Director of Public Prosecutions v Ali
[2009] VSCA 162
•26 June 2009
SUPREME COURT OF VICTORIA
COURT OF APPEAL
No 3793 of 2008
| DIRECTOR OF PUBLIC PROSECUTIONS FOR VICTORIA | Appellant |
| v | |
| KHODI ALI | First Respondent |
| and | |
| DOUNIA ALI | Second Respondent |
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JUDGES: | MAXWELL P, WEINBERG JA and KYROU AJA | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 11 May 2009 | |
DATE OF JUDGMENT: | 26 June 2009 | |
MEDIUM NEUTRAL CITATION: | [2009] VSCA 162 | |
JUDGMENT APPEALED FROM: | [2008] VSC 167 (Smith J) | |
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CRIMINAL LAW – Confiscation – Restraining order over property – Order lapsed following acquittal – Conviction of co-accused – Status of property as ‘tainted property’ established – Whether DPP can make fresh application for restraining order over same property – Whether DPP can rely on ‘reasonable suspicion’ when status of property as ‘tainted property’ already established – No bar to fresh application on that ground – Confiscation Act 1997 (Vic), ss 16, 18, 20, 24, 27, 37 and 38.
STATUTORY INTERPRETATION – Statement of purposes – Statutory language clear and unambiguous – Whether open to court to read in words of limitation – Proposed limitation contrary to stated legislative purpose – Presumption against statutory interference with property rights – Whether applicable – Interpretation of Legislation Act 1984 (Vic), s 35(a).
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| APPEARANCES: | Counsel | Solicitors |
| For the Appellant For the First Respondent No appearance for the Second Respondent | Mr S G O’Bryan SC with Mr C G Juebner | Solicitor for Public Prosecutions Victoria Legal Aid |
MAXWELL P
WEINBERG JA
KYROU AJA:
Introduction and summary
This is an appeal from a decision of a judge of the Trial Division refusing to make a restraining order over the rural property of the first respondent (‘KA’) at Knowsley (‘property’) and $6,500 cash seized from his home in Brunswick (‘cash’).[1]
[1]DPP v Ali [2008] VSC 167 (‘Reasons’).
The unsuccessful application had been made by the appellant, the Director of Public Prosecutions (‘DPP’), under s 16(2)(a) of the Confiscation Act 1997 (Vic) (‘Act’). That provision permits an application for a restraining order to be made where ‘a member of the police force suspects on reasonable grounds that the property is tainted property in relation to a Schedule 2 offence’.
KA is the registered proprietor of the property and had possession of the cash. The second respondent (‘DA’) is his wife.
The DPP had previously obtained a restraining order over the property when KA and three others were charged with conspiracy to traffick a commercial quantity of methylamphetamine, which is a Schedule 2 offence under the Act. That restraining order lapsed when KA was acquitted by direction following a ‘no case’ submission. The co-accused were convicted of another Schedule 2 offence, namely conspiracy to traffick a large commercial quantity of methylamphetamine. The drug was manufactured at the property.
The trial judge decided that it was not open to the DPP to apply for a new restraining order in the circumstances of this case. He refused the application for three main reasons. First, s 16(2)(a) of the Act only applies prior to charges being laid. Secondly, s 16(2) permits the making of only one restraining order in respect of the same property. Thirdly, as the Act interferes with common law property rights, s 16(2) must be construed strictly.
The DPP has challenged each of the above bases for the trial judge’s decision. Thus, the critical issue in this appeal is the proper interpretation of s 16 of the Act.
For the reasons that follow, we have concluded that the trial judge erred in his interpretation of s 16 and that the appeal should be allowed.
Relevant provisions of Confiscation Act
Section 15 of the Act deals with the purposes for which a restraining order may be made. It relevantly provides:
15 Purposes for which a restraining order may be made
(1) A restraining order may be made to preserve property or an interest in property in order that the property or interest will be available for any one or more of the following purposes—
(a)to satisfy any forfeiture order that may be made under Division 1 of Part 3;
(b)to satisfy automatic forfeiture of property that may occur under Division 2 of Part 3;
(c) to satisfy any civil forfeiture order that may be made under Part 4;
(d)to satisfy any pecuniary penalty order that may be made under Part 8; …
(2) An application for a restraining order must state the purpose for which it is sought.
(3) If a court makes a restraining order in respect of property or an interest in property—
(a) the court must state in the order the purpose for which the property or interest is restrained; …
(4) If a court makes a restraining order on application under section 16(2)(a) and a person is subsequently charged with a Schedule 2 offence in relation to which the restrained property or interest in property is tainted property, the court may vary the restraining order to add to or substitute the purpose for which the property or interest is restrained.
Section 16 of the Act deals with when an application for a restraining order may be made. It relevantly provides:
16 Application for restraining order
…
(2) The DPP or a prescribed person, or a person belonging to a prescribed class of persons, may apply, without notice, to the Supreme Court or the County Court for a restraining order in respect of property if—
(a) a member of the police force suspects on reasonable grounds that the property is tainted property in relation to a Schedule 2 offence; or
(b) a member of the police force or a person authorised by or under an Act to prosecute the relevant type of offence believes that—
(i) within the next 48 hours a person will be charged with a Schedule 2 offence; and
(ii) that person has an interest in the property or that the property is tainted property in relation to that offence; or
(c) a person has been charged with a Schedule 2 offence and that person has an interest in the property or the property is tainted property in relation to that offence; or
(d) a person has been convicted of a Schedule 2 offence and that person has an interest in the property or the property is tainted property in relation to that offence.
(2A) An application under subsection (2) for the purposes of civil forfeiture may only be made in respect of property that is reasonably suspected to be tainted property.
(3) An application under subsection (2) for the purposes of automatic forfeiture may only be made before the end of the relevant period in relation to the conviction.
(4) An application under subsection (1) or (2)(b), (c) or (d) must be supported by an affidavit of—
(a) a member of the police force; or
(b) a person authorised by or under an Act to prosecute the relevant type of offence—
setting out any relevant matters and stating that the member or person believes the following matters and setting out the grounds on which the member or person holds those beliefs—
(c) in the case of an application made in reliance on the proposed charging of the defendant with an offence, that the defendant will be so charged within the next 48 hours; and
(d) that the defendant has an interest in the property or the property is tainted property, as the case may be; …
(5) An application under subsection (2)(a) must be supported by an affidavit of a member of the police force setting out any relevant matters and stating that the member suspects that the property is tainted property in relation to a Schedule 2 offence and setting out the grounds on which the member has that suspicion.
