Loo v Director of Public Prosecutions - [2005] VSCA 161

SUPREME COURT OF VICTORIA
COURT OF APPEAL

No. 1436 of 1999

TAT SANG LOO
	Appellant
v.
DIRECTOR OF PUBLIC PROSECUTIONS (VICTORIA)	Respondent

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JUDGES:	WINNEKE, P., CHARLES and CALLAWAY, JJ.A.
WHERE HELD:	MELBOURNE
DATES OF HEARING:	15 and 16 March 2005
DATE OF JUDGMENT:	29 June 2005
MEDIUM NEUTRAL CITATION:	[2005] VSCA 161

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Constitutional law – Inconsistency between State and Commonwealth laws – S.109 Constitution (Cth.) – Whether ss.70 and 72 of the Confiscation Act 1997 (Vic.) can operate consistently with the provisions of Ch.5 of Corporations Act 2001 (Cth.).

Corporations – Part 1.1A of Corporations Act 2001 (Cth.) – Whether provisions of s.5G(3) of Corporations Act apply to prevent “direct inconsistency” between ss.70 and 72 Confiscation Act 1997 (Vic.) and “winding up” provisions of Corporations Act 2001 (Cth.) –Whether State laws can operate “concurrently with Commonwealth law”.

Proceeds of Crime – ss.70 and 72 of Confiscation Act 1997 (Vic.) – Providing that property in “effective control” of a person available to satisfy a pecuniary penalty order made by a court against that person in respect of “forfeiture offences”, and enforceable “as if the property were property of [that person]” – Meaning of “effective control”.
Corporations Act 2001 (Cth.) – ss.5E, 5F and 5G in Part 1.1A considered.

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APPEARANCES:

Counsel

Solicitors

For the Appellant

For the Respondent

Dr. J.F. Bleechmore

Ms. P.M. Tate, S.C., Solicitor-General for the State of Victoria and
Mr. S.P. Donaghue

Ellinghaus & Lindner

Solicitor for Public Prosecutions

WINNEKE, P. :

Overview of the legislation governing the Issues in dispute before the trial judge

In recent years, Commonwealth and State parliaments have legislated to deprive those who commit offences against their laws of the profits generated by their criminal exploits. Such legislation is based on the general principle that crime “should not pay”; and that knowledge by criminals that the proceeds of their crimes may be confiscated by the State operates as a general deterrent to crime. In this State, the Confiscation Act 1997 enables the Director of Public Prosecutions to take action before the courts to “freeze” and recover assets alleged to be “proceeds of crime”. Not infrequently, because corporations have been established to conceal such proceeds, disputes will arise as to priorities of entitlement to the assets of a corporation, where it is alleged that those assets represent proceeds of crime.

The point at issue in the proceeding from which the appeal emanates was whether the relevant provisions (ss.70, 72) of the Confiscation Act (Vic.) 1997 (“the Act”) could operate consistently with the provisions of Chapter 5 of the Corporations Act 2001 (Cth.) (the “winding up provisions”); or whether the State provisions could not so operate with the Commonwealth provisions and thus, and to that extent, are invalid as a consequence of the impact of s.109 of the Constitution (Cth.). The circumstances which gave rise to this issue can be briefly described.

At material times – particularly 1997 and 1998 – the appellant Loo (“Loo” or “the appellant”) was a trader in illegally…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2005] VSCA 161
Decision Date: 29 June 2005

CaseChat Overview and Summary

In the case of Loo v Director of Public Prosecutions, the dispute arose from an inconsistency between state and Commonwealth laws, specifically concerning sections 70 and 72 of the Confiscation Act 1997 (Vic.) and the Corporations Act 2001 (Cth.). The issue was whether these state provisions could operate consistently with the Commonwealth law. The case was heard in the Supreme Court of Victoria.

The legal issues the court had to decide were whether sections 70 and 72 of the Confiscation Act 1997 (Vic.) could operate concurrently with the provisions of Part 1.1A of the Corporations Act 2001 (Cth.) and, if not, whether section 5G(3) of the Corporations Act could prevent a direct inconsistency between these state provisions and the winding-up provisions of the Commonwealth Act. Additionally, the court needed to clarify the meaning of "effective control" in the context of the state confiscation provisions.

The Supreme Court held that the state provisions could operate concurrently with the Commonwealth law, provided that the meaning of "effective control" was interpreted to exclude property that is subject to a company's proprietary rights under the Corporations Act. The court found that the state provisions did not create an inconsistency with the Commonwealth law, as they could be interpreted to allow for concurrent operation. The court also noted that the state provisions could be enforced in a way that did not conflict with the Commonwealth provisions.

The final orders of the court were that sections 70 and 72 of the Confiscation Act 1997 (Vic.) could operate consistently with the Corporations Act 2001 (Cth.), and the meaning of "effective control" should be interpreted in a way that excluded property subject to a company's proprietary rights.

Orders