainly to one article, very recent, in the Australian Journal of Administrative Law, called “Customs Prosecutions”, but that may be a comment on these decided cases. Perhaps we can give your Honour a list of them rather than take up time now.
KIRBY J: Yes, thank you. I do not want to delay you further in getting into the Constitution. You seem to be a little reluctant.
MR ROBERTSON: No, I should go to that now. Having perhaps repeated the proposition, lest I be at cross-purposes with your Honour Justice Kirby, that it is of great importance to start with what are Customs prosecutions and they are limited to the recovery of penalties and the submission that, as a matter of construction, the recovery of penalties does not extend to what is spelt out in 254(2), that is:
indictable offence or for an offence directly punishable by imprisonment –
so that those provisions of the Customs Act that do not relate to monetary penalties, in our submission, are not customs prosecutions that can be dealt with under section 247.
In terms of the constitutional argument, your Honours, we have, in our written submissions, drawn attention – and I am now speaking not for the appellant but for the Attorney-General intervening – in footnote 11 to the Attorney-General’s submissions to those cases, of which there are four or five in this Court dealing with, admittedly, onus of proof rather than standard of proof. Milicevic v Campbell, which your Honour Justice McHugh has mentioned, was, of course, a proceeding under section 235 of the Customs Act and the provision was, from recollection, that it was proof of the reasonable excuse lay upon the defendant. It was not a Customs prosecution, as such, because 235, at least ‑ ‑ ‑
McHUGH J: It was a drug case, was it not?
MR ROBERTSON: It was a drug case, yes, so 235, at least at the time of that decision, was and still is, or at least at the time of Reprint No 11, a matter that could lead to imprisonment for a particular period. But, in our submission, the capacity shown in those cases in footnote 11 – Milicevic v Campbell, Williamson v Ah On, Orient Steam Navigation v Gleeson – to reverse the onus of proof is, in terms of section 71 of the Constitution, a power that may well have a greater impact than a provision that, in terms of civil penalties, affects the standard of proof by prescribing – and, supposing for the purpose of this argument 247 does prescribe that the standard of proof should be the civil standard. In other words, I am supposing, for the purpose of this argument that 247, expressly read, and the standard of proof in these civil proceedings shall be the civil standard.
But it is perhaps difficult to talk about these issues in the abstract, but certainly from Nicholas’ Case 193 CLR 173, no doubt it was dealing with a quite different provision with quite different origins, that is 15X, I think it was, and reversing or perhaps preventing the court from looking at a particular fact, that is the officer’s involvement in the offence in the first place. But if one looks at the indications given in the reasons for judgment and applies them to a provision on the standard of proof, one can say and submit that section 247 does not direct a finding as to a particular fact, contrary perhaps to what one could say an averment provision was directed to, for example, as in Milicevic v Campbell, the particular fact being whether or not the person had a reasonable excuse.
The conclusions in Nicholas, at least to some extent, centred upon whether or not 15X brought the court into disrepute. Certainly there is no flavour, we would submit, of that being able to be said about a provision dealing with the standard of proof. We would also submit that a standard of proof provision “does not impair”, that being another test from Nicholas’ Case, “the curial functions” or require the court to act inconsistently with the curial process. Those are words that come from Chief Justice Brennan’s judgment in Nicholas at paragraphs 23 to 24 on pages 189 to 190.
As we have put in the written submissions, the history is relevant, as we put it, the long history of treating proceedings for the recovery of penalties as civil proceedings, is not a matter that could be ignored in relation to approaching the question of whether a law requiring a Chapter III court was requiring it to act in some way contrary to the essential character of the court or the judicial process.
KIRBY J: But that was a Ridgeway‑type argument. It was not really the same argument that is being advanced before us now. I rather took the respondent’s submission to be, enlightenment is dawning, we are finding the implication of due process in the Constitution, and the mere fact that in 1926 and in earlier cases mentioned in 11, it was not seen does not mean that it was not there. The eyes of the blind shall be opened.
MR ROBERTSON: Well, perhaps I would accept that the mere fact that it has not been seen before does not mean that it is not there. But certainly, consistently with the traditional approach of this Court to Chapter III questions, the history of the particular alleged interference has a large bearing, we would submit, in the same way as the Court approaches what has traditionally been seen as part of the judicial power, or what has traditionally been seen as non‑judicial power, and the grey area in between those two, where one can have a different character for the same activity, depending on in whom it is vested or on whom it is conferred.
KIRBY J: But do you say that the Parliament of the Commonwealth could enact a law changing for all federal criminal offences the standard of proof?
MR ROBERTSON: Certainly, we would submit that the power would go that far in relation to monetary penalties.
