Leask v The Queen
[1999] HCATrans 463
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S45 of 1999
B e t w e e n -
STEPHEN ARTHUR LEASK
Applicant
and
THE QUEEN
Respondent
Application for special leave to appeal
KIRBY J
HAYNE J
TRANSCRIPT OF PROCEEDINGS
AT SYDNEY ON FRIDAY, 10 DECEMBER 1999, AT 2.00 PM
Copyright in the High Court of Australia
MR S.J. GAGELER: If the Court pleases, I appear for the applicant. (instructed by G. Shelton and Associates)
MR D.J. FAGAN, SC: If it please the Court, I appear with my learned friend, MR. F.A. VELTRO, for the respondent. (instructed by Commonwealth Director of Public Prosecutions).
MR GAGELER: Your Honours, section 31(1) of the Financial Transaction Reports Act is set out at page 133 of the application book. It contains two key phrases. The first is “having regard to”, which invites the question whether the subparagraphs that follow are exclusive of the matters to which regard is to be had. The second key phrase is “it would be reasonable to conclude” which invites two questions. One is what, if any, mens rea, need be proved for the commission of the offence, and the other is what standard of proof applies? In relation to the second phrase and the two questions it raises, there are, on my count, four different views that one can find in the appellate courts.
HAYNE J: But what view did the trial judge tell the jury?
MR GAGELER: None of them. Your Honour, the first view is that of Chief Justice Brennan in Leask at page 592 where his Honour said, in effect, the test is wholly objective. One asks what would a hypothetical, reasonable person conclude in the circumstances? That is the first. The second view is that of Justice Dawson in Leask at page 597 where his Honour says mens rea is required. There are two elements of it. There must be knowledge of the reporting requirement. There must be a purpose of evading the reporting requirement and his Honour says that the standard of proof becomes reduced from beyond reasonable doubt to that of a reasonable conclusion. He says that is what those words mean. That is the second view.
The third view is that of Chief Justice Doyle in the South Australian case Question of Law Reserved. The view is summarised in his Honour’s answers to question at page 169. The view is essentially the same as Justice Dawson except that the element of knowledge, as distinct from purpose, his Honour says, has to be proved beyond reasonable doubt. That is the third view. The fourth view is that of Justice Hume in the present case, expressed most succinctly at page 83 of the application book where he accepts Justice Dawson’s and Chief Justice Doyle’s view that there is a reduced standard of proof, but he says that the only mens rea that needs to be proved is the purpose of ensuring that a transaction takes place that would not involve more than $10,000. So his Honour leaves out the purpose of evasion of the reporting requirements.
Now, your Honours, those are the four available views. What was put to the jury your Honours will find at page 53 of the application book and it is none of them. It is put most succinctly, line 41, page 53:
you must determine having regard to the manner and form of the transactions whether you are satisfied beyond reasonable doubt that it would be reasonable to conclude that the accused carried out the transactions in that way –
et cetera. Now, that is an amalgamation. It is a halfway house between the more extreme view of Chief Justice Brennan, on the one hand, and Justice Dawson on the other. What it does not tell the jury is whether they are looking at actual purpose or some objective standard and it does not tell them what standard of proof. It really leaves the jury, in my submission, with any clear direction, the result of which is to deprive the applicant of the chance of acquittal.
KIRBY J: Why do you say it does not refer to the standard of proof. His Honour, at 53, he refers to “satisfied beyond reasonable doubt”.
MR GAGELER: “that it would be reasonable to conclude” – what does that mean?
KIRBY J: Those words are in the statute.
MR GAGELER: Indeed.
KIRBY J: “That it would be reasonable to conclude”.
MR GAGELER: Yes, and those words ‑ ‑ ‑
KIRBY J: They have, no doubt, given rise to these differences of judicial opinion.
MR GAGELER: Indeed. Those are the words of the statute but ‑ ‑ ‑
KIRBY J: In a criminal offence, “commits an offence”, the Parliament has used words which do lend themselves to the suggestion that they are posing a civil standard. I am not saying that that is the majority view. I am not saying that is what the trial judge directed because he used the formula which is comfortable with the criminal standard, “beyond reasonable doubt”.