Section 18 of the Act deals with the determination of applications made under s 16. It relevantly provides:
18 Determination of application
(1) On an application under section 16(1) or (2)(b), (c) or (d), the court must make a restraining order if it is satisfied that the defendant—
(a) has been, or within the next 48 hours will be, charged with; or
(b) has been convicted of—
a Schedule 1 offence or a Schedule 2 offence (as the case may be) and—
(c) it considers that, having regard to the matters contained in the affidavit supporting the application and to any other sworn evidence before it, there are reasonable grounds for making the restraining order; and …
(2) On an application under section 16(2)(a), the court must make a restraining order if it is satisfied that—
(a) the deponent of the affidavit supporting the application does suspect that the property is tainted property in relation to a Schedule 2 offence; and
(b) there are reasonable grounds for that suspicion.
Section 20(1) of the Act provides that if a court makes a restraining order against property under s 18, any person claiming an interest in the property (including the defendant) may apply to that court for an exclusion order[2] under ss 21, 22 or 24. Section 20(6) provides that, if a court makes a restraining order and a person claiming an interest in the restrained property is charged with a Schedule 2 offence and then applies for an exclusion order, that person need not give notice of the grounds for the application until the charge against him or her is finally determined or is withdrawn. Section 20(7) enables the court to make an order that the hearing of the application for an exclusion order be stayed until the charge is finally determined or is withdrawn.
[2]An exclusion order has the effect of excluding from a restraining order a person’s interest in the restrained property.
Section 24 deals with orders for the exclusion of property from a restraining order made for the purpose of civil forfeiture. It provides:
24 Determination of exclusion application – restraining order – civil forfeiture
On an application made under section 20, where the restraining order has been made in relation to a Schedule 2 offence for the purposes of civil forfeiture—
(a)the court may make an order excluding the applicant's interest in the property from the operation of the restraining order if the court is satisfied that—
(i)the property is not derived property; and
(ii)the property is not tainted property; or
* * * * *
(b)the court may make an order excluding the applicant's interest in the property from the operation of the restraining order if the court is not satisfied that the property in which the applicant claims an interest is not tainted property or derived property but is satisfied that—
(i)the applicant was not, in any way, involved in the commission of the Schedule 2 offence; and
(ii)where the applicant acquired the interest before the commission, or alleged commission, of the Schedule 2 offence, the applicant did not know that the property would be, or was intended to be, used in, or in connection with, the commission of the Schedule 2 offence; and
(iii)where the applicant acquired the interest at the time of or after the commission, or alleged commission, of the Schedule 2 offence, the applicant acquired the interest without knowing, and in circumstances such as not to arouse a reasonable suspicion, that the property was tainted property or derived property; and
(iv)the applicant's interest in the property was not subject to the effective control of the person who is suspected to have committed the Schedule 2 offence on the earlier of the date on which that person was charged with the Schedule 2 offence (if such a charge was filed) or the date that the restraining order was made in relation to the property; and
(v)where the applicant acquired the interest, directly or indirectly, from the person who is suspected to have committed the Schedule 2 offence, that it was acquired for sufficient consideration.
** * * *
Section 27 of the Act deals with the duration and setting aside of restraining orders. It provides:
27 Duration and setting aside of restraining order
(1)If, at the end of the period of 48 hours after the making of a restraining order in reliance on the proposed charging of a defendant with a Schedule 1 offence or a Schedule 2 offence, the defendant has not been charged with the offence or a related offence that is a Schedule 1 offence or a Schedule 2 offence, whether or not in the same Schedule as the original offence, the order ceases to be in force at the end of that period.
(2)A restraining order made on an application under section 16(2)(a) ceases to be in force on the expiry of 90 days after it is made unless an application for a civil forfeiture order in respect of the restrained property is then pending before the Supreme Court or the County Court.
(3)If, when a restraining order was made in reliance on the charging, or proposed charging, of a defendant with a Schedule 1 offence or a Schedule 2 offence or in reliance on the conviction of a defendant of such an offence—
(a)the charge is withdrawn and the defendant is not charged with a related offence that is a Schedule 1 offence or a Schedule 2 offence by the time of the withdrawal, whether or not in the same Schedule as the original offence, the restraining order ceases to be in force on the expiry of 7 days after the charge is withdrawn; or
(b)the defendant is acquitted of the charge and the defendant is not charged with a related offence that is a Schedule 1 offence or a Schedule 2 offence by the time of the acquittal, whether or not in the same Schedule as the original offence, the restraining order ceases to be in force when the acquittal occurs; …
Section 35 deals with automatic forfeiture of restrained property on conviction. Sections 37 and 38, which are in Part 4, deal with civil forfeiture orders. They relevantly provide:
37 Application for civil forfeiture order
(1AA)In this section—
the Court means the Supreme Court or the County Court.
(1)If a restraining order is in force under section 18(2) in respect of property, the DPP or a prescribed person, or a person belonging to a prescribed class of persons, may apply to the Court for a civil forfeiture order in respect of the property.
** * * *
…
(10)If an application under subsection (1) has been finally determined, no further application may be made under that subsection in relation to the same Schedule 2 offence, except with the leave of the Court.
(11)The Court must not grant leave under subsection (10) unless it is satisfied that—
(a)the property to which the new application relates was derived, realised or identified only after the earlier application was determined; or
(b)necessary evidence became available only after the earlier application was determined; or
(c)it is otherwise in the interests of justice to do so.
…
38 Determination of application for civil forfeiture order
(1AA)In this section—
the Court means the Supreme Court or the County Court.
(1)On an application under section 37(1), the Court must order that the restrained property be forfeited to the Minister if the Court is satisfied that—
(a)the requirements of section 37 as to notice of the application have been complied with; and
(b)not less than 30 days have elapsed since the last notice given in accordance with section 37; and
(c)there are no pending applications under section 20 in relation to the restrained property.
