Director of Public Prosecutions v Delaney, Drewe Francis

[1998] TASSC 29

29/1998

PARTIES:  DIRECTOR OF PUBLIC PROSECUTIONS
  v
  DELANEY, Drewe Francis

TITLE OF COURT:  COURT OF CRIMINAL APPEAL
JURISDICTION:  APPELLATE
FILE NO/S:  FCA 122/1997
DELIVERED:  3 April 1998
HEARING DATE/S:  4 March 1998
JUDGMENT OF:  Underwood, Wright and Crawford JJ
CATCHWORDS

Criminal Law - Jurisdiction, practice and procedure - Judgment and punishment - Orders for compensation, reparation, restitution, forfeiture and other matters relating to disposal of property - Forfeiture or confiscation - Pecuniary penalty order - Discretion to make order - Relevant considerations - Impecunious respondent with little prospects of paying penalty - Procedure and evidence - How facts may be established.

Crimes (Confiscation of Profits) Act 1993 (Tas), s21.

R v Pepin (1996) 86 A Crim R 327, discussed.

Aust Dig Criminal Law [927]

REPRESENTATION:

Counsel:
             Appellant:  D J Bugg QC
             Respondent:  C G Rainbird
Solicitors:
             Appellant:  Director of Public Prosecutions
             Respondent:  Piggott Wood & Baker

Court Computer Code:  
Judgment ID Number:  29/1998
Number of pages:  17

Serial No 29/1998
File No FCA 122/1997

DIRECTOR OF PUBLIC PROSECUTIONS v
DREWE FRANCIS DELANEY

REASONS FOR JUDGMENT  COURT OF CRIMINAL APPEAL

UNDERWOOD J
WRIGHT J
CRAWFORD J (Dissenting)
3 April 1998

Order of the Court

Appeal dismissed.

Serial No 29/1998
File No FCA 122/1997

DIRECTOR OF PUBLIC PROSECUTIONS v
DREWE FRANCIS DELANEY

REASONS FOR JUDGMENT  COURT OF CRIMINAL APPEAL

UNDERWOOD J
3 April 1998

The respondent was convicted on his own plea of one count of trafficking in a narcotic substance (amphetamine) and one count of trafficking in a prohibited substance (heroin) and sentenced to four years' imprisonment.  A month after the sentencing hearing, the appellant made application, pursuant to the Crimes (Confiscation of Profits) Act 1993 ("the Act") for the following orders:

"1That pursuant to Section 16(1) of the Act property comprising cash in the sum of $2,000 located at the Tasmania Police Property Store at Hobart (Miscellaneous Property no 67873) be forfeited to the Crown in right of Tasmania.

2That the Court assess in accordance with Section 22 of the Act the value of the benefits derived by the respondent from the commission of the offences specified in the schedule hereto.

3That pursuant to Section 21(1) of the Act the respondent pay to the Crown in right of Tasmania a pecuniary penalty equal to the value of the benefits assessed by the Court to have been derived by the respondent from the commission of the offences specified in the schedule hereto.

4...".

In support of the application the applicant read an affidavit of a police officer and, by virtue of the provisions of the Act, s15, relied upon the transcript of the sentencing proceedings and three orders that had been made earlier in related proceedings.

The transcript of the sentencing proceedings disclosed that at the time the respondent was arrested, $2,000 was taken from him by the arresting officers.  Upon the hearing of the application from which this appeal is brought, an order was made that $2,000 be forfeited to the Crown.  No attack is made upon that order.

Pursuant to the Act, s21, the learned judge at first instance assessed in accordance with section 22 "the value of the benefits, including any commercial benefits, derived by the [respondent]" in the sum of $117,000. No complaint is made about that assessment.

However, the learned judge at first instance declined to exercise his discretion to make the pecuniary penalty order sought by par(3) of the application.  From that part of the order, this appeal is brought on the following grounds:

"1That the learned primary judge erred in fact and/or in law in concluding that there was little point in making a pecuniary penalty order which the respondent had no prospects of meeting, even in part, let alone in full, and further that the learned primary judge misdirected himself in concluding that such a situation was adverted to by Smart J in Pepin (1996) 86 A Crim R 327 at page 332 in what was described by Smart J as circumstance '(d)'.

2That the learned primary judge erred in fact and/or in law when he expressed himself to be of the opinion that there were no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 or even a small proportion of it, in that in reaching that opinion he failed to pay any or any sufficient regard to the fact that the respondent was possessed of an asset valued at $10,000.

3That the learned primary judge erred in fact and/or in law in that he failed to pay any or any sufficient regard to the fact that the application for a pecuniary penalty against the respondent was not opposed by the respondent."

The essence of this appeal arises out of the opening sentence of the concluding paragraph of the reasons for judgment against which this appeal is brought, viz:

"In my opinion, there are no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 [the $2,000 earlier forfeited was deducted] or even a small proportion of it."

To support that opinion, the learned judge said at 7:

"He imported Heroin into Tasmania and consumed half of it himself, paying the cost of it by trafficking in the remaining half of the Heroin and in the amphetamine which he also imported.  He made no commercial profit.  The whole exercise was designed to procure and pay for drugs which he thereupon consumed.  The definition of benefit is wide enough to cover the value of the drugs consumed and if he had the means to pay it, a penalty equal to that amount would be a strong deterrent to repetition and no doubt it would be considered just that he should disgorge the equivalent value of the drugs which he consumed.  But if he has no assets and nothing to disgorge, there seems little point in making a pecuniary penalty order which he has no prospects of meeting, even in part, let alone in full."

