Director-General of National Parks & Wildlife v Histollo Pty Ltd

[1999] HCATrans 166

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S203 of 1998

B e t w e e n -

DIRECTOR-GENERAL OF NATIONAL PARKS & WILDLIFE

Applicant

and

HISTOLLO PTY LTD

Respondent

Application for special leave to appeal

GUMMOW J
KIRBY J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 18 JUNE 1999, AT 2.52 PM

Copyright in the High Court of Australia

MR D.A. BUCHANAN, SC:   May it please the Court, I appear with my learned friend, MR S.J. ODGERS, for the applicant.  (instructed by Vivienne Karin Ingram)

MR C.A. PORTER, QC:   Your Honours, I appear with my learned friend, MR J.D.L. NELSON, for the respondent.  (instructed by D.G. Thomas & Co)

GUMMOW J:   Mr Buchanan.

MR BUCHANAN:   The question of general importance in this case, if it please the Court, is the role, if any, of the doctrine of wilful blindness ‑ ‑ ‑

GUMMOW J:   That is not a doctrine, is it?

MR BUCHANAN:   What sort of doctrine, is it?

GUMMOW J:   It is not a doctrine.

MR BUCHANAN:   Principle of wilful blindness.

GUMMOW J:   It is just a matter from which - it describes a circumstance in which a jury may properly draw an inference on evidence.

MR BUCHANAN:   A fact‑finding process.

GUMMOW J:   Exactly.  That is right.  It is not a doctrine like the doctrine of constructive notice.

MR BUCHANAN:   May it please the Court.

KIRBY J:   Doctrines are very important.

MR BUCHANAN:   They certainly are in this particular case.

GUMMOW J:   It all comes, as I understand it, from what Lord Esher said in a case called Mercantile Investment Trust v Brunton (1892) 2 QB 700 at 708. He knew as much about this as anybody ever did, as a great common lawyer. That is what he said. The principles are well settled, are they not, in this Court?

MR BUCHANAN:   We say that they are and that they were ignored.

GUMMOW J:   Why should they be reagitated on a prosecution appeal?

MR BUCHANAN:   Because in this case the Court of Criminal Appeal ignored the principle.  They said, in essence, that law is to be put to one side.  It is not to be applied and that, in future, in the determination of a question of knowledge in the criminal law, actual knowledge, face‑to‑face proof with guilt is required, and nothing less, and that there is, in essence ‑ ‑ ‑

GUMMOW J:   Is there a particular passage where you can isolate this, what you say is a terrible heresy?

MR BUCHANAN:   There are a number of passages.  Firstly, the judge at first instance, Justice Bignold in the Land and Environment Court, had fallen into error by applying the doctrine of wilful blindness, and the error had been to apply a principle of reckless indifference.  We say that is a fundamental error.             Secondly, that what is required to be proved is actual knowledge.

GUMMOW J:   Is that another doctrine, reckless indifference?

MR BUCHANAN:   No, may it please the Court.  And that what is required to be proved is actual knowledge.

GUMMOW J:   What is required to be proved is probably knowledge, I suppose.

MR BUCHANAN:   It is knowledge in this particular case.

GUMMOW J:   The question is, by what evidentiary steps you go about that, and what evidence can be taken into account properly to reach that conclusion.

MR BUCHANAN:   In a case where there are suspicious circumstances ‑ ‑ ‑

GUMMOW J:   The common law just knows about knowledge.  Constructive knowledge is some equitable left field for this point of view.

MR BUCHANAN:   But knowledge can be found on the authorities in a circumstance where the defendant is suspicious.  It can be found the defendant is suspicious and fail to make inquiries.  That has been the law since, if I can go back at least as far as Glanville Williams, the authority cited by his Honour the judge at first instance, and has been the law made by this Court ever since.  He Kaw Teh, Justices Gibbs and Brennan, Kural, Pereira.  In this case the Court of Criminal Appeal simply put all of that to one side and said, “Notwithstanding the existence of suspicious circumstances, we require actual knowledge”, and they failed to apply.

GUMMOW J:   Where do they actually say it?  Can you take us to a page?

KIRBY J:   What is the most purple passage that you can point to?

GUMMOW J:   Yes, that is right.

KIRBY J:   Inflame us.

MR BUCHANAN:   To describe the doctrine as one of reckless indifference, at page 162, line 25:

What his Honour is describing is a species of reckless behaviour rather then actual knowledge.

