Director of Public Prosecutions v Latorre
[2006] VSC 398
•18 October 2006
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| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
PRACTICE COURT
No. 1550 of 2006
| DIRECTOR OF PUBLIC PROSECUTIONS | Plaintiff |
| v | |
| VINCENT PAUL LATORRE | Defendant |
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JUDGE: | WHELAN J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 17 October 2006 | |
DATE OF RULING: | 18 October 2006 | |
CASE MAY BE CITED AS: | Director of Public Prosecutions v Latorre | |
MEDIUM NEUTRAL CITATION: | [2006] VSC 398 | |
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CRIMINAL LAW – Confiscation Act 1997 (Vic) ss. 16(2)(c), 17(1) and (1A) – application for restraining order – whether notice of application to any person required prior to hearing and determination.
Navarolli v DPP (2005) VSCA 323
DPP v Vu (2006) VSCA 188
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr C Juebner | Office of Public Prosecutions |
HIS HONOUR:
Yesterday the Director of Public Prosecutions filed an application under s 16 of the Confiscation Act 1997 (Vic) (“the Act”) for a restraining order in relation to property in which it is alleged Vincent Paul Latorre has an interest within the meaning of the Act. I commenced to hear the application ex parte in the Practice Court yesterday morning, shortly after the application had been filed. I completed the hearing yesterday afternoon and stood the matter over until this morning.
Counsel for the DPP indicated that in the circumstances to which I will refer below, detailed reasons were desirable, but he also indicated at the same time that a determination of the application ought not to be delayed.
The application is supported by an affidavit sworn by Dannielle Bolton, a Detective Senior Constable of the Police Force.
Mr Latorre has been charged with 19 offences. Copies of the charges are Exhibit “DB1” to Ms Bolton’s affidavit. At least four of the charges are offences listed in Schedule 2 of the Act. All of the charges are Schedule 1 offences. The Schedule 2 offences to which I have referred are the following: (1) Conspiracy to cheat and defraud between 1 December 2005 and 4 August 2006 (in the sum of $55,000); (2) Extortion with threat to kill on 14 December 2003 (demand in the sum of $100,000); (3) Extortion with threat to destroy property on 14 December 2003 (demand in the sum of $2,000,000); (4) Extortion with threat to destroy property on 1 September 2004 and 1 May 2006 (demand in the sum of $25,000). These offences respectively fall under Item 7(a), 2(a)(i), 2(b)(i) and 2(b)(ii) of Schedule 2.
Amongst the other offences with which Mr Latorre has been charged are two charges of attempting to pervert the course of justice, a charge of conspiring with others to pervert the course of justice and a charge of theft.
The basis for the application, as put by counsel on behalf of the DPP, is s 16(2)(c) of the Act. Under that sub-section the DPP may apply, without notice, to the Supreme Court for a restraining order in respect of property if
“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.”
Such an application must, pursuant to s 16(4), be supported by an affidavit complying with that provision. That is the case here.
Under s 14(1) of the Act, a restraining order is an order that no property or interest in property, that is property or an interest to which the order applies, is to be disposed of or otherwise dealt with by any person except in the manner and circumstances, if any, specified in the order. Pursuant to s 14(2)(c) the application for an order may be made in respect of specified property in which a person has an interest “and all other property of the person, including property acquired after the making of the order.”
Section 15 of the Act provides that a restraining order may be made to preserve the property in order that it will be available for one or more of a number of specified purposes. Amongst those purposes are so as to satisfy any forfeiture order under Division 1 of Part 3 of the Act, any forfeiture under Division 2 of Part 3 of the Act, any pecuniary penalty order under Part 8 of the Act, and any order for restitution or compensation that may be made under the Sentencing Act 1991 (Vic).
Section 18 of the Act relevantly provides that the court must make a restraining order if it is satisfied that the defendant has been charged with a Schedule 2 offence, and it considers that having regard to the matters contained in the affidavit supporting the application, there are reasonable grounds for making a restraining order. Where the purpose for which the order is sought is to satisfy any order for restitution or compensation under the Sentencing Act, the court must also be satisfied that such applications are likely to be made and that the order of the court is likely to exceed $10,000.
