Ford v Lowe - [2020] WASC 374

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CRIMINAL

CITATION:   FORD -v- LOWE [2020] WASC 374
CORAM:   HILL J
HEARD:   5 JUNE 2020
DELIVERED          :   22 OCTOBER 2020
FILE NO/S:   SJA 1161 of 2019
BETWEEN:   JASON PAUL FORD
Appellant
AND
STEPHEN JOHN LOWE
Respondent

ON APPEAL FROM:
For File No:   SJA 1161 of 2019
Jurisdiction              :   MAGISTRATES COURT OF WESTERN AUSTRALIA
Coram:   MAGISTRATE B MAHON
File Number            :   AR 9565/2018; AR 238/2019

Catchwords:

Criminal law - Appeal against conviction - Possession of cash reasonably suspected of being unlawfully obtained - Whether verdict was unreasonable or unsupported by the evidence - Whether specific finding should have been made as to whether all money seized was reasonably suspected of being unlawfully obtained

Legislation:

Criminal Code (WA), s 417

Result:

Leave to appeal refused on each ground
Appeal dismissed

Category: B

Representation:

Counsel:

Appellant	:	Mr S Watters
Respondent	:	Ms M M Yeung

Solicitors:

Appellant	:	Porter Scudds
Respondent	:	Director of Public Prosecutions (WA)

Case(s) referred to in decision(s):

Costa v The State of Western Australia [2019] WASCA 200
Le v Feakes [2018] WASC 331
Libke v The Queen [2007] HCA 30; (2007) 230 CLR 559
M v The Queen [1994] HCA 63; (1994) 181 CLR 487
Rundle v Innerd [2015] WASC 340
Samuels v The State of Western Australia [2005] WASCA 193; (2005) 30 WAR 473
The State of Western Australia v Olive [2011] WASCA 25; (2011) 57 MVR 269

HILL J:

On 21 November 2019, the appellant was convicted after trial in the Magistrates Court of two charges of being in possession of sums of money that were reasonably suspected to be unlawfully obtained, contrary to s 417(1) of the Criminal Code (WA). The appellant seeks leave to appeal against his conviction.
For the reasons that follow, I am not satisfied that either of the grounds of appeal has a reasonable prospect of succeeding. On this basis, leave to appeal is refused and the appeal is dismissed.

Notice of appeal and leave to appeal

The appellant filed his notice of appeal on 17 December 2019 which was within time.[1]
[1] Criminal Appeals Act 2004 (WA), s 10(3).
There are two grounds of appeal namely that:
1.The verdict of guilty in relation to the charge of being in possession of cash reasonably suspected of being unlawfully obtained was unreasonable and/or unsupported by the evidence.
2.The learned Magistrate should have directed himself to deliver a special verdict in relation to the money he found was lawfully obtained.
The appellant requires leave to appeal on each ground of appeal. The court must not give leave to appeal on a ground of appeal unless it is satisfied the ground has a rational and logical prospect of succeeding.[2]
[2] Criminal Appeals Act, s 9(2); Samuels v The State of Western Australia [2005] WASCA 193; (2005) 30 WAR 473.

Factual background

The background facts of the offence were not in dispute either at trial or on appeal.
The appellant was the subject of two separate search warrants; one executed on 1 June 2018 and the other on 3 January 2019.
On 1 June 2018, a firearm was found in a bedside drawer at the appellant's home, $1,670 was found in the bedside drawer and an additional $3,610 in the appellant's bathroom. The appellant told police that each of these amounts came from his tow truck business, Evil Clown Pty Ltd. The appellant declared to police he had a further amount of $5,500 which was in his walk‑in robe. A further sum of $305 was in a jacket pocket in the wardrobe.[3]
[3] ts (Trial) 12 - 13, 18.
On 27 June 2018, the appellant was charged with one count of being in possession of $11,085 that was reasonably suspected of being unlawfully obtained (AR 9565/2018).
On 3 January 2019, the police executed a further search warrant. On this occasion, $7,920 was found in a kitchen drawer, which the appellant said was work related, $21,600 was found in a cereal box, which he told police was from the sale of a car a month earlier, $45,000 was found in a jacket, $2,595 was in his wallet which the appellant said was from work he had done the day before; and $700 was on a shelf in the walk‑in wardrobe in the appellant's bedroom. During the warrant, the police also found a handgun in the bedside cabinet.[4]
[4] ts (Trial) 13 - 17, 19.
On 4 January 2019, the appellant was charged with one count of being in possession of $78,435 that was reasonably suspected of being unlawfully obtained (AR 238/2019).

