Leask v Cwealth of Aust

[1995] HCATrans 277

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S136 of 1992

B e t w e e n -

STEPHEN ARTHUR LEASK

Plaintiff

and

THE COMMONWEALTH OF AUSTRALIA

Defendant

Summons for Directions

McHUGH J

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON TUESDAY, 19 SEPTEMBER 1995, AT 9.32 AM

Copyright in the High Court of Australia

MR J.R.K. PRYDE:   May it please the Court, I appear for the plaintiff.  (instructed by Schrader & Associates)

MR G. GRIFFITH, QC, Solicitor-General for the Commonwealth:If your Honour pleases, I appear with MS M.A. PERRY for the defendant.  (instructed by the Australian Government Solicitor)

HIS HONOUR:   Yes, Mr Pryde.

MR PRYDE: Your Honour, the matter comes before the Court by way of summons seeking orders pursuant to section 18 of the Judiciary Act 1903, that questions be reserved for the consideration of a Full Court. Draft questions, your Honour will see, are annexed to the summons dated 27 July 1995. The questions involved the validity of section 31(1) of the Financial Transaction Reports Act 1988, formerly the Cash Transactions Report Act.  The relevant subsection is set out at paragraph 8 of the statement of claim which was filed with the writ.

HIS HONOUR:   Yes.  I have read all the papers. 

MR PRYDE:   As at the filing of the summons, the parties were agreed as to the form of the questions to be reserved.  As it happens, two proposed amendments have been forwarded by the defendant and those are amendments which the plaintiff objects to.  Perhaps my learned friend may wish to take your Honour - I think he has a printed form of the questions in their proposed amended form which he could hand up.  One is - - -

HIS HONOUR:   Before we get to that, perhaps we should deal with the question of principle.  Why should not this case be allowed to go to trial in the ordinary way?  I appreciate that the facts are not in dispute but why should the Full Court’s time be taken up with these issues?  Is there any serious doubt as to the constitutionality of this section?

MR PRYDE:   With respect, your Honour, I think there is.

HIS HONOUR:   Why is it not a law with respect to currency?

MR PRYDE:   Your Honour, the primary argument that I think will be relied upon at the hearing of the matter will be that it is disproportionate; that if there is, in fact, no mens rea element permitted, then the section as it stands is disproportionate.

HIS HONOUR:   But does disproportionality come in at all into this particular case?  Does this not go right to the core?  It deals with cash transactions which are defined to refer to the movement of physical currency.  Why is it not a law with respect to 51(xii) of the Constitution?

MR PRYDE:   Your Honour, even if it would otherwise be within power, we would say that the proportionality principle comes - that it comes back to that as to whether it can then be a valid exercise of power.

HIS HONOUR:   I understand how you put it in the - - -

MR PRYDE:   I am sorry, I know that that is not a direct answer to your Honour’s question.

HIS HONOUR:   But what about question (1)?  It is a question that really relates to the construction of a section in criminal proceedings and this Court has said again and again - well, said at least twice:  in Sankey v Whitlam and I think, perhaps, in Murphy, that the Court would not make declarations in the course of committal proceedings except in very exceptional circumstances.  In addition, the question that is asked hardly seems to me to deal with all the difficulties under section 31.  It does not deal with the question of mens rea, it does not deal with the question of whether a Proudman v Dayman point might be available and, add to that, the fact is that after a trial and before a verdict, you could ask for these questions to be reserved under section 72 of the Judiciary Act and the court would then - the trial judge might state a case either to this Court or to the Court of Criminal Appeal of New South Wales.  If he stated it here, then it may well be that, in accordance with what we did in Murphy, that we would remit the matter under section 44 back to the Court of Appeal.  But at least the Court would then have the benefit of the Court of Criminal Appeal on a section which involves general questions of criminal liability.

So, I must say I am very reluctant to refer question (1).  It may be in the course of determining question (2), the Court would have to say something about the construction of it.  But I am very reluctant to reserve question (1).  I do not think it exhausts the problem.

MR PRYDE:   Your Honour, with respect to what your Honour just said about mens rea, it seems to me that as question (1) is currently framed, it does, in fact, raise squarely the mens rea issue because if someone - and can I refer your Honour also to the plaintiff’s contention (a) in paragraph 2(a) of the preamble to the questions.

HIS HONOUR:   Yes.