MR GAGELER: Your Honour, can I say I fully embrace the view of Justice Dawson in Leask. That is, I fully embrace that mens rea is required, that it has two elements: knowledge of the reporting requirement and a purpose of evading reporting requirement, and I fully embrace the proposition that the standard of proof is one of a reasonable conclusion, or to use the words of the statute, “that it would be reasonable to conclude”. Your Honour, the difficulty is that a direction in accordance with Justice Dawson’s reasoning was simply not given to the jury.
HAYNE J: What is the effect of what is said at 34? Does that deal with knowledge?
MR GAGELER: Yes. Your Honour, what happened here was that the offence was broken up into three elements, and I have summarised those. So the element of knowledge was separated from the element of purpose. There is no doubt that what was said about knowledge was not an objective standard. The question was, “What was the knowledge of this accused?”
HAYNE J: Did this man know?
MR GAGELER: That compounds the error when one get to purpose because ‑ ‑ ‑
HAYNE J: Sorry, you will need to explain that to me. I do not follow.
MR GAGELER: Yes. Your Honour, the direction says that the offence has three elements. The second element focuses on the actual subjective knowledge of the accused. There is no doubt about that. That is clearly what the jury was being told at page 34 and elsewhere. The third element does not similarly clearly focus on the actual subjective purpose of the accused. Rather, the jury is given this confusing direction which, in my submission - and this accords with the way it occurred to me when I first read it - leaves one wondering, but with a tendency to think that the judge is really talking about some sort of objective hypothetical standard and not the actual purpose of the accused.
HAYNE J: Can I try to understand what you say the effect of the direction was? One step at 34 was you must be “satisfied beyond reasonable doubt” that the accused had this subjective knowledge of the existence of the reporting conditions, is that right?
MR GAGELER: Correct.
HAYNE J: The third element, 53 and thereabouts, you must be “satisfied beyond reasonable doubt” that the accused conducted the transactions (which by hypothesis you have concluded he knew were the subject of certain conditions) in a “manner and form…..for the sole or dominant purpose”, namely.
MR GAGELER: But your Honour has left out, if I may say so ‑ ‑ ‑
HAYNE J: “It would be reasonable to conclude”.
MR GAGELER: Your Honour has left out that, but your Honour has left out also whether the purpose being referred to there is the actual subjective purpose of the accused whose actual subjective knowledge the jury is told, very clearly, they are required to address, or whether it is, as Chief Justice Brennan would have it, some objective standard of reasonable conclusion.
HAYNE J: But what does the trial judge mean, or more accurately, what would the jury have understood the trial judge to have meant by the references to “sole or dominant purpose”? Whose sole or dominant purpose could be under consideration save that of the accused?
MR GAGELER: Your Honour, it is the accused’s purpose, but the question is, is it the actual subjective purpose of the accused, or is it – I should, perhaps, take your Honour to Chief Justice Brennan’s judgment in Leask where he says - I am looking at page 592 about point 9:
Paragraph (b) requires the relevant transactions to have a particular objective quality, that is, they must exhibit such of the features mentioned in sub-par (b)(i) as would lead a reasonable person to conclude that the offender’s sole or dominant purpose in conducting the transactions was one of those specified in par (b).
A reasonable and, in my submission, the natural construction of what the trial judge was saying to the jury was this, “You have to be satisfied beyond reasonable doubt, by reference to certain factors, that it is reasonable to conclude that the offender’s sole or dominant purpose”, et cetera. Your Honours, there is a difference between an objective standard, even an objective standard that one must prove beyond reasonable doubt, and subjectively asking the jury to look into the mind of the accused. It is that fundamental distinction which is a true distinction between Chief Justice Brennan, on the one hand, and Justice Dawson, on the other, that is just glossed over in this direction. The point your Honour Justice Hayne makes about the second element of knowledge simply highlights a deficiency when the judge came to address the jury on the question of purpose.
KIRBY J: Accepting that there are disparities in this Court in the expression of the way in which the offence should be explained to a jury, did the Court of Criminal Appeal, at least the majority, accept that the proper approach was that which Justice Dawson directed or favoured? We are not hearing here an appeal from Justice Brennan’s view or, if we granted special leave, from the trial judge, it is from the Court of Criminal Appeal.