(2)The Court may exclude particular property or any particular interest in property from the operation of a civil forfeiture order if satisfied that otherwise hardship may reasonably be likely to be caused to any person by the order.
(3)A civil forfeiture order must specify the interests in property to which it applies.
(4)The Court may, subject to any rules of court, take into account in determining the application any material that it thinks fit.
** * * *
(6)The making of a civil forfeiture order does not prevent the making of a pecuniary penalty order.
Facts
On 21 August 2005, a search warrant was executed at the property. The police found laboratory equipment and chemicals associated with the manufacture of methylamphetamine. The cash of $6,500 was found at the home of KA and DA and was seized. KA was arrested and charged on the same day. Four other individuals were also arrested and charged.
On 27 September 2005, the County Court made a restraining order over the property pursuant to s 16(2)(c) of the Act. The order was made for the purpose of satisfying any forfeiture order that might be made, any automatic forfeiture that might occur, and any pecuniary penalty order that might be made under the Act.
On 7 November 2007, KA was joined in a presentment with three other co‑accused. The presentment included four counts. KA was charged with conspiring to traffick ‘in a drug of dependence namely methylamphetamine’ in a commercial quantity (count 2) and conspiring to traffick ‘in a drug of dependence namely methylamphetamine’ (count 3). The co-accused were charged with count 2 and also with conspiring to traffick ‘in a drug of dependence namely methylamphetamine’ in a large commercial quantity (count 1). The offences in counts 1 and 2 were Schedule 2 offences.
At the conclusion of the Crown case, the judge ruled that KA had no case to answer on either of the two counts brought against him. The judge said that, although there was evidence that KA knew that some drugs were being manufactured on the property, and that he had helped set up some of the laboratory equipment, the Crown could not establish beyond reasonable doubt that KA knew the nature of the drug that was being manufactured. That was a necessary element of each of counts 2 and 3. The jury acquitted KA. The other co-accused in the presentment were convicted on count 1.
Under s 27(3)(b) of the Act, upon KA’s acquittal the restraining order of 27 September 2005 ceased to be in force.
On 15 February 2008, the DPP applied to the Supreme Court for a restraining order over both the property and the cash under s 16(2)(a) of the Act. The order was sought for the purpose of seeking a civil forfeiture order under Part 4 of the Act. The DPP alleged that the property was tainted property because it was used by the convicted co-accused for the purpose of the Schedule 2 offence in relation to which they were convicted. KA did not dispute that there was evidence that the property was used for that offence. The DPP alleged that the cash was also tainted property because it was rent received by KA from leasing the property to the convicted
co-accused.[3] As such, it was derived or realised from their commission of the Schedule 2 offence.[4]
[3]The judge in the criminal proceeding in his ruling on the ‘no case’ submission treated the cash as having been received by KA as rent from the leasing of the property to his co-accused.
[4]The definition of ‘tainted property’ is set out in [35] below.
On 21 May 2008, the judge who heard the application (‘trial judge’) refused to make a restraining order, for reasons that we now discuss.
The judgment below
The critical issue before the trial judge, as it was before us, was whether s 16(2)(a) authorised the making of a restraining order in circumstances where the previous restraining order, based on charges being laid against KA, had lapsed on his acquittal.
The trial judge first considered the meaning of paragraph (a) of the definition of ‘tainted property’ in s 3 of the Act.[5] His Honour decided that ‘tainted property’ for the purposes of that paragraph had two limbs: first, property used (whether by the defendant or another person) in or in connection with the commission of the relevant offence; and secondly, property intended by the defendant to be used in or in connection with the commission of the offence. The first limb was not confined to property used by the defendant in or in connection with the commission of the offence. His Honour held that, as KA’s co‑accused had used the property in connection with the commission of the Schedule 2 offence for which they were convicted, the property was tainted property. It did not matter that KA had not used the property for the commission of a Schedule 2 offence.[6] This finding was not challenged before us.
[5]The definition is set out in [35] below.
[6]Reasons, [21]-[36].
The trial judge then turned to the construction and scope of s 16(2)(a). His Honour identified two issues. The first was whether the right to apply under s 16(2)(a) – based on suspicion – continued to exist even when, because of the charging and then the conviction of the co-accused, both s 16(2)(c) and (d) were applicable. The second was whether more than one application could be made under s 16(2) relating to the same property.
On the first issue, the trial judge ruled that no application could be made under s 16(2)(a) in circumstances where an application could be made under one or more of the other paragraphs in s 16(2). Relevantly for present purposes, s 16(2)(a) could not be utilised once charges had been laid. His Honour’s reasons were as follows:
[T]he highest it may be put for the DPP is that s.16 is, at best, not explicit as to whether, in bringing an application, the applicant can use paragraph (a) when paragraphs (c) and (d) are applicable. The construction that paragraph (a) is not available in those circumstances is, however, supported by a number of considerations.
(1)Parliament plainly attempted to set out [in s 16(2)] four alternative situations and no more and did so with considerable care. It would be inconsistent with the existence of carefully drawn alternatives that Parliament intended that more than one of them be used at the same time or that one of them was intended to be available to be used when any other alternative was more specifically applicable. If that was the intention the phrase “under one or more of the following paragraphs” would have been appropriate and its inclusion to be expected.
(2)The Act is structured in a number of areas by distinguishing the (a) category from the (b), (c) and (d) categories.
•Category (a) is confined to tainted property. The categories other than (a) include property other than tainted property, namely, property of the defendant. Thus in the situations referred to in the other three categories, Parliament thought it appropriate to broaden the net to include any property of the person about to be charged, or charged and convicted.
•The category relied upon in obtaining a restraining order has a direct connection with the form of forfeiture procedure that is available; in particular, whether it is automatic forfeiture (s.35) or civil forfeiture (s.37).
•Separate sub-sections are included in s.16(4) & (5) to deal with applications under s.16(2)(b), (c) & (d) on the one hand, and s.16(2)(a) on the other.
•The Act includes specific provisions in s.27 relating to the duration of restraining orders depending on, and reflecting, the bases on which they are obtained and the purposes for which they are sought. For example, a restraining order sought in support of a civil forfeiture order will lapse after 90 days unless an application for a civil forfeiture order is then pending.
