Franco v State of SA - [2016] SASC 29

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Criminal)
FRANCO v STATE OF SA
[2016] SASC 29
Judgment of The Honourable Justice Bampton
4 March 2016
MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA - APPEAL TO SUPREME COURT
CRIMINAL LAW - PROCEDURE - CONFISCATION OF PROCEEDS OF CRIME AND RELATED MATTERS - FORFEITURE OR CONFISCATION - APPEAL OR REVIEW
Appeal against Magistrate’s dismissal of application for interest on monies seized in January 2004 pursuant to s 30 of the Criminal Assets Confiscation Act 1996 (SA) (the 1996 Act) – the 1996 Act repealed and replaced by the Criminal Assets Confiscation Act 2005 (SA) (the 2005 Act) on 2 April 2006 – no interest entitlement under the 1996 Act – section 228 of the 2005 Act entitles a person whose money is seized and required to be paid back to interest – whether transitional provision in clause 11 of Part 7 of Schedule 1 of the 2005 Act operates so as to deem seizures pursuant to warrants issued under the 1996 Act to have occurred under the 2005 Act.
Held:
1. Transitional provision of the 2005 Act does not apply to warrants issued under the 1996 Act.
2. Appeal dismissed.
Criminal Assets Confiscation Act 1996 (SA) s 8, s 9, s 30, Part 3; Criminal Assets Confiscation Act 2005 (SA) s 228, Sch 1, cl 11; Taxation Administration Act 1953 (Cth) Sch 1, s 260-5, referred to.
Director of Public Prosecutions v Kobelt & Ors [2007] SADC 57, distinguished.
Love v Attorney-General (NSW) (1990) 169 CLR 307, considered.