The making of a pecuniary penalty order is authorised by the Act, s21. The relevant provisions are:

"21 — (1)   If a person has been convicted of a serious offence and an application is made to a court under section 11 (1) (b) for an order in respect of the offence, the court may —

(a) assess in accordance with section 22 the value of the benefits, including any commercial benefits, derived by the person from the commission of the offence; and

(b)  order the person to pay to the State a pecuniary penalty equal to the value so assessed.

(2)  If —

(a)  property that constitutes the proceeds of the serious offence referred to in subsection (1) has been forfeited under this Act or a law of another State or the Commonwealth; or

(b)  a forfeiture order is proposed to be made against property that constitutes the proceeds of that serious offence —

a pecuniary penalty to be paid in respect of that offence under this section is to be taken to be reduced by an amount equal to the value (as at the time of the making of the order) of the property forfeited, or to be forfeited.

(3)  ...

(4)  An amount payable by a person to the State under a pecuniary penalty order made under this section is, for all purposes, taken to be a civil debt due by that person to the State.

(5)  A pecuniary penalty order made by a court under this section may be enforced as if it were an order made by the court in civil proceedings instituted by the State against that person to recover a debt due by that person to the State and the debt arising from the order is taken to be a judgment debt."

It is necessary, first of all, to dispose of ground 2 which alleges, in effect, that the learned judge at first instance made an error of fact with respect to the finding, expressed as an opinion, that there were no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order or even a small proportion of it. Mr Bugg QC submitted that there was evidence that the respondent "was possessed" of a motor vehicle valued at $10,000.

The evidentiary material with respect to the respondent's ownership of a car was, to say the least, sparse. There was an order made by this Court on 14 July 1995, pursuant to the Act, s8, restraining the disposition of a Toyota Hi-lux model utility motor vehicle and a Holden FJ model utility motor vehicle. The order provided that those vehicles be delivered into the custody of the Public Trustee. It ceased to have effect on 28 July 1995. On 18 July 1995, a further order was made releasing the Toyota Hi-lux model utility motor vehicle from the restraining order and on 24 July 1995, the terms of the original order were extended until further order. No reference to either motor vehicle appears in either the affidavit of the police officer or the transcript of the sentencing proceedings. The question of the respondent's ownership of the Holden motor vehicle and its value did not arise until the end of the hearing at first instance when the restraining orders were handed up to the learned judge and counsel for the appellant in the court below said:

"And I can indicate from the Bar Table there was an affidavit filed in the earlier proceedings, if my learned friend doesn't have any objection, I can indicate from the Bar Table that the value of the motor vehicle in question is somewhere in the order of $10,000."

That sentence completed counsel for the appellant's submissions and counsel for the respondent rose and said:

"MR RAINBIRD:  Your Honour, I am instructed not to make any submissions in relation to this matter and as pointed out between yourself and Mr Virs, it's a matter of discretion for your Honour, although I can indicate, your Honour, that the financial circumstances of my client haven't changed since the plea in mitigation was made to you, that is he is impecunious and has no assets apart from the vehicle in question which I understand and subject to what Mr Virs says, is subjected [sic]to a claim by a person in New South Wales for the purchase of the property where a deposit of $2,000 has been paid on the vehicle which it is my submission goes to the value of the vehicle and in relation to payments made on the loan moneys made available to purchase the vehicle which have been satisfied to some degree by Mrs Delaney during the defendant's period of incarceration.

HIS HONOUR:   There is some claim by a person in New South Wales, is there?

MR RAINBIRD: That's correct, your Honour."

Thus far, counsel for the appellant in the court below has "indicated" that if counsel for the respondent had no objection to him so stating, the value of the Holden motor vehicle, the subject matter of the restraining order, is "somewhere in the order of $10,000".  However, counsel for the respondent did not say whether or not he had any objection to the "indication" made on behalf of the appellant but proceeded instead to give his own "indication".  This "indication" is almost impossible to understand but, on any view, does not amount to an unqualified agreement that the respondent owns an asset that is worth $10,000 to him.  Absent oral or affidavit evidence or an agreed fact, there was, at this stage, no evidence upon which the learned judge at first instance could have concluded that the respondent owned an asset worth $10,000.  Statements from the bar table are not evidence of facts unless there is agreement that such statements have that status.  Following the above exchange, counsel for the respondent chose to make no further submissions but counsel for the appellant said:

MR VIRS:          Your Honour.  Sorry to interrupt.  If I could just clarify the last point that there certainly has been some correspondence from a person in New South Wales named Walters who does claim to have entered into some form of contract or arrangement with the respondent for the sale of the motor vehicle for a price of $10,000.  It has been alleged there were deposit moneys paid and I think the figure of $2,000 is correct.  Of course, there were earlier some proposals put forward by my office to the effect that my office was happy for that transaction to be concluded, provided of course the purchase moneys were paid into the hands of the Public Trustee who presently has custody and control of the motor vehicle pursuant to the restraining order.

...

HIS HONOUR:   Yes.  It may be that the motor vehicles [sic] aren't worth anything in satisfaction of any debt that I might order.

MR VIRS:          Yes.  It's simply that if the transaction were to proceed, it is submitted that the restraining order would apply, whether it may have to be formally varied or not will remain to be seen, but it would certainly be argued that the restraining order would apply or sought to be applied towards the proceeds of that transaction.  In other words, if the transaction were to proceed, the proceeds would again be property in the hands of the respondent which the Crown would submit is available to satisfy any pecuniary penalty order."