Prosecution case at trial

At the commencement of the trial, counsel for the appellant made a number of admissions pursuant to s 32 of the Evidence Act 1906 (WA) that:[5]
[5] ts (Trial) 12 - 16.
(a)on 1 June 2018, during the execution of the search warrant:
(i)a firearm was found in the bedside drawer,
(ii)$3,600 was found at the appellant's tow truck business,
(iii)$3,610 was found in the bathroom, which was also from his tow truck business. The appellant did not recall when he put the cash there or how much it was; and
(iv)the appellant declared $5,000 to the police;
(b)on 3 January 2019, during the execution of the search warrant:
(i)$7,920 was found in a drawer, which the appellant said was from his tow truck business;
(ii)$7,980 was located in another drawer. The appellant thought there was $5,700 in this drawer which he had made over two months;
(iii)$21,600 was found in a cereal box, which the appellant said was from the sale of a car about a month previously. He did not disclose the name of the purchaser, although there were reasons for that decision. He had hidden the cash there to prevent thieves stealing it and had forgotten it was there;
(iv)a handgun was found in the bedside cabinet;
(v)$45,000 was found in a jacket, on which the appellant provided no comment; and
(vi)$2,595 was located in a wallet, which the appellant said was from work that he had been paid for the day before which he planned to take to the bank.
As a consequence of these admissions, the prosecution called only one witness, a forensic accountant, and tendered the financial investigation report.[6]
[6] Exhibit 1.
In his opening address, counsel for the respondent addressed the court on the particulars of the amounts found on each search warrant which differed from the formal admissions made by the appellant. Counsel informed the court that in the first search warrant, an amount of $11,085 was located. This comprised $1,670 (in a bedside drawer), $3,610 (in the ensuite), $5,500 (in a walk in wardrobe in the master bedroom) and $305 (in a jacket pocket in the wardrobe).[7] On the second search warrant, an amount of $78,435 was located. This comprised $7,920 (in a drawer in the kitchen), $21,600 (in a cereal box in the walk‑in pantry), $45,000 (in the front pockets of a Harley Davidson jacket in a walk-in wardrobe in the appellant's bedroom), $2,595 (in the appellant's wallet located in the top drawer of the bedside cabinet in the appellant's bedroom) and $700 (on the top shelf in the walk‑in wardrobe in the appellant's bedroom).[8]
[7] ts (Trial) 18 - 19.
[8] ts (Trial) 19.
In closing submissions, counsel for the respondent highlighted the discrepancies in the evidence given by the appellant and his witnesses and submitted that the explanations provided by the appellant's witnesses for the amounts did not add up or explain how the evidence of these amounts related to the money that was located at the appellant's house during the search warrants in June 2018 and January 2019.[9]
[9] ts (Trial) 183, 187.

Appellant's case at trial

At the commencement of the trial, counsel for the appellant advised the learned magistrate that possession of the cash was admitted and that the 'live issue' was where the money that was in the possession of the appellant came from.[10] In answer to a specific question from the learned magistrate, counsel for the appellant conceded that the element of reasonable suspicion was created by the circumstances in which the money was seized.[11] At trial, it was not in contention that cash was a thing capable of being stolen.
[10] ts (Trial) 3.
[11] ts (Trial) 8 - 9; Appellant's submissions [5].
The appellant's case at trial was that the cash located during the search warrants was lawfully obtained from one or more of the appellant's income streams being his tow truck business, his tattoo parlour in Bali, the sale of a car and engine, and the sale of imported pots and gargoyles.
The appellant gave evidence at trial. He also called five witnesses to give evidence being Mr Pisano, the appellant's accountant; Mr Ford Snr, the appellant's father, who gave evidence about bringing cash to the appellant from a tattoo parlour in Bali; Mr Klanjscek, who gave evidence about purchasing certain pots and gargoyles from the appellant; and Mr and Mrs Murray, who gave evidence about purchasing a car from the appellant and bringing cash to the appellant in Perth from a tattoo parlour in Bali.
On the basis of the evidence of these witnesses, counsel for the appellant submitted that the appellant had proved on the balance of probabilities that the money had been lawfully obtained.[12]
[12] ts (Trial) 23.

Evidence of witnesses called at trial

Mr Stammers

Mr Stammers was the only witness called by the prosecution. He gave evidence concerning the financial investigation report prepared by Ms Selina Tan, a financial investigator in the Proceeds of Crime Squad of the Western Australian Police Force.[13] The report concerned the appellant's financial position during the period 15 March 2018 to 3 January 2019. Specifically, the evidence was that:
[13] ts (Trial) 23.
(a)over this period, $162,843.56 was paid into the appellant's bank and credit card accounts and $167,895.05 was withdrawn;[14]
[14] ts (Trial) 29; Exhibit 1 [2.3].
(b)the bank accounts were always in a negative aggregate financial position due to the appellant's large credit card debt which was not paid off in full each month;[15]
[15] Exhibit 1 [2.4].
(c)there were 42 cash or cheque deposits amounting to $144,550, all of which were below $10,000.[16]
[16] ts (Trial) 24; Exhibit 1 [2.12].
(d)there were payments of $151,018.58 to known third parties. The known third parties included payment of the appellant's mortgage, online gambling websites, utility companies, government departments, subscription service providers, major airlines and accommodation providers;[17]
[17] ts (Trial) 24; Exhibit 1 [2.15].
(e)over this period, there was no indication of regularly occurring electronic deposits, deposits with recurring descriptions or descriptions mentioning salary and wages;[18]
[18] Exhibit 1 [2.10].
(f)deposits of $18,215 could not be categorised due to the vague descriptions in the bank and credit card statements;[19]
(g)between 15 March 2018 and 3 January 2019, $12,469.77 was paid off the appellant's mortgage. As a consequence, there was a net reduction in the outstanding mortgage balance from ($195,092.13) to ($191,411.03) as at 3 January 2019;[20]
(h)$8,123.84 was identified as potential business transactions relating to the purchase of gargoyle statues or other goods for resale. This included overseas payments to vendors by the appellant either directly or through a remitter such as PayPal;[21]
(i)purchases of $8,752.63 could not be categorised due to the vague descriptions in the bank and credit card statements;[22]
(j)there were no cash withdrawals from the account;[23]
(k)the appellant had lodged a tax return for the year ending 30 June 2013 but not since then;[24]
(l)the appellant was the sole director and shareholder of Echo Transport WA Pty Ltd and Evil Clown Pty Ltd.[25] No tax returns had been lodged with the ATO for these companies.[26] Evil Clown Pty Ltd had lodged Business Activity Statements in the quarters ending 31 March 2016 to 30 September 2017 with nil activity;[27]
(m)the appellant had an Australian business number under which three business names were registered being JBL Ford Contracting, Evil Clown Towing and Evil Clown Racing. Since 18 January 2016, the registered owner of the business names of Evil Clown Towing and Evil Clown Racing has been Evil Clown Pty Ltd.[28]

