Leiah v Tasmania
[2013] TASSC 8
•8 March 2013
[2013] TASSC 8
COURT: SUPREME COURT OF TASMANIA
CITATION: Leiah v Tasmania [2013] TASSC 8
PARTIES: LEIAH PTY LTD
v
STATE OF TASMANIA
FILE NO/S: 253/1995
DELIVERED ON: 8 March 2013
DELIVERED AT: Hobart
HEARING DATE: 6 February 2012
JUDGMENT OF: Wood J
CATCHWORDS:
Primary Industry – Fish – Forfeiture – Vessels – Claim arising from detention of vessel following seizure – Whether lessee "the owner" for the purposes of disputing forfeiture – Meaning of the term "the owner" – Whether s61(1) is subordinate to s59(2).
Fisheries Act 1959 (Tas), ss58, 59, 61 and 62.
Cole v Esanda Ltd [1982] Tas R 130; Cheatley v R (1972) 127 CLR 291; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384, referred to.
Aust Dig Primary Industry [1135]
REPRESENTATION:
Counsel:
Applicant: K E Read SC
Respondent: T J Ellis SC
Solicitors:
Applicant: Ben Lillas
Respondent: Director of Public Prosecutions
Judgment Number: [2013] TASSC 8
Number of paragraphs: 113
Serial No 8/2013
File No 253/1995
LEIAH PTY LTD v STATE OF TASMANIA
REASONS FOR JUDGMENT WOOD J
8 March 2013
On 15 January 1995, in Tasmanian waters in Bass Strait, Tasmania Police seized a vessel that was being used for taking abalone and crayfish unlawfully. The vessel has been in the possession and control of the defendant ever since. By legal proceedings commenced by writ, the plaintiff claims that the detention of the vessel is unlawful. The plaintiff seeks a declaration that it is entitled to possession and to have the vessel returned to it, and also damages for the unlawful detention of the vessel.
The defendant resists the claim on the basis that convictions for offences committed contrary to the Fisheries Act 1959 ("the Act") and the Sea Fisheries Regulations 1962 ("the Regulations") take effect as a condemnation of the vessel by virtue of s61 of the Act. There are issues as to whether this provision has application, and as to the interpretation of various provisions in the Act as well as the scheme of the Act with respect to seizure, forfeiture and condemnation.
The facts relevant to the issues that fall for consideration are not contentious. The vessel, "Take that Back", is a sea-going 10 metre fibreglass "Devil Cat". At least until two days prior to seizure of the vessel it was the property of the plaintiff. The plaintiff had owned it free of any encumbrances. One of the questions that arises is whether, at the date of seizure of the vessel, the plaintiff company qualifies as "the owner" for the purpose of the Act.
On 13 January 1995, the plaintiff sold the vessel to the State Bank of New South Wales and leased it back. The vessel was the subject of an agreement entitled "Sale and Purchase Agreement" and also a deed of lease between the plaintiff and the State Bank of New South Wales, both dated 13 January 1995. The plaintiff was lessee and bailee of the vessel at the time of seizure.
At all material times the vessel was registered pursuant to the Marine Act 1998 (Vic) in the name of the plaintiff.
The facts surrounding the seizure of the vessel are also not contentious. On 15 January 1995 police officers located the vessel at anchor in a bay on the western side of Hunter Island. Hunter Island lies off the north-west tip of Tasmania. At that time, the vessel was unoccupied. It was designed to be used and being used as a base vessel for fishing purposes; a punt used by the crew diving for abalone could be driven straight onto the deck of the vessel. Police officers located the punt approximately half a kilometre to the south of the vessel. In the punt were two men, David Strachan and Robert Kelly. As the police boat approached, Mr Strachan, who had been diving for abalone, threw overboard two bags containing a quantity of abalone. The abalone were recovered, and amounted to a total of 345. Of the 91 that remained in the shell, 72 of those were undersize. Of the 254 that had been removed from the shell, 32 were less than the minimum permissible weight. On the deck of the vessel police located two large male crayfish in a sugar bag. Mr Strachan admitted taking them that morning. The two men were not licensed or authorised to take abalone or crayfish.
Mr Strachan told one of the police officers, Sergeant Steven Collidge, that he had built the vessel at Margate, and that he owned the vessel. It was not revealed that the State Bank of New South Wales had recently purchased the vessel.
On the same day, Sergeant Collidge seized the vessel, punt, and diving equipment at Stanley Wharf.
There is no question that the vessel was used by its crew for the taking of fish within the jurisdiction of the State contrary to the provisions of the Act and the Regulations. Mr Strachan was part of the crew and he had taken abalone and crayfish contrary to the provisions of the Act and the Regulations.
Section 58 provides:
"58-A boat the crew of which, or any part of the crew of which, is found –
(a) fishing or taking fish; or
(b) preparing to fish or take fish,
or is proved to have been fishing or taking fish anywhere within the jurisdiction of the State contrary to the provisions of this Act, and a boat on board of which any fish unlawfully taken, or any part thereof, or any engine or apparatus for fishing, the use of which is prohibited by this Act, is found, together with all other boats, if any, connected or used therewith, and the tackle, rigging, furniture, stores, and appurtenances, engines, nets, and other apparatus, belonging thereto or being therein, are, by force of this section, forfeited to and are the property of the controlling body constituted under the Part under or in relation to which the contravention occurs."
There is no question about the fact that by force of s58 the vessel was forfeited to and became the property of the controlling body. An issue is whether the vessel, having been forfeited and seized, has been condemned by the application of the Act. Sections 59 and 61 make provision for condemnation. Section 59 provides:
"59-(1) Where a boat or article has been seized under this Act as forfeited, and no proceedings have been taken within 14 days after the seizure against any person for the offence in respect of which the forfeiture was incurred, the officer by whom the boat or article has been seized shall, forthwith after the expiration of that 14 days, give notice in writing of the seizure to the owner of the boat or article, by delivering the notice to him, either personally or by post.
