Craven v Registrar of NSW Court of Appeal

[1995] HCATrans 335

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney   No S95 of 1995

B e t w e e n -

JAMES ASHLEY WOODFORD CRAVEN

Applicant

and

REGISTRAR OF THE NEW SOUTH WALES COURT OF APPEAL

Respondent

Application for special leave to appeal

DAWSON J
TOOHEY J
McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON THURSDAY, 23 NOVEMBER 1995, AT 9.48 AM

Copyright in the High Court of Australia

MR C.J. STEVENS, QC:   If the Court pleases, I appear with my learned friend, MS K.E. BURKE, for the applicant.  (instructed by Gillis Delaney Brown)

MR K. MASON, QC:   I appear with my learned friend, MR N.J. WILLIAMS, for the respondent.  (instructed by I.V. Knight, Crown Solicitor for the State of New South Wales)

DAWSON J:   Mr Stevens.

MR STEVENS:   Your Honours, Mr Craven was a person who had assisted investigations in relation to the Spedley group of companies and was called as a witness in one of the Yuill trials before Judge Shadbolt.  At that time, he had been provided with a use and derivative use indemnity under section 9(6), and notwithstanding that indemnity, the advice he had of senior counsel was to then accept that the derivative use indemnity was not sufficient to protect him in relation to answers he may give when being called in that case.

The consequence was that there were some 215 questions asked of him in relation to which he refused to answer approximately 145 on the basis that the answers so given may tend to incriminate him, or may be available for such use.  Nine omissions to answer questions, after having being so directed by the judge to do so, were then the subject of the contempt application.  He had been represented by Mr Gruzman, QC, in relation to an application for leave to appear before Judge Shadbolt but, beyond that, which was an unsuccessful application, no further representation was available to him.

The Court of Appeal initially was of the view that the section 9(6) indemnity was but partially effective and that, accordingly, in relation to three of the representative questions as are set out in the orders, a privilege that might otherwise have attached to those was waived as a result of evidence that had been given in earlier civil proceedings.  The effect was that Mr Craven was therefore found guilty of three contempts in relation to those three questions and not in relation to the remaining six.

The consequence of that finding of guilt was that in relation to some of the judges, they went further than was necessary of determining a threshold issue, namely, a question is asked, “Is there any legal basis for refusing to answer that question in the face of a direction by the judge, as in the absence of such a legal justification would therefore amount to criminal contempt in the face of the court?”  In that sense, the court, having considered an aggravated circumstance and an ulterior motive at the time of the determination of the existence of a contempt, the court then went on to consider the question of penalty, and associated with that question of penalty was an application by the registrar to be able to reopen in relation to the use of the other six questions not being outside the scope of the indemnity.

The court ultimately refused to allow the reopening on the basis of a double jeopardy, but then went on to determine the penalty associated with the three questions as had been refused to be answered.  The court came, effectively, to three different judgments in respect of penalty.  The learned President was prepared to give a fine of $10,000 and six months but with a suspended sentence on the basis of an opportunity to not in the puristic sense purge the contempt, but be available as a witness at later trials in respect of the Yuill as would show the necessary contrition for it to remain.

Mr Justice Meagher imposed a fine of $50,000 and six months without any suggestion of a stay.  Mr Justice Powell would not have, had it been for him alone, allowed any fine but then, for the purposes of obtaining consensus, imposed a fine of $10,000 and then adopted the six months without the circumstance of a suspended sentence and with a further rider that there would be an opportunity to be able to come back to the court pursuant to Part 55 of the New South Wales Supreme Court Rules in the event of a change of circumstances.

TOOHEY J:   Mr Stevens, what is under attack here?  Is it the sentence that was imposed or the findings of contempt or both?

MR STEVENS:   The sentence is attacked and separately, your Honour, the question of bias or pre-judgment in relation to a determination in respect of penalty at a premature time.

TOOHEY J:   I am not sure that that really answers my question, does it?  The orders sought, as appears from page 208, are, “That the sentence be quashed” and that there be a variation of the orders made by the Court of Appeal, but what does that mean, “to quash to the sentence”?