Notwithstanding that s 16 expressly provides that applications may be made without notice, one of the matters which must be addressed in every application of this kind is the question of whether notice ought to be given to any person before hearing and determining the application. That issue is dealt with in s 17 of the Act. It is an issue which has been the subject of controversy and the section has been amended very recently. It was suggested in the course of this application that this is the first matter that has come before the court since that amendment. It is for that reason that it was suggested that detailed reasons might be appropriate.
Before considering the amended provision, it is necessary to address s 17 as it was prior to amendment and the authorities dealing with that provision.
Prior to amendment, s 17(1) of the Act read as follows:
The court may require an applicant under s 16(1) or (2) to give notice of the application to any person whom the court has reason to believe has an interest in the property that is the subject of the application.
The Court of Appeal considered the issue of notification of applications for restraining orders in Navarolli v DPP.[1]
[1](2005) VSCA 323 (“Navarolli”).
In that particular case, counsel for a person potentially affected by a proposed order had been in court when the application was made and sought to be heard. Counsel sought a direction under s 17(1). The judge refused to give that direction and, without hearing submissions from counsel for the potentially affected person, proceeded to deal with the application and make the restraining order.
The Court of Appeal constituted by Maxwell P and Eames JA held that notification ought to have been required. It is necessary to quote some passages from their Honours’ joint judgment. Their Honours said:[2]
“In short, where what is in issue is a right to be heard before such a statutory power is exercised... it is the principles of natural justice, not the statute, which constitute the starting point. The question then is whether the common law right to a hearing is excluded by the words of the statute.
In the present case, there is no such exclusion. On the contrary, as in Tanos, there is express provision for the Court to require that notice be given. That power is conferred as an unfettered discretion and there is no reason whatever to suppose that Parliament intended thereby to limit the general right to be heard.
...
His Honour fell into error in regarding the statute as creating what amounted to a presumption against the giving of notice, or as imposing on a person in Navarolli’s position the onus of showing why he should be given notice. His Honour failed to consider the fundamental natural justice principle to which we have referred. For the reasons given, that principle meant that Navarolli had a right to be heard, unless there was some compelling reason for that to be denied to him.
...
It follows from what we have said about the right to be heard that the Director, and the judge in the Practice Court, should start from the position that notice of the application should be given to any person whose property may be affected if the order is made. To that end, in our view, the Director should as a matter of course at the commencement of each such ex parte application draw to the attention of the judge in the Practice Court the discretion conferred by s 17(1) and the entitlement of a party affected to be heard, as set out in these reasons for judgement.”
[2](2005) VSCA 323 at [35]-[40].
Their Honours stated that their conclusion was not in any way affected by the opportunity afforded by s 20 of the Act to make application for property to be excluded from a restraining order already made.[3]
[3](2005) VSCA 323 at [38].
Their Honours observed that it might be possible to vindicate the right to be heard in every case by making an interim restraining order on an ex parte basis whenever the DPP believed that advanced notice might prompt the person to dispose of or deal with the subject property.[4]
[4](2005) VSCA 323 at [42].
The issue was very recently reconsidered by a differently constituted Court of Appeal in DPP v Vu.[5]
[5](2006) VSCA 188 (“Vu”).
In the joint judgment of Chernov, Nettle and Neave JJA, their Honours said:[6]
“Thus, for reasons explained, once an application under s.16 of the Act comes before the court, it is bound to consider whether notice of it should be given to the relevant parties. In those circumstances, bearing in mind the absence of relevant parties from the hearing, as the court explained in Navarolli, it is for the applicant for the restraining order to satisfy the judge that notice of the application should not be ordered.
...