FRANCO v STATE OF SA
[2016] SASC 29
Magistrates Appeal: Civil

BAMPTON J: Vittorio Franco appeals a Magistrate’s dismissal of his application for interest on monies seized in January 2004 during the execution of two warrants issued pursuant to s 30 of the Criminal Assets Confiscation Act 1996 (SA) (the 1996 Act).
The Criminal Assets Confiscation legislation
The 1996 Act was repealed and replaced by the Criminal Assets Confiscation Act 2005 (SA) (the 2005 Act) which came into operation on 2 April 2006. The 1996 Act did not provide an entitlement to interest. By contrast, the 2005 Act entitles a person to interest payable by the Crown in respect of property seized or forfeited and required to be paid back. Section 228 of the 2005 Act provides:
228—Interest
(1)If—
(a) money of a person is seized or forfeited under this Act; and
(b) not less than one month after the seizure or forfeiture, the money (or an equal amount of money) is required under this Act to be paid back to the person or the person is required to be compensated by the Crown under this Act in respect of the seizure or forfeiture,
the person is entitled to be paid interest on the money at the prescribed rate.
(2)An amount payable by the Crown under this section is recoverable as a debt.
(3)Except as provided by this section, no interest is payable by the Crown in respect of property seized or forfeited under this Act.
Clause 11 of Part 7 of Schedule 1 of the 2005 Act (the transitional provision) provides:
(1)An order in force under the former Act immediately before the commencement of this Act continues in force, subject to this Act, as if this Act had been in force when the order was made and the order had been made under this Act.
(2)In this clause—
former Act means the Criminal Assets Confiscation Act 1996.
Mr Franco contends that the transitional provision operates so that monies seized from him prior to the commencement of the 2005 Act are subject to the 2005 Act and he is entitled to interest on those monies pursuant to s 228.
The sole issue for determination on this appeal is the proper interpretation of the transitional provision of the 2005 Act.
The seizure of the monies
In January 2004, officers of the South Australia Police (SAPOL) seized three amounts of money totalling $284,343.33 from Mr Franco. The sum of $22,623.10 was seized by SAPOL pursuant to a general search warrant from a house at Marden on 22 January 2004. As this sum was seized pursuant to a general search warrant and not a warrant issued under the 1996 Act, it is not the subject of this appeal.
The balance of the monies was seized pursuant to two warrants (the warrants) issued under the 1996 Act.
On 27 January 2004, a warrant was issued by a Magistrate pursuant to s 30 of the 1996 Act authorising any SAPOL member to enter and search the National Australia Bank and seize anything liable to forfeiture under the 1996 Act, or seize material relevant to identifying and locating property liable to forfeiture under that Act.
The second warrant was issued on 28 January 2004, authorising officers to enter and search National Australia Trustees Ltd.
Pursuant to s 32(5) of the 1996 Act, if the warrants were not executed at the expiration of one month from the date of issue, they expired. However, as both warrants were executed, s 32(5) was not enlivened as once executed they were no longer extant.
The sum of $261,720.23 was seized from accounts in Mr Franco’s name during execution of the warrants. Those funds were subsequently transferred to the Crown Solicitor’s Office trust account.
The forfeiture proceedings
On 17 February 2004, the Director of Public Prosecutions (the DPP) commenced proceedings in the Magistrates Court seeking a restraining order over the monies seized pursuant to s 15 of the 1996 Act. Those proceedings were transferred to the District Court wherein the DPP sought forfeiture of the sum of $284,343.33 (the District Court forfeiture proceedings).
On 24 January 2008, the DPP discontinued the District Court forfeiture proceedings except insofar as the proceedings related to the sum of $22,623.10, being a sum of money that the DPP claimed was liable to forfeiture in separate District Court criminal proceedings brought against Mr Franco.
On 25 January 2008, the Attorney General’s Department paid $261,720.23 to the Australian Tax Office (the ATO) in response to a notice issued on 23 January 2008. The notice, issued under s 260-5 of Schedule 1 of the Taxation Administration Act 1953 (Cth), required payment of Mr Franco’s tax debt to the Commissioner for Taxation (the Commissioner) from monies then owed to Mr Franco following discontinuance of the District Court forfeiture proceedings.
On 4 November 2008, the District Court dismissed an oral application by the DPP for forfeiture of $5,000 in the separate District Court criminal proceedings. Thereafter, on 12 November 2008, SAPOL paid $22,623.10 to the Commissioner in response to a notice issued on 5 November 2008 under s 260-5 of Schedule 1 of the Taxation Administration Act.
Analysis
As detailed above, the warrants were executed and the monies seized by SAPOL prior to the commencement of the 2005 Act.
The District Court forfeiture proceedings were dismissed on 7 April 2009 without restraining orders or forfeiture orders being made. Further, no order for forfeiture was made in the separate District Court criminal proceedings.
Mr Franco argued that the warrants are orders for the purposes of the transitional provision of the 2005 Act. He submitted that the words “an order in force” in the transitional provision applies to a warrant issued pursuant to s 30 of the 1996 Act.
The respondent argues that the only orders that could have been made under the 1996 Act are orders pursuant to s 8 and s 9 for forfeiture of tainted property and restraining orders under Part 3.
The transitional provision does not apply to the seized monies as they were not subject to “an order in force” under the 1996 Act at the time the 2005 Act commenced. Had the seized monies been subject to an order (for example, a forfeiture or restraining order) imposed under the 1996 Act and in force at the time of the commencement of the 2005 Act, then arguably s 228 of the 2005 Act confers an entitlement to interest by operation of the transitional provision.
When the transitional provision is placed in the statutory context of the 1996 Act, it is clear that the word “order” is a reference to either a forfeiture order under s 8 or s 9, or a restraining order under Part 3 of the 1996 Act. In my view, the transitional provision recognises the distinction between the use of the word “order” in s 8 and s 9 and Part 3 and the word “warrant” in Division 2 of Part 5 of the 1996 Act which provided for the issuing of warrants.[1]
[1] See Criminal Assets Confiscation Act 2005 (SA) Parts 2 – 5; Part 6, Division 5, Subdivision 2.
A warrant authorising the seizure of property pursuant to s 30 of the 1996 Act is not an order and therefore does not enliven the transitional provision.
The different uses of the words “order” and “warrant” in both the 1996 Act and the 2005 Act indicate that Parliament, by the transitional provision, intended to give effect to the distinction between the accepted legal definition of an order and a warrant.
As stated by the High Court in Love v Attorney-General (NSW), an order is a judicial act, whereas the issuing of a warrant is an administrative act.[2]
[2] Love v Attorney-General (NSW) (1990) 169 CLR 307 at 321-322.
In my view, it is clear that the transitional provision does not apply to warrants issued under the 1996 Act.
The decision in Director of Public Prosecutions v Kobelt & Ors[3] relied upon by Mr Franco is to be distinguished from this matter. That decision concerned a restraining order that had been made pursuant to s 15(1) of the 1996 Act. It was an order in force at the time of the commencement of the 2005 Act and by virtue of the transitional provision it continued in force, subject to the 2005 Act, as if the 2005 Act had been in force when the order was made.
[3] [2007] SADC 57.
Accordingly, the transitional provision in the 2005 Act does not operate so as to deem seizures pursuant to warrants issued under the 1996 Act to have occurred under the 2005 Act.
The Magistrate was correct to determine that there is no entitlement to interest on the monies seized.
Accordingly, I dismiss the appeal.