Jason Paul Ford

[19] Exhibit 1 [2.11].

[20] Exhibit 1 [2.6] - [2.7].

[21] ts (Trial) 35; Exhibit 1 [2.16].

[22] Exhibit 1 [2.17].

[23] ts (Trial) 24; Exhibit 1 [2.18].

[24] ts (Trial) 25; Exhibit 1 [2.27].

[25] Exhibit 1 [1.4].

[26] ts (Trial) 28; Exhibit 1 [2.30], [2.34].

[27] Exhibit 1 [2.35].

[28] ts (Trial) 25; Exhibit 1 [2.33].

The appellant set up Evil Clown Towing in late 2015 and operated this business until January 2019. This business owned a truck as well as a motor vehicle.[29] During busy periods, he hired an additional vehicle.[30] The appellant required clients to pay in cash for the work undertaken by the business. Under cross examination, the appellant's evidence was that he would tow 15 to 20 cars a day and that a 'cheap tow' was $150.[31] He employed two people and paid them between $50 to $70 in cash if the tow was worth $350.[32] Under cross‑examination, the appellant said that the money he deposited into his bank account was from his towing business.[33]
[29] Exhibit 2.
[30] ts (Trial) 41.
[31] ts (Trial) 69, 95.
[32] ts (Trial) 95.
[33] ts (Trial) 96.
The appellant owned another business, Evil Clown Tattoo Studio, in Bali, which he had operated since December 2015. The appellant employed an Indonesian manager of the business, who he was introduced to by Mrs Tracy Murray. The profits from the business were paid to him in cash, generally in Australian dollars.[34] The appellant's evidence was that the cash from this business was brought into Australia by the appellant, his father, Mr and Mrs Murray, as well as any close friend who was going to Bali.[35] In about 2018, the appellant agreed with the manager of the tattoo shop that the appellant would receive $15,000 in cash per quarter and the manager would retain the remaining profit.[36]
[34] ts (Trial) 48.
[35] ts (Trial) 47.
[36] ts (Trial) 49.
In about May 2016, the appellant purchased a 40 foot sea container full of pots and statues which was brought into Australia in 2017. The sea container contained approximately 45 pots, 10 gargoyles which were 1500 mm high and about 10 gargoyles which were 1250 mm high.[37] The appellant advertised these for sale on Facebook[38] and Gumtree. All of these pots and gargoyles were sold by the appellant prior to January 2019 for cash. A number of these items were purchased by Bryce Klanjscek.[39] The appellant's evidence was Mr Klanjscek bought '15 or 16' pots and 'a couple of gargoyles' for about $8,000. All the gargoyles were sold for approximately $33,000[40] and the pots were sold for $300 to $400 each.[41] Under cross‑examination, the appellant denied that he sold these items prior to November 2018. He confirmed that he had only ever had one importation of pots and gargoyles and had no receipts from selling these items.[42]
[37] ts (Trial) 50 - 51; Exhibit 6.
[38] Exhibit 7.
[39] ts (Trial) 55.
[40] ts (Trial) 55.
[41] ts (Trial) 54, 61.
[42] ts (Trial) 78 - 79.
In relation to the money seized by the police on 1 June 2018, the appellant's evidence was that this cash was from his tow truck business.[43] One of the amounts seized (of $5,500) was kept separately. Under cross‑examination, the appellant's evidence in relation to this amount was as follows: [44]
You recall there was an amount of $5500 that you keep separately?---Yes, that was money I was saving, yes.
And that was from your tow truck company as well, all that was - - -?---That's correct, yes. That was money I was putting aside.
And that took you 12 months to save that up?---Yes. A few hundred here and a few hundred there.
[43] ts (Trial) 56.
[44] ts (Trial) 74.
In relation to the money seized by the police in January 2019, the appellant's evidence was that he sold a spare engine in August or September 2018 and an unregistered Holden Commodore in November 2018 to Mr Shane Murray, the husband of Mrs Tracy Murray, for $22,000,[45] he had sold the gargoyles and pots, he had received approximately $30,000 from the Bali tattoo parlour and had his earnings from his tow truck business. The appellant agreed that he did not keep any financial records and that at this time, his life was chaotic.[46] The appellant's evidence was that the money from the sale of the car and the pots and gargoyles was to pay his lawyer and expert witnesses.[47]

Antonio Pisano

[45] ts (Trial) 57 - 58.