It is clearly not the function of counsel to attempt to "clarify" a factual matter by purporting to give evidence from the bar table other than by way of agreed fact.  Further, even if regard may properly be had to Mr Virs' statement from the bar table, it clarifies nothing but raises a number of questions.  They include; has the Holden motor vehicle been sold to a person in New South Wales? If yes, what was the agreed price and has the property in the vehicle passed to this person? If yes, what are the prospects of the balance of the purchase price being paid?

By virtue of the provisions of the Act, s21(1):

_    The Court has a discretion whether or not it will:

(a)       make an assessment;

(b)       order payment of a pecuniary penalty.

_    No fetter is imposed on the exercise of the judicial discretion.

_    If an assessment and a pecuniary penalty order is made, the latter must be in a sum equal to the former.

Presumably, the onus of persuading the Court to exercise either or both of the discretions conferred by the subsection falls upon the applicant who seeks to activate the discretion(s).  See Gillies, Law of Evidence in Australia 2nd edn, 46 et seq and cases cited.  From the transcript of the sentencing proceedings, it was clearly open for the learned judge to make the findings that he did at 8, viz:

_    all the profits of the crimes were spent acquiring drugs for the respondent's own use;

_    at the time of sentencing, the respondent was suffering from a long term physical disability, was unemployed, lived in rented accommodation and had no money or other assets except perhaps, this motor vehicle.

Having made those findings, the learned judge concluded:

"The respondent has no assets, save the $2,000 already forfeited and a motor car which is the subject of a restraining order.  That was valued at $10,000 but is the subject of a claim by a third party."

At best, it might be said that in the exchange between counsel there emerged an agreed fact that the respondent owned the motor vehicle referred to in the restraining order.  I doubt if that exchange resulted in there being an agreed fact about the value of the vehicle, but it did appear to be common ground that there was some undefined claim against the vehicle by a third party, one that prompted the learned judge to observe that "[i]t may be that the motor vehicles [sic] aren't worth anything in satisfaction of any debt that I might order."  This being the state of the evidentiary material before the learned sentencing judge, the critical finding that there were no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 or even a small proportion of it, was not only open, but in my respectful opinion, the only one that could reasonably have been made.  Ground 2 fails. 

With respect to the exercise of the discretion, the learned judge at first instance referred to R v Pepin (1996) 86 A Crim R 327. This is a decision of the Court of Criminal Appeal, New South Wales. It concerned the Confiscation of Proceeds of Crime Act 1989 (NSW). That Act, s24(1) is in very similar terms to the Tasmanian Act, s21(1) and imposes no fetter on the exercise of the discretion to make an assessment and a penalty order. Smart J, with whose judgment on this aspect of the appeal the other members of the court agreed, said at 331:

"In discussion with members of the bench during argument, it was appreciated by the Crown that an order may well not be made by a court in the following circumstances:

(a)judgment had been obtained by the victim in civil proceedings whether by consent or by default or by a settlement or after a hearing.  Doubling up should be avoided; or

(b)the accused had restored the property taken or its value to the victim.  Included in this category would be restitution or payment made on behalf of the accused by his relatives; or

(c)the property taken was of little or no value, even though there had been an armed robbery or the offence of break, enter and steal; or

(d)the accused was destitute or seriously disabled so that any order would be useless.  There was also the case where the accused was bankrupt with no assets, large liabilities and no prospect of being able to meet even a part of an order.  If there was a suggestion of substance that the accused had not disclosed all his assets or income or that an investigation into the accused's financial position should take place later an order would probably be made."

Smart J referred to R v Fargher (1989) 16 NSWLR 67 where the Court was divided on the question of whether hardship to the respondent could be a ground for declining to exercise the discretion to make a pecuniary penalty order and said that he could envisage cases of exceptional hardship "where a court might pause." (333 - 334) The other two members of the Court of Criminal Appeal in Pepin preferred to express no opinion about the issue of hardship for it did not arise in that case and, of course, it does not arise in this one.  The learned judge at first instance referred to par(d) in the judgment of Smart J set out above when he concluded at 7:

"But if he has no assets and nothing to disgorge, there seems little point in making a pecuniary penalty order which he has no prospects of meeting, even in part, let alone in full."

On the appeal, Mr Bugg QC argued that the learned judge fell into error in that the circumstances of this case were quite different from the circumstances described by Smart J in par(d) above and therefore the exercise of the discretion had miscarried.  There is no substance in that submission.  The parameters of the exercise of the discretion are unfettered by statute.  The passage taken from the judgment of Smart J is merely an indication of what one court considered would be a relevant matter to be taken into account in the proper exercise of the discretion.  The issue here is whether, in the circumstances of this case, the discretion miscarried.

By the enactment of the Crime (Confiscation of Profits) Act 1993 the legislature made its intention clear. The Act is designed to compel criminals to disgorge an amount equal to the profits gained by the commission of crime. It is also clear that the legislature does not want the court to engage in any nicely balanced inquiry into the means of the offender to pay any pecuniary penalty order, for no discretion is conferred with respect to the amount of the pecuniary penalty order. It must be for an amount equal to the profit earned by the commission of the crimes in respect of which the proceedings relate. It might be inferred, therefore, that the Parliament intended that where a respondent has some assets or income, or may, in the reasonably foreseeable future acquire assets or income, he or she should be ordered to disgorge all of the profit earned by criminal conduct. Accordingly, considerations which govern the proper exercise of the discretion upon the imposition of a fine have no part to play in the exercise of the discretion conferred by the Act, s21(1), cf. Broughton v Lowe [1979] Tas R (NC 7) 309; Young v Geddie (1978) 22 ALR 232.