(2) The boat or article seized shall be deemed to be condemned, and may be sold or otherwise disposed of by the relevant controlling body, unless the owner, within one month from the date of the seizure, gives notice in writing to that body that he disputes the forfeiture, whereupon proceedings shall be taken against the owner for the forfeiture and condemnation of the boat or article.
(3) Where the owner of the boat or article was present at the seizure, or is not known, or is not in the State, notice under subsection (1) is not necessary."
Section 61 provides:
"61-(1) When the commission of any offence against this Act involves a forfeiture of a boat or article, the conviction of a person for the offence takes effect as a condemnation of the boat or article, without any complaint laid for the condemnation.
(2) When a complaint has been laid against a person for the forfeiture of a boat or article seized under this Act, the justices, upon the appearance of the defendant or upon proof of service of the summons if he fails to appear, may proceed to the examination of the matter, and on proof that the boat or article is liable to forfeiture may condemn it.
(3) Condemnation under this Act of a boat or article by justices, or as the result of a conviction by justices, may be proved in any court or before any competent tribunal by production of a certificate of the condemnation purporting to be signed by the justices, or an examined copy of the record of the condemnation certified by the clerk of petty sessions."
Further facts relevant to the application of these provisions are as follows. At all material times the State Bank of New South Wales Ltd had its registered office in Sydney and operated no branches in Tasmania. Counsel for the plaintiff wrote to the Minister for Primary Industry and Fisheries on 7 February 1995 giving notice that it disputed the forfeiture. The notice was within the timeframe of one month stipulated in s59(2) of the Act. If the plaintiff qualifies as the owner, the correspondence amounts to notice disputing forfeiture for the purpose of that section. There was a subsequent demand by the plaintiff for the return of the vessel. The Minister for Primary Industry and Fisheries responded by letter dated 10 February 1995, relying on the pending prosecutions regarding the incident which would result in examination of the lawfulness of the seizure.
The crew, David Strachan and Robert Kelly, were charged on complaint made on 10 July 1995 with offences committed on 15 January 1995. On 12 March 1997 they were convicted in the Hobart Magistrates Court of various offences contrary to the Act and the Regulations:
· obstructing an officer contrary to the Act, s24(1)(d),
· take undersize abalone contrary to the Regulations, reg31A(2),
· possess underweight abalone contrary to the Regulations, reg44(1)(z),
· have in possession more than 20 abalone contrary to the Regulations, reg44(1)(oc),
· possess on a boat abalone being detached from the shell contrary to the Regulations, reg44(1)(s), and
· take crayfish without a non-commercial licence contrary to the Regulations, reg17B(1)(a).
An appeal to the Supreme Court did not result in the convictions being disturbed.
A letter was written on behalf of the State Bank of New South Wales as owner of the vessel to his Excellency the Governor for the State of Tasmania seeking the grant of relief under s62(1) of the Act. That provision provides that
"62-(1) The Governor may –
(a)direct the restoration to the owner thereof of any boat or other article seized under this Act, whether or not condemnation thereof has been ordered; and
(b)grant relief from the whole or any part of any penalty imposed under this Act,
Upon such terms and conditions, if any, as the Governor may think fit.
…"
In the letter it was said that the Bank was as an innocent party, that it had no knowledge that the vessel was being used for illegal fishing, and that the Bank had purchased the vessel only two days before it was seized.
No proceedings have been taken pursuant to the Act s59(2), with respect to forfeiture and condemnation of the vessel.
An injunction was granted on 15 September 1999 restraining the defendant from selling, transferring, or disposing of the vessel until the determination of the action. An undertaking was given by the plaintiff that it would pay to the defendant any damages which the defendant may sustain by reason of the injunction which the Court may think the plaintiff ought to pay. There is a counterclaim for damages arising from the plaintiff's undertaking. It is agreed that the defendant has incurred costs for storage of the vessel as a result of the injunction.
The vessel has remained in the possession of the defendant. It seems the proceedings were not progressed until an amended statement of claim and defence were filed in 2012, shortly before trial.
The contentions
The submissions for the plaintiff focussed on the interpretation of s59(2) of the Act, contending that, as the procedure had not been followed by the controlling body, the possession and detention of the vessel was unlawful. Despite the fact that a notice of dispute had been given by the plaintiff pursuant to that provision, and notwithstanding the requirement to thereupon take proceedings for forfeiture and condemnation, that was not done.
Section 59(2) was triggered by the plaintiff as "the owner" giving notice. The submission hinged on the proposition that the plaintiff, as lessee of the vessel, qualifies as "the owner". It was submitted that the phrase has a meaning which is not confined to the true owner.
Principles of statutory construction were relied upon: as the Act is a penal statute the words "the owner" should be given a wide meaning, and Parliament should not be taken to deprive a person of an existing property right unless it expresses its intention in clear and unmistakable language. Various cases were relied upon which have expansively interpreted the word "owner" in legislation such as the Customs Act 1901 (Cth), the Merchant Shipping Act 1894 (Imp), and the Admiralty Act 1988 (Cth).
It was submitted that a lessee falls within the term "the owner" having regard to general concepts of bailment and the nature of a bailee's interest.
Section 59(2) provides owners with the opportunity to contest forfeiture and the vesting of title in the Crown. Because proceedings have not been taken, the plaintiff has been deprived of the opportunity to present a case with respect to forfeiture and condemnation. As the procedure provided for in s59 has not been followed by the defendant, the right of the defendant to commence proceedings for condemnation is lost and the continued possession and detention of the vessel is unlawful.
While condemnation can be effected by s61(1), in the case of convictions for offences, that procedure must be read as subject to the procedure set out in s59(2). Therefore, in cases where the owner has given notice of dispute, the seized boat or articles cannot be condemned except by proceedings taken against the owner for forfeiture and condemnation. Authority for the proposition that the operation of s61(1) is subordinate to s59(2) proceedings is Cole v Esanda Ltd [1982] Tas R 130.
