Johnston v The State of Western Australia

[2012] WASCA 148

JOHNSTON -v- THE STATE OF WESTERN AUSTRALIA [2012] WASCA 148

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2012] WASCA 148
Court:	THE COURT OF APPEAL (WA)
Case No:	CACR:124/2011	Heard:	19 JUNE 2012
Coram:	BUSS JA MAZZA JA BEECH J	Delivered:	3/08/12
No of pages:	25	Judgment Part:	1 of 1
Result:	Appeal dismissed
Category:	B
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Parties:	JOY ANNE REBECCA JOHNSTON THE STATE OF WESTERN AUSTRALIA
Catchwords:	Criminal law and procedure Prosecution application for leave to reopen its case in light of evidence of co-accused of appellant Trial judge permitted reopening Whether unfair to appellant Whether trial judge's discretion miscarried Whether miscarriage of justice Turns on own facts
Legislation:	Nil
Case References:	Browne v Dunn (1893) 6 R 67 (HL) Manyam v The State of Western Australia [2010] WASCA 107 Webb v The Queen (1994) 181 CLR 41 Wiaceck v The State of Western Australia [2011] WASCA 254

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE COURT OF APPEAL (WA) CITATION : JOHNSTON -v- THE STATE OF WESTERN AUSTRALIA [2012] WASCA 148 CORAM : BUSS JA

MAZZA JA
BEECH J

HEARD : 19 JUNE 2012 DELIVERED : 3 AUGUST 2012 FILE NO/S : CACR 124 of 2011 BETWEEN : JOY ANNE REBECCA JOHNSTON

Appellant

AND

THE STATE OF WESTERN AUSTRALIA
Respondent

ON APPEAL FROM:

Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA

Coram : WISBEY DCJ

File No : IND 990 of 2010, IND 991 of 2010

Catchwords:

Criminal law and procedure - Prosecution application for leave to reopen its case in light of evidence of co-accused of appellant - Trial judge permitted reopening - Whether unfair to appellant - Whether trial judge's discretion miscarried - Whether miscarriage of justice - Turns on own facts

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Legislation:

Nil

Result:

Appeal dismissed

Category: B

Representation:

Counsel:

Appellant : Mr A L Troy
Respondent : Mr B Fiannaca SC and Mr L K Rosenthal

Solicitors:

Appellant : Legal Aid (WA)
Respondent : Director of Public Prosecutions (WA)

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

Browne v Dunn (1893) 6 R 67 (HL)
Manyam v The State of Western Australia [2010] WASCA 107
Webb v The Queen (1994) 181 CLR 41
Wiaceck v The State of Western Australia [2011] WASCA 254


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1 BUSS JA: I agree with Beech J.

2 MAZZA JA: I agree with Beech J.

BEECH J:

Introduction

3 The appellant, Ms Johnston, was convicted after a five week trial on 12 counts of dishonesty: four counts of stealing as a servant; seven counts of fraud; and one count of dishonestly obtaining Commonwealth property.

4 Ms Johnston was jointly charged and tried with her husband, Mr Roy Chapman. Mr Chapman was also charged with three additional counts of stealing in respect of which Ms Johnston was not charged. Mr Chapman was convicted of all counts. He has not appealed his conviction.

5 Ms Johnston has two grounds of appeal. The first relates to the State's successful application at trial for leave to reopen by recalling one of its witnesses. The second relates to a note received from the jury.

6 It is convenient to begin with a broad outline of the State case.

Overview of State case

7 Mr Chapman was employed by the Department of Industry and Resources (DOIR). He was the General Manager of Technology Park and Innovation Services. In that position he was responsible for the management and general supervision of Technology Park in Bentley. The essence of the State case was that Mr Chapman used his position to deceive various persons into paying substantial sums of money to companies associated with and controlled by Ms Johnston.

8 The two companies involved were Metra Business Services Pty Ltd (MBS) and Gordian Holdings Pty Ltd (Gordian).

9 These two companies invoiced the DOIR for substantial sums of money, purportedly for consultancy services. The State case was that no work had ever been performed in consideration for any of the monies paid to MBS and Gordian. The evidence in support of that contention included evidence to the following effect:

(a) neither company was on the approved vendor list (ts 797 - 798, exhibits 21 and 22);

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(b) there were no written contracts of engagement (ts 643, 795) as would have been expected (ts 627 - 628);

(c) apart from the invoices, there were no other documents or correspondence produced by either company (ts 630 - 631, 795 - 796);

(d) there was no pre-qualification process for work on behalf of these companies (ts 628 - 631); and

(e) the companies were not on the conflict of interest register (ts 796) as they should, in accordance with government policy (ts 655 - 657).

10 Ms Johnston was the sole director and shareholder of MBS. Gordian was the trustee of the Johnston Family Trust. The sole director and shareholder of Gordian was Mr Ashley Cross, accountant for Ms Johnston and the two companies. His evidence was that he held the share and the office of director on behalf of and at the direction of Ms Johnston.

11 The State case as opened was that Ms Johnston provided the companies she controlled as the means by which these funds could be obtained. It was alleged that her companies generated the false invoices on which the fraud charges were founded.

12 It was also the State case that part of Ms Johnston's role was to make her companies available to receive the money, thereby concealing Mr Chapman's involvement, and enabling the money to be dealt with by both accused. The State pointed out that she shared in the benefits of the receipt of the money.