[46] ts (Trial) 60 - 61.

[47] ts (Trial) 54, 92 - 93.

Mr Pisano is an accountant who met the appellant in approximately 2012. At that time, he did a tax return for him and subsequently set up a company and a trust for him. After this, he reminded the appellant on a number of occasions that he needed to lodge his tax returns but had not received any documentation from him.[48]

David Albert Walter Ford

[48] ts (Trial) 103.

Mr Ford is the appellant's father. In 2017, he visited Bali on two occasions, in May 2017 and August 2017. While he was there, he collected money from the manager of the tattoo parlour to bring it back for the appellant. His evidence was that in May 2017, he collected $6,500 and in August 2017 he collected $8,700.[49]

Bryce Wesley Klanjscek

[49] ts (Trial) 117.

Mr Klanjscek's evidence was that in early December 2018, he bought 15 pots and two gargoyles from the appellant. He paid $300 for each of the pots and $1,800 for each of the gargoyles in cash.[50] In examination‑in‑chief, Mr Klanjscek's evidence was that the pots were at various locations including Mr Klanjscek's house, some at his parents' house and some in storage. Both gargoyles were at his parents' house.[51]
[50] ts (Trial) 122.
[51] ts (Trial) 123.
Under cross‑examination, Mr Klanjscek agreed that the photographs that were tendered[52] showed three pots at his place and two gargoyles at his parents' house. His evidence was that the remaining pots were stored at his house in a sea container.[53] No photos were tendered of these. Mr Klanjscek agreed that the photographs had been taken 'to prove he had given [the appellant] the cash'.[54]

Tracy Ann Murray

[52] Exhibit 10.

[53] ts (Trial) 128.

[54] ts (Trial) 127.

Mrs Murray described herself as the appellant's 'surrogate mum'.[55] Her evidence was that in or about April 2014, the appellant told her that he wanted to open a tattoo shop in Bali and asked if she knew anyone in Bali that could manage the tattoo shop. She introduced him to Johnny Setiawan.[56] She gave evidence that she and her husband went to Bali approximately four times a year. While in Bali, they would go and check on the tattoo shop for the appellant.
[55] ts (Trial) 133.
[56] ts (Trial) 133.
In approximately 2017, the appellant asked Mrs Murray and her husband if they would take on a more formal role with the tattoo shop. The appellant offered to pay for their accommodation and flights to Bali. When they were in Bali, Mrs Murray and her husband would visit the tattoo shop every day to make sure it had enough supplies and to ensure that the general running of the shop was going well. They collected the profit from the shop and brought that home to give to the appellant. Mrs Murray's evidence was that in June 2018 and September 2018, they collected $15,000 on each occasion ($7,500 each) which they gave to the appellant on their return to Perth.[57]
[57] ts (Trial) 135.
Mrs Murray also gave evidence that in or about the end of November 2018, her husband purchased a vehicle and engine from the appellant for $22,000.[58]

Ronald Shane Murray

[58] ts (Trial) 136.

Mr Murray is a commercial concreter and has known the appellant for approximately 10 years. His evidence was that he and Mrs Murray travelled regularly to Bali. While they were there, they would regularly visit the appellant's tattoo shop.[59] The manager would give them money to bring home for the appellant. He could not recall the exact amounts they brought back in June and September 2018 but recalled it was an amount somewhere between $5,000 and $7,500 each.[60]
[59] ts (Trial) 149.
[60] ts (Trial) 151.

In about December 2018, he bought a silver Commodore and engine from the appellant. His evidence was that he had told the appellant probably 12 months previously that if the appellant was selling the silver Commodore, he was interested in buying it.[61] Mr Murray paid cash for the car and engine but could not recall the exact amount he paid. He believed it was between $21,500 and $22,000.[62] Under cross‑examination, Mr Murray's evidence was that when he bought the car, he did not know what its market value was but that he agreed with the appellant the car was worth approximately $12,000. He explained that he gave the appellant $21,500 in cash because the appellant owed him $500 which he deducted from the $22,000 he had agreed to pay for the car and engine.[63]
[61] ts (Trial) 151.
[62] ts (Trial) 152.
[63] ts (Trial) 156.