(3)Paragraphs (a), (b), (c), & (d) of s.16(2) are placed sequentially reflecting the normal progress of a police investigation into, for example, drug trafficking, and its ultimate resolution with conviction. As the investigation progresses, and greater certainty arises, the requirements in paragraphs (a) to (d) change from suspicion, to belief and to the fact of the property being tainted. The situation becomes one where the requisite belief can be asserted as opposed to suspicion. That sequential analysis is supported by s.15(4), a provision relied upon by counsel for [KA and DA]. It provides that if a restraining order has been made on the basis of a police officer suspecting on reasonable grounds that the property is tainted (s.16(2)(a)) and, subsequently, a person is charged with a Schedule 2 offence in relation to which the restrained property or interest is tainted property (s.15(2)(c)), the restraining order can have added to it, or substituted, the purpose for which the property interest is restrained. This lends support to the conclusion that Parliament did not consider it appropriate, and therefore did not intend, that s.16(2)(a) be used or available where a person is subsequently charged or convicted.
(4)Artificial situations would be created if sub-paragraph (a) could apply in situations where the matter had progressed to the point where someone had been charged or had been convicted. If the [DPP’s] construction is accepted, s.16(2)(a) and s.16(5) would require a police officer to swear an affidavit that he or she “suspects” that the property is “tainted property” in relation to a Schedule 2 offence and the “grounds” of that suspicion even when the situation is one where the officer legitimately has no doubts – for example, after conviction.
In my view, therefore, a consideration of the legislation itself supports [KA’s and DA’s] construction. Properly construed, s.16(2)(a) is only available prior to charges being laid. Alternatively, the circumstances of this case do not come within any of the circumstances described in s.16(2).[7]
[7]Reasons, [52] (citations omitted).
On the second issue, the trial judge concluded that no more than one application could be made in respect of the same property. As an application for a restraining order over the property had already been made (and granted) under s 16(2)(c),[8] the DPP had no right to make a further application. His Honour noted that the Act expressly dealt with subsequent applications for forfeiture orders and for pecuniary penalty orders but did not do so in relation to restraining orders. In explaining this conclusion, his Honour said:
[8]See [16] above.
There are several reasons why express provisions would be expected if Parliament intended that more than one application could be made in respect of the same property.
(1)In our legal system, there are two well recognised and long accepted public policies that
• there be an end to litigation and
• no-one should be sued more than once.
A number of common law rules [issue estoppel, res judicata, Anshun estoppel, abuse of process] have been developed to give effect to those policies. One would expect Parliament to address such fundamental policies in legislation if it was intended to depart from them.
(2)Further, if the [DPP’s] construction is correct, Parliament chose to leave control of the issue of repeat applications to common law principles. Leaving the common law to apply inevitably leaves open the opportunity to mount arguments relying on the above rules in respect of any subsequent applications; for, as here, in relation to the property, there will be situations involving the same litigants, the same property, the same offence and the same reliance on “tainted property”. Generally, much will be at stake. Further, if the construction of the [DPP] is correct, there is no statutory limit to the number of times an application may be brought.
(3)When regard is had to the whole Act, it is difficult to accept that Parliament chose to leave the issue unaddressed if it intended that second applications for restraining orders could be brought. It attempts in the Act to cover all aspects and potential issues in detail and so attempts to minimise uncertainty. It is that attempt, among other things, that gives rise to the Act’s complexity. Further, the Act did address the issue of subsequent applications in relation to confiscation orders on three occasions. In all the circumstances it would be remarkable with such detailed and complex legislation for Parliament not to address the issue if it intended that subsequent applications could be brought.
In my view, the construction arguments supporting [KA’s and DA’s] construction on this issue are to be preferred.
…
… Parliament intended to permit only one application for a restraining order against the same property. The only variation or departure permitted is covered by s.15(4).[9]
His Honour also invoked the principle that, as the Act interfered with common law property rights, it had to be construed strictly. He cited Director of Public Prosecutions (NSW) v Logan Park Investments Pty Ltd,[10] Jeffrey v Director of Public Prosecutions (Cth)[11] and Sybott v R.[12]
[9]Reasons, [54], [61] (citations omitted).
[10](1995) 37 NSWLR 118, 125-7 (Kirby ACJ) (‘Logan Park’).
[11](1995) 121 FLR 16; (1995) 79 A Crim R 514 (‘Jeffrey’).
[12][2005] VSCA 41.
His Honour dismissed the DPP’s application for a restraining order over the property. He also dismissed the application in relation to the cash. Although no application had previously been made for a restraining order over the cash, his Honour concluded that it came within s 16(2)(c) and (d) and therefore s 16(2)(a) was not applicable.
Issues
The following construction issues arise for determination in this appeal:
(a)Does the wording of s 16(2)(a) preclude an application for a restraining order under that section after the owner of the relevant property is charged and, in particular, after the owner is acquitted?
(b)Does the wording and structure of s 16(2), read with other provisions of the Act, preclude an application for a restraining order under s 16(2)(a) after the owner of the relevant property is charged?
(c)Does s 16(2) preclude more than one application for a restraining order in respect of the same property?
(d)Do the principles requiring a strict interpretation of statutory provisions interfering with private property rights apply?
(e)Does the legislative history of the Act affect the interpretation of s 16(2)(a)?
KA filed a notice of contention by which he sought to uphold the trial judge’s decision on the additional ground that, as the DPP had obtained a restraining order over the same property at an earlier time, the making of a further restraining order over the same property would lead to an inequitable result and therefore the DPP’s application should be permanently stayed. Before us, counsel for KA properly conceded that, if we concluded that s 16(2) permitted the DPP to bring a fresh application, this ground could not succeed.
DA did not appear before us. However, we were informed by counsel for KA that DA adopted the submissions of KA and that DA would abide by the decision of the Court. The position of DA is discussed separately in this judgment.
The wording of s 16(2)(a) of the Confiscation Act and s 16(2) as a whole
KA submitted that the phrase ‘suspects on reasonable grounds’ in s 16(2)(a) means a state of satisfaction falling short of belief.[13] Parliament must therefore have intended that property could be restrained under that section only where proof was lacking and something less than a ‘belief’ was present. KA also noted that s 16(4) (which deals with applications under s 16(2)(b), (c) and (d)) requires a police officer to depose to belief, whereas s 16(5) (which deals with applications under s 16(2)(a)) required an officer to depose to a suspicion. In this case, KA submitted, his co-accused were convicted of using the property in connection with a Schedule 2 offence. It was therefore an established fact that the property was tainted property.