However, the legislature clearly did not intend that a pecuniary penalty order must be made in every case.  Had it so intended, it would have provided that the making of the order was mandatory.  The fact that a respondent has no prospects, either in the present or in the reasonably foreseeable future of meeting any part of a pecuniary penalty order, is a factor relevant to the proper exercise of the discretion.  In such a case there is no point in making an order that the court knows will never be satisfied even in part.  Accordingly, it cannot be said that the exercise of the discretion from which this appeal is brought, miscarried by reason of the matter alleged in ground 1 of the appeal.

There is no substance in ground 3 of the appeal.  Mr Bugg QC conceded that lack of opposition to the making of the order did not require the learned judge at first instance to make the order sought in the application.  His Honour referred to the failure of counsel for the respondent to make any submissions and said that, notwithstanding this failure, the proper exercise of the discretion required him to decline the application.  No fault can be found with that.

I would dismiss the appeal.

WRIGHT J
3 April 1998

The appellant applied, pursuant to the Crime (Confiscation of Profits) Act 1993, ("the Act") for forfeiture to the Crown of $2,000 seized from the respondent in connection with drug trafficking offences. The application was not opposed and a forfeiture order was made by the Chief Justice on 17 November 1997. The appellant also applied for a pecuniary penalty order under the Act, s21(1). This part of the application proceeded on the basis that the respondent had been convicted of a "serious offence" and had derived valuable "benefits" from that offence.

The respondent had pleaded guilty to one count of trafficking in a narcotic substance (amphetamine) between 29 October 1993 and 1 September 1994 and to one count of trafficking in a prohibited substance (heroin) between 29 October 1993 and 9 September 1994. Material placed before the Chief Justice satisfied him that the respondent had derived a benefit of $117,000 from the commission of the two crimes. His Honour then considered whether, in accordance with the discretion vested in him by s21(1), he should order the respondent to pay the sum so assessed as a pecuniary penalty, after deducting therefrom the forfeited sum of $2,000 as required by the Act, s21(2). His Honour considered a number of authorities in which the purpose and principle of similar legislation in other parts of the Commonwealth had been discussed and he made particular reference to Pepin (1996) 86 A Crim R 327.

It has not been contended by the appellant that the matters discussed in those cases were erroneous or were irrelevant to the exercise of his Honour's discretion.  The essence of his Honour's reasoning process appears to be distilled in the following passage at 7 of his reasons:

"However, in the present case there is no question of the respondent retaining his ill-gotten gains and seeking to avoid disgorging them.  He imported Heroin into Tasmania and consumed half of it himself, paying the cost of it by trafficking in the remaining half of the Heroin and in the amphetamine which he also imported.  He made no commercial profit.  The whole exercise was designed to procure and pay for drugs which he thereupon consumed.  The definition of 'benefit' is wide enough to cover the value of the drugs consumed and if he had the means to pay it, a penalty equal to that amount would be a strong deterrent to repetition and no doubt it would be considered just that he should disgorge the equivalent value of the drugs which he consumed.  But if he has no assets and nothing to disgorge, there seems little point in making a pecuniary penalty order which he has no prospects of meeting, even in part, let alone in full."

At 8, his Honour said:

"In my opinion, there are no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 or even a small proportion of it."  [My emphasis.]

During the course of proceedings before the Chief Justice, counsel for the appellant informed his Honour from the bar table that the respondent owned a an FJ Holden utility, registered No DF 7757 and that its value was "somewhere in the order of $10,000".  This vehicle had been the subject of an ex parte restraining order made on 14 July 1995 and was held in the custody of the Public Trustee, pursuant to that order. No affidavit or other documentary or oral evidence was presented to the Chief Justice verifying the respondent's ownership of the vehicle or its value. The transcript of the sentencing proceedings in which the respondent had been involved, were placed before his Honour, pursuant to the Act, s15, but there was no relevant material therein bearing upon the question of the ownership or value of the vehicle.

Counsel for the respondent did not dispute what counsel for the appellant told the Court. He said:

"MR RAINBIRD:  Your Honour, I am instructed not to make any submissions in relation to this matter and as pointed out between yourself and Mr Virs, it's a matter of discretion for your Honour, although I can indicate, your Honour, that the financial circumstances of my client haven't changed since the plea in mitigation was made to you, that is he is impecunious and has no assets apart from the vehicle in question which I understand and subject to what Mr Virs says, is subjected to a claim by a person in New South Wales for the purchase of the property where a deposit of $2,000 has been paid on the vehicle which it is my submission goes to the value of the vehicle and in relation to payments made on the loan moneys made available to purchase the vehicle which have been satisfied to some degree by Mrs Delaney during the defendant's period of incarceration."

The following exchange between the Chief Justice and counsel then took place:

"HIS HONOUR:  There is some claim by a person in New South Wales, is there?

MR RAINBIRD: That's correct, your Honour.

HIS HONOUR:   Yes.  Well you've got no submissions about the way I should exercise my discretion?

MR RAINBIRD: No.  I have heard ... the flow of conversation between you and Mr Virs and I have no further instructions to make any further submissions, your Honour.