MR GAGELER: There are two elements in your Honour’s question. One is whether the question of interpretation or construction raised is of sufficient importance to warrant this Court looking at it. The second is, if your Honours decide that against me, is that enough to say that special leave should be refused? My answer to the second is, no, because we have a conviction which, in my submission, was wrongly entered.
But in relation to the first, your Honour, there remain the four views to which I have referred, in the majority judgment of the Court of Criminal Appeal, which was delivered by his Honour Justice Barr, there was an acceptance, not of Justice Dawson’s view, but of Chief Justice Doyle’s view, and my learned friends, in their submission, say that is not the correct view. Even the respondent to the application does not accept that the majority acted upon the correct construction of the provision. What it did, your Honours, was deprive the jury of being able properly to consider the defence ‑ ‑ ‑
KIRBY J: I have not read Chief Justice Doyle’s opinion, but does he not perform an analysis of where the opinions in this Court fell out? Looking at 165 to 168, that appears to be what his Honour is attempting to do.
MR GAGELER: Indeed, that is correct.
KIRBY J: So that, Chief Justice Doyle is simply, as he were, a vector for analysis of the opinions of the Justices in this Court.
MR GAGELER: Well, not entirely ‑ ‑ ‑
KIRBY J: And that is a correct approach for the Court of Criminal Appeal, either of South Australia or New South Wales, to perform.
MR GAGELER: Well, your Honour, he did engage in an analysis of the decisions in Leask. He did, however, come out with a formula which was somewhat different from that which was accepted by Justice Dawson, and that is entirely appropriate for him to do so, but the result is, and I believe this to be common ground, that what Chief Justice Doyle has said does not accord entirely with what Justice Dawson said.
HAYNE J: Then where lies the distinction? If we take Chief Justice Doyle’s statement at the foot of 167 over to the top of 168, where his Honour appears to record what Justice Dawson’s view is, where lies the distinction?
MR GAGELER: His Honour - and this is probably picked up best in the answers to the questions at page 169 at the top - his Honour says that the element of knowledge, which is the third dot point at the top of page 169, the element of knowledge has to be proved beyond reasonable doubt. Do your Honours see that? Then he goes on and says that the next element, the sole or dominant purpose, is one which is to be proved, although on a lower standard of proof.
HAYNE J: This trial judge directed the jury that that last element we have been discussing had to be established beyond reasonable doubt as opposed to add some lesser standard..
MR GAGELER: Yes, but what is element? Is the element the actual subjective purpose? Now, that is not summarised here but his Honour picked up what Justice Dawson said about that which is true mens rea, or is it some objective question as Chief Justice Brennan would have it? That is the critical distinction that the trial judge glossed over and, your Honour ‑ ‑ ‑
HAYNE J: It is that which I have not yet understood from your argument. I am sorry, Mr Gageler, I am just - obviously it is the end of a long, difficult list.
MR GAGELER: Your Honour, I am doing the best I can.
HAYNE J: The fault is mine, I am sure.
MR GAGELER: Your Honour, it is really the question of is this an offence of mens rea? That is the question, and that is the issue that is really just not addressed, indeed, glossed over, indeed, confused by the trial judge’s direction. The view of Justice Dawson, the view of Chief Justice Doyle, was that it is an offence of mens rea and the direction given at page 53 of the application book, particularly in the light of the very clear element of mens rea required in relation to knowledge, that is actual knowledge, leaves the jury at least wondering, at least confused and, in my submission, more likely than not thinking that it really is an objective standard, not a question of mens rea. I think I have said it again, your Honour, but that is the essential point.
KIRBY J: Yes.
MR GAGELER: I see my light is on.
KIRBY J: You still have a few more minutes. It is only the orange light. It is such a pleasure to hear you that if you have anything more to say, we will listen.
MR GAGELER: I will do what I do at traffic lights, your Honour.
HAYNE J: Disobey the red, is that right, Mr Gageler.
MR GAGELER: Never, your Honour, it is only the orange. There is another point, as I mentioned, and that is whether the words “having regard to” are exhaustive. His Honour Justice Hume, who was in dissent, said that those words are exhaustive and, relevantly, for each offence that is alleged, and there were 42 of them in this case, involving two or more transactions, what that means is that one can only take into account the manner and form in which those particular transactions relevant to that offence were conducted. Now, if that is right, then the trial judge gave further directions which were wrong in this case.