MR STEVENS:   Quashed in the sense of a change of penalty, your Honour.

TOOHEY J:   So the findings of contempt are not under challenge, are they?

MR STEVENS:   That is right, your Honour.  The threshold finding of there being a contempt in respect of the refusal to answer those three questions are not challenged, but both penalty is, and additionally, in relation to the question of bias. the regime ‑ ‑ ‑

DAWSON J:   Penalty is attacked on the basis, one, of bias, and - - -?

MR STEVENS:   Severity of the penalty.

DAWSON J:   In the circumstances.

MR STEVENS:   In the circumstances of there being, in essence, three separate judgments and then a consensus approach to be adopted.

DAWSON J:   So the two questions are intertwined because you say the fact that the other six charges were considered and a conclusion is reached as to those that entered into the question of sentence on the three charges of which he was convicted, and that showed bias, and also is the basis for saying the penalty is too severe?

MR STEVENS:   That is so, your Honour.

DAWSON J:   Yes, I see.

MR STEVENS:   It is an appropriate vehicle to be able to consider the approach to be adopted when, by necessity, a court of appeal is the court of first instance and is going to be embarking upon two separate processes; one, a determination as to whether or not a contempt has occurred and then, secondly, having found such a determination, to then impose the penalty that might arise.  There is an opportunity, in our submission, to consider whether or not there ought to be two separate courts to so consider the matter as a general practice, or whether or not there should be cautions in relation to the extent of the necessary findings when a court is determining the existence of a contempt before, by necessity, as it were, infecting the reasoning, as would apply at a later time, in respect of the question of penalty.

TOOHEY J:   When you put it that way, you do not appear to be saying that there is any obligation to have a second and independent hearing.  You express it in terms of ought.

MR STEVENS:   We express it in terms of the limited instance, as applied here, was an apparent, or apprehended, bias by reason of the judgments.  However, the case is an appropriate vehicle for a wider application in terms of what should be the approach to be adopted.  It remains, in that sense, an unusual situation for three judges of appeal to be the judges at first instance with the only right of an appeal a right by way of seeking special leave to the High Court.  In other words, not an automatic right of appeal, but a discretionary right of appeal.

In those circumstances, is it appropriate to revisiting the approach to be adopted in respect of such a class of case, especially bearing in mind the recent determination of this Court in respect of the removal of that subtlety of distinction between criminal and civil contempts in that sense.

DAWSON J:   But is there a right of appeal in criminal cases ordinarily as opposed to appeal by leave on questions of sentence?

MR STEVENS:   Your Honour, in the normal course of events there is an appeal to the Court of Appeal.

DAWSON J:   By leave against sentence, or am I wrong?

MR STEVENS:   No, an automatic right of appeal to the Court of Criminal Appeal.

DAWSON J:   Yes.

MR STEVENS:   It then becomes a question of leave in the criminal sense to this Court, but also leave in the threshold sense in terms of the first opportunity of review.  There remains the second and separate issue, which is in terms of the opportunity of revisiting the determination of the Court.  So far as the New South Wales Court of Appeal, it is not a matter of certainty as to whether or not the scope of Part 55 of the Supreme Court Rules would allow such an opportunity.

This is an unusual circumstances in so far as the opportunity of being able to further mitigate the contempt.  It is theoretically available in respect of future trials that would have occurred.  In fact, but for the change of plea to one of guilty, Mr Craven would have given evidence in respect of a further trial that was to have commenced a fortnight ago involving Mr Yuill and, of necessity, would have given him an opportunity to have perhaps canvassed before this application came on - to have sought Part 55 change of circumstances before the New South Wales Court of Appeal.

What otherwise occurs now is that there is no likelihood of him being able to give evidence and be able to seek that leave without, by necessity, having commenced to serve some portion of the sentence that would otherwise be arising.

