Macdonald, Ian v The King; Edward Obeid v The King; Moses Obeid v The King
[2023] NSWCCA 250
•06 October 2023
Court of Criminal Appeal
Supreme Court
New South Wales
- Summary available
- Amendment notes
Medium Neutral Citation: Macdonald, Ian v R; Edward Obeid v R; Moses Obeid v R [2023] NSWCCA 250 Hearing dates: 17 – 20 April 2023 Date of orders: 6 October 2023 Decision date: 06 October 2023 Before: Bell CJ; Basten AJA; Button J Decision: In each matter:
(1) To the extent necessary, grant leave pursuant to s 5(1)(a) of the Criminal Appeal Act 1912 to appeal against conviction.
(2) Dismiss the appeal.
Catchwords: CRIME – conspiracy – conspiracy to commit common law offence of wilful misconduct in public office – elements of conspiracy – element of misconduct created by conflict between self-interest and public duty – need to establish causal element – whether agreement to do undertake a particular act(s) required – whether each participant in the conspiracy must agree to carry out act(s) in furtherance of unlawful purpose – whether motive of parties to be established – need to prove parties agreed as to quality of misconduct – conduct to be serious and meriting criminal punishment
CRIMINAL PROCEDURE – elements of a conspiracy – each element and fact that are necessary links in the chain to conviction to be established beyond reasonable doubt – whether Shepherd direction required
CRIMINAL PROCEDURE – judge alone trial – nature of warnings – warning to be “taken into account” – whether to be recorded in reasons – application of Criminal Procedure Act 1986 (NSW), s 133(3)
CRIMINAL PROCEDURE – conviction – appeal – verdict unreasonable or not supported by the evidence – appeal court to conduct independent assessment of evidence – consideration of all circumstantial evidence – relevance of reasons of trial judge – Criminal Appeal Act 1912 (NSW), s 6(1), first limb – challenge to individual findings – whether finding indispensable to conviction – standard of review
EVIDENCE – admissions – hearsay rule – conduct of one conspirator admissible as admission by other conspirator – operation of Evidence Act 1995 (NSW), ss 57(2), 87(1)(c)
EVIDENCE – admissions – lies – consciousness of guilt – need for direction in accordance with Edwards v The Queen
EVIDENCE – unreliability – description of map – whether tantamount to identification evidence – whether warning required under Evidence Act 1995 (NSW), s 165(2)
Legislation Cited: Criminal Appeal Act 1912 (NSW), ss 5, 6, 8
Criminal Procedure Act 1986 (NSW), ss 132, 133 (former ss 32, 33)
Evidence Act 1995 (NSW), ss 38, 55-57, 81, 87, 165
Mining Act 1992 (NSW), ss 13, 14, 22, 368
Mining Regulation 2016 (NSW), Pt 3, Div 1
Cases Cited: Adam v The Queen (2001) 207 CLR 96; [2001] HCA 57
Ahern v The Queen (1988) 165 CLR 87; [1988] HCA 39
Australian Competition & Consumer Commission v Leahy Petroleum Pty Ltd (2007) 160 FCR 321; [2007] FCA 794
Chamberlain v The Queen (No 2) (1984) 153 CLR 521; [1984] HCA 7
Dansie v The Queen (2022) 96 ALJR 728; [2022] HCA 25
Domican v The Queen (1992) 173 CLR 555; [1992] HCA 13
Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63
EE v R [2023] NSWCCA 188
Elomar v The Queen (2014) 300 FLR 323; [2014] NSWCCA 303
Fennell v The Queen (2019) 93 ALJR 1219; [2019] HCA 37
Filippou v The Queen (2015) 256 CLR 47; [2015] HCA 29
Fleming v The Queen (1998) 197 CLR 250; [1998] HCA 68
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22
Gerakiteys v The Queen (1984) 153 CLR 317; [1984] HCA 8
Glasser v United States (1942) 315 US 60
Higgins v R [2020] NSWCCA 149
HKSAR v Hui Rafael Junior (2017) 20 HKCFAR 264
Hofer v The Queen (2021) 274 CLR 351; [2021] HCA 36
IW v City of Perth (1997) 191 CLR 1
Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8
Kanaan v R [2006] NSWCCA 109
M v The Queen (1994) 181 CLR 487; [1994] HCA 63
Mahmood v The State of Western Australia (2008) 232 CLR 397; [2008] HCA 1
Maitland v R; Macdonald v R (2019) 99 NSWLR 376; [2019] NSWCCA 32
Mohana v R [2023] NSWCCA 61
Mulcahy v The Queen (1868) LR 3 HL 306
Obeid v R (2015) 91 NSWLR 226; [2015] NSWCCA 309
Peacock v The King (1911) 13 CLR 619
Peters v The Queen (1998) 192 CLR 493; [1998] HCA 7
R v Agius [2011] NSWSC 367
R v Boulanger [2006] 2 SCR 49
R v Clout (1995) 41 NSWLR 312
R v Dolding (2018) 100 NSWLR 314; [2018] NSWCCA 127
R v Gill and Henry (1818) 2 B & Ad 204, 205; 106 ER 341
R v Kurtic (1996) 85 A Crim R 57
R v Llewellyn-Jones (1966) 51 Cr App R 4
R v Macdonald, Edward Obeid, Moses Obeid (No 15) [2020] NSWSC 1949
R v O’Brien (1974) 59 Cr App R 222
R v O’Donoghue (1988) 34 A Crim R 397
R v Speechley [2005] 2 Cr App R (S) 75; [2004] EWCA Crim 3067
Richardson v The Queen (1974) 131 CLR 116; [1974] HCA 19
Romeyko v Samuels (1972) 2 SASR 529
RPS v The Queen (2000) 199 CLR 620; [2000] HCA 3
Shepherd v The Queen (1990) 170 CLR 573; [1990] HCA 56
Shum Kwok Sher v HKSAR (2002) 5 HKCFAR 381
Simic v The Queen (1980) 144 CLR 319; [1980] HCA 25
Sin Kam Wah v HKSAR (2005) 8 HKCFAR 192
SKA v The Queen (2011) 243 CLR 400; [2011] HCA 13
The King and the Attorney-General (Cth) v The Associated Northern Collieries (1911) 14 CLR 387
The King v Boston (1923) 33 CLR 386; [1923] HCA 59
The King v Kidman (1915) 20 CLR 425; [1915] HCA 58
The Queen v Baden-Clay (2016) 258 CLR 308; [2016] HCA 35
The Queen v Hillier (2007) 228 CLR 618; [2007] HCA 13
The Queen v LK (2010) 241 CLR 177; [2010] HCA 17
The Queen v Quach (2010) 27 VR 310; [2010] VSCA 106
The Queen v Rogerson (1992) 174 CLR 268; [1992] HCA 25
Tripodi v The Queen (1961) 104 CLR 1; [1961] HCA 22
Trudgeon v R (1988) 39 A Crim R 252
Waterways Authority v Fitzgibbon(2005) 79 ALJR 1816; [2005] HCA 57
Western Australia v Marchesi (2005) 30 WAR 359; [2005] WASCA 133
Whitehorn v The Queen (1983) 152 CLR 657; [1983] HCA 42
Zoneff v The Queen (2000) 200 CLR 234; [2000] HCA 28
Texts Cited: Australian Law Reform Commission, Interim Report on Evidence, No 26 (AGPS, 1985) Vol 1; Vol 2, Draft Bill
de Smith Woolf & Jowell, Judicial Review of Administrative Action, 5th ed (1995)
Review of Commonwealth Criminal Law, Interim Report: Principles of Criminal Responsibility and Other Matters, (July 1990)
Russell on Crimes 7th ed, Vol 1
Category: Principal judgment Parties: Ian Michael Macdonald (First Appellant)
Edward Moses Obeid (Second Appellant)
Moses Edward Obeid (Third Appellant)
The Crown (Respondent)Representation: Counsel:
Solicitors:
C Parkin (First Appellant)
A Francis (Second Appellant)
B Walker SC / M Kalyk (Third Appellant)
D Staehli SC / E Nicholson / N Wootton (Respondent)
HWL Ebsworth (First Appellant)
M Bowe (Second Appellant)
Murphy’s Lawyers (Third Appellant)
C Hyland, Solicitor for Public Prosecutions (Respondent)
File Number(s): 2015/212910; 2015/214251; 2015/212851 Decision under appeal
- Court or tribunal:
- Supreme Court
- Jurisdiction:
- Crime
- Citation:
[2021] NSWSC 858
- Date of Decision:
- 19 July 2021
- Before:
- Fullerton J
- File Number(s):
- 2015/212910; 2015/214251; 2015/212851
HEADNOTE
[This headnote is not to be read as part of the judgment]
In 2020, the appellants, Ian Michael Macdonald, Edward Moses Obeid and Moses Edward Obeid were charged with conspiracy to commit misconduct in public office. The prosecution alleged that the appellants agreed, no later than 9 May 2008, that Mr Macdonald, in his capacity as Minister for Mineral Resources, would take steps in connection with the grant of an exploration licence with respect to a coal reserve believed to exist under a property owned by the Obeid family at Mount Penny in the Bylong Valley for the improper purpose of advantaging the Obeids, their family and associates. The agreement envisaged that Mr Macdonald would wilfully breach his Ministerial duties and obligations of confidentiality and impartiality.