The defendant's submissions are that s59(2) does not have application to this case as the plaintiff did not give notice in accordance with the section as "the owner". The obligation to commence proceedings against the plaintiff did not arise as it was not the owner. Only the Bank would qualify as the owner and it did not give notice pursuant to that provision.
The term "the owner" in s59(2) has a narrow meaning, limited to the true owner. Such a meaning accords with the ordinary meaning of the word, and promotes the object of the statute to protect fishing grounds from exploitation.
Even if the plaintiff was the owner for the purpose of s59(2), all that might arise is an obligation on the part of the controlling authority to institute proceedings for forfeiture and condemnation. A failure to carry out that obligation might, at most, sound in damages, assuming the true owner is thereby deprived of a legitimate opportunity to contest the forfeiture of the property.
In any event, s61(1) applies. The vessel is condemned because convictions have resulted. Sections 59(2) and 61(1) provide concurrent pathways to condemnation and the remarks of Green CJ in Cole v Esanda Ltd are obiter and should not be followed.
Forfeiture occurred at the time the offences were committed. Condemnation is merely a formal proceeding against the true owner.
If the controlling body chooses not to take proceedings under s59(2) then it runs the risk that the condemnation, as against the true owner, might not be perfected.
There is a further contention for the plaintiff relevant to remedy which will need to be decided if the plaintiff's claim succeeds. The term of the lease concluded on 13 February 1999 and the plaintiff asserts that it then once again became the owner of the vessel. The defendant argues that ownership and entitlement to possession on termination of the lease are not supported by the terms of the deed of sale and the lease.
It is conceded by the plaintiff that if its claim does not succeed and it is not entitled to possession, and has not been entitled to possession of the vessel since it was seized, then the counterclaim succeeds. The parties agree that in this event damages are to be assessed at a later stage.
Three main issues
There is no issue that the vessel was lawfully forfeited to the Minister by virtue of the commission of offences, s58. There is no issue that convictions for offences involving a forfeiture of the vessel have resulted, s61. It is not contentious that the controlling body, for the purpose of s59(2), is the Minister for Sea Fisheries, and correctly so. Section 59(2) states "the controlling body constituted under the Part under or in relation to which the contravention occurs". In this case the contraventions were under the Regulations and s24(1)(d) of the Act. Section 24(1)(d) falls within PtII of the Act. The Regulations were made pursuant to that Part.
There are three main issues arising for determination. In relation to the claim that the possession of the vessel was unlawful, an issue arises as to whether the plaintiff gave notice as "the owner" for the purpose of s59(2). Put simply, whether as a lessee, the plaintiff may qualify as "the owner" for the purpose of that provision.
If the plaintiff is "the owner" and the Minister's obligation to commence proceedings for forfeiture and condemnation was enlivened by the issuing of a notice, what is the consequence of proceedings not being brought? Is the continued possession and detention of the vessel thereby unlawful?
A further issue arises if the plaintiff is "the owner" and if s59(2) was enlivened by the plaintiff giving notice. That is, whether s61 may apply resulting in condemnation of the vessel, or whether its operation is subject to s59(2). This issue gives rise to consideration of the remarks of Green CJ in Cole v Esanda Ltd.
Discussion
Before proceeding to an analysis of the provisions and the effect of s59(2), the term "the owner" and the operation of s61(1) of the Act, I will consider the well settled principles of statutory interpretation to be applied in undertaking that task. The principles are referred to in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, at [69] - [71] and [78], Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27, per Hayne, Heydon, Crennan and Kiefel JJ at [47]; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408.
The guiding considerations are the text used, and its context, including the general purpose and policy of the legislation, and particularly the mischief it is seeking to remedy. The assistance provided by context does not just arise at some later stage of the analysis in the event of ambiguity.
As stated by Brennan CJ, Dawson, Toohey and Gummow JJ in CIC Insurance Ltd at 408, "instances of general words in a statute being so constrained by their context are numerous". Such words may "wear a very different appearance" when "read in light of the mischief which the statute was designed to overcome and of the objects of the legislation".
Further, the consequences of the competing interpretations and inconvenience or improbability of the result of those interpretations may assist the court in determining the legislative intent.
It is necessary to prefer a construction that would promote the purpose or object of the Act, to one that does not, Acts Interpretation Act 1931, s8A.
The courts do not impute to the legislature an intention to interfere with fundamental rights such as property rights, in the absence of unmistakable and unambiguous language to do so: Coco v R (1994) 179 CLR 427 at 437 per Mason CJ, Brennan, Gaudron and McHugh JJ. Forfeiture provisions are construed as taking away property rights: Tran v Commonwealth (2010) 187 FCR 54 at 76.
In arguing for an expansive construction of "the owner" the plaintiff relies heavily on a principle of statutory interpretation whereby any ambiguity in a penal provision, and a forfeiture provision constitutes a penalty, should be resolved by adopting an interpretation favourable to the defendant rather than the Crown: Jeffrey v DPP (Cth) (1995) 121 FLR 16 at 19 per Cole JA citing Tuck & Sons v Priester (1987) 19 QBD 629 at 638 per Lord Esher MR. By construing the expression "the owner" widely, some relief is provided against the punitive nature of the forfeiture provisions. A wide construction extends relief to third parties, noting the prospect that they may be innocent of wrongdoing.
However, the principle does not operate in the way submitted, so that any ambiguity in a penalty provision must necessarily be resolved in favour of defendants. Statutes containing penal provisions are to be construed by application of the same settled principles of construction as other statutes. In Beckwith v R (1976) 135 CLR 569 at 576 Gibbs J stated:
"The rule formerly accepted, that statutes creating offences are to be strictly construed, has lost much of its importance in modern times. In determining the meaning of a penal statute the ordinary rules of construction must be applied, but if the language of the statute remains ambiguous or doubtful the ambiguity or doubt may be resolved in favour of the subject by refusing to extend the category of criminal offences: see R v Adams; Craies on Statute Law, 7th ed (1971), pp 529-534. The rule is perhaps one of last resort."