TOOHEY J:   I am still not clear how the question of bias arises?  It does not, at least on a quick reading of the notice of appeal, appear to emerge from any of the grounds.  I am not suggesting that is fatal, but it makes it difficulty to grasp exactly what is being said by way of bias.

MR STEVENS:   If I could your Honour Justice Toohey to page 136 of the application book in the judgement of Mr Justice Meagher from line 31 to line 42 is:

the question of privilege not because he was fearful of any prosecution but because he wished to bring pressure on the Director of Public Prosecutions to drop the charge against him which they had brought.  This submission compels acceptance.  It is supported both by the express terms of Mr Craven’s solicitor’s threat and by all the surrounding evidence.  But what is the significance of this?  In my view, it aggravates the contempt involved in charges, 1, 2 and 3, but it cannot convert the absence of contempt in charges 4, 5, 6, 7, 8 and 9 into contempts.

That is Mr Justice Meagher’s judgment in terms of the first of the judgments and goes further in terms of determining at that stage, without the surrounding circumstances, that it was not merely a contempt but, rather, it was an aggravated contempt in terms of the approach.  Similarly, Mr Justice Powell, at page 140, formed the same view in relation to the question of motive which, of course, is irrelevant in terms of the establishment in a legal sense of whether a contempt exists.  That is at line 15, that having regard to the circumstances, would:

have led me to believe that Mr Craven’s purpose in refusing to answer the questions directed toward him, was to persuade the Director of Public Prosecution and any other relevant authorities, to grant to him, in respect of any matter of which he was then, or later, to give evidence against Mr Yuill, a full transaction indemnity, and, as well, to withdraw any prosecutions charging offences under the Companies (NSW) Code -

so that those findings, or those statements, by their Honours at that stage, and picked up, and perhaps repeated by Mr Justice Powell at page 144, lines 15 to 26, are all instances of the expression of the pre-judgment in respect of the manner of approach to penalty, and having ‑ ‑ ‑

McHUGH J:   You have two problems about this.  The first is, it is not a question of somebody has made a judgment about something or made a statement.  The real question is, is there grounds for believing that the judge will not change his mind in respect of some statement that he has made?  Now, this would be just about the last case that you could make finding, having regarding to what happened in respect of other charges.  But the second problem you have is, that no objection was taken on the bias point on the question of penalty, and does not Vakuta hold, as many other cases hold, that you then must be taken to have weighed this point?

MR STEVENS:   Your Honour, in fact, the point was made.  We did at least have the 10 minutes of uninterrupted address to the court while the submissions on that aspect were in fact being dealt with.  It had been contained in a fairly quite manner, perhaps, in terms of the opponent’s submissions on penalties that have been provided to the court, and we can hand to your Honour a copy of those which made the point.  It was made in two ‑ ‑ ‑

McHUGH J:   What, the judges should disqualify themselves?

MR STEVENS:   That is right.  The argument in relation to the question of penalty was a rather unusual argument because it was being dealt with two ways.

McHUGH J:   Why does not appear in the application books?

MR STEVENS:   The submissions as were handed ‑ ‑ ‑

McHUGH J:   This point that you asked the judge to disqualify himself.  Does it appear anywhere in the application books?  I cannot recollect seeing it.

MR STEVENS:   I do not think it does, your Honour.

McHUGH J:   But, anyway, you were going to hand it up?

MR STEVENS:   Yes.  To the extent that it appears in the application book in a veiled form, it is at page 198, paragraph (f):

In its judgment dated 30 June 1995, the Court erred by failing to discount the observations made in its judgment dated 11 November 1994.

McHUGH J:   That is in your notice of appeal to this Court but where before the Court of Appeal?

MR STEVENS:   Paragraphs 7, 8 and 11 in page 3 of the outline of argument, and in terms of it being put to the court both as the Vakuta v Kelly proposition and also in relation to the determination of the Court of Appeal in Wentworth v Rogers, No 9.

McHUGH J:   But you do not ask these judges to disqualify themselves; that is the whole point.  Is there anywhere where you ask Justice Powell or Justice Meagher to disqualify themselves because of apprehended bias?