13 Further, she dealt with the receipt of the moneys in the books of the companies controlled by her as if it were company income. The State led evidence from Mr Cross of his dealings and communications with her. After the State closed its case, Mr Chapman gave evidence. During Mr Chapman's evidence, it became clear that he was asserting that the monies paid to MBS and Gordian were as income for work he had performed. Nothing to this effect had been put to Mr Cross by Mr Chapman's counsel in cross-examination. Following cross-examination of Mr Chapman, the State successfully applied for leave to reopen to ask a further question of Mr Cross about his knowledge or understanding of who generated the income. The grant of leave to reopen to ask a further question of Mr Cross is the subject of ground 1.

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14 I proceed to outline the State case in respect of each count.

Counts 1, 2 and 4: stealing part of the proceeds of sale of government land

15 These three counts were of the same general character. The State alleged that Mr Chapman stole State money by directing that some of the proceeds of sale of government owned land be paid to MBS.

16 Lot 15 Brodie Hall Drive at Technology Park was sold to the CSIRO for about $1.55 million. The Department of Commerce and Trade (DCT) handled the sale on behalf of the State of Western Australia. The solicitors for the DCT wrote to Mr Chapman seeking instructions as to the disbursement of the proceeds of settlement (exhibit 16). Mr Chapman caused an officer of the DCT, Ms Danica Johnson, to write a letter to the instructing solicitors that professional fees payable to MBS totalling $139,050.00 be paid from the proceeds of sale (exhibit 17). The solicitors paid MBS the sum of $139,050.00 in accordance with those instructions.

17 The general ledger for MBS recorded a deposit of $139,050.00 as consulting fees (exhibit 20).

18 In the tax returns and financial statements of MBS, this money was treated as income for consulting work. In this respect, the State relied on evidence of Mr Cross, and documents adduced through him, to which I will refer later in these reasons.

19 In her record of interview, Ms Johnston said that as far as she could recall she had not done any substantial work for anyone else since she worked for the Department of Planning and Infrastructure (DPI) in the past eight years.

20 The State case on count 2 was of a similar character. It related to $16,900.00 of the proceeds of sale of 24 Brodie Hall Drive. Again, the solicitors wrote requesting instructions on the disbursement of funds (exhibits 23 and 24). An officer of the DCT, Ms Fransen, wrote with instructions to pay $16,900.00 to MBS (exhibit 25). Her evidence is that instructions to write that letter very likely came from Mr Chapman (ts 336 - 337).

21 In accordance with those instructions, the sum of $16,900.00 was paid to MBS on 29 June 2000.

22 Count 4 relates to part of the proceeds of sale of 7 Parker Place at Technology Park.

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23 On 3 July 2002, the DCT's solicitors wrote to Mr Chapman seeking instructions as to the disbursement of the proceeds of settlement of the property.

24 Mr Chapman spoke by telephone to the settlement agent at the solicitor's office (exhibit 39). Mr Chapman stated that he wanted a cheque payable to MBS for $52,526.60, to be picked up the following morning. Those instructions were followed (exhibits 40, 41 and 42).

Count 3

25 Count 3 alleged a crime against Criminal Code (Cth) s 134.1. The charge alleged that Ms Johnston, by deception, dishonestly obtained a cheque of $330,000 from the CSIRO.

26 During 2002, there was a project at Technology Park known as the Knowledge Hub Project. Mr Chapman had discussions with Dr Steven Harvey, a senior officer of the CSIRO. In June 2002, Mr Chapman wrote to Dr Harvey requesting a contribution of $300,000 towards the costs of appointing a coordinator to oversee the Hub's development (exhibit 31).

27 A tax invoice was issued in the name of MBS in the sum of $330,000 to the CSIRO (exhibit 32). A further invoice for the same amount was provided (exhibit 33). The invoice described the moneys payable as being 'CSIRO contribution to State Government expansion of ARRC and Resources and Energy Knowledge Hub Project for the period 1 July 2002 to 30 June 2004'. The invoice requested payment by cheque or bank transfer to MBS.

28 On about 5 July 2002, the CSIRO paid the sum of $330,000 by electronic transfer to MBS (exhibits 34, 35 and 10); $315,000 was paid from the MBS account to Ms Johnston and Mr Chapman's joint mortgage account.

29 A number of Mr Cross's files notes, to which I will refer later relate to this payment: see exhibits 103, 104 and 36.

Counts 5 and 6

30 Mr Chapman was dealing with an architect, Mr Julian Shaw, who administered the building works. The general manager of the Technology Park project was Zernike Australia Pty Ltd (Zernike). Zernike proposed to appoint a contractor to carry out the building works. Before the contractor was appointed, Mr Chapman caused Mr Jones of Zernike to tell Mr Shaw that there would be an additional $100,000 built into the

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contract for a market demand study. That addition would require the contractor to pay a third party. MBS invoiced the contractor for $132,000 (exhibit 50). The contractor made the payments in two cheques, giving rise to counts 5 and 6. The contractor then sought and obtained reimbursement from the DOIR (see exhibits 44 - 50).

31 This money was identified in the MBS accounting ledger as consulting work and tax deductions were made against it.

Count 7

32 In January and February 2005, Gordian issued four invoices (exhibits 53 - 56), totalling $300,318 to Mr Jones of Zernike. The invoices were expressed to be for 'Innovation Centre related services', 'Biotech/ICT wing related services', 'Technology Precinct related services', and 'Enterprise Unit related services'.

33 Mr Jones of Zernike approved the payment and signed the cheque for $300,318. His evidence was that he authorised payments to Gordian because he was instructed by Mr Chapman to do so.

34 Exhibit 109 was a payment advice slip printed 28 February 2005 for Gordian. Attached to it was a copy of the cheque with a note 'original given to Joy'. The note is signed by Mr Cross (ts 699) and dated 1 March 2005.