Reasons of the learned magistrate

At the conclusion of the evidence, the learned magistrate reserved his decision overnight and delivered his reasons for decision on 21 November 2019. His Honour noted that the issue for his determination was whether the appellant had satisfied him that it was more probable than not that the funds located during the search warrants were lawfully obtained.[64]
[64] ts (Trial) 215.
The learned magistrate accepted the evidence of Mr Pisano, Mr Ford Snr and Mrs Murray. In relation to Mr Klanjscek, his Honour did not reject his evidence in its entirety.[65] The learned magistrate then commented that:[66]
[T]his is not necessarily a case where I need to comment, in my view, as to whether I – on a totality basis – accept or reject the evidence on specifics from any of the witnesses, as this is a case where Mr Ford bears the burden on that totality approach. And I think that's the fairest way to approach this matter.
[65] ts (Trial) 220.
[66] ts (Trial) 222.
The learned magistrate then addressed each of the income streams relied upon by the appellant.
First, in relation to the tow truck business, his Honour accepted there was a connection between the appellant and the tow truck business. He noted that there was no documentation which supported the appellant's assertions regarding the income of the towing business[67] or any documents in relation to the business.[68] In this regard, the learned magistrate found that the appellant was 'a woefully inadequate bookkeeper'.[69] His Honour noted that on the evidence of the appellant, the gross income of the business was in the order of $820,000 per annum. Even if 80% of this amount was costs, this would leave the appellant with a gross weekly income of $3,200. His Honour considered that this was 'difficult to reconcile' with the appellant's evidence that it took him 12 months to save $5,000,[70] which was one of the amounts seized in June 2018. The learned magistrate also referred to the mortgage on the appellant's property and the deterioration of his financial position by $5,000 ‑ $6,000 over the period in question. The learned magistrate concluded that 'some of the figures don't stack up'.[71] His Honour noted that on the appellant's evidence, he should have been 'swimming in cash', which was inconsistent with his evidence that it took him 12 months to save $5,000.[72]
[67] ts (Trial) 223.
[68] ts (Trial) 224.
[69] ts (Trial) 224.
[70] ts (Trial) 226.
[71] ts (Trial) 227.
[72] ts (Trial) 227.
In relation to the tattoo shop in Bali, the learned magistrate found there was a connection between the appellant and the tattoo shop in Bali and that from time to time, friends and family of the appellant collected envelopes of cash from the manager and delivered them to the appellant.[73] His Honour noted that there was no documentary evidence to support the income from the tattoo shop but only the oral evidence of the appellant, the Murrays and Mr Ford Snr. This evidence was that the appellant received $60,000 net per annum from this business which his Honour said it was difficult to resolve with the evidence that 'it took him 12 months to save five grand'.[74]
[73] ts (Trial) 228.
[74] ts (Trial) 229.
The learned magistrate accepted that Mr Murray purchased a car and a motor from the appellant for $22,000.[75] His Honour found that the vehicle was valued at approximately $12,000 which meant that the motor had an approximate value of $10,000. The learned magistrate referred to the absence of documentation in relation to the transfer, including receipts or transfer documentation.[76] He held that the explanation that the money was put in a cereal box and forgotten about was 'an implausible account and lacks credibility'.[77]
[75] ts (Trial) 227.
[76] ts (Trial) 229 - 230.
[77] ts (Trial) 234.
Finally, in relation to the pots and gargoyles, the learned Magistrate found that in 2016, the appellant brought into Australia a sea container of garden pots and gargoyles.[78] His Honour noted the absence of evidence apart from the original purchase and import documents. The learned magistrate concluded that although there was some connection between the appellant and 'some gargoyles and some pots', matters were extremely unclear.[79] His Honour referred to the explanation of the appellant, that this money was required to pay legal fees and expert evidence fees, but commented that:[80]
[A]gain, when one backtracks to that original extrapolation on the Evil Clown Towing, it's difficult to see how that might need to arise because the cashflow on that side is strong, on Mr Ford's case, although it's not backed up by documents.
[78] ts (Trial) 230.
[79] ts (Trial) 230.
[80] ts (Trial) 231.
The learned magistrate referred to the appellant's mortgage and noted that most people tend to clear mortgages when they can and that there was an overall cash deficit over the relevant period of $5,000 to $6,000.
The learned magistrate considered that in order to discharge his onus, the appellant needed to show a nexus between the money and the lawful income 'with some degree of fabric to it and proper foundation. There needs to be some persuasive evidence, with respect, beyond the oral assertions which a cynic might say are easily made and difficult to disprove'.[81]
[81] ts (Trial) 233.
His Honour concluded that:[82]
[O]n a totality basis … all of those matters I've just summarised are certainly possibilities. They're possibilities only, on the evidence. And it is – has been impossible for me to go further than possibilities on the state of the evidence. Perhaps, might altogether be to do with Mr Ford's inability to properly account for his position. But I have to say at the conclusion of it where Mr Ford does, indeed, bear the burden, this creates problems.
I take the view that we do need that specific nexus, even if all those income streams were verified which, at this stage, with respect, they're not verified, they're possibilities, no more, no less. And even if they were, in my view, there then needs to be a nexus – which has not been shown – to the cash that was there on both the 1 June and 3 January dates.
…
[I]t seems to me that, overall, Mr Ford comes up short in that regard, not least because of his accounting practices. The lack of documentation has, in my view and in my finding, deprived Mr Ford of cogent, persuasive, trackable, traceable and logical, easily accessible documentation which provides a regular source of income which is capable of scrutiny and carrying the matter in Mr Ford's favour.
[82] ts (Trial) 235 - 236.
For these reasons, the learned magistrate convicted the appellant on both counts.