Likewise, in Waugh v Kippen (1986) 160 CLR 156, at 164 - 165, Gibbs CJ, Mason, Wilson and Dawson JJ stated that the court's primary task is that of "extracting the intention of the legislature from the fair meaning of words by which it has expressed that intention". The statutory context is the guiding consideration, not a characterisation of a provision as creating an offence or penalty. The penal nature of a provision remains a relevant consideration but merely as an aspect of the nature and purpose of the statute: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue per Hayne, Heydon, Crennan and Kiefel JJ at [55] - [57].
In ascertaining the meaning of the term "the owner" in s59 of the Act, I have given consideration to the text and what can be gleaned from the Act with regard to the specific provision, and also generally having regard to the use of the term elsewhere in the Act.
The phrase "the owner" in s59 is not defined in the Act. I do not regard the use of the definite article as indicative that Parliament intended "the owner" to mean owner in the singular sense and thus the true owner. The singular shall include the plural: Acts Interpretation Act, s24(d). Also, Blue Metal Industries Ltd v Dilley (1969) 117 CLR 651 at 656 and Commissioner of State Revenue v Muir Electrical Co Pty Ltd (2003) 8 VR 200 at 206 - 207. Noting that it is not uncommon for vessels to have joint owners, in the conventional sense, indicates that "the" should be read as "an owner". A sensible reading of the section would be to regard "the owner" as meaning a number of owners or any one or more of them. I return to the key issue, the meaning of "owner".
The use of the phrase as it appears in other sections in the Act does not provide a sound indication as to whether a wide or narrow meaning was intended by Parliament. The phrase appears in s62, which enables the Governor to grant relief by directing the restoration to the owner of a vessel or articles that have been seized even if a condemnation order has been made. The word "restoration" is apposite in the context of restoring title of the article or vessel to the true owner, but arguably it may also include the mere return of possession. This kind of last resort reprieve, arising at condemnation stage which is likely to lead to the sale or disposal of the item, would seem intended to ameliorate hardship to the true owner, in the conventional sense, rather than encompassing those with a lesser interest. Arguably, the use of the expression "the owner" in this context is an indication of a narrow meaning. However, I consider that all that can be concluded with confidence is that the expression "the owner" means whatever it means in s59(2) of the Act.
Before exploring the statutory context, it is worthwhile to begin a consideration of the meaning of the phrase "the owner" by considering what it means outside the Act. While it cannot be readily defined in the abstract it can be said to have an ordinary meaning: "The notion of ownership … carries a connotation of dominance, ultimate control and of ultimate title against the whole world": Kent v SS "Maria Luisa" (No 2) (2003) 130 FCR 12 at [61] – [62], referring to O W Holmes, The Common Law (1982) 242 - 246; Blackstone’s Commentaries (18th ed, 1829) Vol 2, 389; and Holdsworth, A History of English Law (1925) Vol VII 449. See also Brisbane Slipways Operations Pty Ltd v Pantaloni [2010] FCA 654 at [63] – [67]: "Ownership, usually involves something greater than beneficial interest". In Kent there was reference at [65] to a description of ownership formulated by Jordan CJ in Gatward v Alley (1940) 40 SR (NSW) 174 at 174 with respect to ownership of a car, which was regarded as helpful in a general sense:
"A good title to property, in the sense of such ownership as the law allows, consists in having the legal right to exercise with respect to it all such rights, as against all such persons, as by law are capable of being exercised with respect to property of the class in question. A person who has possession of property but not ownership has, as a general rule, the same legal rights as the owner, save to the extent to which those rights are qualified as against the owner ...".
An aspect of the plaintiff's submission is that as bailee, his interest was sufficient to amount to ownership for the purpose of the Act.
The question in this case is whether the plaintiff's interest as bailee amounts to ownership, or whether the phrase "the owner" is used in its proprietary sense, as belonging to the relevant person. The plaintiff's submissions emphasised that as a bailee the plaintiff has possession and possession gives title against a wrongdoer. Significantly, this means absolute and complete ownership as between bailee and stranger: The Winkfield [1902] PD 42 at 60; and, N E Palmer, Bailment (2nd Ed, 1991) at 114. An incident of bailment is that a bailee may assert his interest against all the world except for the rightful owner.
While it is acknowledged by the plaintiff that the ordinary meaning of ownership would not extend to a bailee, it is argued for the plaintiff that it is evident that the Act intended an extended meaning of "the owner" to apply, at least to the extent that it extends to the plaintiff as bailee.
Having noted the ordinary notion of ownership, the meaning of the term "the owner" in the Act is to be derived from the statutory context. Does the phrase "the owner" in the Act have a wider meaning than the ordinary meaning and extend to the plaintiff as the bailee?
In some legislation the phrase "the owner" is expansively defined. The plaintiff relied on cases which considered a wide definition of the phrase in customs legislation and the Merchant Shipping Act 1894.
In Willey v Synan (1935) 54 CLR 175, the Customs Department took possession of some silver coins on board a ship traveling from New Zealand to Australia. A crew member of the ship made a claim for them under the Customs Act (1901), alleging he had found them on the ship. The definition of "owner", s4, in part included any person having possession of, or beneficially interested in, or having any control of, the goods. In a passage relied upon by the plaintiff, it was accepted by Dixon J, at 182, that the word "owner" in a provision concerned with condemnation included "not only the person entitled to the property in goods against all the world, but also a person entitled to the possession, use and enjoyment of goods except as against the true owner". Given the definition of "owner" in the legislation that was applied to the provision in question, that approach is unsurprising.[1] It does not advance the enquiry here, given the absence of a definition in the Act.
[1] It has since been held that the wide meaning should not be applied to that provision and noted that the remarks of Dixon J were obiter: Whim Creek Consolidated NL v Colgan (1991) 31 FCR 469.