The trial before Fullerton J, sitting without a jury, commenced in February 2020, with final submissions in February 2021 and a verdict delivered on 19 July 2021. The prosecution case proceeded on the basis that Mr Macdonald committed eight acts of misconduct in carrying out the agreement. The appellants were convicted and each was sentenced to a term of imprisonment. There are three appeals, each appellant challenging his conviction.
The grounds of appeal included five grounds (with several subgrounds) common to all three appellants and some additional individual grounds. The issues on appeal fell into three broad categories:
Challenges to the indictment, including the elements of the offence;
Assertions that the verdicts were unreasonable or could not be supported having regard to the evidence; and
Miscellaneous assertions of legal error and factual errors.
The Court (Bell CJ, Basten AJA and Button J) held, dismissing the three appeals:
As to ground 1(1) – no agreement to do a particular unlawful act
Absence of agreement as to specific acts to be undertaken was not fatal to the existence of a conspiracy; so long as an unlawful purpose was sufficiently identified, the precise means by which it was to be effected need not be known or agreed upon. The context, providing a process by which steps were to be taken to seek expressions of interest, assess applicants and grant exploration licences, identified with sufficient precision the nature of the conduct that was the subject of the agreement between the parties: [23], [39].
Gerakiteys v The Queen (1984) 153 CLR 317; Peters v The Queen (1998) 192 CLR 493; [1998] HCA 7; R v Gill and Henry (1818) 2 B & Ad 204; 106 ER 341, applied
As to ground 1(2) – requirement of act by Obeids
A conspiracy may involve the recipient of favours not being actively involved through his or her own unlawful conduct; there is no requirement that each party to the conspiracy agree to be responsible for some unlawful overt act in carrying out the agreement: [42], [43], [47].
R v LK (2010) 241 CLR 177; [2010] HCA 17, distinguished
Nor was it necessary to establish a motive for Mr Macdonald, namely that he would benefit from his participation: [53].
As to ground 1(3) – no misconduct ‘but for’ agreed improper purpose
There did not need to be an agreement that Mr Macdonald would not have taken the unlawful steps he took “but for” the agreement. The elements of the offence are not expressed in the language of causation. It was the creation of a conflict between self-interest and public duty that constituted the element of misconduct and in circumstances where that conflict is perceived, the relevance of a causative element was expressly denied in Boston: [61]-[62].
HKSAR v Hui Rafael Junior (2017) 20 HKCFAR 264, The Queen v Boston (1923) 33 CLR 386; [1923] HCA 59, applied; Maitland v R; Macdonald v R (2019) 99 NSWLR 376; [2019] NSWCCA 32 distinguished
As to ground 1(5) – no agreement that conduct serious and meriting criminal punishment
It was not necessary either that Mr Macdonald believe his conduct to involve a particular level of moral culpability, or that the conspirators agree that his conduct would involve that level of moral culpability: [81].
As to ground 3 – absence of Shepherd direction
Each element of an offence and every fact which is a link in a chain necessary to establish an element of an offence and is therefore an indispensable step to conviction must be established beyond reasonable doubt; a jury must be so directed. However, there is no further direction required in all cases: [102]. The common knowledge which formed a substratum to the agreement, and was known to the participants, was that the Obeid family had an interest in land at Mount Penny. No special direction that Moses Obeid knew that Macdonald knew that fact was required: [104].
Shepherd v The Queen (1990) 170 CLR 573; [1990] HCA 56 applied
As to ground 4 – failure by prosecution to call evidence
The judge did not err in declining to give herself a direction that she could infer from the failure of the prosecutor to call particular witnesses, without a sufficient explanation, that the evidence they might have given would not have assisted the prosecution case: [115]. If the prosecution leaves gaps in the evidence, that may result in an acquittal; except to the extent necessary to achieve a fair trial, the prosecutor is not otherwise obliged to call persons who may possibly be able to give relevant evidence: [121]-[123].
RPS v The Queen (2000) 199 CLR 620; [2000] HCA 3; Whitehorn v The Queen (1983) 152 CLR 657; [1983] HCA 42 applied
As to ground 6 – admissions by co-accused
The representation of a co-conspirator may be used to support a finding of the existence of the common purpose, and is admissible to that end if it were open to the fact-finder to be satisfied that there is a common purpose. It is not necessary to prove the existence of a conspiracy before giving in evidence of the acts of the alleged conspirators: [149], [152].
Evidence Act 1995 (NSW), ss57(2), 87(1)(c) applied
R v Dolding (2018) 100 NSWLR 314; [2018] NSWCCA 127 applied
As to ground 7 – use of inadmissible evidence
Five matters were relied on as unavailable to support a conclusion of involvement of Mr Obeid Snr in the conspiracy: none involved evidence not available for that purpose. And none was conclusive: the degree of reliance placed on each by the trial judge was open to her.
As to ground 8 – admissions and consciousness of guilt
Having addressed the principles discussed in Edwards v The Queen in R v Macdonald (No 15) in terms which were not the subject of criticism on the appeal, and having identified which particular representations were capable of demonstrating consciousness of guilt, no further direction was required: at [196]-[197]. Each of the relevant factors was in fact applied: [205], [207]. Accordingly, the requirement to take the warning into account was met: [210].
Criminal Procedure Act 1986 (NSW), s 133(3) applied
Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63;
Zoneff v The Queen (2000) 200 CLR 234; [2000] HCA 28 applied
As to ground 5(1) – conversation with Fitzhenry in early 2008
It was open to the judge to find that a conversation took place prior to 9 May 2008, in which Mr Moses Obeid demonstrated excitement as to the prospect of an exploitable resource under Cherrydale: [232]-[233].