Section 417 of the Criminal Code

Section 417 of the Code provides that:
417 Possessing stolen or unlawfully obtained property
(1)A person who is in possession of any thing capable of being stolen that is reasonably suspected to be stolen or otherwise unlawfully obtained is guilty of a crime and is liable, if no other punishment is provided under section 417A, to imprisonment for 7 years.
Summary conviction penalty: imprisonment for 2 years and a fine of $24 000.
(2)It is a defence to a charge under subsection (1) to prove that at the time the accused was allegedly in possession of the thing, the accused had no reasonable grounds for suspecting that the thing was stolen or unlawfully obtained.
In Le v Feakes, Justice Hall summarised the matters that the prosecution was required to prove to establish an offence under s 417: [83]
[83] Le v Feakes [2018] WASC 331 [30] - [32], [34] - [35].
In order to establish an offence under s 417, the prosecution is required to prove beyond reasonable doubt that:
1.the appellant was in possession of a thing, [in this case cash];
2.the [cash] was capable of being stolen; and
3.the [cash] was reasonably suspected to be stolen or otherwise unlawfully obtained.
The onus of proof of the elements is on the prosecution. However, the prosecution is not required to negative the defence in s 417(2). If an accused person relies upon s 417(2), he or she bears an evidentiary and legal onus to prove on the balance of probabilities that at the time he or she was in possession of the property he or she had no reasonable grounds for suspecting that the thing was stolen or unlawfully obtained.
An accused person will be guilty of the offence if the prosecution proves the three elements beyond reasonable doubt and, where raised by the defence, the accused does not prove on the balance of probabilities that he or she had no reasonable grounds for suspecting that the property in question was stolen or unlawfully obtained.
…
The element of reasonable suspicion requires the trier of fact to reach an objective conclusion from all of the evidence in the trial as to whether or not the property in question might reasonably be suspected of being stolen or unlawfully obtained. A reasonable suspicion that a thing has been stolen or unlawfully obtained will necessarily fall short of certainty. The section does not require any certainty greater than suspicion to be established.
The words 'reasonable suspicion' are not defined in s 417. A similar phrase is also used in the context of search warrants. In George v Rockett, the High Court held that in the context of a search warrant a suspicion is a state of conjecture or surmise where proof is lacking. It is more than an idle wondering; it is a positive feeling of actual apprehension or mistrust amounting to a slight opinion but without sufficient evidence. The addition of reasonableness means that a suspicion based on reasonable grounds requires the existence of facts which are sufficient to induce that state of mind in a reasonable person. (citations omitted)
Where the offence concerns a sum of cash, the amount of the cash is a particular of the charge and not an essential element of the offence.[84] The offence will be proved even if the prosecution proves that only part of the cash was reasonably suspected to be unlawfully obtained.[85] However, a finding as to the amount of cash that was reasonably suspected of being unlawfully obtained is relevant both to sentence and the order for forfeiture of the cash.[86]
[84] Rundle v Innerd [2015] WASC 340 [76].
[85] Rundle v Innerd [72], [75]; Criminal Procedure Act 2004 (WA) sch 1 cl 8(2).
[86] Rundle v Innerd [76].