Count 10

35 Gordian submitted three invoices totalling $221,000 to Zernike. The first was dated 9 November 2005, the second 21 February 2006 and the third was 8 March 2006 (exhibits 68 - 70). All the invoices were stated to be for 'innovation related services'.

36 Mr Butler of Zernike authorised the invoice. He did not know who Gordian was or what innovation related services meant.

37 The cheque for $221,000 was received by Mr Cross and, according to his note, sent to Ms Johnston (exhibit 110; see also ts 700).

Count 12

38 Again, this relates to payment made, by two cheques, in satisfaction of an invoice for 'innovation related services' in the sum of $160,000 (exhibit 82). Zernike administered various trust accounts for the Technology Park project. These accounts were known as 'TIDA

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accounts'. The State case was that the two cheques came from separate TIDA accounts and exhausted the balance of one of the accounts.

Count 13

39 In June 2006, Mr Chapman emailed to Mr Foley of the DPI, two invoices from Zernike, each for $100,000. One was said to be for the sub-regional transportation study for the technology precinct; the other for a detailed area plan for the technology precinct (exhibits 85, 86 and 88).

40 In July 2007, Gordian invoiced Mr Jones of Zernike the amount of $200,000 (exhibit 91). Zernike paid that sum to Gordian on 15 August 2007 (exhibit 92).

Count 14

41 Count 14 relates to the payment by Zernike of a Gordian invoice dated 12 October 2007 for $107,954.

42 Two invoices dated 14 August 2007 from Zernike to the DOIR, totalling $107,954, were endorsed for payment by Mr Chapman (exhibits 93 and 94).

43 Gordian invoiced Zernike the sum of $107,954 on 12 October 2007 for 'innovation related services' (exhibit 95). Payment was made on 28 November 2007 by Zernike (exhibits 96 and 97).

Count 15

44 Count 15 alleged that Mr Chapman stole the balance of various TIDA accounts. The payment to Gordian for the balance of various TIDA accounts is shown in exhibit 98. Mr Jones's evidence was that Mr Chapman instructed him to transfer the balance of the TIDA accounts (ts 599 - 600).

Ms Johnston's case at the trial

45 Ms Johnston elected not to give evidence at the trial.

46 At the trial, senior counsel for Ms Johnston cross-examined very few of the State witnesses. The only cross-examination of any relevant substance was of Mr Cross. I will outline the effect of that cross-examination later.

47 Ms Johnston's case at trial did not challenge whether the State had proved that Mr Chapman engaged in the fraud and stealing alleged.

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Rather, the submissions of senior counsel for Ms Johnston focussed on whether it was proved beyond reasonable doubt that Ms Johnston was a party to what Mr Chapman did. Senior counsel submitted that there was at least a reasonable possibility that Ms Johnston was, like many other people, deceived by Mr Chapman. Consequently, the submission continued, the jury ought not be satisfied beyond reasonable doubt that Ms Johnston knew of and was a party to Mr Chapman's defrauding and theft.

48 Because the evidence of Mr Cross was central to the State's case against Ms Johnston, and because ground 1 relates to the grant of leave to recall Mr Cross, I will outline Mr Cross's evidence in detail.

The evidence of Mr Cross

49 Mr Cross was Ms Johnston's accountant for 12 or 13 years, doing her tax and accounting work (ts 670). He did tax returns for MBS and Gordian, and for Ms Johnston personally in some years.

50 Mr Cross was the accountant for MBS from about 1998 to 30 June 2007 and for Gordian from 2002 to 30 June 2007 (ts 672).

51 Ms Johnston was the director, secretary and sole shareholder of MBS (ts 673).

52 Gordian was registered on 19 February 2003 (ts 674).

53 Gordian was trustee of a family trust (ts 701). Mr Cross was the director and shareholder of Gordian. He held a share on trust for Ms Johnston (ts 703). Mr Cross was not a signatory to Gordian's bank account; Ms Johnston was (ts 703).

54 Mr Cross's evidence was that in the period from 2002 to 2005 he generally met two or three times a year with Ms Johnston. At one meeting, she would provide schedules of income and expenses and they would go through them. The second meeting would occur when the financial statements and income tax returns had been completed, and Ms Johnston and Mr Cross would go through them. In some years there would be a third meeting of a planning kind (ts 690 - 691).

55 In the course of completing the returns for MBS for the year ending 30 June 2002, Mr Cross saw that some of the information provided by Ms Johnston included expenses in the region of $20,000, but with no income in the year. He raised that question with Ms Johnston. She said that they were expenses related to income which would be received in the

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following year, namely through a contract that would provide around $300,000 of income (ts 675 - 676). The discussion was recorded in a file note made by Mr Cross (exhibit 103, blue AB1161). One entry on that note stated:

(iii) During [year ended] 30/06/02 working on obtaining contract for $300,000. Expenses were incurring in work to do to obtain contract. Contract was obtained in July 2002. Full income will be in [year ending] 30/6/2003.

Expenses deductible in [year ended] 30/6/2002 as company was in business at that time, just not receiving income.

(iv) Professional Fees are all consulting fees. Joy used other consultants to help her.

(underlining added)


See ts 676 - 681.

56 With reference to the meeting the subject of exhibit 103, senior counsel for the State put a leading question, to which no objection was taken, with a response as follows:

And in that meeting, Ms Johnston is telling you that she ... anticipates that she will receive approximately $300,000 by way of a contract, at that stage from an unknown entity, is that so?---Yes (ts 681).