What we say, with respect, is what his Honour the judge at first instance did, was an impeccable elucidation and application of the principle of wilful blindness.  The same sort of description was assigned by his Honour the Chief Justice at page 107, about line 50, to suggest:

that the evidence with respect to each of the three counts never rose above, at best, proof that the appellant was recklessly indifferent to the probability that its conduct would cause damage to such relics.

KIRBY J:   Give us the last one and then explain the difference between wilful blindness and reckless indifference.

MR BUCHANAN:   In the case of Justice Sperling at page 113 at the top of the page:

For the reasons explained by Greg James J, it is only where wilful blindness implies actual knowledge that wilful blindness is a relevant concept.  Bignold J made no finding that actual knowledge was so implied.

A misunderstanding of the circumstances in which wilful blindness can be applied, or comes to be applied.

Indeed, any such implication would have been inconsistent with his finding that there was no actual knowledge in this case.

In my view, Bignold J erred in holding that the necessary element of knowledge could be and was established in this case by recourse to the concept of wilful blindness notwithstanding a finding by him that actual knowledge was not established.

In other words, and especially having regard to the fact‑finding process, if it can be so described in which Justice Greg James engaged in this particular case, there is no function for wilful blindness to perform.  The classic role of wilful blindness has been to find actual knowledge; that it is tantamount to find knowledge.  The requirement that there be actual knowledge in the first place means that there is no role for wilful blindness to perform.

GUMMOW J:   Is the statutory text set out in the judgment in ready form?

MR BUCHANAN:   The terms of the statute in as much as the offence is set out at the bottom of Justice Greg James, first page 115 ‑ ‑ ‑

GUMMOW J:   It is section 90(1), is it not?

MR BUCHANAN:   Yes:

“A person who, without first obtaining the consent…..knowingly…..damages, or knowingly causes or permits the destruction or defacement of or damage to, a relic…..is guilty of an offence against the Act.”

KIRBY J:   I just want to get clear in my mind the interrelationship, if any, between wilful blindness and reckless indifference.  Can reckless indifference be the explanation why a person does not, being suspicious, take the inquiries further?

MR BUCHANAN:   No; we say that the difference between the two is the second limb of wilful blindness, the failure to take inquiries further.  There is no aspect of that to reckless indifference.  As I am reminded, it is a deliberate failure to make inquiry in circumstances which call out for it.

KIRBY J:   So that you say the primary judge looked at and found that deliberate failure that the Court of Criminal Appeal misdirected itself by addressing its attention to recklessness as distinct from a finding made by the primary judge of wilful refusal to investigate a matter which ought properly to have been investigated?

MR BUCHANAN:   There was certainly a proper application of the test by his Honour the primary judge.  The Court of Criminal Appeal said, in effect, “Yes, there is wilful blindness, but no, there is no function for it to serve and we will not apply it, or are not going to apply it in the circumstances of this case”.  By requiring that there be actual knowledge before wilful blindness can be applied, one defeats the whole purpose of the exercise of having a principle of wilful blindness for the purpose of finding knowledge, where the circumstances call out for its application – the existence of suspicious circumstances, and consequently, the failure to make inquiry.

The strange thing, in this particular case, is where his Honour Mr Justice Greg James, towards the end of his judgment, says, in essence, “Yes, there are certainly suspicious circumstances.  The purchase price reflected an awareness that there were relics present.  He knew that the development and use was restricted to protect the relics” – I am reading from page 164.  “The respondent knew that the conservation agreement imposed an obligation upon the respondent not to do the very thing which it did do”, and that the purpose of that obligation – we are not talking about a breach of contract being imported into the criminal law here, rather that from the existence of the contract ‑ ‑ ‑

GUMMOW J:   Just slow down for a minute.  What is your present proposition?

MR BUCHANAN:   The Court of Criminal Appeal found, as did, I might add, the judge at first instance, that there was an awareness of suspicious circumstances; awareness of an obligation not to do that which the respondent in fact did, and that the purpose of that obligation was to avoid the very conduct which is proscribed by the National Parks and Wildlife Act in this particular case.  What this gave rise to was an awareness of a likelihood that the offence would be committed if he went and engaged in the behaviour which he knew was under an obligation not to engage in.

