Dpp v Van Wyk No. DCCIV-97-1010 Judgment No. D3752

[1998] SADC 3949

DIRECTOR OF PUBLIC PROSECUTIONS FOR THE STATE OF SOUTH AUSTRALIA v NORBET STANLEY VAN WYK

Civil
Judge Lunn

In these proceedings the applicant seeks forfeiture of the respondent’s undivided moiety in the property comprised in Certificate of Title Register Book Volume 4013 Folio 959, being a house property at 42 Abbott Avenue, Morphett Vale (“the house”). The application is made under the Crimes (Confiscation of Profits) Act 1986 (“the Act”). The Act was repealed as from 7 July 1997 by the Criminal Assets Confiscation Act 1996, but it was common ground that by virtue of Section 16 of the Acts Interpretation Act 1915 these proceedings continue to be governed by the Act as they had been commenced before its repeal. Other claims under the Act against the respondent which were referred to in the summons and affidavits were abandoned.

General background

The respondent was born in 1950 and was 47 years of age at trial.  In 1970 he married Beverley Van Wyk (“the wife”).  There are three surviving children of that marriage, the youngest of which is Jonathon, who was born on 30 January 1982.  In 1975 the respondent and the wife jointly bought the house which became the matrimonial home.  At various times both were declared bankrupt.  The moneys used to buy the house and to discharge the mortgages which were used to fund its purchase came from their respective earnings.  Money was borrowed on the security of the house to assist in various business ventures.  While there is a mortgage to the Commonwealth Bank now registered on the title to the house there is no money owing under it.

In 1990 the respondent and the wife separated.  Their relationship since has been acrimonious.  They have been divorced, but there are property settlement claims by each still pending in the Family Court which have been held over to await the outcome of these proceedings.  Apart from when he was in gaol in 1997 the respondent has generally continued to live in the house.  The wife has lived elsewhere and has now formed a defacto relationship with Gerard Steele.  On 15 November 1993 the respondent was declared bankrupt.  His moiety in the house was transmitted to his Trustee in Bankruptcy.  He was discharged from bankruptcy on 20 January 1997, but his moiety remains registered in the name of his Trustee in Bankruptcy as there is $4,000 owing to the trustee for the costs of the bankruptcy administration.

On 4 February 1997 the respondent pleaded guilty in this Court to two counts of producing cannabis.  These counts were firstly that between 1 August 1994 and 1 April 1995 he produced a crop of cannabis of between seventy and eighty plants and secondly on count 2 between 1 August and 13 November 1995 he produced a crop of cannabis comprising eighty five plants.  These plants were grown in a locked metal cage, which measured three metres by six metres, which was at the rear of the house property.  The respondent dried the cannabis from the first crop in a garden shed at the house.  He supplied and sold cannabis from that crop from the house.  I imposed a single sentence of imprisonment of twelve months with a non parole period of four months and refused to suspend it.  (It is fortuitous that I as the Judge who dealt with the criminal proceedings was also allocated to hear this civil trial.)

There have been problems and disputes about the custody of Jonathon.  In 1995 he commenced residing with the wife and her defacto.  It is not necessary to go into the details of what occurred, but he did not fit harmoniously into their household and he got into trouble.  He left school at the end of 1996.  He has since been employed casually and has done some short study courses.  In mid 1997 he went to reside with the respondent in the house.  He has a much better relationship with his father than with his mother.  Although his mother is prepared to have him back in her home, he is adamant that he will not return to her.  Since mid 1997 the respondent has been unemployed and in receipt of a single parent allowance, but this ceased on 30 January 1997 when Jonathon turned sixteen.  In recent years the respondent has not had a good employment history and at his age there is certainly a substantial risk that he will not be able to find future employment.  Apart from his interest in the house he has no assets of significance other than some welding equipment and materials which he values at about $7,500.  He owes about $5,600 on various outstanding warrants for traffic offences, which he is discharging at $25 per week, $804 for water rates and $1,648 for council rates on the house.  In the past he has not shown himself to be a good financial manager.

Role of the wife in these proceedings

As the wife has an unresolved claim in the Family Court in respect to the respondent’s moiety in the house she has a right under s5(5) of the Act to be heard in these proceedings. She appeared in person at the trial. In her final address she supported the applicant’s claim that the respondent’s moiety be forfeited. That was surprising as it would seem to be against her financial interests, but she seems to have been pursuing some tactical ploy in relation to future proceedings in the Family Court. In view of her concession there is no basis to find any relevant hardship from the effect on her of any forfeiture.

The evidence

It is not necessary for me to resolve a number of issues which were canvassed in the evidence about disputes between the respondent and the wife.  They are properly to be left for the Family Court.  I can resolve this matter on evidence which largely was undisputed.