As to ground 5(2) – Minister’s “strong suggestion” of small area “in the east”
The finding by the trial judge as to what Mr Macdonald said to Mr Mullard at a meeting with Mr Macdonald on 6 June 2008, based on the latter’s evidence, was open and the criticisms of the finding lacked substance: [243].
As to ground 5(3) – whether Bylong area considered by DPI at May meeting
It was open to the judge to find that the Bylong Valley was not an area that officers in the Minister’s department discussed with Monaro Mining NL in early May 2008. The competing evidence was identified and discussed by the judge; the suggestion that the finding was not open was without substance and should be rejected: [248], [253].
As to ground 5(4) – the fourth misconduct (the Wiles maps)
It was open to the trial judge to find that the Wiles Map 2 was shown to Mr Brook at a meeting on 7 July 2008 with Paul and Moses Obeid at the Wentworth Hotel. That finding depended on acceptance of the reliability of Gardner Brook’s evidence and the absence of evidence that the map had been provided to the Obeids by anyone other than Mr Macdonald. Three complaints relating to the fact that Mr Brook had been shown the map at the ICAC hearings but was not shown the map in giving evidence, and gave a flawed description of the map, were addressed by the judge and provided no basis for concluding the judge’s finding of fact was not open: [262], [268], [270].
As to ground 5(5) – warning as to unreliability of Mr Brook
The judge expressly addressed the appellants’ claim that Mr Brook’s evidence as to the map was tantamount to identification evidence and required a warning as to unreliability compliant with s 165 of the Evidence Act. Correctly noting that this was not “identification evidence” as defined in the Evidence Act, the trial judge nevertheless addressed the manifold criticisms of Mr Brook’s evidence, applied the necessary degree of scepticism and detachment required by the warnings, and explained her process of reasoning: [291].
As to ground 5(6) – basis of finding as to Wiles Map 2
The challenge to the judge’s reliance on Mr Brook’s unprompted reference to a “contiguous area” in describing the extent of the coal seam, on the basis that the judge misunderstood the evidence, did not show that her reliance on that evidence was not open: [301].
As to ground 5(7) –finding that eighth act of misconduct proved
The finding that Mr Macdonald caused a member of the Obeid family to be provided with a memorandum and map identifying proposed coal release areas dated 21 July 2008 was open on the evidence. The evidence of this matter was properly regarded in its historical context, and with specific regard to the evidence of Mr Brook. The evidence did not demonstrate that the conclusion that Mr Brook did not receive the Wiles Map 2 from Monaro Mining was not open: [329], [337].
As to common ground (2) – legal principles
In considering a challenge to the reasonableness of a verdict under the first limb of s 6(1), the appeal court must undertake an “independent assessment of the evidence, both as to its sufficiency and its quality”: [351].
Criminal Appeal Act 1912 (NSW), s 6(1)
M v The Queen (1994) 181 CLR 487; [1994] HCA 63 applied
In circumstances where an appeal ground invokes the first limb of s 6(1), but on the basis of specific errors, if the errors are not made out, there is no obligation on the appeal court to review the whole of the judgment to determine whether it entertains a reasonable doubt: [368].
Filippou v The Queen (2015) 256 CLR 47; [2015] HCA 29, referred to
Ground 2 in the present case was not expressly articulated by reference to specific errors of fact, but ground 5 was. As to ground 5, the appellants were required to demonstrate that the findings were not reasonably open; considering ground 2, the question was whether the Court entertained a reasonable doubt as to the ultimate finding of guilt, or as to a step essential to that finding, which doubt was not assuaged upon having regard to the advantage of the trial judge having seen and heard the evidence at trial: [372]-[374].
Dansie v The Queen (2022) 96 ALJR 728; [2022] HCA 25, applied
In a circumstantial case, to establish that particular findings leave open a reasonable hypothesis consistent with innocence (and thus permit a reasonable doubt as to the verdict), the Court must be satisfied that having regard to all of the circumstantial evidence, the doubt remains: [378].
Rejection of a challenge to specific findings on the basis that the findings were open to the trial judge may not preclude the formation of a reasonable doubt as to the outcome: [378].
As to common ground (2) – whether verdicts unreasonable
Having engaged in an assessment of the whole of the evidence, the court was satisfied that the indispensable elements were established beyond reasonable doubt. The Court was of the view that the prosecution had proved beyond reasonable doubt the existence of a conspiracy as alleged in the indictment, and that each of the co-accused were participants in it at the time at which it was formulated, namely prior to 9 May 2008: [559]-[560].
INDEX TO JUDGMENT
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JUDGMENT
PART A INTRODUCTION
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THE COURT: Following a series of interlocutory rulings in 2019, the appellants, Ian Michael Macdonald, Edward Moses Obeid and Moses Edward Obeid, stood trial before Fullerton J on a single count of conspiring together that Mr Macdonald would wilfully misconduct himself in public office, namely as Minister for Mineral Resources. (The precise terms of the charge will be considered shortly.) The trial, commencing in February 2020, proceeded over 77 days before the judge sitting without a jury, with final submissions in February 2021.
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On 19 July 2021, the judge delivered her verdict and reasons, finding each of the appellants guilty. [1] In a further judgment delivered on 21 October 2021, Fullerton J sentenced each of the appellants to a term of imprisonment.
1. R v Macdonald; R v Edward Obeid; R v Moses Obeid (No 17) [2021] NSWSC 858.
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Each appellant has filed a notice of appeal in relation to his conviction; Mr Macdonald, who was sentenced to imprisonment for nine years and six months, with a non-parole period of five years and three months, has sought leave to appeal the severity of his sentence. At the time of the hearing of the appeal, each of the appellants remained in custody serving a non-parole period which had commenced on the date of sentencing.
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The nature of the conspiracy was unusual in that it alleged an agreement between the three persons charged that one person, namely Mr Macdonald, should conduct himself in a manner which constituted the underlying offence (described in submissions as the predicate offence) of wilfully misconducting himself in public office. Members of the Obeid family were said to be the beneficiaries of Mr Macdonald’s misconduct. The prosecutor did not particularise any acts of either Edward Obeid (Mr Obeid Snr) or Mr Moses Obeid in furtherance of the conspiracy.
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The factual circumstances of the matter were complex, as were the grounds of appeal. Many grounds were common to all three appellants, but some had additional grounds. It will be convenient to deal with the facts as necessary to engage with the particular grounds of appeal and submissions. The grounds may conveniently be divided into three categories, namely:
Challenges to the indictment, including the elements of the offence;
Assertions by each appellant that the verdict against him was unreasonable or could not be supported having regard to the evidence, under the first limb of s 6(1) of the Criminal Appeal Act 1912 (NSW); and
Miscellaneous challenges to the fact finding and specific allegations of legal error on the part of the trial judge.
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Grounds not involving a question of law alone require leave pursuant to s 5(1) of the Criminal Appeal Act, as does Mr Macdonald’s appeal against sentence. As many grounds satisfy the requirement for an appeal as of right (including category (a) grounds), and as others (though not all) are reasonably arguable, it is convenient to grant leave so far as necessary to cover all grounds. (Hereafter the applicants will be referred to as appellants.)
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With respect to the challenges to the judge’s fact finding in category (b), it will be necessary to identify the nature of the exercise based on the first limb of s 6(1) of the Criminal Appeal Act, and, in particular, the relationship between those generic challenges and challenges to specific findings of fact which require that a miscarriage of justice be demonstrated under the third limb of s 6(1).