Disposition of appeal

Ground 1 - Guilty verdict was unreasonable and/or unsupported by the evidence

The general principles that govern an appeal on this ground are well-established and were recently summarised by Court of Appeal in Costa v The State of Western Australia in the following terms:[87]
(1)The appeal court must undertake its own independent assessment of the sufficiency and quality of the evidence. It is not simply a matter of deciding whether as a matter of law there was evidence to support the verdict. The appeal court must determine whether, in all the circumstances, it would be dangerous to permit the verdict to stand.
(2)The question for the appeal court is whether, upon the whole of the evidence, it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty.
(3)That question requires consideration of whether the jury must, as distinct from might, have entertained a reasonable doubt about the accused's guilt.
(4)In answering that question, the appeal court must pay full regard to the consideration that the jury was entrusted with the primary responsibility of determining guilt or innocence, and to the advantage that the jury had of seeing and hearing the witnesses.
(5)A doubt experienced by an appellate court would be a doubt which a jury ought also to have experienced, unless the jury's advantage in seeing and hearing the evidence is capable of resolving that doubt.
(6)If the evidence, upon the record, contains discrepancies, displays inadequacies, is tainted or otherwise lacks probative force in such a way as to lead the appellate court to conclude that, even making full allowance for the advantages enjoyed by the jury, there is a significant possibility that an innocent person has been convicted, then the appellate court must set aside the verdict.
(7)The setting aside of a jury's verdict on the ground that it is unreasonable within the meaning of s 30(3)(a) of the Criminal Appeals Act 2004 (WA) is a serious step, not to be taken without regard to the advantage enjoyed by the jury over an appellate court which has not seen or heard the witnesses called at trial.
[87] Costa v The State of Western Australia [2019] WASCA 200 [210] (Mitchell JA, Buss P & Mazza JA agreeing).
These principles apply by analogy to a trial before a magistrate.[88] That is, the question for this court is whether, on the whole of the evidence before the learned magistrate, his Honour must have been satisfied on the balance of probabilities that the appellant had made out the defence in s 417(2) of the Criminal Code, namely that the appellant had no reasonable grounds for suspecting that the cash had been unlawfully obtained.[89]
[88] The State of Western Australia v Olive [2011] WASCA 25; (2011) 57 MVR 269 [44].
[89] Libke v The Queen [2007] HCA 30; (2007) 230 CLR 559 [113]; M v The Queen [1994] HCA 63; (1994) 181 CLR 487, 493 - 495 (Mason CJ, Deane, Dawson & Toohey JJ).
Before turning to consider the evidence before the learned magistrate, I note that the amounts admitted by the appellant in relation to each search warrant exceed the amounts that are particularised in each of the charges. In addition, the amounts which were outlined by the prosecutor in their opening address in respect of the search warrant on 3 January 2019 did not equate to the amounts particularised in the charges.[90] However, given the offence is proved even if the prosecution proves that only part of the cash was reasonably suspected to be unlawfully obtained, these discrepancies are not material.
[90] See [15]. Respondent's submissions fn 9, p 3.
Counsel for the appellant accepted that, in relation to the monies seized in June 2018, this largely depended on the assessment of the credibility of the appellant. However, counsel contended that in relation to the monies seized on 3 January 2019, there was independent evidence which corroborated the appellant's evidence.[91] Counsel submitted in relation to the monies seized on 3 January 2019 that there was sufficient evidence before the learned magistrate to show the sale of the vehicle by the appellant to Mr Murray, the sale of gargoyles and pots, and that the appellant received cash from his two businesses - namely the tow truck company and the tattoo parlour in Bali. On this basis, the appellant contended that his Honour 'could' infer that the appellant had lawfully obtained at least $95,000, separate to the income he derived from the tow truck business being $12,000 from the sale of pots, $31,000 from the sale of gargoyles, $30,000 from the profit from the tattoo shop in Bali and $22,000 from the sale of the car to Mr Murray.[92]
[91] Appellant's submissions [54] - [55].
[92] Appellant's submissions [32].
At the hearing before me, counsel for the appellant submitted that the learned magistrate misconstrued the evidence of the appellant in relation to his savings of $5,500 (which was seized during the first search warrant) which was then used by his Honour to reject other aspects of the appellant's evidence. Counsel contended that, properly viewed, the appellant's evidence was this amount had been accumulated by him putting aside a few hundred dollars here and there and not that he had taken 12 months to save this amount.[93]
[93] ts 3 - 4.
Counsel for the respondent emphasised that while there was evidence before the learned magistrate that the appellant had a number of income streams, the evidence as to the quantum of the income derived from each of these streams and whether the cash that was seized was generated from these income streams was vague and non‑specific.[94]
[94] ts 18 - 19.
Turning to the first charge, the only evidence adduced by the appellant was that this cash was derived from his tow truck business. This evidence came from the appellant, which the learned magistrate was entitled to reject. No records of the tow truck business were produced and the evidence as to the earnings of the business was fairly general. The appellant's evidence that he earnt substantial sums of money from his tow truck business was inconsistent with the report into the appellant's financial affairs, which disclosed a substantial credit card debt, minimal repayments of his mortgage and a deterioration of his financial position over the 10 month period in question.[95] It was also inconsistent with the appellant's evidence that he had over 12 months, saved $5,500 by putting aside a 'few hundred here and a few hundred there'. Even if, as the appellant contends, the learned magistrate placed too much emphasis on the appellant's evidence in relation to this amount of money, the appellant's evidence as to his earnings from the business was inconsistent with his financial position, as demonstrated by the financial report. Accordingly, I do not consider that on the whole of the evidence, the learned magistrate must have been satisfied on the first charge that the appellant had made out the defence in s 417(2) on the balance of probabilities.
[95] Exhibit 1.
In respect of the second charge, I consider that, for the following reasons, it was open for the learned magistrate to conclude that the appellant had not discharged the evidentiary and legal onus under s 417(2). First, it is clear from his Honour's reasons that he accepted that the appellant had sold the car and engine to Mr Murray, had sold some pots and gargoyles and received cash from both his tattoo shop in Bali and his tow truck business. However, this did not mean that his Honour was required to conclude that the cash obtained from these matters formed part of the cash seized during the search warrant. The evidence before the learned magistrate was that the appellant did not withdraw any cash from his bank accounts over this period. There was no evidence as to the appellant's living expenses or how much cash he spent per week. Accordingly, while the evidence of the appellant's witnesses was that the appellant obtained cash from lawful means, the only evidence of the nexus between that cash and the cash seized by the police was the appellant's evidence, which the learned magistrate was entitled to reject.
Second, there were discrepancies between the evidence of Mr Murray and the appellant as to the amount of cash he paid to the appellant. Mr Murray's evidence was that he gave the appellant $21,500, whereas the appellant said he received $22,000. Neither of these amounts was the amount found in the cereal box of $21,600. No explanation was given as to the difference in these amounts.
Third, while both Mr Klanjscek and the appellant gave evidence that Mr Klanjscek bought 15 to 16 pots and two gargoyles, photographs of only three pots and two gargoyles were tendered at trial. This was notwithstanding the evidence of Mr Klanjscek that the photographs of these items had been requested by the appellant's lawyer to prove the sale of these items by the appellant to Mr Klanjscek. In any event, this evidence, at its highest, is that the appellant received $8,000 in cash, not the $43,000 contended by the appellant in this submissions as summarised at [52] above.