MR STEVENS:   Not in that outline of arguments, your Honour, no.  In terms of the submissions as were made, paragraph 11 was amplified and the point was separately made in terms of the application of Wentworth v Rogers, No 9, which is said, in the judgment of Mr Justice Kirby, the approach in relation to that is that the court will then not so act and will rely upon the parties’ rights to then seek special leave of this Court.

TOOHEY J:   That particular paragraph 11 and the grounds of appeal do not seem to me raise a question of bias so much as an argument that the Appeal Court judges took into account irrelevant considerations.

DAWSON J:   And I am not entirely clear where we are.  What you are saying is they reached conclusions in relation to the six counts of which your client was not convicted, and those conclusions were operative in arriving to sentence on the three counts which remained.

MR STEVENS:   As part of the material that had been before them, yes, your Honour.  Separately, in so far as ‑ ‑ ‑

DAWSON J:   But they reached the conclusion that your client, maybe erroneously, was not guilty of contempt on the six counts.

MR STEVENS:   Yes, and had then determined that those three answers were, as it were, innocuous or very minor, but then in terms of the determination of the contempt, approached the matter not on the basis of there having being six acquittals and, hence, only a conviction in relation to minor matters but, rather, the severity of the contempt in any threshold sense.

TOOHEY J:   Would they say that your clients were not guilty of the other six charges or, rather, that they were not prepared to allow the registrar to reopen that matter because of a misunderstanding as to the extent of the operation of the indemnity?

MR STEVENS:   Your Honour is correct in terms of the latter operation because the court had not had the orders entered in respect of the first judgment by the time of the second.

TOOHEY J:   That is why it seemed to me, on a reading of the material, that what was really being attacked was the taking into account of considerations which the court ought not to have taken into account, rather than an allegation of bias by reason of taking those matters into account.

MR STEVENS:   What your Honour suggests is, in essence, one step back from the question of bias.  We go the further step ‑ ‑ ‑

TOOHEY J:   I know you do now, but it is not all that clear that that is what was being said in the earlier proceedings.

DAWSON J:   And whilst the refusal to answer in relation to the first three counts may not have seemed terribly important in itself, was it not open to them to consider the context in which those refusals to answers were made?

MR STEVENS:   Certainly, your Honour, we do not cavil with that.

DAWSON J:   And that context was the same, so they said, the charges on which he was acquitted, upon which he was convicted

MR STEVENS:   But the context there being a contempt in relation to what, on any view, are very innocuous questions per se.  Your Honour, the other circumstance of general application is that were the matter to be the subject of the grant of special leave, it is also an appropriate vehicle potentially in terms of the scope of the indemnity available section 9(6) to be explored, an issue that had not been taken in terms of section 78B notices being issued when the matter was before the Court of Appeal, but which is available then to consider in terms of an opportunity of the Solicitor‑Generals in respect of any appeal.

McHUGH J:   You would be asking us to consider a matter on which the Court of Appeal has not addressed itself to? 

TOOHEY J:   Not only that, you would be asking us to consider something in respect of which you have findings in your favour?

MR STEVENS:   That is so, your Honour, yes.

TOOHEY J:   You might regret that.

MR STEVENS:   One has a two-edged sword in the sense of, on one hand, being anxious to obtain the opportunity of the special leave and being conscious as to the jeopardy that may attach to that.

TOOHEY J:   But it is really an academic exercise in so far as you are asking the Court to consider the scope of the indemnity, is it not?

MR STEVENS:   Yes, that is so, your Honour.  They are our submissions, if your Honours please.

DAWSON J:   Thank you, Mr Stevens.  Mr Solicitor.

MR MASON:   Your Honours, these were representative charges as appears on page 81 of the application book.  The aggravating factor was alleged in the summons.  Please see page 9, paragraph 13.  It was relevant on two accounts.  It obviously was relevant to penalty but, equally, it was relevant to the argument of waiver or of the invocation in good faith or otherwise of the privilege.  One of the arguments taken with respect to the three counts upon which Mr Craven was convicted was that he had already answered those questions and he was not really taking the privilege because he desired to invoked it, but it was part of this campaign to obtain transactional immunity.