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In addition to the complexity of the evidence there is complexity in the reasons. The judgment was lengthy (comprising over 670 pages and 2,047 paragraphs) and precise in its references to transcript and documentary material (there were over 2,000 footnotes). [2] Although to a large extent the prosecution case was circumstantial, the judge adopted a highly structured and step by step process in reaching her conclusions. She was meticulous in stating the extent to which a particular finding was probative of an element of the offence or an intermediate fact. While it will be necessary to summarise the judge’s reasoning, it must be understood that the strength or otherwise of ultimate findings depended upon the cumulative effect of earlier findings.
2. Footnotes have been routinely omitted from the extracts from the judgment set out below.
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It is convenient to start with the terms of the indictment and the nature of the offence.
The indictment and elements of the offence
Brief factual overview
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There were two critical factors which underlay the prosecution of the appellants. The first was that on 27 September 2007 a company associated with the Obeid family, Locaway Pty Ltd, entered into a contract to purchase a property known as Cherrydale Park to the west of Mount Penny at Bylong, which is north of the Hunter Valley. Locaway was a trustee for the Moona Plains Family Trust, the beneficiaries of which were members of the Obeid family. The directors of Locaway were Paul Obeid and Damian Obeid, sons of Mr Obeid Snr. Settlement occurred on 15 November 2007. The location of Cherrydale Park may be seen on the map which is annexure A to these reasons.
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The second material fact is that the Department of Mineral Resources had identified a coal seam which followed the general direction of the Bylong Valley, between the towns of Bylong in the east and Wollar in the west. The coal area is also marked on the map which is annexure A to these reasons. The area was described as being in the shape of a sideways S with the eastern (north-south) section lying under three properties of which the most southerly was Cherrydale Park. Directly to the north of Cherrydale Park was a second property, Donola, and to the north of that a third property, Coggan Creek. A short distance to the east of Donola was the Mount Penny trig point, which gave the area its name, variously described as north Bylong-Mount Penny and the Mount Penny area.
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At the time the Obeid family purchased Cherrydale Park it was used as fertile grazing land and had an attractive house and surrounding gardens. At that time, an area which included the three properties was the subject of an exploration licence (EL) granted under the Mining Act 1992 (NSW) known as EL6676, which was held by the Department of Primary Industries. There was, in late 2007, no intention on the part of the Department to release the area for private exploration because the extent and value of the coal resource had not been assessed. In broad terms, the charge was directed to steps taken by Mr Macdonald as Minister for Mineral Resources to release the area for exploration, with potential benefits for the Obeid family through their ownership of Cherrydale Park.
Terms of indictment
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The trial proceeded on an indictment dated 11 February 2020 by which the Director of Public Prosecutions charged the appellants that:
“Between about 1 September 2007 and about 31 January 2009 at Sydney and elsewhere in the State of New South Wales, each of the accused conspired together that Mr Macdonald would, in the course of or connected to his public office as Minister for Mineral Resources in the Executive Government of the State of New South Wales, wilfully misconduct himself, without reasonable cause or justification, by doing acts:
(a) in connection with the granting of an exploration licence at Mount Penny in the State of New South Wales; and
(b) concerning the interests of Edward Moses Obeid, and/or Moses Edward Obeid and/or their family members and/or associates; and
(c) knowingly in breach of:
(i) his duties and obligations of impartiality as a Minister in the Executive Government of the State of New South Wales; and/or
(ii) his duties and obligations of confidentiality as a Minister in the Executive Government of the State of New South Wales,
such misconduct being serious and meriting criminal punishment having regard to the responsibilities of the Office Mr Macdonald occupied as Minister for Mineral Resources and his responsibilities as the holder of that Office, the importance of the public objects which the Office and Officeholder serve and the nature and extent of the departure from those objects.”
Particulars – acts of misconduct
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The prosecution did not provide a statement of the acts which it was agreed Mr Macdonald would undertake: rather, it relied on establishing an agreement to undertake acts falling within the cumulative elements of the charge. (The primary legal challenge to the convictions on the appeal was directed to the alleged inadequacy of that course.) The prosecutor did, however, provide particulars, which were revised during the trial, of the acts said to have been undertaken by Mr Macdonald pursuant to, and in furtherance of, the agreement reached with Mr Obeid Snr and Mr Moses Obeid. The case ultimately addressed in closing submissions was particularised in a document dated 30 October 2020 and identified eight acts of misconduct alleged to have been committed by Mr Macdonald. As will be seen, the first act of misconduct was said to have occurred on or about 9 May 2008. For that to have occurred pursuant to and in furtherance of the agreement charged, that agreement must have been in place by 9 May 2008. The prosecution case proceeded on that basis.
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The revised statement of particulars omitted what had been the third act of misconduct originally relied upon. The remaining particulars were not renumbered, and were as follows:
“FIRST MISCONDUCT: On or about 9 May 2008, Mr Macdonald sought information, via his chief of staff Mr Jamie Gibson, from the Department of Primary Industries (DPI) as to the volume of coal reserves in the area of Mount Penny (in the Bylong Valley, New South Wales) (Mt Penny). He did so in breach of his duty of impartiality as he knew the Obeid family owned property in this location.
SECOND MISCONDUCT: On or about 14 May 2008, Mr Macdonald sought further information, via his chief of staff Mr Jamie Gibson, from the Department of Primary Industries about coal reserves in the area of Mt Penny including whether it was possible for the DPI to open its holdings for tender. He did so in breach of his duty of impartiality as he knew the Obeid family owned property in this location.
…
FOURTH MISCONDUCT: In the period 9 May to 9 July 2008, Mr Macdonald caused Mr Edward Obeid, Mr Moses Obeid or another member of the Obeid family, to be provided with a copy of:
(i) a map titled ‘Mt Penny’ area, prepared by Ms Leslie Wiles dated 9 May 2008 (Wiles Map 1); and
(ii) a map titled ‘North Bylong – Mt Penny Area’ prepared by Ms Leslie Wiles dated 30 May 2008 (Wiles Map 2).
He did so in breach of his duty of impartiality as he knew the Obeid family owned property in this location, and in breach of his duty of confidentiality as both maps were confidential.
FIFTH MISCONDUCT: Between 4 and 16 June 2008, Mr Macdonald directed that the ‘potential open cut area’ depicted in Wiles Map 2 be reduced to a smaller area comprising the eastern portion only. He did so in breach of his duty of impartiality as he knew the Obeid family owned property in this location.
SIXTH MISCONDUCT: Between 17 June and 23 July 2008, Macdonald communicated to Edward Obeid and/or Moses Obeid that the EOI process for Mt Penny was to commence at the end of July 2008. He did so in breach of his duty of impartiality, as he knew the Obeid family owned property in a location proposed to be included in the EOI (ie Mt Penny), and in breach of his duty of confidentiality as this information was confidential.
SEVENTH MISCONDUCT: On or after 7 July 2008, Macdonald caused Edward Obeid, Moses Obeid or another member of the Obeid family, to be provided with:
(i) a document titled ‘Company EOI 2 July 2008’ containing a list of companies proposed to be invited to participate in the EOI; or
(ii) information as to the companies on that list.
He did so in breach of his duty of impartiality, as he knew the Obeid family owned property in a location proposed to be included in the EOI (ie Mt Penny), and in breach of his duty of confidentiality as the list was confidential.
EIGHTH MISCONDUCT: On or after 23 July 2008, Macdonald caused Edward Obeid, Moses Obeid or another member of the Obeid family, to be provided with:
(i) the page [of a memorandum titled ‘Coal allocation’ dated 5 August 2008] with the heading ‘MEDIUM COAL ALLOCATION AREAS’; and
(ii) a map titled ‘Proposed Coal Release Areas for EOIs’ prepared by Fred Schiavo dated 21 July 2008 (Schiavo Map 3).
