Commissioner of the Australian Federal Police v Courtenay Investments Ltd [No 3] - [2014] WASC 383

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE -v- COURTENAY INVESTMENTS LTD [No 3] [2014] WASC 383

CORAM: EDELMAN J

HEARD: 23 OCTOBER 2014

DELIVERED : 23 OCTOBER 2014

FILE NO/S: CIV 2702 of 2012

BETWEEN: COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE
Applicant
AND
COURTENAY INVESTMENTS LTD
HAPPLE LTD
DAVENRITE LTD
Defendants

Catchwords:

Criminal law and procedure - Forfeiture of property - Meaning of 'may, in determining the application, have regard to' in s 64(2) of the Proceeds of Crime Act 2002 (Cth) - Whether a party can object to transcript and evidence from an earlier proceeding being received into evidence in a forfeiture application

Legislation:

Acts Interpretation Act 1901 (Cth)
Corporations Act 1989 (Cth)
Foreign Evidence Act 1994 (Cth)
Proceeds of Crime Act 2002 (Cth)

Result:

Preliminary questions answered

Category: B

Representation:

Counsel:

Applicant: Ms W J Abraham QC & Ms C H Thompson
Defendants: Mr C E Chenu

Solicitors:

Applicant: Australian Federal Police - Proceeds of Crime Litigation
Defendants: Bennett & Co

Cases referred to in judgment:

Commissioner of the Australian Federal Police v Courtenay Investments Ltd [No 2] [2014] WASC 55; (2014) 283 FLR 59
Finance Facilities Pty Ltd v Federal Commissioner of Taxation [1971] HCA 12; (1971) 127 CLR 106
Ward v Williams [1955] HCA 4; (1955) 92 CLR 496
EDELMAN J:
(This is the text of reasons for decision delivered orally. The text has been edited for grammar and syntax.)

Introduction

The Commissioner of the Australian Federal Police has sought the forfeiture of $885,003 and interest to the Commonwealth of Australia under s 49(1) of the Proceeds of Crime Act 2002 (Cth). The Official Trustee in Bankruptcy holds the money under a restraining order under that Act. The money is held by the Official Trustee on behalf of the defendant companies which are incorporated overseas. The trial is to be heard in December this year.
In Commissioner of the Australian Federal Police v Courtenay Investments Ltd [No 2],[1] I held that s 64(2) of the Proceeds of Crime Act empowers this court on a forfeiture application to have regard to the transcript and evidence in any proceeding against the person who is alleged to have committed the underlying offence upon which the forfeiture application is based. The proceeding from which the Australian Federal Police rely upon the transcript and evidence is the criminal trial which concerned the alleged underlying offence which is a knowing contravention by Mr Corp of officer's duties under s 232(2) of the Corporations Act 1989 (Cth).[2]
[1] Commissioner of the Australian Federal Police v Courtenay Investments Ltd [No 2] [2014] WASC 55; (2014) 283 FLR 59.
[2] As taken to be included in the Corporations Act 2001 (Cth) by s 1401 of the Corporations Act 2001.
Another issue has now arisen. The issue that is now in dispute is whether (and the manner by which) a party to a forfeiture application can object to the admission into evidence of parts of transcript or evidence from an earlier proceeding on grounds other than relevance. The context in which this issue arises is that the Australian Federal Police wish to rely upon transcript (in the case of six witnesses) and evidence (in the case of the affidavit of one witness) from Mr Corp's criminal trial without making those witnesses available for cross-examination by the defendants.
My conclusion is that under s 64(2) of the Proceeds of Crime Act, the defendants cannot object to the admission into evidence of parts of transcript or evidence from the earlier proceeding on grounds other than relevance. The question was formulated by the parties to exclude objections on the ground of relevance. It is unnecessary to determine whether any objection on the ground of relevance can be made because the Australian Federal Police have accepted that they do not rely on any of the witnesses about whom relevance objections were made by the defendants.

Section 64 of the Proceeds of Crime Act

The text of s 64 of the Proceeds of Crime Act provides:
64Procedure on application
(1)Any person who claims an interest in property covered by an application for a forfeiture order may appear and adduce evidence at the hearing of the application.
(2)The court may, in determining the application, have regard to:
(a)the transcript of any proceeding against the person for an offence that constitutes unlawful activity; and
(b)the evidence given in any such proceeding.
(3)The court may still make a forfeiture order if a person entitled to be given notice of the relevant application fails to appear at the hearing of the application.

The first question: Can a party object to admission of the transcript other than for relevance?