So it was perfectly proper for their Honours, in the first judgment, to address the question of the motive or the aggravating circumstances.  Their Honours did not falsely sentence on the basis of nine charges as distinct from six, and there is no material to suggest that they did.  Each of them expressly said to the contrary.  Justice Kirby’s remarks to that effect are at pages 158 and 166, but can I go to the other two judges, because Justice Kirby would not have sent him to gaol anyway.  Page 171, Justice Meagher, about lines 20 and 21, having declined to reopen the acquittal on the six charges, said:

proceed to adjudicate the balance of the outstanding questions as if the original judgment were correct.

Nothing that follows indicates that he is sentenced having regard to the acquitted matters.  Similarly, Justice Powell at page 181, lines 16 and 17.  I do no understand my learned friend to argue here that those two judges were not entitled on the evidence to reach the finding that the refusal to answer all of the questions was motivated by the factors referred to in the passages to which the Court has already been taken, namely, the attempt to persuade the Director of Public Prosecutions to abandon all charges against Mr Craven as the price for him giving evidence against Mr Yuill.

Your Honours, the matter really comes down to an appeal against a sentence which, in my submission, is within an appropriate tariff for a contempt in the form of a considered refusal to answer a question motivated by the improper purpose that was so found.  The fact that the witness had advice from senior counsel that he was not obliged to answer the question was taken into account, but it did not remove the sting of the improper motive, and it remained an error of law and, ultimately, a matter that was not determinative either of guilt or of the appropriate sentence.

The question of future opportunity to mitigate the sentence and apply for a discharge does not really arise at this stage of the proceedings.  The court left it on the basis of, “Well, if you give evidence when called upon new time, you come back and apply, if you’re entitled to, for a discharge of the sentence”.  The fact, as my friend has informed the Court, that Mr Yuill has pleaded guilty and that the, at least, first chance of Mr Craven to give evidence and show his change of heart has been removed, does not change that aspect of the matter.  Your Honours, so it really comes down to an appeal on a matter of sentence for which there is no question of principle and there is no evidence of bias or improper factor taken into account.

TOOHEY J:   Mr Solicitor, something you said a moment ago suggests that the sentence was not immediately operative.

MR MASON:   It was not immediately operative because Mr Craven had been sentenced for some other matter unrelated to these proceedings, and that other sentence does not expire until 27 December this year.  The court said, “The sentence we impose will start from the expiry of that sentence”.  The court also said that if the provision of a Supreme Court Act that allows a contemnor to apply to discharge a sentence for contempt is applicable, “Well, you come back later when you have shown your charge of heart by giving evidence when next called upon against Mr Yuill”.

TOOHEY J:   That might be a matter of timing, I suppose.

MR MASON:   At the time the Court of Appeal gave its second judgment, the one on sentence, it was anticipated that the second Yuill trial would take place in October of this year and that the opportunity to show change of heart would have arisen in time for some application to be made down the track.  Your Honours, there was in fact an application made prior to October, and the Court of Appeal said that is premature.  October came and

Mr Yuill pleaded guilty.  So the question of calling Mr Craven did not arise.  That is where the matter stands at the moment.  The six month contempt sentence will start, unless suspended by some operation of law by the Court of Appeal in December of this year.

TOOHEY J:   It might be difficult for him to purge his contempt in those circumstances.

MR MASON:   It might be, but that would then be a matter for the court to decide whether, “Well, we are satisfied that you would have if you could have.  Therefore, we may or may not respite all or part of the sentence”, but that matter has not been foreclosed by the judgment at this stage and it does not give rise to any general questions. 

The constitutional point really does not arise and does not have any merits.  It was not referred to in the summary of argument, although it was in the application book.  There has been no 78B notice filed with respect to these proceedings, and it really ‑ ‑ ‑

DAWSON J:   Yes, we do not need to trouble you on that constitutional point.  Yes, Mr Stevens.