He did so in breach of his duty of impartiality, as he knew the Obeid family owned property in a location proposed to be included in the EOI (ie Mt Penny), and in breach of his duty of confidentiality, as the information in this document was confidential.
NINTH MISCONDUCT: Between 27 November 2008 and 13 January 2009, Macdonald communicated to Edward Obeid and/or Moses Obeid that the EOI process was to be (or was) reopened to allow the ‘White Group’ of companies (including Cascade Coal P/L) to apply. He did so in breach of his duty of impartiality, as he knew the Obeid family owned property in a location included in the EOI (ie Mt Penny), and in breach of his duty of confidentiality as this information was confidential.”
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The manner in which the prosecutor deployed the particulars was described by the trial judge in the following terms:
“179 The Crown has sought to prove the existence of the conspiracy of the object and scope alleged in the indictment by proving Mr Macdonald committed each of eight separate acts of wilful misconduct particularised in the Revised Statement of Particulars. In the Crown’s submission, those acts of misconduct committed by Mr Macdonald between May 2008 and January 2009, as the opportunity presented for him to fulfil his agreement with Edward Obeid and Moses Obeid (forged as at 9 May 2008) that he would intentionally do things in connection with the granting of an EL at Mount Penny for the improper purpose of advancing or benefitting Edward Obeid and/or Moses Obeid and/or members of their family and/or associates, in wilful breach of his Ministerial duties of confidentiality and/or impartiality.
180 The Crown submitted that those proven acts of misconduct, viewed in combination, are available to the Crown to prove that the conspiracy alleged was in existence before the first act of misconduct was committed by Mr Macdonald on 9 May 2008, that it continued up to 30 January 2009 (with the ninth act of misconduct committed no later than 13 January 2009) and that each of the eight acts of misconduct were acts of misconduct committed by him in furtherance of the conspiracy to which he was a party and from which his participation in the conspiracy is proved.”
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As will be explained in detail below, the judge found that the first and second acts of misconduct were established, but that, taken alone, they did not provide a sufficient basis for her to be satisfied beyond reasonable doubt as to the existence of the conspiracy. The judge further found that the fourth, seventh and eighth acts of misconduct were established. She was not satisfied that the fifth, sixth and ninth acts were established in the terms in which they were pleaded, although she was satisfied as to aspects of each.
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It may be noted that the indictment charged that Mr Macdonald misconducted himself in public office in breach of his duties and obligations of “impartiality” and “confidentiality” as a minister. Each of the acts of misconduct, other than the first, second and fifth, alleged a breach of both duties: the first, second and fifth alleged a breach only of his duty of impartiality.
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The judge then summarised the manner in which the case was presented based on the particulars:
“185 In proving the existence of the conspiracy (that is, in proving an agreement of the kind alleged in the indictment), the central and dominating fact in issue framing the way the trial was conducted was whether the Crown could establish that between May 2008 and January 2009 Mr Macdonald committed any of the eight successive acts of wilful misconduct particularised by the Crown and, if he acted in that way, whether he did so pursuant to the conspiracy alleged, including whether he did so for the improper purpose alleged.
186 The allied question whether the Crown can also prove that were it not for the improper purpose alleged, Mr Macdonald would not have acted in connection with the granting of an EL at Mount Penny as he has been shown to have acted (that is, by deliberately breaching his duties and obligations of confidentiality and/or impartiality as the Minister for Mineral Resources) was also a dominating fact in issue in the trial.
187 A further and discrete fact in issue was whether the Crown could prove that Mr Macdonald knew that the Obeids owned a rural property (Cherrydale Park) situated near Mount Penny in the Bylong Valley. That fact was conceded by the Crown to be indispensable to proof of the conspiracy and, for that reason, it was a fact which needed to be established beyond reasonable doubt. That fact is hereinafter referred to as the Shepherd fact.”
PART B SPECIFIC GROUNDS
Common ground 1
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The structure of the cases run by the appellants on appeal was, as reflected in the written submissions, that Mr Moses Obeid presented the primary arguments on the five common grounds, with some supplementation by the other appellants, who also had separate grounds for which they took primary responsibility. Ground 1 in each notice of appeal was as follows:
“1 The Trial Judge erred in finding that the conspiracy alleged was available at law or in the alternative misdirected herself as to an essential element to establish guilt for the conspiracy alleged.” [3]
3. Ground 1 in Edward Obeid’s appeal omitted the word “or”, thus suggesting that the second limb was a particular formulation of the first limb. Nothing turned on that variation.
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The ground itself was uninstructive as to the nature of the challenge. However, the written submissions identified six separate bases of challenge in the following terms:
No agreement to do any particular unlawful act;
No “agreement” to do any act alleged against Moses Obeid;
No agreement that Macdonald would not act “but for” the improper purpose;
Conduct not defined by the phrase “in connection with the granting of an exploration licence at Mount Penny”;
No agreement that conduct was serious and meriting criminal punishment; and
Error in referring to duties of impartiality “and/or” confidentiality.
Ground 1(1) – no agreement to do any particular unlawful act
Nature of challenge
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The gravamen of the challenge under this sub-ground was threefold. First, the charge was said to be formulated at too high a level of generality to constitute a conspiracy at law. What was required was an agreement to do a particular act or acts. Secondly, an agreement that one conspirator would commit an offence, namely misconduct in public office, did not cure the problem: no particular act (or acts) was (or were) identified by the use of the phrase. Thirdly, where no particular act had been identified at the date of the agreement, it could not be said that there was a concluded agreement, as opposed to a common intention, expectation or discussion of possibilities. [4]
4. Trudgeon v R (1988) 39 A Crim R 252, 256 (Gleeson CJ); R v O’Brien (1974) 59 Cr App R 222, 226.
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The principle that the formulation of an intention, albeit common between two persons, or the expectation of two persons that a particular course will be followed, or discussion of the possibility of taking a particular course will not, singularly or in combination, constitute an unlawful conspiracy. So much must be accepted; in the words of McHugh J in Peters v The Queen, [5] “there can be no conspiratorial agreement unless the accused and his or her co-conspirators also intend that the common design should be carried out”. However, it is also true, as was accepted by the appellants, that an agreement to do an unlawful act or to do a lawful act by unlawful means, constitutes the actus reus of the conspiracy, although no overt acts have been undertaken at that time. [6] (Because the crime is one of agreement, the distinction between the mental element and the physical act is fraught, if not meaningless. [7] ) It is also common ground that a conspiracy, for example, to defraud an insurance company, may be complete although the precise means or method by which the conspiracy is to be effected is not known, nor agreed upon. [8]
5. (1998) 192 CLR 493; [1998] HCA 7 at [55].
6. The Queen v Rogerson (1992) 174 CLR 268 at 280-281 (Brennan and Toohey JJ); [1992] HCA 25.
7. Peters at [54].
8. Gerakiteys v The Queen (1984) 153 CLR 317 at 327 (Brennan J); [1984] HCA 8; R v Gill and Henry (1818) 2 B & Ad 204, 205; 106 ER 341, 342 (Abbott CJ) applied in Peters at [70].
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Statements of principle in different language may be found in different cases, often determined by the particular facts under consideration and the nature of the substantive offence, the subject of the conspiracy. Further, there is no bright line to be drawn between an agreement to carry out unlawful acts or an unlawful purpose where the means or method by which the purpose will be carried out has not been identified, on the one hand, and an inchoate agreement on the other.