That is, he invited the jury, at least by inference as Justice Hume held, to look beyond the particular transactions, the subject of each particular count, and to look at them globally. That was, in my submission, a separate error in his Honour’s directions. I still have not got to the red light, but that will do.
KIRBY J: Yes, Mr Fagan.
MR FAGAN: Your Honours, the distinction that my learned friend seeks to draw between actual knowledge, a question of actual acknowledge or subjective knowledge and purpose on the one hand, and some other objective test, is a distinction that the jury would not have appreciated even existed, let alone been confused into falling on the wrong side of it by this direction. They would well have understood the direction that is given at page 53 over and 54, but what the judge was telling them they had to determine was what it would be reasonable to conclude was the accused’s, the applicant’s, purpose in effecting the transactions the way he did.
They had before them evidence of over 100 transactions which were of just slightly under $10,000, many of them in groups where the applicant had gone to a bank, for example, and bought a bank cheque for just under $10,000 cash, taken that bank cheque and deposited it at another bank together with another amount of just under $10,000 cash. These were the agreed facts ‑ ‑ ‑
KIRBY J: I do not think the case is being put before us on the basis that this is a miscarriage of justice except in the sense of a technical misdirection. If that is demonstrated, that is enough.
MR FAGAN: I understand that, your Honour, but in the context of the facts, taking the summing up as a whole, the way the matter was put to the jury, they would not have appreciated that there existed any alternative view of what his Honour was telling them. But, that they had to determine, according to a standard of proof which he gave them, whether or not the applicant had intended to structure his transactions to avoid this requirement.
HAYNE J: How do you fit that submission against the words of application book 53? I am not saying you can or cannot, but can you just take me slowly through the words and how you say that works?
MR FAGAN: Yes. Well, it goes back to where his Honour listed out in points one to three what it was that were the elements of the offence, and that is at 32 over on to 33 ‑ ‑ ‑
KIRBY J: Was there any general direction on the onus of proof, …..burden or is this the first time that his Honour got to beyond reasonable doubt?
MR FAGAN: I think this is the first time. It was not a case that lent itself to that very well in summing up because there were two different standards of proof that his Honour was putting to them. One of beyond reasonable doubt on the question of knowledge of the reporting transactions, and the other one of a standard which his Honour described as being “satisfied beyond reasonable doubt that it would be reasonable to so conclude”. The Court of Criminal Appeal thought that the jury would have understood that latter as again meaning they had to be satisfied beyond reasonable doubt but it was not a case which lent itself to that familiar direction, that everything has to be proved by the Crown to this high standard and elaboration of it. As to what Justice Hayne asked me, at the top of page 33 in the appeal book, he gave them this element:
that having regard to the manner and form –
and so on –
it would be reasonable to conclude that the accused conducted the transactions in that manner or form for the sole or dominant purpose of ensuring or attempting to ensure that the cash involved in the transactions was transferred in a manner and form that would not give rise to a significant cash transaction.
Now, given that element, and then it is elaborated at 53, he goes back to the third element in the first full paragraph of that page:
Once you have had regard to the manner and form of the non-reportable cash transactions…..you must determine whether you are satisfied beyond reasonable doubt that it would be reasonable to conclude that the accused conducted the transactions…..for the sole or dominant purpose.
Now, that could really only be understood by the jury in the context of a case which involved evidence such as I have referred to and which they were reminded of in the course of this. It could only be understood by them as meaning that they had to decide, according to this standard of proof which he gave them, whether the accused had had this purpose – whether that was his purpose in doing it. That was pointed up by the way in which the applicant explained himself in his statement to the jury. He gave another reason. He said that, in part, he was concerned with security matters and also he had thought that there was some limitation on how much cash he could deposit at one time. So, the whole atmosphere of the trial was of the jury having to decide what had been his purpose. Now, they would not have ‑ ‑ ‑
HAYNE J: The trial judge, at 53, lines 30 and 32, emphasised:
for the sole or dominant purpose, I will repeat that, for the sole or dominant purpose.
How do you say we should read that? How would the jury have understood that?