HIS HONOUR:   Very well.

MR VIRS:          Your Honour.  Sorry to interrupt.  If I could just clarify the last point that there certainly has been some correspondence from a person in New South Wales named Walters who does claim to have entered into some form of contract or arrangement with the respondent for the sale of the motor vehicle for a price of $10,000.  It has been alleged there were deposit moneys paid and I think the figure of $2,000 is correct.  Of course, there were earlier some proposals put forward by my office to the effect that my office was happy for that transaction to be concluded, provided of course the purchase moneys were paid into the hands of the Public Trustee who presently has custody and control of the motor vehicle pursuant to the restraining order.

HIS HONOUR:   Yes.  The restraining order is simply no more than that is it - it restrains the respondent here from dealing with it and requires that it be placed in the safe custody of the Public Trustee.  But it doesn't purport to exclude other people from claiming an interest in any property seized.

MR VIRS:          Not at all, your Honour.  The point I was simply making was that in the event that at the end of the day it may well be that my office will recognise the claim that is made.

HIS HONOUR:   Yes.  It may be that the motor vehicles aren't worth anything in satisfaction of any debt that I might order.

MR VIRS:          Yes.  It's simply that if the transaction were to proceed, it is submitted that the restraining order would apply, whether it may have to be formally varied or not will remain to be seen, but it would certainly be argued that the restraining order would apply or sought to be applied towards the proceeds of that transaction.  In other words, if the transaction were to proceed, the proceeds would again be property in the hands of the respondent which the Crown would submit is available to satisfy any pecuniary penalty order.

HIS HONOUR:   But you are not asking me to make declarations or made orders that might affect that at this stage.  You just want me to assess the value of benefits received and exercise my discretion by ordering that he pay them.

MR VIRS:          Yes.  And it is then there is provision for the Public Trustee to come to this Court seeking an order that the property presently restrained and held in the custody and control of the Public Trustee be applied towards partial discharge of any pecuniary penalty order made."

I think it plain enough from this debate that counsel for the respondent clearly admitted on his client's behalf that he had some interest in the subject motor vehicle, either as owner or unpaid vendor.  The precise nature and value of that interest was unclear however.  In the penultimate paragraph of his reasons, the Chief Justice said:

"The respondent has no assets, save the $2,000 already forfeited and a motor car which is the subject of a restraining order.  That was valued at $10,000 but is the subject of a claim by a third party."

Ground 2 of the present appeal contends that the Chief Justice:

"... erred in fact and/or in law when he expressed himself to be of the opinion that there were no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 or even a small proportion of it, in that in reaching that opinion he failed to pay any or any sufficient regard to the fact that the respondent was possessed of an asset valued at $10,000."

In short, the appellant seeks to persuade us that there was a factual error made by the learned Chief Justice which vitiated his exercise of discretion in declining to make a pecuniary penalty order.

In my opinion, however, there was insufficient material before the learned Chief Justice for him to reach any satisfactory conclusion on the balance of probabilities, as required by s71 regarding either the value of the subject vehicle or the respondent's interest therein.  Accordingly, I am unable to conclude that his Honour erred as alleged in this ground.

Ground 3 contends that there was an error "... in fact and/or in law" by his Honour "in that he failed to pay any or any sufficient regard to the fact that the application for a pecuniary penalty against the respondent was not opposed by the respondent."  As to this ground, the following observations may be made.

In the first place, his Honour did advert to Mr Rainbird's failure to oppose the order sought in the final sentence of his reasons.  He said, "Notwithstanding that his counsel made no submission urging this course," [ie, to refuse the order sought] "this is, in my view, a proper case in the exercise of my discretion to decline to make such an order."  In the second place, a decision not to oppose the making of an order is not the same as consenting thereto.  The lack of opposition to the order sought was, no doubt, a matter which his Honour was entitled to take into account in deciding whether or not to exercise his discretion.  This is what he did, but, having done so, he refused the application.  I can see no appealable error in the way in which he exercised his discretion in this respect.

A final word should be said about ground 1 which is in the following terms:

"1That the learned primary judge erred in fact and/or in law in concluding that there was little point in making a pecuniary penalty order which the respondent had no prospects of meeting, even in part, let alone in full, and further that the learned primary judge misdirected himself in concluding that such a situation was adverted to by Smart J in Pepin (1996) 86 A Crim R 327 at page 332 in what was described by Smart J as circumstance '(d)'."

The short answer to this contention is that the Chief Justice, in referring to Smart J's judgment in Pepin (supra) was not purporting to follow a statutory formula and was not claiming to follow an immutable principle of law.  He merely referred to some of the features which were referred to in that case as being worthy of consideration upon an application such as this.  There was no error in his Honour's approach.

Insofar as this ground seeks to challenge the learned Chief Justice's assessment of the respondent's ability to pay any penalty, what I have already said as to grounds 2 and 3, is sufficient to demonstrate that the appellant's complaints are not supportable.

In my opinion, the appeal should be dismissed.