The manner in which the first question arises

The first question is as follows:
Does s 64(2) of the Proceeds of Crime Act 2002 (Cth) (POCA) on a proper construction mean that a party cannot object to parts of transcript or evidence from an earlier proceeding being received into evidence at proceedings under section 49 POCA, on grounds other than relevance?
Initially, the manner in which evidence was to be given at the forthcoming trial was provided in orders made by consent of the parties. Those orders directed the parties to file affidavit evidence, including (if the Australian Federal Police wished to do so) evidence from any witness that incorporated the transcript of evidence given by that witness at the criminal proceedings against Mr Corp. The directions provided that the transcripts would be included as evidence in chief of the witnesses, and that the party calling that witness would require leave of the court to rely upon the evidence if the witness were not made available for cross‑examination. There was an application made at a directions hearing on 27 August 2014 for evidence to be given by video link.
On 17 September 2014, after the filing by the Australian Federal Police of parts of the transcript of the criminal proceedings against Mr Corp, and after the filing by the defendants of affidavit evidence of Mr Corp in response, the Australian Federal Police informed the defendants that none of the witnesses whom the defendants required for cross-examination would be made available to be cross-examined.[3] The Australian Federal Police said that, instead, they proposed only to rely upon the power of the court under s 64 of the Proceeds of Crime Act to 'have regard to' the transcript of evidence of individuals from Mr Corp's trial.
[3] See Affidavit of Ms Adamos sworn 25 September 2014, Attachment AJA-1 and Attachment AJA-3, pages 4, 9.
The proceedings from which the Australian Federal Police wish to rely upon parts of the transcript were conducted in the District Court of Western Australia. The defendants have objected to the admissibility of parts of the transcript of the video record of evidence given by two witnesses in those proceedings, Ms Susan Wickerson and Ms Dawn Dodd. Those witnesses gave their evidence in the Royal Court of the Island of Jersey for the purposes of the District Court proceedings. That evidence was taken in Jersey by the Viscount Substitute under s 24 of the Foreign Evidence Act 1994 (Cth).

The reasons why a party cannot object on grounds other than relevance

Section 64(2) of the Proceeds of Crime Act is a facilitative provision. Without the facilitative provision in s 64(2), the transcript of evidence from a witness in different proceedings would be hearsay evidence that is not independently admissible. Although s 64(2) is not directed to admissibility, as a practical matter, and on any view, the transcript would inevitably be admitted into evidence so that a court could decide whether to 'have regard' to it.
The purpose of s 64(2) is to facilitate the necessary proof of the offence in proceedings for forfeiture. It provides a mechanism by which a court can have regard to transcript and evidence which might not otherwise be before it on a forfeiture application. The starting point in ascertaining the meaning of s 64(2) is therefore the meaning of the words 'may, in determining the application, have regard to'.
Counsel for the defendants submitted that the concept of having regard to a matter required that the court rely on that matter or place some weight on that matter. If this were correct then the word 'may' would have its ordinary meaning importing a discretion.[4] An extreme example might be where no objection was taken at a criminal trial to a question requiring a witness to speculate, without any basis, about the state of mind of another person. A plainly inadmissible answer, where the witness speculates without any basis, would not be given any weight in determining a later forfeiture application. On the approach of counsel for the defendants, the court would exercise a discretion not to 'have regard to' the answer.
[4] Acts Interpretation Act 1901 (Cth) s 33(2A).
Senior counsel for the Australian Federal Police submitted that the concept of having regard to a matter was different from relying or placing weight upon that matter. Her submission was effectively that the words 'have regard to' merely involves considering the transcript.
The approach of senior counsel for the Australian Federal Police is consistent with both the facilitative nature of s 64(2) as well as the ordinary meaning of 'have regard to'.
The approach of the Australian Federal Police is consistent with the facilitative nature of s 64(2) that I discussed in Commissioner of the Australian Federal Police v Courtenay Investments Ltd [No 2][5] because it is concerned only with procedure, that is the process of putting material before the court, rather than the manner in which the court undertakes the task of determining the application.
[5] Commissioner of the Australian Federal Police v Courtenay Investments Ltd [No 2] [2014] WASC 55; (2014) 283 FLR 59, 66 - 67 [39] - [40].
The approach of the Australian Federal Police is also consistent with the literal meaning of 'have regard to' because the Macquarie Dictionary defines 'regard' as meaning 'to take into account; consider'.[6]
[6] Macquarie Dictionary, full online edition, definition 4.
For those two reasons the approach of the Australian Federal Police should be accepted. The approach does, however, mean that the word 'may' imports some mandatory duty.[7] There is a discretion in the sense that the court is not required to have regard to transcript or evidence if the transcript or evidence is not relied upon by any party. But once one party seeks to rely upon transcript or evidence from a proceeding that satisfies the requirements of s 64(2)(a) or s 64(2)(b) then the court must consider that transcript in the course of determining the application.
[7] See, for instance, Finance Facilities Pty Ltd v Federal Commissioner of Taxation [1971] HCA 12; (1971) 127 CLR 106, 124 (Gibbs J), 134 - 135 (Windeyer J), 138 ‑ 139 (Owen J). See also Ward v Williams [1955] HCA 4; (1955) 92 CLR 496, 505 - 508 (the Court).
The difference between the two approaches may rarely be of any significance. On the approach that I accept, regard could be had to various answers given in the transcript by witnesses, but those matters might not be relied upon or given any weight in the reasoning process. A reason why they might not be relied upon is if the underlying principles of fairness required by common law rules of evidence would otherwise have rendered those answers inadmissible. So, in the example I gave of speculation, a court would not put any weight on the answer given to the question.
There is a different question concerning whether non‑compliance with the rules of evidence in relation to answers given in the transcript will always mean that the court will place no weight, or no reliance, upon the answer in determining the application.
For three reasons, it is neither necessary nor appropriate to determine that question at this stage.
First, this was not the preliminary question that was formulated by the parties. Submissions on this point were made only in passing.
Secondly, this issue should not be determined in the abstract. It is appropriate to consider it in the context of particular evidence or transcribed answers to questions. That context could suggest that the fairness concerns that generally underlie the rules of evidence might not remove all weight that could be placed on the answer. For instance, consider the following example. The transcript might concern a criminal trial in which the accused is the same person who is subject to the forfeiture application. For tactical reasons, counsel for the accused person might not object to a question that is otherwise inadmissible. Could the accused person then argue in the forfeiture proceedings that the inadmissible answer should not be given any weight because it turned out not to support his case in light of all of the evidence? There is force in the submission by senior counsel for the Australian Federal Police that such an approach could be contrary to the administration of justice.
Thirdly, the question whether the court should place any weight upon answers given in transcript may be influenced by matters in addition to mere questions of whether the answers are admissible evidence. For instance, the inability to see and hear witnesses, including the inability to assess witnesses' demeanour and tone of voice.