The departure by the Court of Criminal Appeal from the line of authority established by this Court is to ignore all of that authority, starting relevantly in He Kaw Teh, to the effect that an awareness of the probability of the proscribed act being engaged in or occurring is knowledge.  Instead, what they required was that there be actual knowledge, despite the findings made by, for example, Justice Greg James of the likelihood to the knowledge of the respondent.

GUMMOW J:   Let me get a word in.  Is there any difference between the judgments in the Court of Criminal Appeal on this point, or are they all equally, as you say, in error?

MR BUCHANAN:   In error.  They are, we submit.

GUMMOW J:   Yes.

KIRBY J:   This is, of course, an appeal by a prosecutor against what is in law an acquittal, and the principles that you are urging upon us appear to be fairly well‑established principles.  If anything has gone wrong, it is simply in the application by the Court of Criminal Appeal in this particular case of established principles. 

MR BUCHANAN:   We submit it is more egregious than that.  It is a misunderstanding of what the principles are that need to be applied, and leading now to the existence of an authority which is available for use in all criminal proceedings, to the effect that the existence, such as, for example, in the drug cases, of suspicious circumstances, is going to be quite insufficient for a prosecutor to ever succeed, and it will mean that there will be a requirement of actual knowledge in all cases before a prosecutor can succeed.  Given that the bulk of the criminal law in this country seems to be made us of drug cases these days, illustrated, perhaps, by the fact that He Kaw Teh and Kural and Pereira all arose from importation and possession of prohibited import narcotic goods cases, it is going to have a devastating effect, we submit.

GUMMOW J:   They are all statutory offences, are they not.

MR BUCHANAN:   And so is this, with respect.

GUMMOW J:   They are all statutory offences, and many of them under the Customs Act.

MR BUCHANAN:   Yes, your Honour.

GUMMOW J:   And in relation to the Customs Act construction, are not the decisions of this Court both clear and controlling?

MR BUCHANAN:   They certainly are, but there was no confinement of those principles in their expression by this Court in those cases to Customs Act matters.

GUMMOW J:   Whatever those cases mean, cannot be upset by what is said in this case by the New South Wales Court of Criminal Appeal in construing section 90 of this State statute.

MR BUCHANAN:   With respect, it is a statement of general principle.

GUMMOW J:   If the Bar cannot get their minds around that, things are in a bad state.

MR BUCHANAN:   But the Court of Criminal Appeal has, with respect, expressed a general principle that actual knowledge is to be required before wilful blindness can be applied.  It has not confined it, with respect, to the circumstances of this case, or a prosecution under this particular statute.  These are expressions of general principle which are available to the courts

of, certainly this jurisdiction, if not the whole of the country in these general principles.  They are principles of common law which have been applied.  The way in which the element of knowledge, and of course, related to an intention, is to be found – the approach that is to be taken to the finding of this particular element.

What I am reminded is that there is, of course, some controversy in the line of authority.  We pointed to this in our written submissions.  There is the decision of Giorgianni, albeit in relation to accessorial liability which would seem to be somewhat at odds with the decision, certainly in Pereira, and that some reconciliation of these authorities would seem to be called for.

The other matter that we pointed out is that a classic offence in which knowledge is an element, namely, receiving stolen goods, is, so far as this jurisdiction is concerned, if not, in fact, extending to all the jurisdictions in Australia, one which is governed by a decision, namely Schipanski, which in essence says that suspicious circumstances are not enough to commence the process of applying the principle of wilful blindness with a view to determining whether or not the requisite knowledge is present.

Accordingly, there is controversy to be resolved; there is a decision which is plainly wrong in principle.  It is available to the courts of the whole of the country and it will lead, we say, to disturbing consequences, to say the least, in the administration of criminal justice in Australia if it is allowed to remain on the books.

KIRBY J:   It is a question of whether it remains on the books if is of current authority.

MR BUCHANAN:   Quite so, your Honour.

GUMMOW J:   I think we are seized of it, I think.

MR BUCHANAN:   This is a matter which has such general importance that leave should be granted.  If the Court please.

GUMMOW J:   Yes, thank you, Mr Buchanan.  Yes, Mr Porter.

MR PORTER:   If your Honours please, we say that the Court of Criminal Appeal was completely correct; that the doctrine of wilful blindness, or the so‑called doctrine of wilful blindness is simply a method of finding actual knowledge, and we adopt, with respect, the article of Sir Daryl Dawson, which was adopted by the Victorian Court of Criminal Appeal, and is at page 185 of the application book before you.