MR PRYDE:   The plaintiff contends that the proper interpretation of the subsection is that if it would be objectively reasonable to form the conclusion that the person charged had conducted the transactions in the manner and form in question for the sole or dominant purpose referred to, the person charged may not avoid conviction by showing that the person did not in fact conduct the transactions in that manner and form.  Well, the essence of that, your Honour, is, in my respectful submission, that mens rea is precluded by the wording of the Act by the wording of the subsection on the plaintiff’s interpretation.  So that, with respect, it seems to me that it does raise that squarely and that is really, in effect, the prime reason for bringing the matter before the Court because if a criminal trial is permitted to proceed where the whole issue of mens rea, the absence or presence of it, as an element of the offence is in doubt, then there can be a major trial ensue ‑ ‑ -

HIS HONOUR:   Of course it can but the concession you just made is very unfortunate from your point of view. I mean, it is the very reason why this Court would not want to state a case on that question. If that is the main question that you are seeking to get determined in the proceedings, we would be interfering with the criminal process. Why should not the question be determined in the ordinary way in the course of the criminal proceedings? You have your rights under section 72 of the Judiciary Act as well as your rights under the Court of Criminal Appeal Act and, in addition, you only get the question before the Court in any event by linking it to the constitutional question. If it stood alone, I doubt if the Court would have jurisdiction to determine the question as against the Commonwealth. It is not a question that arises under the Constitution or involves its interpretation, so, you do not get the benefit of section 30 of the Judiciary Act or section 75 of the Constitution.

MR PRYDE:   It seems to me this, your Honour, that question (1) is, in effect, a branch of question (2) and therefore it is an aspect and an aspect going to the validity of the section.

HIS HONOUR:   I appreciate that is the way you put it. You say this creates an absolute liability which depends on reasonableness. There is no question of mens rea and so on and therefore it is disproportionate and cannot be justified under section 51(ii) or 51(xii) or any other provision of the Constitution. But what I was putting to you earlier, you could succeed on question (1) and yet not exhaust the possibilities of the section. It might give rise to a Proudman v Dayman “honest and reasonable belief” defence even though there is no mens rea.  In any event, you see, it would require ultimately the Court to make a declaration on the meaning of a section in the

course of the criminal process and which the Court is most reluctant to do.  The Full Court might say, “We are just not going to make a declaration; not going to answer the question”.

Now, it may be that to get to section 51(xii) or section 51(ii) point, the Court would have to say something about the construction of the section so you would get the benefit of it.  But as for stating a specific question, I have real reservations about that.  Is there anything further you want to put in relation to that matter generally?

MR PRYDE:   Yes, just in relation to the aspect of raising it during committal proceedings.  The committal, of course, has been heard so it is not during the course of committal proceedings as such.

HIS HONOUR:   No, I am not sure that I said that, did I.  I said “during the course of the criminal process”.

MR PRYDE:   Yes.  At an earlier stage when your Honour was referring to Sankey v Whitlam and those cases.  So, there is that aspect.  Could I just take some instructions on that?

HIS HONOUR:   Yes.

MR PRYDE:   Your Honour, in light of the matters that your Honour has raised, it simply occurred to me this:  that I had perhaps not envisaged that the whole basis for the reservation of the questions might, in fact, be in doubt and what I just sought instructions about was whether, in fact, my leader, Mr Jackson, if he is available, may wish to just canvass those aspects with your Honour, if your Honour is otherwise not minded to permit the questions to be reserved in their form.  It just seemed it may be a little better.  Mr Jackson, obviously enough, has a lot more experience in these matters.

HIS HONOUR:   Yes, I appreciate that but particularly in relation to the first question, the Court would be asked to express an opinion on the meaning of the section without the benefit of a trial judge or an intermediate Court of Appeal view on the matter and the Court has said again and again it is very reluctant to put itself in that position.  Constitutional questions are different matters.  Very well, I will hear what the Solicitor says about it.  Yes, Mr Solicitor.

MR GRIFFITH:   Your Honour, just a minor point.  There is an error in our defence, paragraph 5, where we have given notice of this, your Honour, that we desire to amend the reference to paragraph 13 to paragraph 14.  So, could we apply to do that?

HIS HONOUR:   In your - - -?

MR GRIFFITH:   In our defence, your Honour.  We say “it denies  paragraph 13”, it should be “it denies paragraph 14”, your Honour.  Could we apply to amend that?

HIS HONOUR:   I see, yes.  You have leave to amend that, yes.