In a case of application for Mareva order, it may be assumed that unless the applicant satisfies the court that the urgency or risk of dissipation is such as to warrant proceeding without notice the Court will refuse to deal with the matter ex parte. Similarly, in the case of an application for a restraining order, unless the applicant satisfies the court that there is urgency or risk of dissipation if notice of the application is given, it may be expected that the court will order that the relevant parties be notified of the application before the matter is heard. Despite the sequential disposition of ss.16 and 17 – which perhaps suggests that an application is to proceed to hearing without notice unless good reason be shown to require notice – in our view the underlying common law right to be heard is of itself sufficient reason to require that notice be given unless there is sufficient urgency or risk of dissipation, or other sufficiently good reason, to warrant proceeding without notice. It is in that sense that the court said in Navarolli that a judge should approach s.17 on the basis that the Director should be ordered to give notice unless “the giving of notice to Navarolli might lead to the disposal or disappearance of the relevant property” or there is otherwise “some compelling reason” not to give notice.”
[6](2006) VSCA 188 at [30].
Later, their Honours said:[7]
“In substance, the court in Navarolli said no more than that, when a judge is faced with an application for restraining order under s.16 of the Act, the judge must consider whether to order that notice be given under s.17 of the Act; and that, in determining whether to order that notice be given, the judge must bear in mind the common law right to be heard and balance it against other competing considerations. As the court said, such competing considerations include, in particular, the risk that notice may result in dissipation of the property the subject of the application. Obviously, however, they also include things such as “the risk of criminals being tipped off” with consequent prejudice to an anticipated arrest or a continuing criminal investigation or danger to persons or property.
In our view, it is to be expected that the bulk of applications for restraining orders under s.16 of the Act will be made and determined under s.18 without notice and ex parte. That is because an application for a restraining order involves a defendant who is suspected or charged or about to be charged with a serious criminal offence, or who has been convicted of a serious criminal offence or, alternatively, involves reasonable grounds to believe that the property the subject of application is tainted property. In the scheme of things it is likely that in most such cases the risks entailed in giving notice of the application will be seen to outweigh the right to be heard. But, as the court in effect said in Navarolli, there will be some cases where it is plain that there is no risk of dissipation or of flight or of prejudice to imminent arrest or otherwise sufficient reason to weigh against the common law right to be heard. And, in those cases, it is to be expected that the judge will order that notice of the application be given.”
[7](2006) VSCA 188 at [54]-[55].
Section 17(1) was amended by s 10 in Part 5 of the Justice Legislation (Further Amendment) Act 2006, being Act No. 79 of 2006. Part 5 came into operation on the day after the Act received royal assent. The Act received royal assent on 10 October 2006. Section 10 of the amending Act substituted for s 17(1) a new provision in the following terms:
If, having regard to the matters referred to in sub-section (1A), the court is satisfied that the circumstances of the case justify the giving of notice to a person affected, the court may direct an applicant under section 16(1) or 16(2) to give notice of the application to any person whom the court has reason to believe has an interest in the property that is the subject of the application.
Section 17(1A) provides:
In determining whether the circumstances of the case justify the giving of notice, the court must have regard to –
(a) the aim of preserving the property that is the subject of the application so as to ensure its availability for the purpose for which the restraining order is sought; and
(b) any jeopardy to an investigation by a law enforcement agency into criminal activity that could result from the giving of notice; and
(c) any risk to the safety or security of a person, including a potential witness in any criminal proceeding, that could result from the giving of notice; and
(d) the provision made by this Act to enable a person claiming an interest in property the subject of a restraining order to apply for an exclusion order to protect that interest from the operation of the restraining order; and
(e) the limited duration of a restraining order; and
(f) the submissions, if any, made by the applicant in relation to the giving of notice.
Section 17(1B) provides:
In determining whether to direct an applicant to give notice of an application under section 16(1) or 16(2), the court may have regard to any other matter that the court considers relevant.
Section 17(1C) provides:
If the court does not require notice of an application under section 16(1) or 16(2) to be given under sub-section (1), it may hear and determine the application in the absence of any person who has an interest in the property that is the subject of the application.
The second reading speech suggested that the relevant amendment was “intended to restore the pre Navarolli position – that is, that notice of applications for restraining orders would only be required in exceptional circumstances and, as a consequence, almost all applications heard and determined in the absence of affected persons.”