CRAWFORD J
3 April 1998

The appeal has been brought from the refusal of the Chief Justice to make a pecuniary penalty order under the Crime (Confiscation of Profits) Act 1993, s21(1). The value of the benefits derived by the respondent from the commission of the offences of trafficking, of which he was convicted, was assessed in the sum of $117,000 and the appeal does not concern that assessment. If a pecuniary penalty order had been made it would necessarily have been in the sum of $115,000, being the assessed value of the benefits, less the sum of $2,000 which was the amount of cash forfeited by the respondent under a forfeiture order. See s21(2). Having made his assessment of the benefits, the Chief Justice only had two options open to him, either to make a pecuniary penalty order in the sum of $115,000 or to make no order at all. It was a case of all or nothing. There was no power to make a pecuniary penalty order for part of the assessed benefits. Section 21(1)(b) requires a pecuniary penalty order to be for payment of "a pecuniary penalty equal to the value so assessed". No discretion is given as to the amount. See Re Ashworth [1992] 2 Qd R 459 at 464.

It is clear that his Honour had a discretion whether or not to make a pecuniary penalty order. Section 21(1) expresses the power to make the order in the form of a discretion, that a court "may" make the order. That there is a discretion is also supported by courts in other jurisdictions when dealing with similar legislative provisions. See, for example, Pepin (1996) 86 A Crim R 327; Re Ashworth (supra); Re Fagher (1989) 16 NSWLR 67.

I agree with Wright J that the essence of the reasoning process of the Chief Justice can be found in the passage at 7 of his reasons (Director of Public Prosecutions v Delaney 142/1997) which Wright J has cited.  Essentially, the Chief Justice considered that if the respondent "has no assets and nothing to disgorge, there seems little point in making a pecuniary penalty order which he has no prospects of meeting, even in part, let alone in full", and concluded that "there are no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 or even a small proportion of it".  The Chief Justice considered "that no good purpose would be served" if the order was made and in the exercise of his discretion, he declined to make it, notwithstanding that the respondent's counsel had made no submission urging that course.

By the second ground of the appeal, the appellant complains that the Chief Justice erred when he expressed himself to be of the opinion that there were no realistic prospects of the respondent ever being able to pay off a pecuniary penalty order of $115,000 or even a small proportion of it, in that in reaching that opinion the Chief Justice failed to pay regard to the fact that the respondent was possessed of an asset valued at $10,000.  This ground raises the question whether a wrong finding of fact was made.

On the hearing of an application for a pecuniary penalty order, questions of fact are to be decided on the balance of probabilities (s71). There is no clear statement in the Act concerning how evidence of facts may be presented, in the usual case, although special rules for particular circumstances can be found. There is however an indication in the Act that it is expected that evidence will be adduced on the hearing of at least some applications. I will refer to some of the Act's provisions. Section 12(2)(b) entitles a respondent to an application to "appear and adduce evidence at the hearing of the application". Section 15(1) provides that a court to which an application is made "may, in determining the application, have regard to the transcript of any proceedings against the person for the offence". On its face, that provision is not limited to the having of regard only to "any evidence given in a proceeding against the person for the offence". See Crimes (Confiscation of Profits) Act 1989 (Q), s6(3)(b), referred to by the Queensland Court of Appeal in Gardiner (1992) 62 A Crim R 370 at 371. Also to be contrasted is the Crimes (Confiscation of Profits) Act 1986 (Vic), s5(3A), which was referred to by the Victorian Court of Appeal in Tsolacos (1995) 81 A Crim R 434 at 439, as providing that a court might take into account "any material that it thinks fit including evidence given in any Proceedings relating to the offence ... and for this purpose ... transcript of those proceedings is admissible in evidence as if it were a record of evidence given on the hearing of the application".

Under s22(2) the value of the commercial or other benefits derived by a respondent from the commission of the relevant serious offence or offences "is to be assessed by the court having regard to the evidence before it concerning all or any" of a number of matters which are specified. Subsections (3) and (4) refer to "evidence" being "given" and to evidence having been given at the hearing of an application for a pecuniary penalty order. Subsection (7) provides that a police officer "may give evidence" with respect to certain matters and subs(8) provides that subs(7) has effect notwithstanding any rule of law or practice relating to the admission of hearsay evidence. That should be regarded as a statutory exception to the rule against hearsay which will apply only in the circumstances postulated in the subsection. Section 23(4)(b) refers to certain persons appearing and adducing evidence at the hearing of an application that particular property is subject to the effective control of a person against whom the court has made a pecuniary penalty order. Part 3 provides for the making of restraining orders over property and s27 allows evidence on the hearing of an application for such an order to be given by affidavit. Section 28 allows any person whose property is the subject of the application, and any person who claims an interest in any such property, to appear and adduce evidence at the hearing of the application.

In the course of the sentencing process a judge sitting as a criminal court, for the purpose of determining the appropriate sentence, "may receive such information, in oral or documentary form, as he thinks fit; and in so doing, he is not bound by any rules of evidence", although the convicted person must have knowledge of, and the opportunity to challenge, any information received by the judge and for that purpose, the judge may require that information to be proved in like manner as if it were to be received at a trial.  Criminal Code, s386(7)(8) and (10). However, as pointed out in Gardiner (supra) at 372, a pecuniary penalty is not a sentence.  It follows that the provisions of s386 do not apply to the hearing of an application for a pecuniary penalty order.  What the Queensland Court of Appeal said was:

"Further, it is important to notice that a pecuniary penalty is not a sentence and there is no provision in the Act enabling the Court to deal with a claim for a pecuniary penalty as if it were a sentence. The practise is to impose sentences, where there is a plea of guilty, having regard to the submissions made on each side. It is unusual for evidence to be called on sentence; of course, if there has been a trial, a court will take into account the evidence given on the trial.