57 The ledgers and financial statements relating to the financial year ended 30 June 2002 are exhibit 111 (blue AB1183).

58 There was a further meeting on 29 April 2003, at which Mr Cross took notes. The first topic of the meeting was planning for the financial year ending June 2003. The notes recorded contemplated income of $460,000, which was said to include one payment of $330,000 in July 2002 for a two year contract. The note recorded that it may be possible to treat the sum as half prepaid at 30 June 2003, with some services still to be performed. The note recorded that there was no contract but '[Ms Johnston] thinks there is a letter of agreement. Will forward - to enable us to check if it meets prepayment rules' (exhibit 104, blue AB1166).

59 On 21 April 2004, Ms Johnston wrote, on behalf of MBS, to Mr Cross (exhibit 105, blue AB1169). The first point in the letter stated that the invoice wording for the period 2002 to 2004 was 'Knowledge Hub Project for the period 1 July 2002 - 30 June 2004'. The letter stated that

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various other things were enclosed, including bank statements for MBS showing fees in revenue, and a detailed list of expenses. The letter requested Mr Cross to call Ms Johnston to go through the return before it was submitted.

60 Mr Cross met with Ms Johnston again on 27 May 2004 (see exhibit 36, blue AB1057). The note records that on the topic of splitting the CSIRO income over two years, Ms Johnston said there was no contract, only the invoice which shows a two year period. On this basis, a prepayment of one year was considered acceptable.

61 In relation to exhibit 36, senior counsel for the prosecution asked, in a leading fashion:

And so the identity of the - the entity to which she'd rendered services was the CSIRO?---Yes (ts 691).

62 Senior counsel for Ms Johnston objected to the question. Although it is not entirely clear from the reading of the transcript, I take it from the prosecutor's response that he accepted that objection, and moved on to ask a different question. Consequently, I exclude this evidence from further consideration.

63 The financial statements provided in respect of the financial year ending June 2003 set out revenue for MBS (exhibit 112, blue AB1192 - 1210). The income included a payment of $165,000, with a further $165,000 shown in the following year, being the $330,000 split between two years (ts 711). The total revenue for the year ending June 2003 was $349,527. This comprised of $52,527 (the subject of count 4), $165,000 (half of the moneys the subject of count 3), and $100,000 and $32,000 (the subject of counts 5 and 6).

64 The expenses including consultant's fees of $55,383.69 and an amount for travel and accommodation of $47,483.07.

65 Mr Cross said that he had some discussions with Ms Johnston about whether the purpose of the trip was business related to the earning of the income of MBS (ts 712).

66 Among the information provided to Mr Cross by Ms Johnston for the financial year ending June 2004 was a spreadsheet of MBS income and Gordian income (blue AB1231; ts 714 - 715).

67 On 1 March 2005, Mr Cross received a cheque for $300,318 payable to Gordian Holdings. The cheque is the subject of count 7. Mr Cross

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telephoned Ms Johnston when it was received and later handed it to her (ts 699).

68 Ms Johnston sent Mr Cross an email on various tax related matters on 28 February 2006 (exhibit 106, blue AB1171). The email attached files for MBS and Gordian tax returns. It stated that some travel bills may have been missed, but that if the daily rate was being used that would not matter.

69 On 1 May 2006, Mr Cross received a cheque payable to Gordian in the sum of $221,000. He sent the cheque to Ms Johnston (exhibit 110, blue AB1181; ts 700).

70 Ms Johnston sent another email to Mr Cross on 22 November 2006 regarding tax matters (exhibit 107, blue AB1173 - 1174). Among the information said to be attached to the email was a 'statement of revenue (Gordian did all the earning)' and a list of travel dates and reasons for travel. One item in the email stated that 'My services are shown as "Services'''. Mr Cross said that this was a description of the income that was coming into MBS and Gordian (ts 697).

71 Ms Johnston sent a further email on 2 February 2007, regarding the 2006 income tax returns (exhibit 108, blue AB1176). The email made various statements about claims for overseas travel.

72 The invoices issued by Gordian, which were exhibits 53 to 56 (blue AB1094 -1103), stated Mr Cross's accounting firm's contact details, namely the postal address, phone number and fax number. He was not aware of this and did not approve it (ts 721). However, he also agreed that the registered address for both MBS and Gordian was his firm's office address (ts 729).

73 Mr Cross examined the general ledger of MBS (exhibit 20, blue AB697). Mr Cross said that the descriptions in the ledger were from Ms Johnston, not from him (ts 728). Relevantly, two deposits were described as 'MBS Consulting': $139,050 on 2 September 1999 and $16,900 on 29 June 2000. These deposits are the subject of counts 1 and 2.

Cross-examination of Mr Cross

74 Counsel for Mr Chapman did not cross-examine Mr Cross (ts 729).

75 The first part of senior counsel for Ms Johnston's cross-examination of Mr Cross was taken up primarily with establishing that Ms Johnston

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conducted herself in a way that was too open, and with too many documents, to be consistent with a person acting dishonestly. For example, Ms Johnston provided spreadsheets and other financial statements for the two companies. She met with Mr Cross and would have been able to see that he was taking notes of what she said. Some of the cheques were sent to him and, as might have been expected, he recorded that fact before passing the cheques on to her (ts 732 - 737).

76 Mr Cross agreed that Ms Johnston provided him with documents which indicated that revenue or income had been accrued by the two companies (ts 735). He also agreed that she had instructed him to take the income that she told him the companies had obtained, including any GST amounts, and declare it, and pay the tax and GST on that income (ts 737).

77 Mr Cross gave some financial and tax planning advice to Ms Johnston (ts 737). To that end, he met with her reasonably regularly. He knew a little about her (ts 737 - 738). She never spoke about Mr Chapman. He did not know what Mr Chapman did for a living (ts 738). In particular, he did not know that Mr Chapman had anything to do with Technology Park in Bentley or with technology or science in general (ts 739).