The second question: the relevance of the manner of conduct of the previous proceedings

The second question does not arise because I have concluded that the defendants cannot object, other than on grounds of relevance, to parts of transcript or evidence from an earlier proceeding being received into evidence at proceedings under s 49 of the Proceeds of Crime Act.
It suffices to observe that s 64(2) does not place any express limit upon the factors to consider in deciding the weight (if any) to be placed upon matters from a transcript to which the court has regard. It was common ground that those factors will include compliance with the rules of evidence as I have mentioned. It may be that they would also include matters raised by this second question such as (i) whether the accused person in the trial of the underlying offence had legal representation, (ii) whether the accused person had the opportunity to object, and did object, to various questions, and (iii) the context of the answer given including whether it was in response to examination in chief or cross-examination.

Conclusion

The two preliminary issues in this application and their answers are below.
Question 1: Does s 64(2) of the Proceeds of Crime Act 2002 (Cth) (POCA) on a proper construction mean that a party cannot object to parts of transcript or evidence from an earlier proceeding being received into evidence at proceedings under s 49 POCA, on grounds other than relevance?
Answer 1: Yes.
Question 2: If the answer to Question 1 is no, do the following matters preclude the defendants at the hearing of the s 49 POCA proceedings making objections to the admission into evidence of parts of the transcripts of the evidence of Susan Joan Wickerson, Dawn Elizabeth Dodd, John Arthur Rump, Alec Raymond Pereira, Lee Ann Maxfield and Michael Ruane given at the relevant earlier proceedings:
(i)as to objections generally, that the accused persons in the earlier proceedings were represented and had the opportunity to object; and
(ii)that any particular objection sought to be made in the s 49 POCA proceedings was made in the earlier proceedings but not upheld?
Answer 2: Unnecessary to answer.
It was common ground at the hearing that if the first question were answered 'yes' then the appropriate manner to proceed would be for the Australian Federal Police to tender the whole of the transcript of the trial which was the subject of the alleged underlying offence. Since the transcript was of a six week trial it would be convenient for this to be done electronically.
It was also common ground that an appropriate course at trial would be for those parts of the voluminous transcript to be removed from the exhibit at the conclusion of the trial where neither party made any reference, or placed any reliance, at trial to those parts of the transcript.
I will now hear from the parties concerning costs of this application and directions for the forthcoming trial.