The applicant’s evidence consisted of a statement of agreed facts, my published remarks upon sentencing the respondent and the transcript of the submissions made by the respondent’s then counsel in relation to sentencing. The affidavits and exhibits filed by the applicant in this action were not tendered and do not form part of the evidence before me.  The upshot of this is that the only evidence in these proceedings about the nature of the offences and their surrounding circumstances are my findings made for the purpose of sentencing and the version given by the respondent through his counsel in the criminal court and in his affidavits and evidence in this action.  The depositions which were before me in the criminal court are not before me in evidence on this action and I cannot have regard to them.

Whether the respondent’s property should be forfeited?

It was not disputed that the respondent’s moiety in the house was “tainted property” which was liable to be forfeited under s4(1) of the Act. The only issue was whether the court should exercise its judicial discretion under s5(1) of the Act to make the order for its forfeiture in the circumstances. This is a general judicial discretion which must be exercised in relation to the whole of the relevant circumstances: Taylor v AG for SA (1991) 55 SASR 462; AG v Myer (1989) 51 SASR 234. The Court must either forfeit the whole of the respondent’s moiety in the house or refuse the order: there is no power to make a partial forfeiture order: R v Bolger (1989) 16 NSWLR 115 at 128. The crucial issue is whether an order for forfeiture “would be severely disproportionate to the circumstances of the offence and the nature and degree of the offending”: Taylor v AG (above) at 475.

In my sentencing remarks on 7 February 1997 I made the following statements to the respondent:-

“On 12 November 1995, the police raided your home, at Morphett Vale, where they found a total of 85 cannabis plants growing in a locked steel cage in your back yard. These plants are the subject of count 2.

Of those 85 plants, nine were 9 to 25 centimetres tall, 14 were 10 to 35 centimetres tall, ten were 50 to 75 centimetres tall and 35 were seedlings, 10 to 25 centimetres tall.

Five of the plants were female and it appears that the other plants were not sufficiently developed to enable their sex to be determined. I accept that there was, in round figures, a 50/50 split between males and females in that crop. Only the female plants were likely to have been used for any commercial purpose.

You have said that that crop was self-sown from a previous crop, which had been in that cage, and that some of the plants, which were in pots, belonged to another person. But, nevertheless, you were cultivating them and looking after them.

On that raid, on that day, the police also found in your home a video, which showed you in the cage, at a time when it contained a different cannabis crop and when it was filled with plants.  That crop is the subject of count 1.

It has been agreed that there were about 70 to 80 plants in that crop.  You have said that only seven to eight grew well and the rest did not grow so well.  You say that you grew that first crop jointly with a person called Bignell. You admitted getting, from the harvest of that crop a garbage bag of female cannabis head.  You gave much of it away socially to friends and this gradually evolved into you selling some of it.

The declarations of the witnesses Shinkfield, Driver and Nathan speak of various transactions of sale on a small scale by you.

The police also found in your possession an electronic organiser, which contained data showing that, between August and November 1995, there had been 21 transactions, where you had sold amounts of cannabis totalling $1350, apparently on credit. You say that you have been paid for very little of this.

There is also, in the papers, the depositions of your former de facto, Cheryl Carpenter and of her mother.

I accept that she was obviously antagonistic and unfriendly towards you, because of the breakdown of your relationship with her.  And I accept that her evidence is to be viewed circumspectly.  But, nevertheless, it confirms that there was a significant commercial enterprise in dealing in cannabis being carried on in your premises during the time when she lived there in the 11 months prior to May 1995.

I refer to the decision of the Full Court of Queensland in a case of R v Le (1996) 2 Queensland Reports p.516, where it was held that the scope of the business of dealing in drugs is not limited simply to the evidence which is before the court of actual transactions, but that, in sentencing, a court is entitled to draw an inference from the evidence of actual transactions that there was a more significant business.

While it is not possible, in this matter, to say precisely the number of sales in which you engaged, or the amounts of cannabis, or the amounts received or payable, I conclude that it is proved, beyond reasonable doubt, that there was a significant commercial element in both of the crops, although not a large scale commercial enterprise.  I also accept that part of the cannabis was for your personal use.”

These findings were not disputed in this action, and probably could not be disputed.  Those findings about the nature and degree of the offences need to be supplemented from other evidence before me.  The steel cage in which the plants were grown was constructed in the 1980s for a legitimate purpose.  The money received by the respondent from that part of the first crop which was sold was spent on food and general living expenses.  During the relevant period he was always in debt.  In paragraph 10 of his affidavit sworn on 20 January 1998 the respondent said he did not intend to sell the second crop for commercial gain.  I do not accept that.  It is inconsistent with submissions which were made prior to sentencing.  The proper inference is that the second crop would have been used in a similar way to the first crop, ie some for personal use, some for social supply to friends and some for sale.