78 Exhibit 118 was a further travel schedule document. Some of the dates of travel shown there were shortly before Ms Johnston's second child was born (ts 750).

79 In re-examination, Mr Cross said that all the information which he obtained came from Ms Johnston and that he did not independently verify it (ts 761, 764).

80 The application by the State for leave to reopen arose following, and in light of, the evidence of Mr Chapman, to which I now turn.

The evidence of Mr Chapman

81 In essence, Mr Chapman said, in evidence, that he had undertaken work of a high level strategic and policy nature that was outside the terms of his government employment and for which he was or believed he was entitled to be paid. See, for example, ts 1032 - 1033, 1040, 1058 - 1065 and 1082 - 1083.

82 He invoiced the department for his work in the name of MBS because it was 'available' (ts 1065, 1082). Mr Chapman said that

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payments were made, later, to Gordian 'on advice from the accountant' that it could be 'handled under Gordian' (ts 1087).

83 Senior counsel for the State cross-examined Mr Chapman in relation to the use of Gordian to receive payments for the work Mr Chapman said he had done. Mr Chapman said that:

(a) Mr Cross was the accountant who had given the advice (ts 1192 - 1193);

(b) Mr Chapman had never spoken with Mr Cross, but had provided Ms Johnston with a written list of questions which Mr Chapman asked that she take to Mr Cross (ts 1193, 1243);

(c) The list of questions did not say that Mr Chapman would be the person generating the income and he did not discuss with her what Mr Cross would be told about who was generating the income (ts 1193, 1240 - 1242);

(d) Ms Johnston returned with advice from Mr Cross that a separate company was not required, and that Gordian was sufficient and the income could be split (ts 1241); and

(e) Mr Chapman was not an employee or shareholder of Gordian (ts 1199).

84 This evidence of Mr Chapman led to an application by the State to recall Mr Cross. The State also applied, successfully, to recall two other witnesses. However it is not necessary to refer to the other witnesses, as the recall of those witnesses is not the subject of any complaint in this appeal by Ms Johnston.

The State's application to reopen

85 In support of its application to reopen, the State submitted at trial that:

(a) the opening address by counsel for Mr Chapman did not contend or suggest that Mr Chapman had done work for which he was or believed himself to be entitled to charge;

(b) neither counsel for the two accused put to Mr Cross the contention that he had given professional advice, as an accountant, that income earned through Mr Chapman's work could be invoiced by Gordian and 'split';

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(c) counsel for Mr Chapman did not cross-examine Mr Cross at all;

(d) senior counsel for Ms Johnston did not put to Mr Cross that there was any statement or understanding that it was Mr Chapman, rather than Ms Johnston, who had done the work to earn the income and incur the expenses;

(e) consequently, the evidence given by Mr Chapman could not reasonably have been foreseen by the State as evidence appropriate or necessary to support the prosecution case; and

(f) it was relevant to the exercise of discretion that there had been breaches of the rule in Browne v Dunn (1893) 6 R 67 (HL), at least on the part of counsel for Mr Chapman.

86 At the trial, counsel for both accused opposed the State's application.

87 Counsel for Mr Chapman submitted, in summary, that:

(a) the evidence complained of by the State was not part of Mr Chapman's evidence-in-chief, but arose through cross-examination; and

(b) the absence of cross-examination of Mr Cross was to be understood in the context that Mr Cross and Mr Chapman had not spoken to each other.

88 Counsel for Ms Johnston submitted, in summary that:

(a) the power to permit evidence in rebuttal by a prosecutor is highly exceptional;

(b) the prosecution was aware of the significance of evidence about what Mr Cross was told about who did the work, and evidence of Mr Cross on that topic was available in the prosecution brief but not led (or not fully led);

(c) in that regard, counsel referred to par 12 and par 24 of Mr Cross's statement of 10 December 2008;

(d) the evidence complained of by the prosecution was adduced as a result of open-ended questions asked in cross-examination by the prosecutor; and

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(e) in substantial measure at least, the prosecution had already adduced evidence to much the same effect as that which it sought to lead in rebuttal, so that it would be unfair to have the witness returned to give further similar evidence.

The trial judge's ruling

89 The trial judge gave the following reasons for ruling that the State could recall Mr Cross to ask a question on one topic only. The topic was whether Mr Cross was aware that the income earned by MBS and Gordian was the product of Mr Chapman's work:

The prosecution seeks to - seeks leave to recall a witness, Ashley Glenn Cross, a chartered accountant and partner in the firm of Adamson & Cross, who gave evidence on 14 and 15 April 2011. Mr Cross was the accused Joy Johnston's accountant for a period of 12 to 13 years up until 2008 and was responsible for the preparation and submission of the financial papers and tax returns for Ms Johnston and the companies Metra Business Services Proprietary Limited and Gordian Holdings Proprietary Limited, the Johnston Family Trust during the relevant period. During the course of his evidence it was not suggested to Mr Cross by counsel for any of the parties that the substantial income being received by each company was in fact income claimed to have been earned by the accused Roy Chapman in a private consulting capacity. Indeed, senior counsel for Ms Johnston specifically directed questions to Mr Cross on the basis that the supposed income had been accrued, transcript 735, or obtained, transcript 737, by one or other of the companies. Mr Cross was not asked to comment as to his knowledge of the accused Chapman's alleged contribution to the entitlement to the money. Not surprisingly, having regard to the documentary and other material in the brief and the fact that counsel for Mr Chapman failed to indicate in her opening address or reveal at any time during the course of the State case by cross-examination or otherwise that Mr Chapman would claim that he earned the monies in a private consulting capacity and/or believed that he had a right to the money, senior counsel for the State did not address this issue with Mr Cross. He now seeks to do so. What has emerged as a result of Mr Chapman's evidence is that an issue of honest claim of right arises for the jury's consideration and the prosecution is required to negative the proposition that what the accused did had [been] done in the exercise of an honest claim of right and without intention to defend. Whether or not Mr Cross was aware that the monies were the result of Mr Chapman's activities is relevant to this issue and had the prosecution been aware of the fact that Mr Chapman would take that position that he has, I am satisfied it would address the issue with Mr Cross. The position taken by Mr Chapman could not reasonably have been anticipated by the prosecution. The dilemma was further highlighted by the re-examination of Mr Chapman, transcript 1448, when this exchange took place:

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'You were asked some questions about the use of Gordian Holdings Proprietary Limited?---Yes.

And it was suggested the purpose of that was to disguise what you were - that you - it was actually you doing the work. Why did you in fact use Gordian Holdings Proprietary Limited?---It was on the advice - well, after receiving financial advice about how the monies would be split.'

In my view, the interests of justice require the prosecution to have the opportunity of addressing this issue with Mr Cross. When I say addressing this issue, limited strictly to asking Mr Cross whether he was aware that the income into the companies was the product of the efforts of Mr Chapman (ts 1469 - 1470).

Mr Cross's further evidence

90 When he was recalled, the prosecutor asked Mr Cross whether, during the period of operation of Gordian Holdings, he was aware that the income coming in to that company was the product of the efforts of Mr Chapman. Mr Cross responded 'No, it was always [Ms Johnston's]' (ts 1516).

91 Counsel for Mr Chapman did not cross-examine.

92 Counsel for Ms Johnston put to Mr Cross that that (his answer in evidence-in-chief at ts 1516) was an assumption that he had made. Mr Cross denied that, saying that 'from the start [Ms Johnston] always presented to us that it was her efforts, her income' (ts 1517).

93 Counsel put to Mr Cross, Mr Chapman's evidence that Ms Johnston had asked Mr Cross for advice about what to do with Gordian Holdings and whether or not the income of Mr Chapman could be put through that company. Mr Cross said that was never asked. He said that Ms Johnston never asked him what to do with income earned by Mr Chapman outside his government job (ts 1518). He said that if such a question had been asked, he would have written it down in his notes.

94 At that point in the evidence, senior counsel for Ms Johnston contended that the way in which Mr Cross's evidence had developed, coming out in rebuttal, caused unfairness to Ms Johnston (ts 1520 - 1521).

95 The trial judge suggested that the way in which things had developed was probably one of the disadvantages of a joint trial (ts 1523). As will appear, I agree with that observation.

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96 Senior counsel for Ms Johnston then put to Mr Cross that he knew full well that the revenue for both MBS and Gordian was the result of Mr Chapman's consulting work. Mr Cross denied that (ts 1524). He denied that he advised Ms Johnston to put the money through Gordian and that he said it was okay because Mr Chapman was acting effectively as an agent for Gordian (ts 1524).

97 Mr Cross said that in the 13 years that he was Ms Johnston's accountant, it never came up that Mr Chapman was involved in Technology Park (ts 1533).

Ground 1

98 Ground 1 contends that the learned trial judge erred in law in permitting the prosecution to adduce the additional evidence of Mr Cross. The particulars to the ground assert that the relevant evidence of Mr Chapman, which formed the basis of the trial judge's decision to permit reopening, did not emerge as part of the defence case, but rather was adduced by the prosecution in the course of cross-examination of Mr Chapman.

99 Leave to appeal on ground 1 was granted on 24 February 2012.

Ground 1 - legal principles

100 The legal principles relevant to the discretion to permit the prosecution to reopen its case were not in dispute on this appeal.

101 The principles have recently been summarised in Manyam v The State of Western Australia [2010] WASCA 107 [19] (Pullin JA), [96] - [106] (Buss JA). The following passages from the judgment of Buss JA set out the principles relevant to the disposition of this appeal:

The general rule is that the prosecution should not be permitted to split its case or adduce rebuttal evidence, except in very special or exceptional circumstances. That is, in general, the prosecution must present the whole of its case before the accused is called upon to present his or her case by giving sworn evidence in his or her own defence or calling other witnesses. The trial judge has a discretion to permit the prosecution to re-open its case and adduce rebuttal evidence but, in general, it should not be exercised if the necessity for adducing the rebuttal evidence as part of the State's case could reasonably have been foreseen.

...

In [R v Chin (1985) 157 CLR 671], Gibb CJ and Wilson J referred to [Shaw v The Queen (1952) 85 CLR 365], [Killick v The Queen (1981)

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147 CLR 565] and Lawrence v The Queen (1981) 38 ALR 1], and then stated and discussed the general principle and the trial judge's discretion to permit departure from it, as follows:

'The general principle is that the prosecution must present its case completely before the accused is called upon for his defence. Although the trial judge has a discretion to allow the prosecution to call further evidence after evidence has been given for the defence, he should permit the prosecution to call evidence at that stage only if the circumstances are very special or exceptional and, generally speaking, not if the occasion for calling the further evidence ought reasonably to have been foreseen. The principle applies where the prosecution seeks to call evidence to rebut matters raised for the first time by the defence; if the rebutting evidence was itself relevant to prove the prosecution case (unless, perhaps, it was no more than marginally, minimally or doubtfully relevant: R v Levy and Tait ((1966) 50 Cr App R 198 at p 202)) and the need to give it could have been foreseen it will, generally speaking, be rejected. The principle would not prevent the prosecution from giving in reply evidence directed to an issue the proof of which did not lie on the prosecution, such as insanity, or from rebutting evidence of the accused's good character, provided that the prosecution had not anticipated the raising of an issue of this kind and led evidence with regard to it, for the prosecution must not split its case on any issue. Also, it has been held that evidence may be given in reply to prove some purely formal matter the proof of which was overlooked in chief (676 - 677).'