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As the respondent submitted, the appellants failed adequately to address the terms of the indictment which did not leave the nature of the unlawful conduct at large, but identified it in a series of descriptive phrases. First, par (a) in the indictment described the acts in question as being undertaken “in connection with the granting of an exploration licence at Mount Penny”. That consideration limited the scope of the particular acts by reference to a power of the Minister conferred by the Mining Act. There was an element of uncertainty as to the precise acts which would be required, but they would fall within the class reflected in the process required to be carried out for the granting of an exploration licence, which will be outlined below. The charge did not require that the actual acts in connection with granting the exploration licence were unlawful in the sense of not complying with the requirements of the Mining Act, other than the implied requirement of being done for a proper purpose.
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Secondly, and cumulatively, pursuant to par (b) the acts were to be done “concerning the interests of [the Obeid family]”. The “interests” may be understood as matters of benefit to the Obeid family. That element required that steps taken towards the granting of an exploration licence must be undertaken in a manner and with the intention of benefiting the Obeid family. There was no expectation or intention that the Obeids would obtain an exploration licence; rather, the prosecution case was that steps would be taken by the Minister to release the Mount Penny area for exploration and to ensure that the Obeids were involved in the process so as to allow them to benefit from the opportunity to negotiate with the successful grantee. It may be noted that there was no initial proposal from the Department to release the Mount Penny area: the departmental view was that further assessment needed to be done to establish the prospects of financially viable recovery of coal from the area.
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Thirdly, in taking those steps, the Minister, it was agreed, would knowingly act in breach of his obligations of impartiality and/or confidentiality. That constituted the mental element of the predicate offence.
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The effect of the three descriptive limbs of the acts which were agreed to be done, understood in the context of the Obeids’ ownership of land in a particular area and the possibility of an exploration licence being granted over or in relation to that land, involved a degree of particularity in relation to the nature of the acts the subject of the charge.
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It is important to note, however, as senior counsel for Mr Moses Obeid (Mr Walker SC) submitted, that there is an important distinction to be drawn between the acts which would constitute the element of the substantive offence of misfeasance in public office and the particular acts of misconduct which, it was said by the prosecutor, demonstrated the existence of the conspiracy. While the distinction is important, the function served by the particulars of misconduct may engage both limbs, although the primary function is the second (evidential) limb. The particulars may also be seen as illustrating the class of acts which, although not agreed upon in advance, could fall within the class which must have been in contemplation, albeit at a higher level of generality.
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In the course of submissions, various examples were explored to illustrate what might be essential for a properly pleaded conspiracy. That required discriminating between the “acts” which must be agreed upon, and the “method” by which those acts might be carried out, which did not need to be foreseen and agreed upon in advance. Simple examples were referred to, such as a conspiracy to rob a bank and illegal entry of premises. However, while simplification may be a valuable aspect of illustration, it carries an inherent risk of distortion. Thus, the examples of bank robbery and illegal entry of premises each involves a singular act. By contrast, the offence of misfeasance in public office may, but does not necessarily, involve a single act. Rather, it may involve a process carried out over some months, as occurred in the present case. As has been stated, this was not a case in which the underlying misconduct was the issue of an exploration licence to one company, on the basis of an expression of interest formulated with knowledge, improperly obtained, of the content of the offers of other appellants.
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Further, the examples of simple conspiracies involved underlying offences with well understood elements. That contextual element was missing in relation to the activities the subject of the present charge. Little attention was given in the appellants’ submissions to the process and activities required for the issue of an exploration licence, which might involve multiple steps taken “in connection with” the grant of such a licence. At least a brief explanation of that process is necessary.
Process for granting exploration licences
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This exercise was undertaken by the trial judge in some detail. [9] The judge noted that the power to grant an exploration licence was conferred on the Minister for Mineral Resources by s 22 of the Mining Act. A skeleton of statutory requirements was set out in the Mining Act, with minor procedural matters found in Pt 3, Div 1 of the Mining Regulation 2003 (NSW). [10] The source of the requirements for ELs in Pt 3, Div 1 of the Mining Act included the following provisions: [11]
9. Primary judgment at [650]-[740].
10. Coal was a group 9 mineral for the purposes of the Mining Regulation: Sch 3.
11. These provisions have been considerably expanded in recent years, but were in this form in May 2008.
13 Applications
(1) Any person may apply for an exploration licence.
(2) An application for an exploration licence:
(a) must specify the group or groups of minerals in respect of which it is made, and
(b) must be lodged with a mining registrar, and
(c) must be accompanied by the required particulars, and
(d) must be accompanied by the appropriate lodgment fee.
(3) The required particulars are as follows:
(a) a description, prepared in the manner prescribed by the regulations, of the land over which the exploration licence is sought,
(b) particulars of the financial resources available to the applicant,
(c) particulars of the technical advice available to the applicant,
(d) particulars of the program of work proposed to be carried out by the applicant on the land over which the exploration licence is sought,
(e) particulars of the estimated amount of money that the applicant proposes to expend on prospecting.
(4) An application that relates to land within a mineral allocation area may not be made, except with the consent of the Minister, in relation to any group of minerals that includes an allocated mineral.
14 Invitations for tenders
(1) This section applies only in relation to allocated minerals in land within a mineral allocation area.
(2) The Minister may, by notice published:
(a) in a newspaper circulating generally throughout the State, and
(b) in one or more newspapers circulating in the locality in which the land concerned is situated,
invite tenders for an exploration licence for an allocated mineral.
(3) An invitation:
(a) must describe the land to which it relates, and
(b) must identify the allocated mineral to which it relates, and
(c) must specify the place at which, and the date on or before which, tenders for the exploration licence should be lodged.
15 Tenders
(1) A tender for an exploration licence:
(a) must be lodged with the Director-General in accordance with the invitation for the tender, and
(b) must be accompanied by the required particulars, and
(c) must be accompanied by the appropriate lodgment fee.
(2) The required particulars are as follows:
(a) particulars of the financial resources available to the tenderer,
(b) particulars of the technical advice available to the tenderer,
(c) particulars of the program of work proposed to be carried out by the tenderer on the land over which the exploration licence is sought,
(d) particulars of the estimated amount of money that the tenderer proposes to expend on prospecting.
(3) A tender may specify that, in the event that the tender is successful, the tenderer will pay a specified amount in addition to the cash reserve price (if any) specified in the invitation for the tender.
(4) A tender may be made in respect of the whole or any part of the land described in the invitation for the tender.
16 Minister may require further information
The Minister may require the applicant or tenderer to furnish further information in connection with the application or tender, including (if the applicant or tenderer is a corporation) information as to the extent to which the controlling power in the corporation’s affairs is held by:
(a) a foreign company within the meaning of the Corporations Act 2001 of the Commonwealth, or
(b) a company registered under that Act that is taken for the purposes of that Act to be registered in a State or Territory other than New South Wales, or
(c) an individual who is a resident of a foreign country.
17 Minister may exclude land from application or tender
(1) The Minister may, by order in writing, direct that any part of the land to which an application or tender relates be excluded from the application or tender.
(2) A direction takes effect on the date on which written notice of the direction is served on the applicant or tenderer.
(3) A tenderer affected by any such direction may amend the tender by written notice lodged with the Director-General on or before such date as may be specified in the direction.
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The prosecutor lead evidence of the processes within the Department at the relevant time from the Deputy Director-General Mineral Resources, Alan Coutts, and the Director of Coal and Petroleum Development, Brad Mullard.