MR FAGAN: As meaning that they had to decide what had been his, either sole, or his dominant purpose. My learned friend says that the jury could have, or perhaps should have, misunderstood this as meaning that they only had to decide some objective question which did not involve really a determination to any standard – a determination by the jury of what he had had as his purpose behind the way he acted. Now, in my submission, they would not have realised that that alternative possibility was even open. But even if they had, your Honours, I would also submit this, that such an issue would not give rise to any point of principle. The mental element requirements under this section really are accepted as settled after Leask’s decision and this case ‑ ‑ ‑
HAYNE J: I think that might invite the question, “Oh, settled how – in favour of which?”
MR FAGAN: In accordance with Justice Dawson’s judgment, in my submission. It is true that Chief Justice Doyle put one matter a little higher than Justice Dawson had, and that is that it appears Justice Dawson only construed the section as requiring proof to this standard of it being reasonable to infer in respect of knowledge of the reporting requirements, or of the constraints upon the deposits of cash, whereas Chief Justice Doyle thought that was a matter which ought to be proved beyond reasonable doubt.
But that, really, in these sorts of cases, is a very academic difference. It is not one of any practical significance because, as in this case it was appropriate to do, the Crown acquiesced in proving that beyond reasonable doubt, because where one has a series of these transactions, the proof of knowledge of the reporting transactions is really wrapped up in the proof that a purpose was held and it is very difficult for a jury to be satisfied as to a dominant purpose unless it is first satisfied that he knew of the constraints. So, the matter of distinction between Chief Justice Doyle and Justice Dawson is, in my submission, a very academic one. But what is pointed to here by my learned friend is really just an attack on a particular summing up, as not conforming to Justice Dawson’s resolution of the matter.
If the Court were to grant leave and hear this appeal, there would be no contradictor of Justice Dawson’s position on the construction. The Crown accepts it and the applicant accepts it. The Court would only then be involved in construing a particular summing up in a particular case, to see whether it adequately gave effect to what is really a consensual position about the mental element in this offence. It would not make any difference to the outcome of the case.
As to the question of standard of proof which it is said by my learned friend was left in a confusing manner, it is true that there was some potential for misunderstanding in speaking of proving beyond reasonable doubt a matter reasonable to conclude, but as the Court of Criminal Appeal said, that would be understood as meaning the higher standard and, if anything, it was favourable to the applicant. It gave the jury a more stringent standard to meet than simply reasonable to conclude. So again, there is, in my submission, no possibility of ‑ ‑ ‑
KIRBY J: Is that the way the Crown presented the matter at trial?
MR FAGAN: The Crown opposed that direction. The Crown submitted to his Honour that he ought not to speak of “beyond reasonable doubt” in relation to that third element of dominant purpose but ought put the matter to the jury that they should be satisfied that it is reasonable to conclude and leave the standard of proof in that statutory formulation as ‑ ‑ ‑
KIRBY J: But, in fact, the direction given incorporated the “beyond reasonable doubt” and to that extent was more favourable to the accused than the Crown submitted and, therefore, if the issue of the difference is to come before this Court, it ought to come in a case where there was, at trial, a true contest.
MR FAGAN: That is my submission, your Honour, yes. The applicant got the best that he could have had and against the submissions of the Crown there. That is my submission.
KIRBY J: Is this a much prosecuted offence?
MR FAGAN: I know of at least – there is one – no, the answer is no, really.
KIRBY J: The only question is whether, given the disparities of view in the Court, if there were many prosecutions of this kind, that the Court owes it to trial judges to try to clarify the way in which this rather awkward statutory formula should be the subject of directions.
MR FAGAN: Yes.
KIRBY J: Of course, we may disagree again and reflect, with different personal, the same dispute that existed in Leask [No 1].
MR FAGAN: Yes. It is fair to say, I think, your Honour, that it is not a much prosecuted offence. There are not a great number of these offences prosecuted. I am aware of at least one other since this was tried and which is still pending.
HAYNE J: There are usually other and rather larger fish to fry if this kind of transaction has been engaged in. I am not suggesting for a moment that has any application to this case but ‑ ‑ ‑
MR FAGAN: It is usually an ancillary and regulatory sort of offence, and usually if there is such dealing in money, there is something of more significant criminality behind which is generally charged and that is, I think, why, probably, it is not much prosecuted because the indictments are
normally framed with some charge that reflects the real criminality of the underlying activity. Those are my submissions.
KIRBY J: Yes, thank you, Mr Fagan. Anything in reply?