It seems to me that the amendments alter the position as set out in Navarolli and in Vu in three relevant respects. They are:
(1)Under the amended provision the applicant does not have to satisfy the judge that notice of the application should not be ordered, rather the court can direct the applicant to give notice only where, after having regard to the matters specified in sub-s (1A), the court is satisfied that the circumstances of the case justify the giving of notice.
(2)The circumstances specified in sub-s(1A), to which the court must have regard, are by their nature matters likely to militate against notification. In particular, it seems to me that the circumstance provided for in sub-paragraph (a) is a circumstance which would always, or almost always, militate against notice, and which would always be present. Thus, it seems to me that the legislature has deliberately altered the balance in favour of an absence of notification.
(3)The capacity to seek an exclusion order, the significance of which was rejected in Navarolli, is by virtue of s 17(1A)(d) a matter to which regard must be had.
With the exception of s 17(1A)(d), the matters set out in sub-s (1A) were always matters which ought properly to have been taken into account in cases where they were relevant, as the judgments in Navarolli and in Vu themselves indicate. As a result of the amendment, the circumstances in which directions to give notice under s 17(1) will be made may become more confined. I am not sure that the amendment will significantly alter the position in practice, particularly as it was described in Vu, but the court should no longer start from the position that notice should be given unless the applicant can satisfy the judge that it should not be given.
I do not consider that this means that the ordinary right of a person whose interests are potentially affected by an order to receive notice of the application for that order is a matter of no future relevance. In my view it remains an important consideration and in a particular case it may justify a direction requiring that notice be given after the court has had regard to the matters in sub-s (1A).
The application here seeks an order in relation to specified property and in relation to “all other property in which Latorre has an interest” including property obtained after the making of the order. The specified property is real estate at 575 Canal Road, Shepparton East, and six motor vehicles. All of this property, with the exception of one of the motor vehicles, is registered in the name of Latorre Produce Suppliers Pty Ltd (“the company”). The company is the trustee of the V. Latorre Income Trust (“the trust”). Mr Latorre is the sole officeholder of the company and has been so since December 2005. The sole shareholder is his wife, Angela Latorre. The trust is a discretionary trust. Mr Latorre is the appointor.
Under s 3 of the Act “interest” is defined as including a situation where a person has a power over, or in connection with, the property. Under s 10 of the Act, property in which a person has an interest includes property subject to that person’s “effective control”.
In my view the material establishes that all of the property registered in the name of the company is property in which Mr Latorre has an interest as defined in s 3 and is property over which he has effective control within the meaning of s 10.
The DPP does not contend at this stage that any of the property has been shown to be tainted property within the meaning of the Act, but the DPP does submit that it may subsequently be established that all or some of it is tainted property.
The item of specified property which is an exception to the position as analysed above is a Toyota utility. This vehicle is registered in the name of Mrs Latorre. The affidavit in support of the application indicates that Mr Latorre is the “sole borrower” from the financier of the vehicle, Esanda Finance Corporation Limited (“Esanda”). The affidavit also indicates that Esanda is actively seeking to repossess the vehicle. If Mr Latorre is the sole borrower from Esanda and if Esanda has proprietary rights over the vehicle, one would expect that Esanda had acquired its rights from Mr Latorre notwithstanding that the vehicle is registered in the name of Mrs Latorre.
In addition to Esanda, there are a number of other security holders who the affidavit in support of the application indicates have an interest in various items of the specified property.
On the issue of notice, it was submitted on behalf of the DPP that a direction requiring the DPP to give notice to persons affected is not justified in the circumstances of this case. Addressing the specified matters in s 17(1A) the position seems to me to be as follows:
(a)The aim of preserving property so as to ensure its availability for the purposes for which the restraining orders are sought is a matter which militates in favour of not giving notice in this case, as it seems to me that it would be, to a greater or lesser extent, in every case, or virtually every case. In this particular case, the nature of the charges, particularly those involving dishonesty which I have set out earlier; the nature of the property, which can be readily encumbered or further encumbered or disposed of; and the fact that all of the specified property other than the Toyota is in my view under the defendant’s sole effective control, means that this is an important factor in this case.