To establish a right to a pecuniary penalty, the Crown has to prove its case. If there has been a trial of the charge in question, the court may do so with the assistance of the provisions obliging the court to take into account "evidence given in a proceeding against the person for the offence": see s6(3)(b) and (4). The court may also act on any agreement between the parties as to the facts of the case and such an agreement may, in some circumstances, be inferred from the course of submissions. In the absence of agreement, any necessary facts must be proved by evidence and the defendant's right to call evidence on disputed questions is clear."

What was said there should be applied to the similar legislation of this State. Subject to any clear exception to be found in the Act, a judge hearing an application for either a forfeiture order or a pecuniary penalty order should take care to ensure that the relevant facts are established on the balance of probabilities (s71) from evidence given to the court, or to the court which tried the respondent for the relevant offence, and from any agreement between the parties as to the facts of the case. As was said in Gardiner, such an agreement may, in some circumstances, be inferred from the course of submissions, but in the absence of agreement, and any expressly contrary provision in the Act, any necessary facts must be proved by evidence in the usual way. It follows in a case such as this, where there was no trial but merely a plea of guilty followed by submissions from counsel both on the sentencing hearing and the hearing of the application for the pecuniary penalty order, with no sworn evidence apart from an affidavit establishing little by way of admissible evidence for the purpose of establishing relevant facts, that the judge hearing the application should take particular care to ascertain what facts are agreed and what facts are not agreed. If facts are asserted by Crown counsel and the respondent does not agree with them, expressly or implicitly, then they must be proved in the usual way in accordance with the rules of evidence, unless there is an express provision in the legislation which permits a different course. See for example s22(8). Applications for forfeiture or pecuniary penalty orders will commonly be Draconian in effect. Substantial sums of money and property of substantial value will often be involved. In this case the pecuniary penalty order which the Chief Justice might have made, would have been in the sum of $115,000, a very large amount in any person's terms, and before it is determined whether to make an order for payment of a sum of that magnitude, facts must be properly established.

It may be the case that a respondent wishes to establish facts in opposition to a pecuniary penalty order.  The same rules will apply in that case.  The facts will need to be established on the balance of probabilities, and if those facts are merely asserted by the respondent or his or her counsel, without being proved by admissible evidence, then they will not be proved unless the applicant admits them.

I do not regard s15(1) as materially affecting what I have said. Essentially it authorises the court hearing the application to have regard to what occurred in the criminal court when it dealt with the respondent for the relevant offence or offences, but in my view it does not permit facts to be established other than in accordance with evidence or agreement. That evidence may have been given in the course of the criminal court's proceedings or upon the hearing of the application under the Act. Similarly any agreement as to facts may have been reached in the course of either proceeding.

On the hearing of the application for the pecuniary penalty order in this case an affidavit of a police officer was read by the appellant's counsel.  I am unsure whether the use of an affidavit is authorised although it is unnecessary to determine that here.  It related to the course of the criminal proceedings against the respondent which had taken place and the result of those proceedings.  Annexed to the affidavit were some of the pages of the transcript of the hearing of those proceedings.  As the respondent had pleaded guilty to the trafficking charges, the transcript consisted of the addresses of counsel on the matter of penalty.  In the course of assessing the value of the benefits derived by the respondent from his commission of those offences, the Chief Justice had regard to that transcript and to documents referred to in it, such as a transcript of an interview conducted by police officers with the respondent and bank records.  The respondent did not object to that course and took no point concerning it at the hearing of this appeal.  Before the Chief Justice, Mr Rainbird, who appeared for the respondent, advised his Honour that the respondent consented to the making of the forfeiture order with respect to the cash of $2,000.  As to the pecuniary penalty order, he said that he did not anticipate making any submissions in relation to the matter, noting nevertheless that his Honour had a discretion whether to make the order.  If Mr Rainbird had said nothing more, the Chief Justice may have been obliged to refuse to make the pecuniary penalty order in the absence of sworn evidence establishing relevant facts on the balance of probabilities.  However Mr Rainbird did say more including that "the quantum" outlined in a document which he understood the appellant's counsel would hand to the Chief Justice, was "certainly not challenged", which amounted to a concession that the value of the benefits derived by the respondent from the offences was $145,535, and on the hearing of this appeal the respondent did not challenge the amount in which the pecuniary penalty order would have been made by the Chief Justice if he had been minded to make it at all, that is to say, the sum of $115,000.

Later, in the course of his submissions to the Chief Justice, the appellant's counsel said that the respondent owned a motor vehicle, the value of which was "somewhere in the order of $10,000".  That statement was immediately followed by the respondent's counsel saying that he was instructed not to make any submissions in relation to the matter of the making of the pecuniary penalty order, commenting that it was a matter of discretion for his Honour.  However Mr Rainbird immediately added that the respondent was impecunious and had no assets apart from the vehicle in question.  He also stated that subject to what Crown counsel said, the vehicle was the subject of "a claim by a person in New South Wales for the purchase of the property where a deposit of $2,000 has been paid on the vehicle which it is my submission goes to the value of the vehicle".  Mr Rainbird made a further statement which, if the transcript of it is correct, was incomprehensible, for he is recorded as saying "in relation to payments made on the loan moneys made available to purchase the vehicle which have been satisfied to some degree by Mrs Delaney during the defendant's period of incarceration".  The Chief Justice then asked whether there was "some claim by a person in New South Wales".  Mr Rainbird responded by saying that was correct, adding that he had no instructions to make any further submissions and thereafter he said nothing.  However counsel for the appellant then attempted to clarify to the Chief Justice the situation concerning the motor vehicle, although it appears doubtful that he succeeded in doing so. What counsel said was:

"If I could just clarify the last point that there certainly has been some correspondence from a person in New South Wales named Walters who does claim to have entered into some form of contract or arrangement with the respondent for the sale of the motor vehicle for a price of $10,000.  It has been alleged there were deposit moneys paid and I think the figure of $2,000 is correct.  Of course, there were earlier some proposals put forward by my office to the effect that my office was happy for that transaction to be concluded, provided of course the purchase moneys were paid into the hands of the Public Trustee who presently has custody and control of the motor vehicle pursuant to the restraining order."