Fourth, there was a complete absence of records to support the specifics of any of these matters including the income derived from the tattoo parlour, documents recording the sale of the vehicle and engine or any receipt, and the absence of receipts or evidence of the number of pots and gargoyles sold and for what amount.
Fifth, the explanations given by the appellant as to the amounts and location of money in his house, particularly in relation to the cash in the cereal box, were found by the learned magistrate to be implausible and lacking credibility.[96] In my view, it cannot be said that the learned magistrate's finding that the appellant's evidence that he had forgotten he had placed this money in the cereal box when the vehicle was, on his evidence, sold about a month previously was not plausible, was not open to him.
[96] ts (Trial) 233.
For these reasons, I consider that it was open to the learned magistrate on the whole of the evidence before him to conclude that he was not satisfied on the balance of probabilities that the cash the subject of the charges had been obtained from lawful means.
Accordingly, I do not consider that on the evidence before the learned magistrate, his Honour must have been satisfied on the balance of probabilities that the cash was lawfully obtained and the defence in s 417(2) was made out. Ground 1 should be dismissed.

Ground 2 - Whether the learned magistrate should have delivered a special verdict

The appellant contends that the learned magistrate should have directed himself to deliver a special verdict in relation to the amount of money he found was lawfully obtained. The appellant submits that the special verdict was relevant to both sentence and the amount of cash which was the subject of the forfeiture order.[97]
[97] Appellant's submissions p 11, [1].
The appellant relied on s 113(2)(a) of the Criminal Procedure Act. This section provides that:
(2)If the judge is of the opinion that the proper sentence or order to be imposed -
(a)on an accused if convicted; or
(b)on an accused if found not guilty on account of unsoundness of mind,
may depend upon a specific fact, the judge may require the jury to give its verdict on that fact specifically.
Section 113 is in pt 4 of the Criminal Procedure Act which concerns prosecutions in superior courts and trials by jury. On this basis, I accept the respondent's submission that s 113 did not apply to the appellant and there was no requirement for the learned magistrate to deliver a special verdict.
While a finding as to the amount of cash reasonably suspected of being unlawfully obtained is relevant both to sentence and any order for forfeiture of the cash, it is not relevant to the conviction of an appellant of the offence.
In this case, the appellant does not appeal against the sentence imposed by the learned magistrate nor is there is any evidence before me that orders for forfeiture of any amount of cash was made by his Honour. In fact, the transcript of the hearing before his Honour makes it clear that this was being dealt with separately and no orders for forfeiture were sought.
While I accept that a specific finding as to the amount of cash reasonably suspected of being unlawfully obtained is relevant both to sentence and the order for forfeiture of the cash, there is no appeal against sentence.
Although the ground of appeal is not expressed in this manner, it appears that the appellant's fundamental complaint is that the evidence could only support, at best, a finding that part of the money was unlawfully obtained and the learned magistrate failed to make adequate factual findings in rejecting the appellant's defence and convicting the appellant on both counts.
His Honour gave the following reasons for finding that the appellant had not discharged the onus under s 417(2) of the Act:
(a)while he accepted there was a connection between the appellant and each of the tow truck business, the tattoo shop, the sale of the pots and gargoyles, and the sale of the vehicle and motor, there was no documentation to support the oral evidence of any witness, in particular the cash received by the appellant in relation to any of these matters;
(b)the evidence of the witnesses as to the cash received by the appellant over the period in question was inconsistent with the financial report that the appellant's financial position had deteriorated over the period and that he still had a substantial mortgage;
(c)on the appellant's evidence, he should have been 'swimming in cash' which was inconsistent with the evidence that over a 12 month period, he had put aside only $5,500;
(d)the explanations provided by the appellant as to the cash located on each of the search warrants was implausible and lacked credibility;
(e)while the evidence of the appellant and his witnesses provided a possible explanation for the cash that was seized, the evidence did not discharge his evidentiary onus of establishing the cash was obtained from these sources on the balance of probabilities.
All of these findings were open on the evidence and support the ultimate conclusion of his Honour that the appellant had not satisfied him on the balance of probabilities that the money was lawfully obtained. It is clear that the learned magistrate's finding related to all and not just part of the money.
For these reasons, I do not consider there is any merit in ground 2 of the appeal.

Conclusion

For the reasons set out above, I consider that leave to appeal on both grounds should be refused and the appeal dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
MG
Research Orderly to the Honourable Justice Hill
22 OCTOBER 2020