In Scott v James Patrick & Co Pty Ltd (1968) 117 CLR 242, consideration was given to the meaning of "owner" in the same Act. In question was whether an agent qualified as the owner so that it would be liable to a penalty under the Act. In the course of considering this question Windeyer J noted, at 248, that the description comprehends a charterer by demise of the ship. The outcome was in accordance with the practice in the United States of "calling a charterer having full possession and control of the ship the 'owner pro hac vice'". The conclusion reached, that a charterer may qualify as an owner, turned on the definition of the word in that Act.
The case of McIlraith McEacharn Ltd v Shell Co of Australia Ltd (1945) 70 CLR 175 differed in that it was not concerned with a definition of the word expressed in wide terms. The High Court considered the meaning of "owner" in s503 of the Merchant Shipping Act 1894 (Imp) and s1 of the Merchant Shipping (Liability of Shipowners) Act 1898 (Imp). Applying a decision of the House of Lords in Sir John Jackson Ltd v The Owners of the SS Blanche [1908] AC 126, at 215 it was held that the word in s503 of the 1894 Act and s1 of the 1898 Act "includes a person who has immediate and exclusive possession of a ship either indefinitely or for a term and has the responsibility of its control and management by himself and his servants". In Blanche, the speech of Lord Loreburn LC at 130 - 131, with whom Lord MacNaughten, Lord Robertson and Lord Atkinson agreed, found little assistance in the terms of the statute under consideration, as in some parts the word "owner" included charterers by demise and in others did not. The proper meaning of "owner" in the particular section was determined by reference to the object of the section itself, and the mischief against which the section was intended to provide.
These cases illustrate the obvious proposition that the meaning the word "owner" depends on the particular statutory context. For discussion on this point, see: Brisbane Slipways Operations Pty Ltd v Pantaloni (supra) at [63] - [67], Tisand Pty Ltd v Owners of Ship MV "Cape Moreton" (Ex "Freya") (2005) 143 FCR 43 at [118] to [121].
The plaintiff relied on the fact that the vessel, at the relevant time, was registered in its name pursuant to the Marine Act 1988 (Vic). An extremely broad definition of "owner" is provided for in that Act relevant to the registration of vessels and other purposes such as the efficient and safe operation of vessels. That definition has not been adopted in the Act. It is unnecessary to point out that the name in which the vessel is registered pursuant to unrelated legislation does not assist in the task of construing the Act.
As noted, the phrase "the owner" has not been defined. It has not been given a wider meaning in the Act than the ordinary meaning. I turn to consider whether the statutory context suggests it should have a wider meaning. In considering the statutory context, I have regard to the operation of the scheme, the general purpose and policy behind it, the mischief it is seeking to remedy and consequences of competing interpretations.
The operation of the scheme with respect to forfeiture, seizure, and condemnation requires consideration of a number of provisions of the Act. Central to the legislative scheme is that property involved in the commission of offences, as specified in the Act, is forfeited by force of statute, and it is then the property of the controlling body: ss57 and 58. Except as otherwise provided in the Act, all articles forfeited or liable to be sold under the Act become the property of the controlling body, and may be sold or disposed of in such manner as that body may direct: s63.
In legal proceedings in respect of a seizure under the Act, the onus of proving it was illegal or that it was not lawfully authorized, lies upon the person so alleging: s64(2).
Forfeiture of property results from the commission of offences and the use of property in connection with such offences, s59, or conviction for offences involving forfeited property, s61(1).
If property is seized as forfeited, and no proceedings for the offence have been taken within 14 days of seizure, the owner may give notice that he disputes forfeiture and thereupon proceedings for forfeiture and condemnation are to commence, s59(2). If no such notice is issued by the owner, condemnation of the property is deemed to occur, s59(2).
The owner must be given notice in writing of the seizure if proceedings have not been taken within 14 days of the seizure against any person for the offence which incurred the seizure, s59(1). The requirement to give notice to the owner is dispensed with in the circumstances referred to in s59(3), if the owner was present at the seizure, or is not known, or is not in the State.
It is evident that even though there has been forfeiture by force of a statutory provision, where a prosecution is not promptly commenced, there is an opportunity to dispute forfeiture in proceedings initiated by a complaint for forfeiture and condemnation, s61(2). Once those proceedings for forfeiture and condemnation are commenced, the matter is examined by the court. The question for determination is set out in s61(2) which provides that upon proceeding to an examination of the matter, the justices may condemn the boat or article on proof that it is liable to forfeiture.
To ascertain whether the vessel is liable to forfeiture takes the court to the statutory provisions which cause property to be forfeited: ss57 and 58 of the Act. As mentioned, liability turns on whether there has been an offence incurring forfeiture.
In Cole v Esanda Ltd, consideration was given to the word "may" in s61(2), and whether the court had a discretion so that it may decline to condemn property, notwithstanding proof that the property was liable to forfeiture. His Honour referred to the purpose of the Act, the nature of the power it confers, and the context as revealing that "may" does not give discretion but confers authority. It was determined that once it is established that the vessel or article is liable to forfeiture, then the court has no discretion and it must be condemned.
The correctness of Cole v Esanda Ltd as to the absence of discretion is not in question. In the course of reaching that conclusion, Green CJ considered the apparent harshness of the operation of the provisions which follows if there is no consideration to be given to the merits of the case. His Honour cautioned that courts must recognise the intention of Parliament, notwithstanding the harsh consequences:
"A court must not allow its natural disinclination to adopt a construction of legislation which could result in an innocent owner losing his property through no fault of his own to frustrate the intention of Parliament. It may be that Parliament has decided that wider considerations of public policy should prevail over the interests of particular individuals."
Green CJ referred by way of example of that intention to Cheatley v R (1972) 127 CLR 291 in which the High Court held that a magistrate was empowered to order the forfeiture of a boat used for the commission of an offence, even though the owner was innocent, and the owner had not been given an opportunity of being heard. Specific reference was made to the judgment of Menzies J at 305 and 306 who stated that to decide that "an owner in proceedings against others must have the opportunity of being heard before an order is made for the forfeiture of his ship would be to impose an unexpressed limitation upon the statute".