MR GAGELER: Your Honours, obviously, the jury would not have appreciated the difference between mens rea, on the one hand, and objective standard on the other. That is why they have to be properly instructed and it is useful, your Honours, to compare what is said by the trial judge at page 53 of the application book with what Justice Dawson accepted as being the elements that needed to be proved in the offence in Leask at page 597. Now, if your Honours look at Leask, page 597, point 9 – this is the argument accepted by his Honour, over the page, point 9:
Upon this basis the Commonwealth argument was that the sub-section requires proof that the person charged with an offence knew of the nature of a significant cash transaction or of exempt cash transactions and intended by structuring his or her transactions in the manner or form alleged to ensure that they would not give rise to a significant cash transaction or exempt cash transactions.
Knowledge and intention, and his Honour goes on and says:
The only effect of the words “it would be reasonable to conclude” is, the Commonwealth contended, to lower the standard of proof from that of beyond reasonable doubt to that of a reasonable conclusion.
Knowledge, intention, reasonable conclusion, not beyond reasonable doubt. They are the odds. If your Honours look at what is said at page 53.
KIRBY J: His Honour then complains about section 31(1) and where does he go on to say what is the correct ‑ ‑ ‑
MR GAGELER: Page 599, point 1. Your Honours only have to compare that with what is said at page 53 to appreciate the confusion. The confusion is added to in this context by adding in the words “satisfied beyond reasonable doubt” and compounded again ‑ ‑ ‑
HAYNE J: Whose purpose could have been the issue at lines 30 and 32, other than the purpose of the accused?
MR GAGELER: Your Honour, the question is mens rea. Obviously, it is the accused, it is not some third person. It is whether or not it is mens rea, that is the critical issue. Your Honour, it is critical and it, at least, potentially, affected the outcome of the case because in the unsworn
statement at page 15, what the applicant, the accused, was saying was that he was “vaguely aware” of the Act and of some sort of reporting, but that he never intended to avoid the reporting.
KIRBY J: I think you are getting into the facts now ‑ ‑ ‑
MR GAGELER: I am, your Honour.
KIRBY J: And I think that is very dangerous territory for you.
MR GAGELER: Not at all.
KIRBY J: Because he has all these transactions which are just shy of the statutory obligation.
MR GAGELER: That is not in dispute. If it is said that it could have made no difference to the outcome of the case, I say that is wrong, because the applicant, the accused, was saying, really, very specific things about his purpose and different things about his knowledge. One cannot just simply lump the two together.
KIRBY J: Yes. We will go off just for a minute to have the pleasure of a quick study of the Financial Transaction Reports Act. The Court will adjourn for a short moment.
AT 2.32 PM SHORT ADJOURNMENT
UPON RESUMING AT 2.37 PM:
KIRBY J: In this application for special leave to appeal the applicant seeks to secure the consideration by the Court of the Financial Transaction Reports Act 1998 (Cth) s. 31(1)(b). The applicant was convicted at a trial which followed his earlier unsuccessful challenge to the constitutional validity of s. 31(1) of the Act. See Leask v The Commonwealth (1996) 187 CLR 579.
It is true that, in the earlier decision, members of the Court expressed varying views about the requirement of knowledge of, and purpose in, and the standard of proof appropriate to, the offence created by s. 31(1) of the Act. However, at the trial, the case was left to the jury on the basis that the Crown had to prove knowledge of the reporting requirement beyond reasonable doubt and that the jury should be satisfied beyond reasonable doubt that it would be reasonable to conclude that the accused conducted the transactions for the sole or dominant purpose of ensuring, or attempting to ensure, that the cash was transferred in the manner and form that would not give rise to a transaction caught by the Act. Read in the context, this could only refer to the accused’s sole or dominant purpose. The direction does not reveal the error of which complaint was made in this application.
Accordingly, the application does not afford a suitable vehicle to elucidate the differences of opinion in the earlier decision. Nor is the Court convinced that there was a miscarriage of justice in this case. Special leave is therefore refused.
The Court will now adjourn to reconstitute for the remaining matter.
AT 2.39 PM THE MATTER WAS CONCLUDED
Key Legal Topics
Areas of Law
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Criminal Law
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Evidence
Legal Concepts
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Charge
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Sentencing
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Appeal
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