Goulding, Delegate of the Chief Executive Officer of Customs v Waylen Enterprises Pty Ltd T/As Harland Tyres (in Liq)
[1999] WASC 238
GOULDING, DELEGATE OF THE CHIEF EXECUTIVE OFFICER OF CUSTOMS -v- WAYLEN ENTERPRISES PTY LTD T/AS HARLAND TYRES (IN LIQ) & ORS [1999] WASC 238
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [1999] WASC 238 | |
| Case No: | CIV:2041/1996 | 27 AUGUST 1999 | |
| Coram: | MASTER SANDERSON | 3/12/99 | |
| 8 | Judgment Part: | 1 of 1 | |
| Result: | Amendment refused | ||
| PDF Version |
| Parties: | MICHAEL LESLIE GOULDING, DELEGATE OF THE CHIEF EXECUTIVE OFFICER OF CUSTOMS WAYLEN ENTERPRISES PTY LTD T/AS HARLAND TYRES (IN LIQ) KIM LOUISE ALDWORTH EILEEN MARY MONK LARAN HOLDINGS PTY LTD T/AS F & M TYRES PETER JOHN MONK EILEEN MONK TURRUMGA PTY LTD |
Catchwords: | Practice and procedure Pleading in Customs Act prosecution Effect of statutory provision on general pleading rules |
Legislation: | Customs Act, s 4, s 251 and s 255 |
Case References: | Bridal Fashions Pty Ltd v Comptroller General of Customs (1997) 17 WAR 499 Gallagher v Cendak [1988] VR 731 Kelly v JRA Limited (1990) 92 ALR 651 Neil Pearson & Co Pty Ltd v Comptroller General of Customs (1995) 38 NSWLR 443 Shaw v The Queen (1952) 85 CLR 365 Barendse v Comptroller General of Customs (1996) 93 A Crim R 210 Goulding v Waylen Enterprises Pty Ltd T/as Harland Tyres (In Liq) & Ors, unreported; SCt of WA (Master Sanderson); Library No 970386; 12 August 1997 Re Horsham Kyosan Engineering Co Ltd [1972] 403 Longmuir v Prosser, unreported; FCt SCt of WA; Library No 9141; 7 November 1991 Monk v R [1999] WASCA 27 Pfenning v R (1994) 127 ALR 99 Stephens v Reid [1902] 28 VLR 82 Re Sydney Formworks Pty Ltd (In Liq) (1965) 82 WN (NSW) 558 Symon & Co v Palmer's Store's (1903) Ltd [1912] 1 KB 259 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
WAYLEN ENTERPRISES PTY LTD T/AS HARLAND TYRES (IN LIQ)
First Defendant
KIM LOUISE ALDWORTH
Second Defendant
EILEEN MARY MONK
- Third Defendant
- Plaintiff
AND
(Page 2)
- LARAN HOLDINGS PTY LTD T/AS F & M TYRES
First Defendant
PETER JOHN MONK
Second Defendant
EILEEN MONK
Third Defendant
TURRUMGA PTY LTD
- Fourth Defendant
Catchwords:
Practice and procedure - Pleading in Customs Act prosecution - Effect of statutory provision on general pleading rules
Legislation:
Customs Act, s 4, s 251 and s 255
Result:
Amendment refused
(Page 3)
Representation:
CIV 2041 of 1996
Counsel:
Plaintiff : Mr E Carlose
First Defendant : No appearance
Second Defendant : No appearance
Third Defendant : Ms J E Bartlett
Solicitors:
Plaintiff : Australian Government Solicitor
First Defendant : No appearance
Second Defendant : No appearance
Third Defendant : Jackson McDonald
CIV 2042 of 1996
Counsel:
Plaintiff : Mr E Carlose
First Defendant : Ms J E Bartlett
Second Defendant : Ms J E Bartlett
Third Defendant : Ms J E Bartlett
Fourth Defendant : Ms J E Bartlett
Solicitors:
Plaintiff : Australian Government Solicitor
First Defendant : Jackson McDonald
Second Defendant : Jackson McDonald
Third Defendant : Jackson McDonald
Fourth Defendant : Jackson McDonald
(Page 4)
Case(s) referred to in judgment(s):
Bridal Fashions Pty Ltd v Comptroller General of Customs (1997) 17 WAR 499
Gallagher v Cendak [1988] VR 731
Kelly v JRA Limited (1990) 92 ALR 651
Neil Pearson & Co Pty Ltd v Comptroller General of Customs (1995) 38 NSWLR 443
Shaw v The Queen (1952) 85 CLR 365
Case(s) also cited:
Barendse v Comptroller General of Customs (1996) 93 A Crim R 210
Goulding v Waylen Enterprises Pty Ltd T/as Harland Tyres (In Liq) & Ors, unreported; SCt of WA (Master Sanderson); Library No 970386; 12 August 1997
Re Horsham Kyosan Engineering Co Ltd [1972] 403
Longmuir v Prosser, unreported; FCt SCt of WA; Library No 9141; 7 November 1991
Monk v R [1999] WASCA 27
Pfenning v R (1994) 127 ALR 99