There is no evidence before me as to the likely yield or value of the cannabis produced.  Other than in a minimal and general way I cannot take judicial notice of the yields and value of cannabis crops which are regularly the subject of evidence given in this Court: R v McCourt (1993) 173 LSJS 281. I find on the balance of probabilities that the actual and likely financial return to the respondent of the parts of crops which were, or would have been, sold was at the most only a few thousand dollars for each crop, and possibly somewhat less.

In the sentencing proceedings there was a dispute about the deposition of the respondent’s former defacto, Cheryl Carpenter.  In order to avoid the expense and inconvenience of a disputed facts hearing about it a compromise was reached to the effect that no major significance would be attached to it for the findings on sentencing.  This precludes me from now placing any great weight on the summary of her evidence contained in my previous findings.  Neither her deposition nor any other evidence from her is before me in this action.

The house was neither acquired nor improved from money obtained through drugs.  The house became “tainted property” because it was the only place apparently available to the respondent to carry on his cannabis production.

Apart from his welding tools and equipment, apparently worth about $7,500, the moiety in the house is the respondent’s only significant asset.  He is not otherwise in a healthy financial position.

Apart from a few times when he has been compelled by circumstances to live elsewhere the house has been the respondent’s home for over twenty years. However, whether it will remain his home, even if the forfeiture is refused, is problematical. The wife seeks orders in the Family Court which could well result in the sale of the house. I do not, and cannot, know what will be the result of the Family Court property proceedings. It is not for me to assess on the evidence before me what the Family Court might be likely to order. The whole of the evidence which will be put before the Family Court was not put before me, and, if the parties had attempted to do so, I would have refused to receive it. (Early in the trial I raised whether this action should be cross-vested to the Family Court so that it could be dealt with in conjunction with the proceedings there, but no party wished to pursue such an application.) Accordingly, for the purposes of these proceedings I find that there is some possibility, but no certainty, that if there was to be no forfeiture under the Act the house would remain available to be the home of the respondent. Insofar as Dr Coates, the psychologist, spoke of a devastating emotional affect on the respondent if he lost the house, I must take into account that there is a significant risk that this would occur in any event.

A considerable amount of evidence was directed to the issue whether a forfeiture of the respondent’s interest in the house would cause hardship for Jonathon.  I accept that it is in his best interests for his well-being that he should continue to reside in the house with the respondent.  However, living with his father is much more significant for him than living in the house.  Whether he would be able to live with his father elsewhere if the house had to be sold is unknown, and would depend principally upon the financial resources then available to them to rent suitable joint accommodation.  There is nothing about the house as such, or the amenities or facilities in the vicinity, which makes it of particular importance that Jonathon should continue to live there.  In any event he is now just sixteen and presumably would not require accommodation in the house for a substantial number of years to come.  Whether the realisation of the wife’s moiety in the house is to be postponed while Jonathon continues to live there is a matter for the Family Court.  I have no evidence that any such order has been, or is being, sought from the Family Court.  Again there is a substantial possibility that orders of the Family Court on the property settlement will preclude Jonathon from living in the house in any event.  It may be that the Family Court would make some provision in the overall property settlement to enable Jonathon to live with the respondent while that continues to be for his benefit, but I do not know if that might occur or not.  Overall I conclude that there is some possibility of hardship to Jonathon from the forfeiture order if it is made, but in itself it is not particularly great.

Section 3a of the Act precludes the Court from having regard to the possibility of forfeiture under the Act in sentencing for an offence. However, it is silent on whether the severity of the sentence can be taken into account in exercising the discretion as to whether forfeiture should subsequently be ordered. In Taylor v Attorney General (above) at 475 it would appear that Debelle J thought that it could when he said:

“The circumstances of this offence do not warrant the imposition of such a heavy burden on the appellant or his family in addition to the other penalties imposed upon him.”  (Underlining added).  See also R v George (1991) 57 A Cr R 356 at 377.

In exercising the discretion I consider that I can in having regard to the public policy aspect of deterrence take into account that a sentence of the most severe kind available, ie actual imprisonment, was imposed on the respondent and that this was a greater general deterrent than a lesser type of sentence would have been.

The value of the house is agreed at $74,000.  It was accepted that the respondent’s nett equity in his moiety was about $30,000.  The effect of a forfeiture order would be to deprive him of about this amount of money.  On the findings which I have made above, and in particular that the financial gain to him was only likely to have been a few thousand dollars on each crop at the most, that drug money was not used to acquire or improve the house and about his generally poor overall financial position and prospects, I consider it would be severely disproportionate to order a forfeiture.  The application is refused.

In Court on Wednesday, 4 February 1998

Reasons published.  Application for forfeiture refused.  The plaintiff is to pay to the defendant his costs as agreed or taxed, of the action.