His Honour commented that the restraining order, which had been made with respect to the vehicle under the Act, s26, at an earlier hearing, would not exclude other people from claiming an interest in the vehicle. The following interchange then occurred between his Honour and the appellant's counsel:

"MR VIRS:       Not at all, your Honour.  The point I was simply making was that in the event that at the end of the day it may well be that my office will recognise the claim that is made.

HIS HONOUR: Yes.  It may be that the motor vehicles aren't worth anything in satisfaction of any debt that I might order.

MR VIRS:        Yes.  It's simply that if the transaction were to proceed, it is submitted that the restraining order would apply, whether it may have to be formally varied or not will remain to be seen, but it would certainly be argued that the restraining order would apply or sought to be applied towards the proceeds of that transaction.  In other words, if the transaction were to proceed, the proceeds would again be property in the hands of the respondent which the Crown would submit is available to satisfy any pecuniary penalty order.

HIS HONOUR: But you are not asking me to make declarations or made(sic) orders that might affect that at this stage.  You just want me to assess the value of benefits received and exercise my discretion by ordering that he pay them.

MR VIRS:        Yes.  And it is then there is provision for the Public Trustee to come to this Court seeking an order that the property presently restrained and held in the custody and control of the Public Trustee be applied towards partial discharge of any pecuniary penalty order made.

HIS HONOUR: Yes.  Thank you.  Well, I am going to reserve my decision about this because I would like to look into this whole question of the discretion, the ambit of the discretion."

Under the second ground of the appeal, the question arises as to what facts were agreed by the applicant and the respondent concerning the state of the respondent's impecuniosity and his interest in the motor vehicle in question.  As no evidence was adduced, the Chief Justice was not authorised to determine the application upon the basis of any facts other than those which were agreed by the parties, expressly or implicitly.  It was plainly an agreed fact that the respondent was the owner of a motor vehicle and that a person in New South Wales claimed to have agreed to purchase it and had paid a deposit of $2,000 for its purchase.  That the value of the vehicle was $10,000 and that the person in New South Wales claimed to have agreed to purchase it for $10,000 were not agreed facts.  Nothing else was established about the matter.  What was said in the course of the interchange between his Honour and the appellant's counsel, which I have quoted, was not capable of establishing any additional facts because the respondent's counsel agreed to none of it.

Literally it was acknowledged to his Honour by counsel on behalf of the appellant that the vehicle might be worth nothing, although it may well be that counsel's "yes" when asked by his Honour if that was so, was not responsive to the question.

With some difficulty I have come to the conclusion that there was no evidence or agreement upon which his Honour was entitled to conclude, as a positive fact, that there was no realistic prospect of the respondent ever being able to pay a small proportion of $115,000.  There was a motor vehicle owned by him, or its proceeds of sale, which was available to provide payment of some proportion.  His Honour's finding of fact of course favoured the respondent and it persuaded his Honour to exercise the discretion in the respondent's favour.  If there was any onus of proof with regard to it, the onus of establishing it rested with the respondent, although ultimately that is of no consequence, for the answer to the question of what was and what was not established depends on the material upon which his Honour was entitled to act and not on who bore the onus.

I have therefore concluded, and only after much hesitation, that the learned Chief Justice erred in the respect asserted in the second ground of the appeal.

I respectfully agree with what has been said by Wright J concerning the first and third grounds of appeal, and wish to add nothing about those grounds.

Because of the factual error which was made, the discretion should be exercised afresh and that falls to be done either by this Court remitting the application to a judge for rehearing or by this Court determining the application itself.  I particularly find troubling the prospect of this Court exercising the discretion upon the basis of what was said to the learned Chief Justice, for it seems to me, with respect, that his Honour and both counsel failed to understand the lawful process by which facts might be established for the determination of the application.  It would be a simple matter for this Court to conclude that the material upon which his Honour was entitled to act established, on the balance of probabilities, that the respondent derived a benefit of $117,000, that he was the owner of a motor vehicle, and that it might be that his interest in that motor vehicle had been converted into an entitlement to be paid a sum of money under a contract by which he may have sold it and under which contract the purchaser had paid $2,000.  In other words this Court might determine that there was a realistic prospect of the respondent being able to pay a small but unascertainable proportion of the sum of $115,000 and that might be sufficient to persuade this Court to exercise the discretion in favour of the appellant and to make a pecuniary penalty order against the respondent in the sum of $115,000.  But I am far from convinced that justice would thereby be done and in my view it is more appropriate to remit the application to another judge for rehearing in accordance with law.

Therefore, it is my opinion that the appeal should be allowed and that the order made by his Honour the Chief Justice on 3 December 1997 whereby the application for a pecuniary penalty order was declined be set aside and that the application be remitted to another judge for rehearing.