MR GRIFFITH:   Thank you.  We will amend the copy on the file, your Honour.  Your Honour, so far as the defendant is concerned, it has never thought that the issue raised in the pleading or the question (a) was a great question.  This was put as an agreed draft on the basis that is what the plaintiff wanted to plead.  But as your Honour can see from the defendant’s contention, we say there is nothing in it.  We have a benign construction that would admit mens rea, reasonable mistake of fact, everything, your Honour, in its operation and our basic view is there is nothing in the entire case.

Your Honour, it was only this morning that I was instructed that, in fact, it seems the trial process has come to a halt in the year or so that this matter has taken to get from issue of the writ to before your Honour.  I was not aware of that.  I would have thought there would be no reason why the trial could not proceed, whatever this Court was being asked to do in a separate action.  Your Honour, in a way, seems to be coming to the point a different way, that one could say, why should the trial not proceed, and if there is still an open point out of it, it can come up one way or another.

HIS HONOUR:   It can be raised under section 72 of the Judiciary Act if necessary as it was in Murphy’s Case and Clyne’s Case.

MR GRIFFITH:   Yes.  But, your Honour, we are taking the view that there is nothing in question (a) and question (b), we say, how can that section be invalid?  We have not seen the point yet.

HIS HONOUR:   No.  It may be, to use the core incidental dichotomy, that although section 7 might go to the core of the currency power, section 31 really goes to the incidental aspect of currency because it is designed to protect the reporting transactions under section 7 and therefore it is incidental and therefore it is disproportionate. 

MR GRIFFITH:   I should add, your Honour, the taxation power is principally relied upon and these materials that we refer to in our amended claim go to support that.

HIS HONOUR:   Yes, I see that.  You might be on more difficult ground justifying it under the taxation power, Mr Solicitor.

MR GRIFFITH:   We will take that as a view of a single Judge at the moment without the advantage of arguing it, your Honour.

HIS HONOUR:   No, no, but it seemed to me that you had a stronger argument under 51(xii) than 51(ii) particularly after the decision in Watson v Lee where the Court held that the foreign exchange regulations could be justified under the currency power.

MR GRIFFITH:   Yes.  But it does seem to be a very specific tact just to one section at the moment, dealing with the offence.

HIS HONOUR:   At the moment the question (1) or question (a), as you call it, does not really seem to raise any real question on what you say and it puts the Court in a situation where you say mens rea is involved in it.

MR GRIFFITH:   We say it is a contrived question, your Honour, because we would argue for the benign in favour of the accused’s construction on all these points.

HIS HONOUR:   Yes.  Is there anything further you want to say, Mr Solicitor?

MR GRIFFITH:   Your Honour, there does seem to be great sense in what your Honour observes about the ordinary practice of this Court and it might be better, your Honour, to adjourn all this sine die and let the trial proceed and see what happens.

HIS HONOUR:   Yes.  Another alternative, I suppose - there are, really, only questions of law involved - is it can just be set down for trial before a single Judge and if the defendant lost the suit then it could appeal to the Full Court.

MR GRIFFITH:   That happened yesterday in a matter, your Honour, I suppose so.

HIS HONOUR:   That happened yesterday?

MR GRIFFITH:   Well, there was a trial before a single Judge yesterday here.

HIS HONOUR:   That was in Gambotto?

MR GRIFFITH:   Yes, your Honour.  Until yesterday it had been an unusual thing in this Court, your Honour.

HIS HONOUR:   Yes.  Well, the notion is growing up that you can start any case in the High Court and get a case stated but, I mean, there has to be something to take up the time of the Full Court.

MR GRIFFITH:   We do not think much of this one.  It is just the plaintiff has issued the writ and we tried to get the issues out of it but your Honour can see that we would desire to refer to that material.  There is a bundle before the Court.

HIS HONOUR:   I appreciate that.

MR GRIFFITH:   There has been an indication from my learned friend that he might have some material.  Well, we do not mind that being produced on notice, your Honour, whatever it is.  It may be better, your Honour, rather than having a trial on the issue, just for the trial for which plaintiff has been committed to continue and just see what comes out of it.

HIS HONOUR:   That is so but, on the other hand, the plaintiff has an action going in this Court and he is entitled to have it dealt with.  At the moment, I must say, with some reluctance I am inclined to refer the second question but I - - -

MR GRIFFITH:   To a single Judge or the Full Court?