As a consequence of the statutory scheme, there is no judicial discretion to decline to condemn property in the face of hardship to the owner, lack of complicity or knowledge of offending, or in the event of mitigating circumstances. If the boat or equipment is liable to forfeiture by virtue of ss57 or 58, then condemnation is the necessary outcome. Indeed, the only issue for determination is whether the vessel or article is liable for forfeiture. This means that if the vessel has been used for unlawfully taking fish, or connected or used therewith, the vessel is forfeited and condemned.
Illustrative of the application of this scheme, is that if proceedings had been issued against the plaintiff in this case, and if the Court had accepted the plaintiff's argument that it was the owner of the vessel and determined the proceedings, the Court would necessarily conclude that there was no valid challenge that could be brought by the plaintiff. The conceded facts of this case are that the vessel was liable to forfeiture. Condemnation of the vessel was inevitable.
There is provision for the Governor to grant relief to owners with respect to seized and condemned articles as well as with respect to penalties: s62.
It is clear that the scheme under the Act is inflexible and punitive. Owners are to be the subject of harsh consequences. The opportunity that they have to contest forfeiture and condemnation, and bring proceedings pursuant to s59(2), arises in limited circumstances, where proceedings for an offence are not commenced within 14 days. The hearing is confined to a narrow issue which takes no account of lack of fault or knowledge by the owner. The scheme gives priority to the State's convenience, and can be described as pragmatic. For example, the owner's opportunity to dispute forfeiture will be nullified by dispensing with a notice to the owner of seizure if the owner cannot be found or is not in the State.
It was argued on behalf of the plaintiff that the purpose of s59(2) is to give all relevant third parties an opportunity to be heard. This argument presupposes that proceedings pursuant to s59(2) for forfeiture and condemnation provide an opportunity to be heard, which is lost if s59(2) does not apply. The reality is that even if the opportunity is available, the proceedings could not yield an outcome taking account of the merits of the case.
It has been noted that typically in legislation of this kind, there are two classes of statutory forfeiture, one dependent on conviction and the other on unlawful conduct, International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at [26]. Likewise, here the Act provides for two pathways to condemnation, one dependent on conviction and the other on the commission of offences. Either way, there is a nexus between offending and forfeiture. It seems obvious that Parliament intended that the commission of offences should necessarily result in the condemnation of property involved in offending. Essentially, the two pathways provide a different mechanism for achieving that result.
That the scheme is a blunt instrument which Parliament anticipated would result in harsh consequences, despite mitigating circumstances, is evidenced by the provision enabling the Governor to grant relief from seizure and condemnation: s62.
The nature of the statutory scheme, with forfeiture resulting from the commission of offences and occurring even when the owner of the goods is not a party to the offending, is commonplace in customs and fisheries legislation. In the context of fisheries legislation, the harsh consequences of forfeiture are warranted by the need for a stern deterrent to protect a valuable resource, being "an area where pecuniary penalties are unlikely to provide an adequate protection": Cheatley v R (supra), per Barwick CJ at 296. Speaking of forfeiture provisions generally, including fisheries, customs and firearms legislation, justifications for prescribing forfeiture as the consequence of offences committed by persons other than the owner, include the nature of the goods, the need for a deterrent penalty, or the difficulty of enforcement against foreign owners: Cheatley, per Mason J at 310.
The forfeiture of things by reason of the fact that they are the means by which offences have been committed has an historical foundation and modern justification. It has its roots in the law of deodands, while modern statutes providing for "forfeiture of property owned by an innocent person are justified on the footing that the liability to forfeiture enlists the owner's participation in ensuring the observance of the law and precludes the future use of the thing forfeited in the commission of crime": Re Director of Public Prosecutions: Ex Parte Lawler (1993) 179 CLR 270, per Brennan J at 279.
The nature of the legislative scheme and the mischief the Act is designed to address is consistent with a narrow approach to the meaning of "owner", and consistent with an intention to restrict the class of people or bodies who may dispute forfeiture.
A relevant matter to observe in considering the scheme and the policy underpinning the provisions is that the Act, in certain key respects, follows a familiar statutory model with respect to forfeiture and condemnation. Further, the meaning of these concepts in other statutory contexts is well established.
Typically, whether or not a particular item of property is forfeit depends on how it was used. It turns on whether the property itself was used in the commission of an offence, not on who owned it or the existence of other interests in the property: Equal Enterprise Ltd v Attorney-General [1995] 3 NZLR 293 at 297.
The case of Bert Needham Automotive Co Pty Ltd v Commissioner of Taxation (Cth) (1975) 26 FLR 108 was concerned with the Customs Act 1901. Rath J considered the scheme of the Act and noted at 113, that forfeiture results from the commission of an offence. Rath J considered the effect and meaning of forfeiture. Having regard to other decisions on customs legislation in England and Australia, it was noted by his Honour at 114, that an incident of forfeiture is that title passes to the Crown immediately upon a cause of forfeiture arising, without either seizure or condemnation: The Annandale (1877) 2 PD 218 at 220 and Burton v Honan (1952) 86 CLR 169 at 178 - 179.
In Burton v Honan (supra) it was held that under the Customs Act 1901 - 1950 , title to the goods vests in the Crown when forfeiture takes place. Dixon CJ, with whom McTiernan, Webb and Kitto JJ agreed, stated at 176: "no further proceedings are requisite to make title, although of course further proceedings may be necessary either to vindicate the title of the Crown or to exclude the claim of some person asserting a right to the goods". This meant that forfeited goods may be seized by Customs even though they have passed into the hands of a bona-fide purchaser for value, the innocent purchaser was deprived of title to the vehicle and could not contest forfeiture, at 182.