All the doctrine of wilful blindness means is that if you deliberately refrain from finding out – if you deliberately refrain from confirming what you already knew then that is evidence of your actual knowledge.    The evidence in this case never went anywhere near that.  There was never any suggestion of a deliberate refraining because he knew what the answer would be.

GUMMOW J:   Or feared what the answer would be.

MR PORTER:   Or feared what the answer would be.  That was never put to him and the extracts of evidence go nowhere near that.  On the contrary, if your Honour pleases, the error made by the trial judge and corrected by the Court of Criminal Appeal was simply to – having made a finding of no actual knowledge, he then made a finding of constructed knowledge adopting the equity principle to the criminal law.  It is a simple adaptation of the equity principle to the criminal law.

In our submission, the three judges in the Court of Criminal Appeal could not have been more correct when they said you cannot have a finding of no actual knowledge, but we infer knowledge - deem knowledge by the application of the doctrine of wilful blindness.  That is not the doctrine of wilful blindness, at all.  That is the doctrine of constructive notice and equity, which, of course, you cannot have in a criminal area.

GUMMOW J:   Yes.

MR PORTER:   I might mention, if your Honour pleases, that this is ‑ ‑ ‑

GUMMOW J:   Thank you, Mr Porter, I think we are seized of it.  Mr Buchanan, do you want to say anything in reply?

MR BUCHANAN:   Yes, your Honour, the state of the authorities, albeit that we say that wilful blindness is clearly established as a legitimate method of finding knowledge in circumstances where suspicion attaches is not necessarily such.

GUMMOW J:   Do you cavil with Sir Daryl Dawson’s article?

MR BUCHANAN:   We do, because the ‑ ‑ ‑

KIRBY J:   His Honour was pretty knowledgable in this area.  It looks right to me.

GUMMOW J:   I think he has read Lord Esher, too, probably many years before.

MR BUCHANAN:   It is not evidence of actual knowledge, with respect.  It is a matter, it is a fact‑finding process that is engaged in as an alternative to actual knowledge.

KIRBY J:   But it is aiming at the same port.  The ship is aiming at the same port, knowingly – knowledge.

MR BUCHANAN:   It is aiming at establishing the mental element of the offence, yes.  But, otherwise, the circumstances in which it comes to be applied are different.  They are not ones in which there should be actual knowledge in the first instance.  On the contrary, there would be, as I have previously submitted, no function for the principle to serve otherwise.  There needs to be a principle which allows for an inference of knowledge to be drawn where actual knowledge is not, in fact, present.  So, in our submission, the statement by Sir Daryl Dawson there is not one that is to be relied upon in the circumstances; and the state of the authorities is not so clear as to happily allow this case to remain on the books with authority, if I might say so, with respect.  So, in the circumstances, the danger of leaving this case on the books is one which requires the intervention of this Court.

GUMMOW J:   Yes, thank you, Mr Buchanan.

We should not be taken as endorsing necessarily all that was said in the New South Wales Court of Criminal Appeal as to what it was necessary to show to establish knowledge for the purposes of section 90(1) of the National Parks and Wildlife Act 1974 (NSW). However, any appeal would turn upon the application of well-settled principles to the interpretation of a State law and would be brought by the prosecution against the allowance by the Court of Criminal Appeal of an appeal against conviction. In these circumstances, a grant of special leave is not attracted and special leave is refused.

MR PORTER:   I ask for costs, if your Honours please.  Although it is a criminal matter, it was a summary prosecution where costs - - -

GUMMOW J:   Did you seek that in your outline and materials?

MR PORTER:   Yes, we do actually, I think, but – yes, “The respondent seeks costs”, page 187.

KIRBY J:   Did you get costs in the Court of Criminal Appeal?

MR PORTER:   The Court of Criminal Appeal does not grant costs, if your Honour pleases.

GUMMOW J:   Ever?

MR PORTER:   I do not think so.  Well, except possibly for stated cases from Magistrates.

GUMMOW J:   That is what I thought.

MR PORTER:   But, your Honours, costs were awarded below against us by the presiding judge and those costs were reversed to costs in our favour in the Court of Criminal Appeal.  Your Honours in the High Court, of course, have a complete discretion but I do rely on a case where - - -

GUMMOW J:   So, you got your costs in the Land and Environment Court, did you?