KIRBY J: If it does not go that far for other criminal offences, ordinarily so called, what is it that stops it?
MR ROBERTSON: If there were a limitation – and I am not putting that there is a limitation, because your Honours are only concerned with monetary penalties – but if there were a limitation, then it would have to be found in the idea that I think your Honour Justice McHugh mentioned in Witham v Holloway, that one would need to look carefully at gaol sentences on the balance of probabilities. Now, we are not looking at gaol sentences. We are not looking at prosecutions of that nature. One is looking only at the recovery of penalties we call civil penalties, related to matters of taxation.
KIRBY J: But here it is only one step removed. If you do not pay your fine, or the penalty, then you will go to prison. So it is really only one step removed. I know how you say that is not for the failure to pay the civil penalty, that is for defying the court order, but it still is the consequence of the scheme of the statute.
MR ROBERTSON: But it still does not deny, we would respectfully submit, that the nature of the provision in relation to the standard of proof relates only to the recovery of penalties.
GLEESON CJ: Forget about the fines for the moment. In relation to a person who is adjudged liable to pay a pecuniary penalty in proceedings of the kind here in question, what is the provision of the Act that produces the consequence that you go to gaol if you do not pay the penalty?
GUMMOW J: Is it in this Act?
MR ROBERTSON: It is not in this Act.
GUMMOW J: No.
GLEESON CJ: Is it in any Act?
MR ROBERTSON: If it is anywhere, it is in a State Act.
GLEESON CJ: It is in a State Act?
MR ROBERTSON: Yes. Now, how that State Act may interact with this Act – but I am told that it was an Act of the Queensland Parliament.
HAYNE J: It used to be in the Customs Act 1901. There used to be such provisions in 258. Section 260 gave a handy little table about how long you had to serve but ‑ ‑ ‑
MR ROBERTSON: I am sorry, your Honour, 258. Is your Honour looking at the ‑ ‑ ‑
HAYNE J: In the 1901 version, yes, but those have since gone ‑ ‑ ‑
GLEESON CJ: Section 261 seems to make an assumption about something.
MR ROBERTSON: Yes. Section 258 certainly used to provide, as your Honour Justice Hayne points out, that:
Where any pecuniary penalty is adjudged to be paid . . . the Court:
(1) may commit the offender to gaol until the penalty is paid ‑ ‑ ‑
GLEESON CJ: But that has gone now.
MR ROBERTSON: That has gone, yes.
KIRBY J: Where has it gone to? Where is it hiding away in the federal statute book? I find it hard to believe that it would have been taken out of the Customs Act to disappear forever from the face of the statute book.
MR ROBERTSON: I think one gets to the State Act by means of section 15A of the Commonwealth Crimes Act:
A law of a State or Territory relating to the enforcement or recovery of a fine imposed on an offender applies to a person convicted in the State or Territory of an offence against a law of the Commonwealth. The law applies:
(a) so far as it is not inconsistent with a law of the Commonwealth ‑ ‑ ‑
GLEESON CJ: Does that cover a person adjudged liable to pay a pecuniary penalty in a civil action?
HAYNE J: I would have thought not in the face of section 4E of the Crimes Act which deals particularly with:
A pecuniary penalty for an offence against the law of the Commonwealth . . . recovered in any court of summary jurisdiction.
GLEESON CJ: I was only wondering what happens in the event of insolvency.
MR ROBERTSON: I am sorry, your Honours, I am one step behind. I am looking for 4E:
A pecuniary penalty . . . may . . . be recovered in any court of summary jurisdiction.
But I understand that the definition in – or somewhere near the part on which 15A is found dealing with ‑ ‑ ‑
GUMMOW J: Well, 15A(1AB)(g) – anyhow, it will emerge one way or another from all these provisions, I suspect. We had better have a note about that too, I think.
MR ROBERTSON: Yes, whether it is a definition or whether it involves a regulation under (1AB)(h) I cannot ‑ ‑ ‑
GLEESON CJ: Well, perhaps you could pursue that and give us a note with the other material.
MR ROBERTSON: Yes, I will, your Honours. But otherwise in relation to the distinction that is at least a potential distinction, and assuming against us that gaol sentences are in a different category, our submission is that there is nothing inconsistent with the judicial power insofar as it does not, we would say, impair the curial functions by requiring the court to act inconsistently with them, and particularly that must be so in light of the history to which we have referred in relation to at least these civil penalties, but otherwise, your Honours, we would rely on the written submissions on the constitutional point. If your Honours please.
GLEESON CJ: Thank you, Mr Robertson. We will reserve our decision in this matter.
AT 4.10 PM THE MATTER WAS ADJOURNED
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