[13]George v Rockett (1990) 170 CLR 104, 115.
It followed, so it was said, that the position had passed the point at which a police officer could be said merely to ‘suspect’ that the property was tainted property. Hence s 16(2)(a) was no longer available. This submission found favour with the trial judge. His Honour described as ‘artificial’ an application based on a reasonable suspicion at a time when persons had already been convicted, establishing the status of the property as ‘tainted property’.
With great respect to his Honour, we are unable to agree with this analysis. For reasons which follow, the provisions of s 16(2) are to be viewed as permissive or facultative, not restrictive. This is apparent, in our view, both from the language of s 16(2) itself and from the stated purposes of the Act as a whole. The relevant purposes as set out in s 1 of the Act are:
(a)to provide for the forfeiture of the proceeds of certain offences, whatever the form into which they have been converted;
(b)to provide for the automatic forfeiture of restrained property of persons convicted of certain offences in certain circumstances;
(c)to provide for the forfeiture by the Supreme Court or the County Court of property restrained on suspicion that it is tainted property in relation to a Schedule 2 offence;
(d)to provide for the forfeiture of property used in connection with the commission of certain offences;
…
The legislation is thus explicitly directed at securing the forfeiture of property where relevant offences have – or may have – been committed. In relation to Schedule 2 offences, the making of a restraining order is the foundation on which the forfeiture provisions rest.[14] Unsurprisingly, then, s 16(2) identifies a whole range of different circumstances in which the DPP may apply for a restraining order in connection with Schedule 2 offences. Although there are only four sub-paragraphs, they contain nine distinct grounds on which the DPP can rely, as follows:
[14]See s 35(1) (automatic forfeiture) and s 37(1) (civil forfeiture).
1.Police officer suspects on reasonable grounds that the relevant property is tainted property in relation to a relevant offence.
2, 3.Police officer believes that within 48 hours a person will be charged with a relevant offence and that either –
(i)that person has an interest in the relevant property; or
(ii)the relevant property is tainted property in relation to that offence.
4, 5.Same as for 2, 3, except that the belief is held by a person authorised to prosecute the relevant type of offence.
6, 7.A person has been charged with a relevant offence and either –
(i)that person has an interest in the relevant property; or
(ii)the relevant property is tainted property in relation to that offence.
8, 9.A person has been convicted of a relevant offence and either –
(i)that person has an interest in the relevant property; or
(ii)the relevant property is tainted property in relation to that offence.
Since many of these grounds rely on the concept of ‘tainted property’, it is relevant also to note just how wide the definition of that term is. According to s 3 –
tainted property, in relation to an offence, means property that —
(a)was used, or was intended by the defendant to be used in, or in connection with, the commission of the offence; or
(b)was derived or realised, or substantially derived or realised, directly or indirectly, from property referred to in paragraph (a); or
(c)was derived or realised, or substantially derived or realised, directly or indirectly, by any person from the commission of the offence; or
…
‘Property’ is defined, in turn, to include any interest in property.[15]
[15]See [72] below.
It can thus be seen that, consistently with the stated purposes of the Act, s 16(2) quite deliberately creates a multiplicity of options for the DPP’s restraining order application. The evident legislative intent was to maximise the opportunities for the DPP to seek a restraining order in respect of particular property, provided always that the DPP could demonstrate a sufficient link between the property and a Schedule 2 offence.
Under s 16(2)(a), the minimum requirement is a reasonable suspicion of a link between the property and a relevant offence. Anything less would not suffice. But it does not follow that the DPP would be disentitled from utilising s 16(2)(a) in circumstances where the police officer had more than a reasonable suspicion about that link. The police officer in question may in fact hold a strong belief – or may even regard it as a matter of near-certainty – that the property is tainted property in relation to a relevant offence. Parliament could not have intended that the DPP be disqualified – because of the officer’s state of belief or even knowledge – from relying on the ‘reasonable suspicion’ provision in s 16(2)(a). Anything above the minimum (of reasonable suspicion) must necessarily satisfy s 16(2)(a). It is immaterial what the officer’s belief/knowledge is based on. In particular, it could not matter that the belief/knowledge was based on a relevant charge having been laid (which would enliven paragraph (c)) or a person having been convicted of a relevant offence (which would enliven paragraph (d)).
Each of the paragraphs in s 16(2) is separated by the disjunctive ‘or’. Accordingly, the natural meaning of the section is that each of the paragraphs contains a separate and independent ground for applying for a restraining order. Each paragraph is an alternative to the other paragraphs. The only pre-condition to relying on a particular paragraph is that the DPP be able to demonstrate that the requirements of that paragraph are satisfied.
This interpretation of s 16(2) arises from a plain reading of the provision. It does not require reading in words that are not there,[16] or ignoring any words that are there. Nor does it rely on any inferences being drawn from the order in which the paragraphs appear. His Honour’s construction could have been sustained if s 16(2)(a) had commenced with the words ‘where no charges have been laid and’ or if s 16(2) had contained a statement to the effect a paragraph was applicable only if a later paragraph did not apply. But such qualifications do not appear in s 16(2), and there is no warrant for reading them in.
[16]With respect, we reject the trial judge’s comment in footnote 28 of the Reasons that the construction advanced by the DPP seeks the implication of the phrases ‘whether or not a person has been charged or convicted’ and ‘whether or not an application has been made previously’.
Plainly, different circumstances are listed in s 16(2)(a), (b), (c) and (d) and they deal with different categories and have different consequences. This does not, however, entail a conclusion that they are mutually exclusive. There is evident overlap between the paragraphs. For example, paragraphs (c) and (d) overlap because a person who has been convicted would have been charged previously. We disagree with the trial judge’s comment that the phrase ‘under one or more of the following paragraphs’ would have been expected to be included if each paragraph was intended to have separate and independent operation. These words would not have added anything to the existing wording.