The general rule and the closely circumscribed circumstances in which the trial judge may permit departure from it are based on two fundamental propositions. First, the burden is upon the prosecution to prove the accused's guilt beyond reasonable doubt. Secondly, the accused is entitled to a fair trial including the protection of his or her right to silence and the presumption of innocence [98], [103] - [104].

Ground 1 - Ms Johnston's submissions

102 Counsel for Ms Johnston emphasised the exceptional character of the power to permit the prosecution to reopen its case. He emphasised that the evidence of Mr Chapman upon which the trial judge primarily relied was not raised in the evidence-in-chief of Mr Chapman, but arose from Mr Chapman's responses to answers asked in cross-examination by senior counsel for the prosecution.

103 In argument on the appeal, counsel for Ms Johnston accepted that, at trial, there had been a breach by counsel for Mr Chapman (appeal ts 7) of the requirements of the rule in Browne v Dunn. Counsel for Ms Johnson accepted on the appeal that, had the discretion to grant leave to reopen

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fallen to be exercised on a trial of Mr Chapman alone, there could be no complaint about the grant of leave. However, Ms Johnston asserts that the grant of that leave occasioned prejudice to her and should have been refused on that ground.

104 Ms Johnston asserts that the additional evidence of Mr Cross was, and should have been expected to be, very damaging to her defence of the prosecution case. Further, the prosecution had failed to lead evidence to similar effect contained in one of the witness statements of Mr Cross. Ms Johnston submits that the prosecution should not have been given a further opportunity to lead this evidence. Counsel for Ms Johnston emphasises that this point was not mentioned by the trial judge in his reasons.

105 Further, counsel submits that the failure of the State to lead this evidence of Mr Cross was pointed out in the course of submissions to the trial judge on the admissibility of portions of the video record of interview (see ts 827, 830). Counsel points out that the State made no application to recall Mr Cross at that stage, which was before the State case had concluded.

106 In summary, counsel for Ms Johnston submits that taking into account:

(a) the strength of the State's case against Mr Chapman;

(b) the prejudice to Ms Johnston's defence by allowing the further evidence; and

(c) the circumstances that the State could and should have led additional evidence from Mr Cross when he first gave evidence,

the trial judge should have refused to allow the State's application to adduce further evidence from Mr Cross.

The merits of ground 1

107 In order to succeed on her appeal it is necessary, but not sufficient, for Ms Johnston to demonstrate error in the discretionary decision to give leave to reopen. It is not sufficient because the appeal is against conviction, not against the decision to permit reopening. Ms Johnston must show an error in the decision to reopen, and that that decision occasioned a miscarriage of justice.

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108 For the reasons that follow, I am not persuaded that the judge erred in the exercise of his discretion. In short, that is because, in my opinion:

(1) the grant of leave to recall Mr Cross to ask the question permitted by the trial judge was justified as against Mr Chapman, taking into account the failure of counsel for Mr Chapman to comply with the rule in Browne v Dunn; and

(2) fairness to Ms Johnston did not require a different exercise of discretion.

109 The concession by counsel for Ms Johnston in the appeal that, at trial, there had been a breach of the requirements of the rule in Browne v Dunn on the part of counsel for Mr Chapman was, in my respectful opinion, rightly made. Nothing said in the opening address by counsel for Mr Chapman suggested that Mr Chapman's case was that he had done work for which he was or believed himself to be entitled to charge. Even if a contention to that effect ought reasonably have been anticipated by the State, nothing was said in opening, or in cross-examination of Mr Cross, to the effect that Mr Cross had given advice based on an understanding that Mr Chapman had done relevant work.

110 I do not accept the submission that the evidence of Mr Chapman upon which the application for leave to reopen was founded arose only in cross-examination. In his evidence-in-chief, Mr Chapman said that payments were made to Gordian 'on advice from the accountant' (ts 1087). An available inference, if not the most likely inference, was that the accountant in question was Mr Cross. The prosecutor was not obliged to leave that evidence untested. The fact that the more detailed evidence of Mr Chapman about the advice given by Mr Cross emerged in cross-examination did not detract from the injustice to the State had Mr Cross not been recalled.

111 For these reasons, as against Mr Chapman, as conceded in this appeal, the judge was justified in granting leave to reopen.

112 In my opinion, fairness to Ms Johnston did not call for any different exercise of the discretion to grant leave to reopen. That is so taking into account a number of matters.

113 First, the discretion fell to be exercised at a time before Ms Johnston had to elect whether to give evidence. Consequently, although the evidence was given after the State had closed its case, and after Mr Chapman had given evidence, as against Ms Johnston the grant of

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leave to reopen did not engage all of the considerations and potential prejudice which underlie the caution with which the power to reopen is exercised.

114 Secondly, the question in respect of which leave was granted was limited and specific. The prosecutor asked Mr Cross a single question. The question was whether, during the period of operation of Gordian Holdings, Mr Cross was aware that the income coming into that company was the product of the efforts of Mr Chapman. That question was capable of, and calculated to produce, a yes or no answer. Had Mr Cross responded by simply saying 'no', there could have been no complaint of prejudice on the part of Ms Johnston. Counsel for Ms Johnston on the appeal accepted that he could not point to any prejudice in a negative answer to the question the judge gave leave to ask (appeal ts 58, 60). In my view, that in itself is a formidable, if not fatal, obstacle to the complaint on this appeal that there was any error in the trial judge's exercise of discretion. The trial judge granted leave to ask a question which, if answered with a yes or no, as would reasonably have been anticipated, would have occasioned no prejudice to Ms Johnston. In those circumstances, fairness to Ms Johnston did not require refusal of the application for leave to reopen.