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Mr Mullard gave evidence that prior to the publication in the Gazette in December 2007 of an order of the Governor designating the whole State as a “mineral allocation area”, specific areas had been designated as “mineral allocation areas” for coal. [12] The purpose of the change was to ensure the orderly development of coal resources, which was not possible when an application for an exploration licence could be made for an area outside the mineral allocation areas. The result had been the speculative land-banking of areas with unknown potential by large miners. [13]
12. Mining Act, s 368.
13. Tcpt, 27/02/20, p 603(30)-(50).
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The trial judge identified the process for seeking an exploration licence in the following terms:
“693 The particular process by which an EL was granted under the Mining Act was firstly determined by:
(1) Whether the coal resource in respect of which the EL application was made was part of a Mineral Allocation Area for coal; and
(2) Having regard to the Coal Allocation Guidelines, whether the EL would be granted via direct allocation or subject to the outcome of a competitive EOI process.
694 Where an EL was granted subject to the outcome of a competitive EOI process, as was the case with the Mount Penny EL, the EOI process involved:
(1) The DPI collecting data about coal resources which coal mining companies were interested in exploring.
(2) Recommendations by the DPI to the Minister with respect to the release of particular coal resources to tender.
(3) The preparation and launch of an EOI process which was either open any coal mining company could apply) or limited (restricted to companies the DPI invited to apply). The EOI process in which the Mount Penny Coal Release Area was included was a limited tender process.
(4) The evaluation of the EOI applications received by the DPI by an independent Evaluation Committee and probity auditor.
(5) The issue of a Ministerial Submission by the Evaluation Committee recommending the preferred applicant for the EL(s).
(6) Upon the Minister accepting the Evaluation Committee’s recommendation, the Minister granting consent for the preferred company to apply for the EL pursuant to the regime in s 13(4) of the Mining Act.
(7) The company making an application for the EL under s 13 of the Mining Act.
(8) The grant of the EL to that company by the Minister under Division 3 of the Mining Act.”
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The judge then dealt with each of the steps set out in [694] separately. It is convenient to set out the judge’s summary of the evidence, although it is lengthy and detailed. [14]
14. References to the evidence are omitted.
“Recommendations by the DPI to the Minister about releasing particular coal resources to tender
700 The usual process for the allocation of ELs for coal resources in New South Wales involved the Department identifying a particular coal resource, or a group of coal resources, and recommending to the Minister that those areas be made the subject of either a competitive process or, in certain circumstances, granted by direct allocation.
701 Between May and June 2008, officers of the DPI were involved and at the Minister’s request, in designating the boundaries of a number of new small to medium coal release areas in the Western, Hunter and Gunnedah Coalfields for inclusion in a proposed EOI process.
702 That process was undertaken by the DPI in accordance with the Coal Allocation Guidelines.
The Guidelines for Allocation of Future Coal Exploration Areas (Coal Allocation Guidelines)
703 Coal Allocation Guidelines operated to guide the DPI’s Coal Allocation Committee in the decisions it made concerning the nomination of future coal exploration areas. Various iterations of the Coal Allocation Guidelines were produced by the DPI and amended and adjusted over time for various purposes with the approval of the Minister.
704 The Coal Allocation Guidelines dated January 2008 were in place at all relevant times during the currency of the conspiracy, replacing … the Coal Allocation Guidelines issued by the DPI in March 2006.
705 The Coal Allocation Guidelines were issued subsequent to the allocation of New South Wales as an MAA for coal for the ‘controlled and rational release of potential coal development areas and the setting of special conditions for each allocation’. The Coal Allocation Guidelines confirm the statutory requirement for the Minister’s consent to the making of any application for an EL in respect of a coal resource in a MAA.
706 The Coal Allocation Guidelines do not apply to any existing coal titles but to only to ‘future coal exploration areas’.
707 Mr Mullard gave evidence about the grouping of potential coal allocation areas into four subcategories:
(1) Subcategory (i) concerns major standalone areas identified as areas containing sufficient coal to develop a ‘large’ new mine.
(2) Subcategories (ii) and (iii) concern, respectively, substantial additions to existing mines and minor additions to existing mines. The former are considered to have potential to be major standalone areas, being coal mined from a continuation of an existing mine over areas adjacent to an existing mine. The latter are not considered large enough to develop major standalone mines, being small areas adjacent to existing mines which could be mined for a continuation of existing operations.
(3) Sub-category (iv) concerns the allocation of ‘small areas unrelated to existing mines,’ including remnant coal resources left from previous mining operations’ and ‘small deposits with some development potential’.
708 Allocation methods were nominated for each of the four subcategories. Two allocation methods are nominated: allocation by ‘priority of application or by some limited form of expression of interest’.
709 The eleven small to medium coal release areas the subject of the EOI process launched on 9 September 2008 which included Mount Penny as ‘Area 7’ concerned small areas within subcategory (iv), that is, remnant coal resources and small deposits with some development potential.
710 In contrast to major standalone areas, or substantial/minor additions to existing mines (subcategories (i), (ii) and (iii) of the Coal Allocation Guidelines), under subcategory (iv) the minimum financial contribution of an applicant for the issue of an EL is ‘based on tonnages of saleable coal, as specified in the appendix attached to the Coal Allocation Guidelines, ranging from $250,000 for a saleable tonnage of coal less than 5Mt to greater than $20 million (as a minimum contribution) for saleable tonnage of coal greater than 100Mt. As the appendix to the Coal Allocation Guidelines makes clear, the minimum financial contributions are indicative only, with the contributions varying depending upon whether the mining method is underground or open cut; the quality of the coal; whether it is for domestic or export purposes; and the size of the resources.
711 Mr Mullard gave evidence that for a mining company to lodge an EOI for the grant of an EL for any one of the four coal allocation categories in the Coal Allocation Guidelines, the company needed to have the capacity to assess the potential return from a successful mining of the coal resource, including the cost of establishing a mine, in order to assess the amount of coal that might be extracted under the terms of a mining lease. He also emphasised the need for the company to assess the cost of environmental studies and any other constraints that might impact on the company’s capacity to undertake mining activities in the area. To that end, borehole data together with geological or geophysical surveys are essential to the preparation of reliable modelling. That model also needs to take into account the method of extraction and other indices.
712 Mr Mullard gave the following evidence:
If you basically don’t have any information, there is no basis for the company ‑ it is very high risk. So a company really doesn’t have an understanding of what the coal is like, how deep it is, can it be mined by underground, what are the other geological constraints or other constraints that might apply. So you would be very reluctant to bid a substantial amount of money because the uncertainty was too high.
The more information you have on a coal deposit, the less uncertainty there is in terms of your ability to mine it and the potential cash flows from that mining operation and that enables companies then to formulate a bid or an offer with a relevantly high degree of certainty; there is no guarantee, but they would be prepared to give a much better offer, generally a substantial offer, than where they had no information.
713 Mr Mullard made clear that while the DPI had information resources of various kinds including, relevantly, its own drilling data for the ELs that the Department held on behalf of the State of New South Wales, a mining company would also need to critically assess its capacity to make an informed assessment of where the coal resources within a coal exploration area might be located, the thickness of the available and accessible coal seam, and the quality of the coal itself. He gave the following evidence as to the significance, as he saw it, of an applicant for a coal EL in a small-to-medium coal release area having access to that general body of information as to which he said:
Well, small to medium areas really were ‑ some of those were remnant areas, some of them were areas that didn’t really have a lot of interest and the additional information really wasn’t warranted by the Department to do a lot of work in those areas because they were never going to generate significant income.