HIS HONOUR:   To the Full Court.

MR GRIFFITH:   We must leave it to your Honour because it is a half-day issue, I would have - - -

HIS HONOUR:   It is, yes.  I am against, at the moment, referring the first question.  I will hear what Mr Pryde has to say in reply about it.

MR GRIFFITH:   Your Honour, we have never seen it as anything in it.

HIS HONOUR:   Yes.

MR GRIFFITH:   Your Honour, I should say, if your Honour does refer question (2) as it is on page 3 of the draft, we would desire to have our paragraph 4 in the amended version - - -

HIS HONOUR:   That refers to all those documents that you refer to, yes.

MR GRIFFITH:   It just refers to this material, just on the basis that that is contemplated.  They would be just handed up and filed in the Court, your Honour.

HIS HONOUR:   Yes.  Well, Mr Pryde, at the moment my inclination is to refer the constitutional question but I am not at the moment, at all events, inclined to refer the first question.  You have heard what the Solicitor says about it.  Do you still want Mr Jackson’s - - -

MR PRYDE:   I would prefer to perhaps take a short adjournment to see whether Mr Jackson is available.  I believe he may well be available.  It being only a relatively short point, I would have thought that he may wish and be prepared to come up and argue that point.

HIS HONOUR:   Yes.  How long do you want?

MR PRYDE:   Is it appropriate that my solicitor might make a phone call to Mr Jackson to see whether that is available at all?

HIS HONOUR:   Yes, certainly, Mr Pryde.  I think the best thing is if you let the Registry know when Mr Jackson is ready or, if he is not going to be ready, and I will come back then.  Adjourn the Court.

AT 9.54 AM SHORT ADJOURNMENT

UPON RESUMING AT 10.05 AM:

HIS HONOUR:   Yes, Mr Pryde.

MR PRYDE:   Your Honour, I have spoken to Mr Jackson on that point.  In reply then, to what the Solicitor-General was saying and to your Honour’s preliminary view on the statement of the questions, we would simply say that question (1), in the plaintiff’s submission, arises directly and centrally to the interpretation of the second question.  So that we would say, in effect, it is a useful articulation of the central question relating to the validity of the section which is question (2).  So, we would say, for that reason, it would be appropriate for the Court to deal with it as a question stated.

Beyond that, if your Honour is not minded to refer that question to the Full Court, could we at least flag that and reserve the prospect of an application for leave at the hearing to have that question officially ruled upon?  I can put it no higher than that.

HIS HONOUR:   That is always open to you, yes.

MR PRYDE:   If we simply flag that.  So, beyond that it is simply a matter for your Honour as to which of the questions to refer.  The only other point that I have:  my friend, I understand, handed up yesterday an amended version, an amended draft of questions reserved in which, at paragraph 4 was set out under agreed facts, the materials relied on which the defendant seeks to rely upon and we simply say on that, that those materials - we are certainly happy that the defendant bring those before the Court but we say it is inappropriate that it come within the ambit of the agreed facts.

HIS HONOUR:   The habit has grown up which, I must say, I disapprove of putting these statements in, “The plaintiff contends” and “The defendant contends” and “The defendant relies” but it is the practice.  It means nothing, really, except to flag the arguments really.  It is a case stated.  It is my case - - -

MR PRYDE:   From the plaintiff’s point of view, we would certainly be better - we would prefer to hear from the defendant what alleged facts those materials are in support of in respect of the validity of the Act.

HIS HONOUR:   You will hear that in due course but if it is a fact - you can agree, can you not, that he relies on those materials.  Whether they get the defendant anywhere is another question altogether.

MR PRYDE:   Yes.  Your Honour, in so far as that is the language, yes, that is so.

HIS HONOUR:   Yes, that is all it does.  Thank you, Mr Pryde. 

MR PRYDE:   Can I say one more thing as far as the wording of question (1) is concerned.  We would seek, if the matter were ever to be dealt with by the Full Court to abide by the original wording which is annexed to the summons - in the document annexed to the summons.

HIS HONOUR:   Yes.  Yes, Mr Solicitor.

MR GRIFFITH:   Your Honour, to pick up what seems to be the position:  if question (1) is deleted - this is from the draft we delivered to the Court yesterday - would your Honour prefer paragraph 2(a) and 3(a) to be deleted too?  It just seems to be running around the bush.  We can expect this sort of argument to be put as one of construction but there seems no need to recite it.