The trial judge relied on s 15(4) of the Act in support of his conclusion that s 16(2)(a) is not available after a person is charged.[17] That provision empowers the court to vary a restraining order made under s 16(2)(a) to add or substitute a purpose if a person is subsequently charged. KA submitted that s 15(4) supports the view that paragraphs (a), (b), (c) and (d) are only ‘alternatives’ to the extent that the one which best reflects the stage of the investigation at the time the application is made must be used. He submitted that the use of the word ‘may’ within s 15(4) does not lead in the opposite direction, as s 15(4) is not concerned with the time at which restraining orders are obtained.
[17]Reasons, [52](3).
In our opinion, s 15(4) does not support the trial judge’s interpretation. The section does not provide that a restraining order made under s 16(2)(a) for the purpose of a civil forfeiture order lapses once a person is charged. Nor does it provide that the original basis for making the order – namely a reasonable suspicion – ceases to exist once charges are laid. Rather, it enables – but does not require – the court to vary the restraining order to add to or substitute the purpose for which the property is restrained (for example, automatic forfeiture). That the order can be varied to add a purpose, rather than to replace the original purpose, indicates that the order as originally made can continue in force notwithstanding the laying of charges. If Parliament had intended that an order should only be made, or maintained, on the basis of the most relevant paragraph of s 16(2), s 15(4) would have made it mandatory that the more appropriate paragraph be substituted.
We also note that s 24(b)(iv) of the Act presupposes that a charge can precede the making of a restraining order under s 16(2)(a).
If more than one interpretation were open – and for the reasons we have given we consider that the words are clear and unambiguous – the conclusion we favour would accord with the requirement in s 35(a) of the Interpretation of Legislation Act 1984 (Vic) (‘IL Act’) that a construction that would promote the purpose or object underlying an Act (whether or not that purpose or object is expressly stated in the Act) shall be preferred to a construction that would not promote that purpose or object. In Mills v Meeking, Dawson J said:
Section 35 of the Interpretation of Legislation Act must, I think, mean that the purposes stated in Pt 5 of the Road Safety Act are to be taken into account in construing the provisions of that Part, not only where those provisions on their face offer more than one construction, but also in determining whether more than one construction is open. The requirement that a court look to the purpose or object of the Act is thus more than an instruction to adopt the traditional mischief or purpose rule in preference to the literal rule of construction. The mischief or purpose rule required an ambiguity or inconsistency before a court could have regard to purpose. The approach required by s.35 needs no ambiguity or inconsistency; it allows a court to consider the purposes of an Act in determining whether there is more than one possible construction. Reference to the purposes may reveal that the draftsman has inadvertently overlooked something which he would have dealt with had his attention been drawn to it and if it is possible as a matter of construction to repair the defect, then this must be done. However, if the literal meaning of a provision is to be modified by reference to the purposes of the Act, the modification must be precisely identifiable as that which is necessary to effectuate those purposes and it must be consistent with the wording otherwise adopted by the draftsman. Section 35 requires a court to construe an Act, not to rewrite it, in the light of its purposes.[18]
[18](1990) 169 CLR 214, 235 (citations omitted). Dawson J dissented in the outcome. See also at 222-3 (Mason CJ and Toohey J).
It follows that an application for a restraining order can be made under s 16(2)(a) notwithstanding that circumstances exist which would warrant an application to be based on another paragraph of s 16(2) (in this case, s 16(2)(c)
and (d)).
‘Only one application’
As already noted, the trial judge concluded that, except as permitted by s 15(4) of the Act, s 16(2) authorised the making of only one application for a restraining order against a particular property. His Honour’s conclusion was based not on the presence of an express prohibition on the making of a further application but on the absence of an express authorisation to do so and on the desirability of finality in litigation.
With respect, we can discern nothing in the language of the Act or in its stated purposes that would justify, let alone require, construing s 16(2) as permitting only a single ‘once and for all’ application for a restraining order in relation to property. As has often been said, it is a strong thing to read words into a statute and in the absence of clear necessity, it should not be done.[19]
[19]French v Queensland Premier Mines Pty Ltd [2006] VSCA 287, [32].
For reasons given earlier, the scheme of the Act and the language of s 16(2)(a) convey, unambiguously, Parliament’s intention to maximise the opportunities for the DPP to obtain (subject to proper proof of the qualifying circumstances) a restraining order over property as a precondition of forfeiture. In the circumstances, there can be no warrant for reading into s 16(2)(a) words of limitation which Parliament itself has not included. To do so would be to subvert the scheme which Parliament has enacted.
There are express restrictions on applications for a restraining order, under s 16(2A) and s 16(3). Critically, however, s 16 contains no restriction on subsequent applications, whereas an express restriction of that kind is imposed by s 32(9) (on applications by the DPP under s 32(1) for a forfeiture order in respect of tainted property), s 37(10) (on applications by the DPP under s 37(1) for a civil forfeiture order in respect of property) and s 58(8) (on applications under s 58(1) and (2) for pecuniary penalty orders). Contrary to his Honour’s conclusion, the inclusion of these express prohibitions on subsequent applications of other kinds reinforces the conclusion that Parliament intended that there be no such restriction on subsequent applications for a restraining order.
It follows that an application for a restraining order can be made under s 16(2) notwithstanding that a previous application for a restraining order has been made in respect of the same property under another paragraph in s 16(2).
In the circumstances of this case, neither KA’s acquittal nor the lapsing of the restraining order made under s 16(2)(c) as a result of the acquittal prevent the subsequent application for a restraining order over the property under s 16(2)(a). This is because the subsequent application is not based on the commission of any offence by KA but on the use of the property by the convicted co-accused in the commission of a Schedule 2 offence within the meaning of the first limb of the definition of tainted property.
Strict interpretation of the Act
The trial judge relied on a strict interpretation of the Act to support his conclusions. He described the applicability of a strict interpretation as a ‘fundamental, and ultimately fatal, problem facing the [DPP]’.[20] He said:
The applicant’s construction would expand the operation of confiscatory legislation. It has long been established that provisions for the forfeiture of property should be construed strictly. In addition, under the Act, the procedures for the forfeiture of property are deliberately draconian and reverse or remove what would otherwise be the procedural rights available under the common law for those affected.[21]
[20]Reasons, [55].