Stephens v Reid [1902] 28 VLR 82
Re Sydney Formworks Pty Ltd (In Liq) (1965) 82 WN (NSW) 558
Symon & Co v Palmer's Store's (1903) Ltd [1912] 1 KB 259
(Page 5)
1 MASTER SANDERSON: This is the plaintiff's application for leave to amend the statement of claim in terms of the proposed amended statement of claim dated 13 August 1999 in actions CIV 2041 of 1996 and CIV 2042 of 1996. In each case the application is opposed by the third defendant. I will refer to CIV 2041 but these reasons will cover the applications in both cases. The action itself is a "Customs prosecution". The nature of such proceedings was considered by the Full Court in Bridal Fashions Pty Ltd v Comptroller General of Customs (1997) 17 WAR 499. The Court had this to say about such proceedings (at 503):
"Proceedings of this type ('Customs prosecutions' as defined in s 244 of the Customs Act) are rather curious in nature. They are civil in form but because they extend beyond seeking compensatory relief they are penal in substance. In some ways they may more properly be assimilated to criminal proceedings rather than civil actions. But there is no such thing as a criminal action. … It has to be recognised that they are civil proceedings and they are to be conducted in accordance with the practices and procedures of the Court in its civil jurisdiction."
2 What that means of course is that a statement of claim in a Customs Act prosecution must comply with the rules of pleading in the same way that a statement of claim must be properly pleaded in any other action. However, as this application makes clear, the rules of pleading are complicated by provisions of the Customs Act. This application illustrates the difficulties that can arise.
3 For the purposes of this application the facts can be simply stated. The first defendant was, at all material times, an importer of remoulded truck tyres. Tyres imported by the first defendant were liable to duty. The procedure for the assessment of duty involved the first defendant submitting an invoice to the plaintiff upon which duty was charged. It is alleged by the plaintiff that the invoices submitted to the plaintiff by the first defendant understated the value of tyres imported with the intent to evade duty. It is said that the second and third defendants, who were directors and shareholders of the first defendant, were knowingly concerned in the breaches of the Customs Act and are therefore personally liable for penalties. That is a very much truncated version of what is a reasonably lengthy and complex pleading. However, it will do for present purposes to establish the nature of the claim made by the plaintiff against the defendants.
(Page 6)
4 The third defendant complains about two particular paragraphs of the proposed amended statement of claim. First, objection is taken to par 8. Because of the way in which the objection is framed it is appropriate that I quote par 8 in full. It is in the following terms:
"8. (1) At all material times, pursuant to s 4 of the Act, the First, Second and Third Defendants were the owners of the goods
Particulars
- (a) The First Defendant was the importer and consignee of the goods.
(b) As shareholders of the First Defendant, the Second Defendant and Third Defendants were, or held themselves out to be, owners or persons possessed of or beneficially interested, in the goods.
(c) As directors of the First Defendant, the Second and Third Defendants were, or held themselves out to be, persons having control of or power of disposition over the goods.
(2) Pursuant to the section 153 of the Act, read with s 15 of the Customs Tariff Act the First, Second and Third Defendants, were liable to pay duty, assessed on the value of the goods. Particulars of the value of, and the duty payable on, the goods are set out in Schedule A in the respective columns."