MR PORTER:   That is right, yes.  Your Honour, this is analogous to the case where the Crown brought a murder appeal and this Court granted costs.  I mean, if the Crown brings them – this is, in effect, the Crown’s National Parks and Wildlife.  If they bring an appeal against an acquittal, in my submission, they do take the risk as to costs.

GUMMOW J:   What do you say about that, Mr Buchanan?

MR BUCHANAN:   We would submit that costs should not be ordered.  This is a criminal matter.  It is not insignificant that the Court of Criminal Appeal did not even apparently entertain an application for costs.

KIRBY J:   They say in their orders:

The question of costs in the proceedings before the Land and Environment Court be remitted to that court.

MR BUCHANAN:   Yes, “to that court.”

KIRBY J:   They obviously entertained the prospect that that court might make, as it already had made, special provision for costs.

MR BUCHANAN:   There are special provisions in the Land and Environment Court Act for costs in criminal matters but no order for costs has been made, as I understand it, in the Court of Criminal Appeal – in any appeal – by either party from a matter coming from the class 5 criminal jurisdiction of the Land and Environment Court.

KIRBY J:   But you are now in the High Court of Australia.  A grant of costs here is within our discretion under the Judiciary Act; if not, under the Constitution. So that why - - -

MR BUCHANAN:   But the restraint that is exercised by this Court in criminal matters on questions of costs should apply just as much in this matter, we would submit.

GUMMOW J:   Yes, but this comes out of a special regulatory regime in the Land and Environment Court where costs do enter into the equation.  Is that not so?  There is a special statutory provision in the State Act.

MR BUCHANAN:   There is in that jurisdiction but not any further up the hierarchy and, in our submission, the restraint that is customarily exercised on questions of costs in criminal matters should apply just as much in this matter as in all other criminal appeals irrespective of the identity of the party that brings the application in this jurisdiction.

KIRBY J:   Can I ask you this:  here is a corporate citizen which has had an acquittal and an appeal against it to this Court which has a complete discretion and it is by the Crown or a manifestation of the Crown, and the corporate citizen has been put to inconvenience and expense.  Now, in those circumstances, against the background that costs are contemplated in the Land and Environment Court, why would one not orders costs in this Court?

MR BUCHANAN:   Well, for the reasons which perhaps underlay or impelled your Honour Justice Gummow’s express reservations that were the introduction to the reasons given, that is to say, that there were very strong grounds for the application to be brought by the Director-General in the circumstances of this case.  In those circumstances, it was a proper matter and costs should not be inflicted upon the Director-General for having endeavoured to have a matter of principle properly addressed by the proper authority.  If the Court pleases.

GUMMOW J:   Thank you. 

KIRBY J:   Do you want to say anything in reply?

GUMMOW J:   Do you want to say anything in reply, Mr Porter?

MR PORTER:   If your Honour pleases, in Martin 58 ALJR, where the Crown sought special leave - - -

GUMMOW J:   You can assume that we have the power.

MR PORTER:   Yes, but there - - -

KIRBY J:   We have got plenty of power.

MR PORTER:   There the Court said:

While it is the established practice that an unsuccessful applicant for special leave to appeal against a conviction is not ordered to pay the costs of the Crown, it does not follow that the Crown should not be ordered to pay the costs when it makes an unsuccessful application for special leave to appeal against a decision of a Court of Criminal Appeal allowing an appeal by a convicted person.

That was an appeal where the Crown sought to upset an acquittal on a murder charge.

KIRBY J:   Yes, but that is against the statutory background, as Justice Gummow pointed out.  This is a special regime.  The old rule goes back to ancient law, that the prerogative is with the Crown; the Crown neither gives nor receives costs.

MR PORTER:   That is right.

KIRBY J:   But here we are in a special statutory regime and it is the misfortune of your client that you have got caught up in that statutory regime.

MR PORTER:   If your Honour pleases, I am quite happy to wear it to the stage of the Court of Criminal Appeal.  The Court of Criminal Appeal either cannot or will not grant costs; probably cannot.  But when we succeed there and, in effect, the Crown comes up here, why should they not pay costs?  It is quite a different position to the ordinary criminal appeal.

GUMMOW J:   Yes, thank you.  Costs are sought.  Undoubtedly, such an award would be within the power of the Court but in the circumstances of this litigation, in our discretion we would not make such an order.  Accordingly, the order simply is:  special leave refused.

AT 3.23 AM THE MATTER WAS CONCLUDED