[21]Reasons, [55] (citations omitted).
In this respect, the trial judge noted that the making of a restraining order is a prerequisite to obtaining a civil forfeiture order and that, once a restraining order is made, the onus is on any person who owns the property or claims an interest in it to seek an exclusion order. He also noted that to obtain an exclusion order, an applicant must meet the difficult requirements in s 24, and that a restraining order carries unusual and onerous consequences for those adversely affected by it.
The trial judge noted that the persons affected will include innocent persons who are compelled to expend substantial sums of money to protect their rights, and that this ‘reversal and removal of common law rights only serves to reinforce the need for a strict approach’.[22] The trial judge concluded:
A strict approach should be taken and any ambiguities should be resolved against the [DPP’s] construction. As a result, it would be contrary to authority, in my view, to adopt the construction advanced for the [DPP]. It is no part of the judicial function to fill gaps disclosed in the legislation, or expand its operation, particularly legislation of this kind. To do so would involve the “usurpation of the legislative function under the thin disguise of interpretation”. The construction of s.16(2) sought by the [DPP] requires clear and specific provision.[23]
[22]Reasons, [59].
[23]Reasons, [60] (citation omitted).
We have already concluded, for reasons set out earlier, that there is no ambiguity in the language of s 16 of the Act. It follows that there is no room for the application of principles dealing with strict interpretation of ambiguous legislative provisions dealing with forfeiture of property.[24] Likewise, the plain and unambiguous meaning of the provisions leaves no room for the operation of the presumption against legislative interference with vested property rights.[25]
[24]Murphy v Farmer (1988) 165 CLR 19, 27-9; Logan Park (1995) 37 NSWLR 118, 125-7, 130; Jeffrey (1995) 121 FLR 16, 19; (1995) 79 A Crim R 514, 517-18.
[25]Clissold v Perry (1904) 1 CLR 363, 373; R & R Fazzolari Pty Ltd v Parramatta City Council [2009] HCA 12, [42]-[43].
Plainly enough, the Act does interfere with property rights, and modifies many common law protections. Equally clearly, Parliament has done this deliberately. It has enacted a statute which contains its own procedures and protections. The fact that these procedures and protections are not as fair or comprehensive as those under common law does not mean that the courts are at liberty to modify them so that they accord with traditional values.
Legislative history of Confiscation Act
Prior to the amendments to the Act effected by the Major Crime Legislation (Seizure of Assets) Act 2004 (Vic) (‘Amending Act’), an application for a restraining order for the purpose of a civil forfeiture order could only be made under the then current s 16(1)(a) where a person ‘has been, or within the next 48 hours will be, charged with or has been convicted of … a civil forfeiture offence’. Section 3(1) defined certain offences to be civil forfeiture offences. Section 16(2) provided that ‘[f]or the purposes of civil forfeiture, it does not matter that the charge has been withdrawn or finally determined’. A similar statement appeared in the then current s 37(2), which dealt with civil forfeiture orders.
The Amending Act, which commenced on 1 January 2005, replaced s 16(1) with new provisions dealing with restraining orders relating to Schedule 1 offences. New provisions dealing with restraining orders relating to Schedule 2 offences were inserted in s 16(2). Those amendments permitted, for the first time, a restraining order being sought for civil forfeiture based on a reasonable suspicion that property was tainted property even if no charge had been laid. Previously, a restraining order for the purpose of a civil forfeiture order was only available where a charge had been laid or was about to be laid. However, the previous ss 16(2) and 37(2) were not re‑enacted in relation to applications for restraining orders and civil forfeiture orders.
The trial judge referred to but did not place any reliance on the 2005 amendments to the Act, including the repeal of the old ss 16(2) and 37(2).
KA submitted that the effect of the amendments, and in particular, Parliament’s failure to re-enact the old s 16(2), was that from 1 January 2005, the civil forfeiture regime operated only where no charges were laid. He also submitted that where a restraining order had been made under s 16(2)(b), (c) or (d) based on the laying of charges or a conviction, a subsequent application could not be made under s 16(2)(a) if the charges were withdrawn or finally determined by an acquittal.
In our opinion, no assistance is provided by Parliament’s failure to re-enact the old ss 16(2) and 37(2) in interpreting the scope of the current s 16(2). This is because the Amending Act introduced a new statutory regime for applications for civil forfeiture orders. The old regime required that charges were about to be laid, or had been laid, as a precondition to an application for a restraining order for the purpose of a civil forfeiture order. It is unsurprising that, under the old regime, there were provisions specifying the consequences of the charges being withdrawn or being determined finally.
The new regime is very different from the old regime because s 16(2)(a) enables a restraining order for the purpose of a civil forfeiture order to be applied for, and made, even though no-one has been charged with an offence. Under this regime, it is not necessary to provide for what happens to a restraining order made under s 16(2)(a) if a charge is withdrawn or is finally determined. The failure to make such provision cannot support an inference that the Amending Act curtailed the longevity of restraining orders made for the purpose of civil forfeiture. In any event, ss 20(6) and (7) presuppose that a restraining order made under s 16(2)(a) can continue in force after charges against a person with an interest in the restrained property are finally determined or are withdrawn.
Likewise, no assistance is provided by the current s 27(3) of the Act, which provides that a restraining order made in reliance on the charging, or proposed charging of a defendant, ceases to be in force after the charge is withdrawn or when acquittal occurs. This is because an application for a restraining order under s 16(2)(a) is not made in reliance on the charging or proposed charging of a defendant. What is relevant is s 27(2), which provides that a restraining order made under s 16(2)(a) ceases to be in force on the expiry of 90 days after it is made unless an application for a civil forfeiture order is made within that time.
Stay based on inequity
As we have concluded that, on its proper construction, s 16(2) of the Act did not preclude the making of the current application for a restraining order, the fact that the previous restraining order lapsed on KA’s acquittal is not a sufficient ground for staying the application. Counsel for KA properly abandoned arguments based on oppression and abuse of process.
Position of the cash
A restraining order was sought over the cash on the basis that it was rent received by KA from leasing the property to his co-accused.[26] The DPP alleged that the cash was derived by the co-accused from their use of the property for a Schedule 2 offence and was therefore tainted property.