HIS HONOUR:   Yes.

MR GRIFFITH:   So, if we took out 2(a) and 3(a) and ran that together - the 2(a) statement merely picks up one of the paragraphs in the statement of claim.

HIS HONOUR:   Yes, I follow.  What do you say about that, Mr Pryde?  If I take the view that question (1) is not to be reserved for the Full Court then it is irrelevant to the case.

MR PRYDE:   It will only be a contention on an aspect of that. 

HIS HONOUR:   It is an argument which both sides will just put before the Court.

MR PRYDE:   That is so, your Honour, in that they are only contentions.  I assume that that they will still be raised as primary contentions - well, as secondary contentions, in effect.  It really makes little difference in the form of the document, I would have thought.

HIS HONOUR:   Mr Solicitor, they are only contentions.  They seem to throw up the structure of the argument.

MR GRIFFITH:   Your Honour, we do not know whether the plaintiff has served 78B notices - - -

HIS HONOUR:   I thought I saw 78B notices somewhere or other.

MR GRIFFITH:   That could be the case, your Honour.

HIS HONOUR:   In the file.

MR GRIFFITH:   Yes.  Well, if they have, your Honour, we would suppose it would be appropriate, to avoid further appearances, if your Honour could order that there should be written submissions and also a notice of any materials the plaintiff might rely upon, say, six weeks before hearing and we should file two weeks or whatever before hearing.

HIS HONOUR:   Yes. In this matter I am prepared to state a case in accordance with paragraphs 1, 2, 3 and 4 of the draft submitted by the Commonwealth yesterday and I would also state question (2) in the Commonwealth’s draft. I am not prepared to state a case in respect of question (1). The determination of that question does not seem to me to be absolutely necessary to the determination of the constitutional question. It raises a separate question under which the plaintiff in effect seeks a declaration of this Court as to the meaning of section 31(1)(a). The Court has said on a number of occasions that it is only in very exceptional circumstances that it will make declarations during the course of criminal proceedings concerning the construction of legislative provisions. Question (1) should be determined in the ordinary way where the Court will have the benefit of a decision of an intermediate Court of Appeal on the matter.

So, accordingly, I refuse to reserve the first question proposed by the plaintiff but, as I say, I will reserve the second question and I direct that the parties file written submissions in the matter and give notice of any materials relied on in support of their arguments. 

What about time, Mr Pryde and Mr Solicitor, for written submissions?

MR PRYDE:   Is there any indication when the matter would come on for hearing, just in terms of a time frame?

HIS HONOUR:   No.  I would be surprised if it came on this year.

MR PRYDE:   Perhaps four weeks or something before the matter was listed:  four weeks and two weeks, something in that order.

HIS HONOUR:   What do you say, Mr Solicitor?

MR GRIFFITH:   Your Honour, I did suggest six and two, but perhaps five and three, your Honour, or five and two.  We would prefer to have three

weeks.  It seems it will be plenty of time, your Honour, so it is not a difficulty.

HIS HONOUR:   Yes, five and three should be sufficient from your point of view, Mr Pryde?

MR PRYDE:   Yes, your Honour.

HIS HONOUR:   I direct that the plaintiff file his written submissions five weeks before the date fixed for hearing and the Commonwealth file its submissions three weeks before the date.

MR GRIFFITH:   I was indicating by “three” that we have three after the plaintiff files his.  So, if it could be two weeks before the hearing.

HIS HONOUR:   Yes.  Well, that gives an extra two weeks.  Yes, I do not see any objection to that?

MR PRYDE:   No, your Honour.

HIS HONOUR:   So, I direct the plaintiff file his written submissions five weeks before the hearing, and the Commonwealth file its written submissions two weeks before the hearing.  Section 78B notices have been given to all parties, I think.

MR PRYDE:   I understand, yes, your Honour.

HIS HONOUR:   Yes, all relevant parties, yes.  Is there anything further?

MR GRIFFITH:   Your Honour, just one matter:  it is our understanding and we hope it remains the case that it is only section 31 that is attacked.

HIS HONOUR:   Yes.

MR GRIFFITH:   Yes.  So, if it was any wider it would be a different case then, your Honour.

MR PRYDE:   No, your Honour, that is so, it is only section 31.

HIS HONOUR:   Yes, very well.  There being nothing further, adjourn the Court.

AT 10.16 AM THE MATTER WAS ADJOURNED