In Bert Needham, Rath J concluded he was bound by The Annandale and Burton v Honan to hold that by the commission of an offence and forfeiture, the change of ownership occurs. The reasoning rested on the terms "forfeiture", "seizure" and "condemnation" which are not defined in the legislation but which are well-known terms in customs legislation. His Honour stated at 114: "The term 'condemnation' refers not to a proceeding which has the effect of vesting title in the Crown, but to a proceeding which determines that upon some cause previously arising title had vested in the Crown …".
In Olbers Co Ltd v Commonwealth (2005) 143 FCR 449, consideration was given to the scheme under the Fisheries Management Act 1991 (Cth), s106A. It was held that it operated to automatically forfeit foreign boats to the Commonwealth upon the commission of the relevant offences. It was argued that forfeiture should be understood as not transferring title to the Commonwealth unless and until the thing is "condemned as forfeited". This would mean that property did not pass as at the date of the offence, and in the event of a failure to comply with provisions regarding seizure, it was argued there had not been a lawful forfeiture. This argument was rejected as contrary to the meaning and effect of the relevant provisions. Consideration was given to the word "condemned" and what it means in various legislative contexts where property is forfeited upon the occurrence of a specified event, and then a procedure is afforded by which the occurrence of that event can be adjudged and the consequences of it officially recognised and recorded. It was said that such an adjudication is properly described as a "condemnation" and that "it adjudicates and records that a forfeiture has already occurred". The court quoted from a passage in Whim Creek Consolidated NL v Colgan (1991) 31 FCR 469 at 477 - 479 explaining the use of the word "condemned" in this way, at 455:
" … the term 'condemnation' refers not to a proceeding which has the effect of vesting title in the Crown, but to a proceeding which determines that upon some cause previously arising title had vested in the Crown."
The legislative schemes considered by the cases are not all identical with the Act. For example, some authorise rather than effect forfeiture. But they have in common the focus on offences, the lack of discretion, and that condemnation is pronouncing or adjudging, and formally recording that a forfeiture has already occurred. They have in common the nature of condemnation as a determination, that at the time of the offence or offences, title had vested in the Crown.
Thus, in the Act, forfeited property regardless of whether it is condemned, becomes the property of the relevant controlling body: ss57 and 58. Forfeiture may occur at the time of the commission of the offence/s. Section 58 operates so that if the crew are found either committing an offence or proved to have contravened the Act, and the use of the vessel falls within that provision, the vessel is forfeited to the controlling body. The terms of the Act recognise that forfeiture occurs before conviction, s61, and before seizure; property is seized as forfeited: s60. The scheme recognises that property will not be sold by the controlling body until condemned or deemed condemned: s59(2). Although arguably, s63 indicates that it may be sold if forfeited but not condemned.
The rationale underpinning these provisions seems to be that articles become the property of the relevant controlling body at the time of forfeiture, but the sale or disposing of property will take place after the adjudging of it as forfeited property and the formal process of condemning it has occurred, or in the event it is deemed condemned. Therefore, under the Act, title passed to the Minister, and the entitlement to sell it occurred at the time it became forfeit.
The scheme does not indicate that if proceedings are initiated for forfeiture and condemnation pursuant to s59, that those proceedings of themselves have the effect of altering the status of those articles as forfeited. If it is proved that the goods are liable to forfeiture, then they are condemned: s61(2). Significantly, they are not forfeited and condemned. Pending resolution of proceedings, there is provision for perishable goods to be sold and the proceeds retained to abide the result of proceedings in respect of forfeiture: s60(2). A vessel that has been seized may be delivered to the owner or person disputing seizure, but only if the person gives security to pay the value of the goods in case of their condemnation: subss(2) and (3).
It may be noted that the nature of forfeiture and condemnation has implications for the plaintiff's contention that if the mechanism for condemnation has not been followed under s59(2) and an adjudication not made, the vessel was unlawfully in the possession of the defendant. It is argued that the failure to take proceedings pursuant to s59(2) against the owner must result in reversal of the forfeiture. Further, the consequence of failing to take proceedings is to concede the invalidity of the forfeiture. Applying the principles I have identified regarding the effect of forfeiture and condemnation, such arguments would seem to have a doubtful foundation. They would mean in this case, on the forfeiting of the vessel by force of the statutory provisions, title passed to the Crown.
The argument about the reversal of forfeiture does not follow as a matter of necessary implication from a failure to institute proceedings. Consistent with the terms of the Act, it may be that forfeiture is not reversed by the failure to take proceedings rather forfeiture and condemnation rests with the outcome of the proceedings, whether they be pursuant to s59(2) or by way of a prosecution. If s59(2) is not complied with, in that proceedings are not taken, then that may merely mean that the article or vessel is not deemed to be condemned under that provision. The argument about reversal of forfeiture has a bearing on the second issue identified at [37], which only arises for determination if there has been a failure to comply with the provision.
In summary, it is noted that the Act, in reflecting a familiar statutory model, has the result that there are drastic consequences for owners resulting from the commission of offences and title passes at the stage of forfeiture.
A further consideration in ascertaining Parliament's intention is the consequences of the competing interpretations of the expression "the owner".
The consequences of the construction urged by the defendant, that "the owner" is to be narrowly construed as meaning "the owner" in the conventional sense, does not thwart the purpose of the Act. In fact, it is in line with the punitive approach taken in the Act and other like legislation, and the strict consequences that flow from contravention of the legislation. Property tainted by the commission of offences will be condemned, without exception.
When considering the consequences of the competing interpretations, it must be borne in mind that if the expression has a restricted meaning, others who have an interest in the vessel are not deprived of an opportunity that owners have to be heard as to the merits of their position, or the unjust consequences that will result from condemnation. There is no such opportunity, there is no discretion and the proceedings are concerned with a very narrow issue. Noting, if the only question is whether offences have been committed then it is difficult to see any rationale for a wide meaning of the expression "the owner".