(b)Potential jeopardy to an investigation does not appear to be a relevant matter here.
(c)Risk to the safety or security of persons does not appear to be a relevant matter here.
(d)There does not appear to be any impediment in the way of Mr Latorre, the company, any beneficiary under the trust, or any of the security holders from seeking an exclusion order, and accordingly, in so far as those entities are concerned, the capacity of those entities to apply for an exclusion order is a factor which militates against a requirement that they be given notice of this application. It seems to me that this factor is less cogent in relation to the Toyota.
(e)I am unsure as to what is meant by the circumstance described as “the limited duration of a restraining order”. I proceed on the basis that this is intended to be a reference to the fact that the order is not permanent, and is intended to be a factor militating against the giving of notice.
(f)The amending legislation includes amongst the matters to which the court must have regard the submissions made by the applicant in relation to the giving of notice. I have had regard to those submissions.
The ordinary entitlement of persons affected to have notice, and to be heard if they wish to be heard, remains a relevant matter.
Having regard to the provisions of s 17 as amended, and to the specified matters in s 17(1A), I do not consider that the circumstances of this case justify the giving of notice to any person affected in relation to any of the property, other than the Toyota.
In reaching this conclusion concerning all of the property, other than the Toyota, I principally rely upon the matter set out in s 17(1A)(a) in the particular circumstances existing here as I have referred to them earlier. The circumstance provided for in s 17(1A)(d) is also important in relation to that property.
It seems to me that the position in relation to the Toyota is different for the following reasons.
The Toyota is not under the sole effective control of Mr Latorre, as it is registered in the name of Mrs Latorre and the financier who claims to be entitled to repossess it is actively seeking to do so.
On the DPP’s own material one can perceive the possibility of an argument that Mr Latorre does not have an interest in the vehicle within the meaning of the Act.
The vehicle has a modest value, approximately $17,400, and such value as it has is not greatly reduced by the amount outstanding to the financier, approximately $5,000. The effect of the order if made, given that Mr Latorre is charged with Schedule 2 offences, is that the Toyota will become potentially the subject of automatic forfeiture.
Having regard to the matters specified in s 17(1A), and given the ordinary entitlement of persons affected by an order of this kind to have the opportunity to be heard, I have reached the conclusion that the circumstances here in relation to the Toyota justify a direction that notice be given to Mrs Latorre and to Esanda.
In the course of argument counsel for the DPP indicated that I if I reached the view that notice ought to be given in relation to the Toyota then he would seek an interim order in relation to that vehicle. In my view it is appropriate that such an interim order be made.
Counsel for the DPP submitted two draft orders, one a restraining order and the other an interim restraining order.
On the basis of the affidavit to which I have referred, in my view a restraining order ought to be made pursuant to s 18 of the Act in relation to all of the specified property other than the Toyota. I will also make an order in relation to other property of Mr Latorre, although that order will reflect the terms of s 14(2)(c) of the Act which differ somewhat from counsel’s draft.
In relation to the Toyota, I will make an interim order together with an order under s 17 of the Act requiring notice to be given to Angela Latorre and to Esanda. I will adjourn the application in so far as it concerns the Toyota.
In both orders I will state the purpose for which the property is restrained, as required by s 15(3)(a) of the Act. The purpose is to satisfy any forfeiture order that may be made under Division 1 of Part 3 of the Act, to satisfy automatic forfeiture of property that may occur under Division 2 of Part 3 of the Act, to satisfy any pecuniary penalty order that may be made under Part 8 of the Act, and to satisfy any order for restitution or compensation that may be made under the Sentencing Act. I am satisfied on the material deposed to on behalf of the DPP, and given the nature of the offences with which Mr Latorre is charged, that applications under the Sentencing Act are likely to be made and that any such orders under that Act are likely to exceed $10,000.
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