115 Thirdly, the single question permitted to be asked was intended to deal with Mr Chapman's evidence. In the circumstances, the fact that the subject of the question overlapped with evidence against Ms Johnston that had been available to the prosecution, but not led, was not a matter of overwhelming weight.

116 Fourthly, there were several elements of Mr Cross's original evidence-in-chief to the effect that, in particular contexts Ms Johnston had said to him, in effect, that she had done the work for which MBS and Gordian were receiving what was said to be income. In this regard, I refer to:

(a) the passage in sub-paragraph (iv) of the file note that was exhibit 103 that '[Ms Johnston] used other consultants to help her'. The natural meaning of this, in its context, was that consultants' fees were a deductible expense because Ms Johnston had used other consultants to help her earn the income in question;

(b) Mr Cross's evidence, albeit in response to a leading question, that Ms Johnston told him that she would receive approximately $300,000 by way of a contract (ts 681); and

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(c) the statement in Ms Johnston's email of 22 November 2006 (exhibit 107) that '[m]y services are shown as "services"', said by Mr Cross to be a description of the income coming into MBS and Gordian (ts 697).

117 At trial, senior counsel for Ms Johnston did not challenge in cross-examination any of this evidence. In contrast, after Mr Cross's further evidence, senior counsel elected to directly challenge Mr Cross's evidence. That led in turn to Mr Cross's clear denials of the propositions put to him. That, no doubt, was unhelpful to Ms Johnston's case. However, in the circumstances I have outlined, the fact that the forensic choices made by senior counsel for Ms Johnston had those consequences by no means establishes any miscarriage of justice.

118 For the reasons I have given, I am not persuaded there was any error in the trial judge's discretionary decision to grant leave to the State to reopen to ask the specified question of Mr Cross. Further, if, contrary to my view, there was any error in his Honour's decision, for the same reasons I am not persuaded that any error occasioned a miscarriage of justice.

119 For these reasons I would dismiss ground 1.

Ground 2 - failure to discharge the jury

120 Ground 2 alleges that the trial judge erred in law in failing to discharge the jury after receipt of a note from the jury. On 24 February 2012, the question of leave on ground 2 was reserved to the hearing of the appeal.

121 During the morning break of the trial on 5 May 2011, the jury provided to the judge a note which read:

The jury feels that [Ms Johnston] has been very obviously drawing and 'eyeballing' certain jurors, particularly this morning. This has been disconcerting for several of us.

122 At the trial, senior counsel made application for the jury to be discharged pursuant to s 116(2) of the Criminal Procedure Act 2004 (WA). Counsel submitted that the note revealed a bias or prejudice against Ms Johnston, which could not be cured by direction from the court (ts 1407 - 1409).

123 When the jury first returned, after having provided the note, the trial judge said to the jury that 'the matter raised in your note has been

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appropriately addressed and you should put the matter out of your minds' (ts 1411).

124 The trial judge dismissed the application for the discharge of the jury. His Honour was not persuaded that the matters the subject of the note might impact upon the jury's deliberations or that it was in the interests of justice to discharge the jury (ts 1470).

125 By ground 2, Ms Johnston appeals against the decision of the trial judge in this respect.

126 It is common ground that the test to be applied in exercising the power to discharge the jury on grounds of bias is whether the relevant conduct gives rise to a reasonable suspicion or apprehension on the part of a fair-minded and informed member of the public that the jury has not or will not discharge its task impartially: Webb v The Queen (1994) 181 CLR 41, 53; Wiaceck v The State of Western Australia [2011] WASCA 254 [28].

127 Ground 2 was supported by brief written submissions. Counsel for the appellant did not develop ground 2 in his oral submissions.

128 Ms Johnston's written submissions assert that the direction initially given by the trial judge in response to the note tended to suggest that there was some merit in the contents of the note, and failed to alleviate the prejudice to Ms Johnston arising from the matters raised in the note. Consequently, the submissions continue, the contents of the note would occasion a reasonable apprehension on the part of a fair-minded and informed observer of prejudice or the risk of an unfair trial.

129 In my view, there is no merit in this ground. In my opinion, the contents of the note do not give rise to a reasonable apprehension of bias. The note alerted the trial judge to behaviour, as perceived by some members of the jury, on the part of the appellant that concerned them and, it can be inferred, which they wished to cease. The trial judge's direction to the jury was, in my opinion, suitably broad in character. It avoided directly addressing the question of whether Ms Johnston had in fact engaged in the conduct described in the note. It stated that 'appropriate' steps had been taken. It unambiguously directed the jury to put those matters out of their minds. A fair-minded and informed member of the public would have no reason to expect the jury to fail to follow the judge's unequivocal direction in this respect.

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130 No further direction was sought. In my view, none was required. If anything, it would have been counter-productive to have given the contents of the note further attention later in the trial.

131 The trial judge gave usual directions informing the jury as to how they were to approach their task. These included directions about what was evidence, and its nature, and directions about the irrelevance of sympathy and prejudice.

132 For these reasons, in my view, ground 2 is without merit. Leave to appeal on ground 2 should be refused.

Conclusion

133 For the reasons I have given, I would refuse leave on ground 2, and dismiss the appeal against conviction.