MR STEVENS:   Your Honour, Mr Justice Meagher did not leave any door open, as it were, in relation to an opportunity of revisiting the consequences of the six month sentence.  Mr Justice Powell merely puts it forward as a possibility but without, in any sense, suggesting that it will amount to such a purging of the contempt although, in a puristic sense, as we say, it is really only a partial answer in relation to it because the contempt has occurred.  This is a retrial.  There have been the opportunities, but unless or until the opportunity comes to pass, it will not exist, and the learned President, of course, would not have imposed the sentence and would have had it suspended anyway.

TOOHEY J:   But it is an option available to you, for what it may be worth, in the circumstances, since there will not be a trial in relation to Mr Yuill.

MR STEVENS:   It is a theoretical opportunity, but of shifting sands, your Honour.  There in fact have been - the first further trial which was originally to have occurred in October, has then been put over into 1996 at a later time; a separate charge which Mr Craven was willing to give evidence ultimately ended in a plea of guilty, and there are further trials that will be occurring later in 1996.  So that the opportunity, in that sense, is illusory, in

the absence of the court being willing to suspend sentence until after there had been such an opportunity actually availed or available.

TOOHEY J:   But has the court been asked to do that, I mean, subsequent to the order which is the subject of this application?

MR STEVENS:   No, your Honour, because on the most recent occasion, it was intended that Mr Craven would be so giving evidence and the timing for being able to do that has not yet occurred, but it reflects the prejudice in terms of the judgment presently standing by the Court of Appeal.

DAWSON J:   Thank you, Mr Stevens. 

The Court is not persuaded that the applicant has demonstrated any basis for the apprehension of bias on the part of any member of the Court of Appeal.  In any event, no objection was taken to the participation of any member of the court in the sentencing process.  The question of the scope of the indemnity afforded the applicant was decided in his favour and would not provide any basis for the grant of special leave.  Otherwise, none of the matters raised contain any point of principle calling for the attention of this Court.  Special leave is refused.

MR MASON:   I would seek an order costs, your Honour.

DAWSON J:   What do you say to that, Mr Stevens?

MR STEVENS:   There is nothing we can say, your Honour - sorry, there is one thing that can be said and that is, it resurrects the confusion in relation to whether this is properly a criminal matter, in which case, in relation to an application for special leave, the convention used to be that the costs would not be offered to the Crown in relation to that.  If it is to be properly treated as a civil matter, though, we say properly costs would follow the event and ‑ ‑ ‑

McHUGH J:   But, surely, it was a criminal matter.  It is a matter that concerned me.  Is there anything in the judgments which indicate that the court complied with beyond a reasonable doubt standard?

MR STEVENS:   Mr Justice Powell referred to it as being a quasi criminal.

DAWSON J:   It is not too quasi if one goes to gaol.

TOOHEY J:   There is not much consolation - - -

McHUGH J:   Particularly after what has already been decided in Whitham.

MR STEVENS:   No, your Honour.

DAWSON J:   What do you have to say to that, Mr Solicitor?

MR MASON:   The practice of the Court has been to award costs in contempt matters even though ‑ ‑ ‑

McHUGH J:   In Hinch that was done.

MR MASON:   In Hinch that was done, yes, and has certainly been the practice in New South Wales in the Court of Appeal.  That does not contradict their criminal character.  It just provides an exception from the general principle that costs are not awarded in criminal matters.

DAWSON J:   Why should there be an exception?

MR MASON:   Why should it be?  Contempt strikes at the heart of justice.  I suppose that must be the reason.  I do not have the passage in Hinch before me but the Court did address it and discuss there the appropriateness of it.  I accept that in the present case, given Mr Craven’s means, there is not much to be gained by it, but I do maintain the principle of the matter.

DAWSON J:   In the circumstances of this case, there will be no order as to costs.

AT 10.22 AM THE MATTER WAS CONCLUDED