The statutory context provides a clear indication that Parliament intended property rights would be affected and to a drastic extent. There is no ambiguity in that regard: Jeffrey v DPP (supra) and Coco v R (supra).
It is not the case that the consequences of a narrow interpretation are inconsistent with the statutory purpose or seemingly unintended in light of the scheme.
While this type of legislation was expected to have harsh consequences for owners as well as those with an interest in the property, this does not mean that they do not have redress. If the owner is innocent of complicity in the unlawful use, his remedy lies in an action for damages against the user whose wrongful conduct deprived him of his property: Forbes v Traders' Finance Corporation Ltd (1971) 126 CLR 429 at 439 - 440.
The consequence of the plaintiff's argument should also be considered. If the phrase "the owner" is not to carry its ordinary meaning and is to be given some wider meaning, to include at least the plaintiff as a lessee, the questions arise, what does the phrase "the owner" mean and who else falls within the class? The consequence of the plaintiff's argument is that the meaning of the expression would be vague and uncertain. Parliament would not have intended that consequence, and the confusion that would result, when it could easily have defined the term to bring precision and certainty to the expression in the Act.
The phrase "the owner" does not extend to the plaintiff as the lessee of the vessel. The Bank would qualify as the true owner, but did not give notice that it disputed the forfeiture. In these circumstances there was no statutory obligation to take proceedings against the owner for forfeiture and condemnation. The controlling body did not fail to comply with the obligation to bring proceedings. The basis for the plaintiff's case regarding the unlawful possession of the vessel fails. So too does the basis for the argument that s59(2) operates to the exclusion of s61. The convictions which were imposed have the effect of a condemnation of the vessel under s61. Indeed, in these circumstances, s59(2) would also operate to effect condemnation because the only exception is if the owner gives notice of disputing forfeiture and that has not occurred.
It is appropriate that I consider the issue regarding s61 and whether it operates subject to s59(2) in case my conclusion regarding the meaning of the expression "the owner" is not correct and noting that it is a central plank to the defence that the convictions took effect as a condemnation pursuant to s61.
It is submitted that the powers of condemnation must be read subject to s59(2), relying on remarks made by Green CJ in Cole v Esanda (supra) at 134. In that passage his Honour stated in part:
"However, those general provisions must be read subject to the particular provisions contained in s59 and s61. It appears that the legislature intended that when an owner gives notice under s59(2), forfeiture and condemnation may only take place by order of a court. It is true that, read alone, s61(1) appears to be applicable to all cases in which there has been a conviction irrespective of whether or not a notice has been given under s59(2). However, to give such an effect to s61(1) would bring it into direct conflict with s59(2) because when s61(1) applies, the boat is condemned 'without any complaint laid for the condemnation', whereas s59(2) read in conjunction with s38(3) of the Acts Interpretation Act 1931 requires that proceedings by way of complaint must be taken before a boat may be condemned. In order to give effect to both s59(2) and s61(1), s61(1) must be read subject to s59(2) and I hold therefore that s61(1) does not apply to cases in which an owner has given the. notice required by s59(2)." [My italics.]
The italicised passage appears to be the reasoning supporting the conclusion of a direct conflict between the provisions, requiring that s61(1) be read subject to s59(2). It may be that his Honour was noting a point of difference between the two pathways to condemnation, one requiring a complaint to be laid for the condemnation, and the other not, as supporting the notion of a conflict. It may be that his Honour found a conflict because he interpreted the words in s61(2) "without any complaint laid for the condemnation" to mean "providing no complaint has been laid for condemnation".
With respect, I part company with Green CJ on the point about a conflict between the two provisions. In my view, the phrase "without any complaint laid for condemnation" is at least equally capable of meaning that the effect of condemnation will result "without the need for" or "irrespective of any complaint". Indeed, that is the meaning I consider is most apposite in the legislative context.
It makes sense that s61(1) should have an overarching application. This would mean that if a conviction resulted, s61(1) would have the effect of overtaking parallel proceedings involving the same property, pursuant to s59(2). Condemnation may result even though those s59(2) proceedings may still be pending. I do not see a conflict in that regard because:
· each pathway to condemnation turns on the commission of offences. The procedures as to condemnation provide merely the mechanism for establishing liability for forfeiture, by conviction or proceedings on complaint; and
· neither pathway provides the court with a discretion.
It makes perfect sense that absent a prompt prosecution, the owner should have the opportunity to bring forward and agitate the question of liability for forfeiture, noting the owner is deprived of his goods pending an outcome of any prosecution. However, I do not see any logical difficulty with those proceedings being brought to an end by a conviction. After all, if not for delay in the prosecution, the owner would not have had an entitlement to issue a notice leading to the commencement of those proceedings.
The plaintiff argues that a consequence of rejecting its interpretation is that if s59(2) did not apply in cases where convictions had been imposed, an innocent owner who was not the offender and the subject of the prosecution, would lose an entitlement to be heard. For the reasons I have given, this is not a deprivation in real terms.
In this case, s61 applied. The conviction for offences had the effect of a condemnation of the boat or article.
By clear and unambiguous language, Parliament revealed an intention to take away private rights of property in cases where there has been liability for forfeiture of that property. The legislature has intended to abrogate the property rights of owners, "clearly manifested by unmistakable and unambiguous language": Coco v R (supra) at 437. The presumption that Parliament would not intend to take away property rights has been displaced by that language and does not operate to provide support for an interpretation of s61(1) as operating subject to s59(2).
I reject the plaintiff's argument with respect to the operation of s61. Even if a valid notice had been issued and proceedings brought for forfeiture and condemnation, the convictions that resulted in this case, would have taken effect as a condemnation of the vessel.
Outcome
For the reasons I have given, the plaintiff’s claim fails. There shall be judgment entered for the defendant on the claim. The counterclaim succeeds, noting the concession regarding the inevitability of that outcome. There shall be judgment for the defendant on the counterclaim in a sum to be assessed. I shall hear from the parties with respect to that assessment.
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