[26]The Reasons refer to the cash as totalling $6,500 whereas the affidavit in support of the restraining order and the notice of appeal to this Court refer to the amount of $6,850. The discrepancy was not explained to us.
The trial judge’s reasons for refusing to make a restraining order over the cash were as follows:
The application for a restraining order in respect of the $6,500 differs from the property application because it is made for the first time. But the circumstances come within paragraphs (c) and (d) and, therefore, paragraph (a) is not applicable. Alternatively, the circumstances are not covered by any of the listed alternatives. Accepting that construction, there is no right to apply for a restraining order in respect of that property.[27]
[27]Reasons, [64].
Senior counsel for the DPP frankly conceded that he did not understand the precise basis for his Honour’s decision in relation to the cash. In response to questions from the Bench, he identified the ground of appeal in respect of this part of his Honour’s decision as the inadequacy in his reasons.
A court is ordinarily required to give reasons for its decision. This is a normal, though not universal, incident of the judicial process. Where a court is required to give reasons, a failure to give adequate reasons is an error of law.[28] In general, reasons will not be adequate if they do not allow an appeal court to ascertain the reasoning upon which the decision is based, or they are such that justice is not seen to be done.[29]
[28]Pettitt v Dunkley [1971] 1 NSWLR 376, 382, 384, 388; Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd (No 2) (2002) 6 VR 1, 30 [99] (‘Fletcher’).
[29]Fletcher (2002) 6 VR 1, 31-4 [101]-[106].
With respect, the trial judge’s reasons for his decision in relation to the cash do not satisfy the above principles and therefore disclose an error of law. However, it is not necessary for us to uphold the appeal in relation to the cash based on the inadequacy of his Honour’s reasons. The appeal can be upheld on the basis that, on our interpretation of s 16(2), the application for a restraining order in relation to the cash falls within s 16(2)(a) and such an order can be made notwithstanding that it could also be made under s 16(2)(c) or (d).
Position of DA
DA appeared at the trial and relied upon the submissions of counsel for KA. She informed the trial judge that if those submissions were unsuccessful, she wished to argue that any restraining order be confined to the proprietary interest of KA and not extend to the equitable interest she claimed in the property. As the trial judge refused to make a restraining order, he did not need to hear separately from DA.
In Director of Public Prosecutions v Le,[30] this Court considered an application for an exclusion order in respect of the applicant’s interest in an apartment property following an automatic forfeiture. The applicant’s husband was originally the sole proprietor of the property. After he was charged, the husband caused the applicant to be registered as joint proprietor. A restraining order was then made over the whole of the property (rather than just the husband’s interest in it) and the property was automatically forfeited when the husband was convicted. A majority of this Court rejected the DPP’s submission that the court’s power under s 52(1) of the Act to make an exclusion order should be read down so that it could only be exercised to exclude so much of the property as relates to the applicant’s interest, as opposed to excluding the property in its entirety.[31] On appeal, the High Court, by a 3-2 majority, disagreed with the majority in this Court on that issue, and upheld the DPP’s construction of s 52(1).[32]
[30](2007) 15 VR 352.
[31](2007) 15 VR 352, 364-5 [49]-[50], 366 [55].
[32]DPP (Vic) v Le (2007) 232 CLR 562, 565 [1], 583 [69]-[70], 586 [84].
The High Court did not take issue with the statement made by the majority of this Court that: ‘[a] restraining order can, of course, be made in respect of an interest in property. That follows from the definition of “property” in s 3’.[33] ‘Property’ is defined in s 3(1) of the Act as follows:
property means real or personal property of every description, whether situated within or outside Victoria and whether tangible or intangible, and includes any interest in any such real or personal property …
[33](2007) 15 VR 352, 365 [52]. In our view, it also follows from the references in s 15 to restraining orders preserving property or an interest in property. See also s 14(1).
In the High Court, Kirby and Crennan JJ (with whom Gleeson CJ agreed in relation to the scope of exclusion orders) appeared to accept that a restraining order could be made in respect of a particular interest in property rather than the property as a whole.[34] Gummow and Hayne JJ, who would have upheld this Court’s decision in relation to the scope of exclusion orders and so dissented on that point, clearly accepted that such a limited restraining order could be made, commenting that ‘[t]he [restraining] order could have been, but was not, made with respect to [the husband’s] interest alone’.[35]
[34]DPP (Vic) v Le (2007) 232 CLR 562, 585-6 [82]-[84]. See also at 587 [88], [91]-[92].
[35]DPP (Vic) v Le (2007) 232 CLR 562, 569 [17]. See generally at 569-70 [16]-[19], 573 [28].
In this case, there has not been any determination of DA’s claim to an equitable interest in the property. If she does have such an interest, a restraining order could be made either in respect of the whole property or only KA’s interest in the property. If a restraining order is made over the whole property, DA’s remedy would be to seek an exclusion order under s 24 of the Act in respect of her interest.
Conclusion and orders
For the reasons set out above, the appeal will be allowed and the trial judge’s orders will be set aside.
As we have already mentioned, the DPP’s notice of appeal sought the making of a restraining order in the event that the appeal was upheld.
Senior counsel for the DPP submitted that it would be futile to remit the question of whether a restraining order should be made to the Trial Division, as the only possible outcome is that a restraining order will be made. He noted that s 18(2) of the Act provides that a restraining order must be made where the court is satisfied that the deponent of the affidavit in support suspects that the property is tainted in relation to a Schedule 2 offence and there are reasonable grounds for that suspicion.
Counsel for KA submitted that the affidavit in support of the restraining order was defective because the deponent stated a belief that the property and the cash were tainted rather than a suspicion. He readily conceded that this defect could be remedied by a supplementary affidavit. Senior counsel for the DPP submitted that there was no defect, as a belief was a higher level of satisfaction than a suspicion and the greater included the lesser.
We agree with the submission of senior counsel for the DPP that the alleged defect in the affidavit would not be a proper basis for refusing a restraining order.
However, it would be inappropriate for a restraining order to be made without first giving DA an opportunity to be heard on the scope of such an order in light of her claimed interest in the property.
Accordingly, we will remit the matter to the Trial Division for further hearing.
We will hear from the parties in relation to costs.
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