5 It is alleged by the third defendant that the particulars to par 8(1) cannot support a plea that the third defendant was the owner of the goods. It is conceded that the first defendant was the owner of the goods, but it is said that the mere fact that the second and third defendants were shareholders in the company cannot possibly render them owners of the goods. Under s 153 of the Customs Act duty can be recovered from "the owner of the goods" in a court of competent jurisdiction. It is therefore fundamental to the plaintiff's case that it establish that the second and third defendants were the owners of the goods within the meaning of the Customs Act. Section 4 of the Customs Act is the definition section. The definition of "owner" relevantly reads:
(Page 7)
- " … includes any person (other than an officer of Customs) being or holding himself out to be the owner, importer, exporter, consignee, agent, or person possessed of, or beneficially interested in, or having any control of, or power of disposition over the goods."
6 It is alleged by the second and third defendants that, even allowing for that extended definition of "owner", the fact that they were shareholders in the first defendant could not render them liable for the payment of duty. The second and third defendants relied on the well-established principle of company law that shareholders do not have a direct beneficial interest in property of the company. In the absence of the definition section including shareholders as owners of the goods, it is said that the particulars cannot support the claim as made. The point is well taken. The statement of material fact must be particularised and as the particulars are not proper the paragraph itself cannot stand.
7 In support of his position counsel for the plaintiff referred to s 255(1) of the Customs Act. That section reads as follows:
"In any Customs prosecution the averment of the prosecutor or plaintiff contained in the information, complaint, declaration or claim shall be prima facie evidence of the matter or matters averred."
- It was submitted that the effect of that section is that par 8(1), shorn of its particulars, is prima facie evidence that the second and third defendants were owners of the goods pursuant to s 4 of the Customs Act. Even in the absence of particulars it was said that paragraph could not be struck out. Counsel sought further support from the provisions of s 251 of the Customs Act which is in the following terms:
"No objection shall be taken or allowed to any information, summons or other originating process for any alleged defect therein in substance or in form or for any variance between such information, summons or other originating process any evidence adduced at the hearing in support thereof, and the Court shall at all times make any amendment necessary to determine the real question in dispute or which may appear desirable, if any such defect or variance shall appear to the Court to be such that the defendant has been thereby deceived or misled it shall be lawful for the Court upon such terms as it may think just to adjourn the hearing of the case to some future day."
(Page 8)
8 In my view neither s 255(1) nor s 251 assist the plaintiff's case. Because of the nature of a Customs Act prosecution, defendants are entitled to have the claims pleaded against them with clarity and to have those claims particularised: see Gallagher v Cendak [1988] VR 731 per Vincent J at 739; Neil Pearson & Co Pty Ltd v Comptroller General of Customs (1995) 38 NSWLR 443 per Kirby ACJ at 468. Furthermore, s 251 of the Customs Act has no bearing on an application under O 20 r 19. Section 251 operates so as to overcome the strict limitations on the re-opening of the Crown case by way of amendments to averments during trial: see Shaw v The Queen (1952) 85 CLR 365; Neil Pearson & Co Pty Ltd v Comptroller General of Customs (supra) at 461. The real effect of s 251 is to enable the plaintiff to amend its pleading in the events that there is a variance between the pleaded case and the evidence sought to be adduced at trial: see Kelly v JRA Limited (1990) 92 ALR 651 at 659.
9 The defendants also took objection to par 11, par 14 and par 15 of the statement of claim. Essentially, the same objection was raised - that is to say, the fact the third defendant was a shareholder of the first defendant could not in and of itself amount to the third defendant being considered the owner of the goods. By way of example, par 14(iii) pleads as a material fact that the third defendant as a shareholder was beneficially interested in the business and was the owner of the goods. Counsel submitted that such a proposition runs counter to law and should not be permitted to stand. Once again, I think the submission is well made. The averment of the fact is prima facie evidence of it. But it must be properly particularised. Without proper particulars the paragraph cannot stand.
10 The objection taken to par 16 really related to particulars. During the course of his submissions, counsel for the plaintiff provided an explanation as to how Sch A and Sch B were to be read and interpreted. It may be that, consequent upon this explanation, the third defendant understands the case made against her. If not, then further particulars of par 16 may be required. However, in the circumstances, I am prepared to allow par 16 to stand in its present form.
11 In conclusion, then, it seems to me that I ought not allow the plaintiff to amend in terms of the proposed amended statement of claim. I will hear the parties in relation to costs and how the matter should proceed from this point.
1
4
0