… By way of additional financial contribution. And there was a risk, significant risk, that if the department drilled these areas they might find there wasn't anything there worthwhile. So by and large where the department did its drilling focused on the larger stand‑alone areas.
714 The Coal Allocation Guidelines, in their various iterations, were available to the public on request. Mr Mullard gave the following evidence:
So all of that information essentially was public information and companies could go to the Department and obtain information on those areas. And, in fact, the Department used to say ‘we are looking at releasing areas in the Gunnedah Coalfield’ or ‘we are looking at releasing areas in the Western Coalfield’ … What was confidential was the very specific ‘this is the area that's going to be released’.
Identifying coal resources for direct allocation and competitive tender
715 In the ordinary course of events, if a company wished to apply for an EL, it would write to the Minister or to the Department seeking the Minister’s consent to apply by direct allocation.
716 Preliminary to any application being considered by the Minister, applications for consent to apply for ELs were considered at meetings of the Department’s Coal Allocation Committee against, amongst other criteria, the Coal Allocation Guidelines. Departmental geologists on the Committee would verify the coal figures put forward by an applicant. Public interest considerations were also assessed, as was fairness to other applicants who had previously registered an interest or sought the Minister’s consent to apply for an EL in respect of a subject area.
717 If the Coal Allocation Committee determined that a company’s application for the direct allocation of an EL for coal was successful, the Committee would prepare a recommendation to the Minister so that he could, by way of invitation, provide his consent for that company to formally apply for the coal EL by direct allocation. In these circumstances, the Department would ordinarily draft a letter to the successful applicant which the Minister would sign. All unsuccessful applicants were informed by the DPI of that outcome.
718 A record of all applications for ELs by direct allocation and the outcomes of Coal Allocation Committee meetings, including successful and unsuccessful direction allocation applications, was maintained in the Coal Register in the form of a spreadsheet created and maintained by the DPI.
719 Mr Mullard gave evidence that the DPI also used the Coal Register to collect information about which unallocated coal resources were attracting interest in the industry. Those areas were released by the DPI from time to time under competitive EOI processes.
720 The inclusion of a particular coal resource in an upcoming EOI process was considered confidential information until such time as the EOI process was publicly released. The Coal Register was not publicly available. The information it contained was treated confidentially because, as Mr Mullard described it, ‘it may contain … expressions of interest by companies that may contain commercial-in-confidence information so we did not make [the Coal Register] publicly available’.
721 The dual possibilities of assigning ELs via direct allocation or subject to competitive tender is particularly relevant to the fourth subcategory of potential coal allocation areas under the Coal Allocation Guidelines, namely ‘small areas unrelated to existing mines,’ including ‘remnant coal resources left from previous mining operations’ and ‘small deposits with some development potential’ which, as noted above, are allocated via ‘priority of application or by some limited form of expression of interest’.
A limited form of expression of interest
722 Mr Mullard explained that ‘all of the allocations within mineral coal allocation areas were subject to an EOI process... which effectively wasn’t a process that was defined in the [Mining Act] but it was a way of formalising the way the Minister made his decision to give consent’ to a company to apply for an EL. EOI processes, including the EOI process launched in September 2008 in relation to eleven small to medium coal release areas including Mount Penny, were undertaken ‘as a precursor to the power that might be exercised by the Minister in section 13(4)’ of the Mining Act where the Minister gave consent to a particular company to apply for an EL.
723 That EOI process was limited in the sense that a limited number of companies, having been selected by the DPI referable to their expressions of interest in the types of coal resources being released to tender (as recorded on the Coal Register), were invited to participate and provided with an EOI Process Information Package prepared by the DPI.
724 While s 14 of the Mining Act provided for the allocation of ELs for allocated minerals in land within an MAA via a process of ‘invitations for tender’, Mr Mullard explained that provision was not used during his time at the DPI and that it was distinct from the EOI process with which the this trial was concerned.
The Evaluation Committee’s selection of a preferred mining company
725 Upon the receipt of expressions of interest from companies invited to participate in an EOI process, an independent Evaluation Committee and an external probity auditor were appointed to evaluate those applications against the criteria provided in the Coal Allocation Guidelines and elaborated upon in the EOI Process Information Package issued to invitee companies. Evaluation Committees and probity auditors were used in the Caroona and Watermark EOI processes together with the EOI process in respect of eleven small to medium coal release areas including Mount Penny.
726 The Evaluation Committee would identify the preferred applicant for an EL to the Minister in writing and recommend that the preferred applicant be granted consent to apply for an EL.
The granting of consent by the Minister for the preferred company to apply for the EL pursuant to the regime in s 13(4) of the Mining Act
727 Whether a coal resource was to be directly allocated or released as a result of a competitive process, the Minister was required to consent to the making of the application.
728 The Minister invited applicants to make the necessary application on the basis of the Evaluation Committee’s advice.
Application by the recommended company for the EL under s 13 of the Mining Act
729 If the successful applicant then wished to proceed with its application, it would apply to the Department using the forms supplied on the Department’s website, which require confirmation of certain administrative issues such as available financial resources, particulars of proposed program of work and a statement providing an estimate of the amount of money proposed to be spent on prospecting. Subject to adequate confirmation of these administrative issues by Departmental officers, an EL in the form of a deed would be prepared.”
Coal resources in Bylong Valley
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The judge also summarised the history of the assessment of coal resources in the Bylong Valley, which had been the subject of two studies undertaken by the Department. The second (later) study, known as the “Dwyer report”, prepared in 2005, recommended that further exploration programs were required to assess the coal resources in the region. [15] What followed was the grant to the DPI of EL 6676 on 21 November 2006. The purpose was to allow the Department to undertake exploration activities to assist in determining whether the area could be released to public tender. As the judge noted, Mr Mullard gave evidence that, as of May 2008, there had been little by way of a drilling program in EL 6676. [16]
Conclusions – ground 1(1)
15. Judgment at [751].
16. Judgment at [752].
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In a passage preceding the detailed discussion of the process, the judge concluded that there was a relevant connection between the steps taken prior to the EOI process and the process itself which demonstrated a relevant connection between those steps and the ultimate grant of the Mount Penny EL. [17]
17. Judgment at [691].
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The contextual material as to the process by which steps were taken to release land for expressions of interest, assess those expressions and finally grant an EL (if thought appropriate) provided a firm basis for concluding that the activities the subject of the pleaded agreement were sufficiently described to allow the parties to understand what was in contemplation. If it were assumed that each of the elements of the charge was established on the evidence, and it was established that those steps were taken for the pleaded purpose of benefiting the Obeid family interests, and putting to one side the other issues raised by the appellants, the charge would not be invalid on the basis that it did not identify with sufficient precision the nature of the conduct, the subject of the agreement between the parties. Accordingly, the challenge to the validity of the indictment based on the first element in ground 1 should be rejected.
Ground 1(2) – no act required of Obeids
Nature of challenge
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The second element of the challenge in common ground 1 was that only one person to the agreement was expected to do anything, namely Mr Macdonald. The written submissions for Mr Moses Obeid succinctly stated the issue in the following terms: [18]
“While a criminal conspiracy may not need to adhere to the same requirements as a contract for the purpose of the civil law, the concept of an ‘agreement’ requires that there be mutual promises or actions on the part of the parties.”
18. Written submissions, par 153.
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At one level, this statement appeared to deny its own premise, namely that this was not a form of agreement which required consideration in the contractual sense. From a practical perspective, the proposition might mean no more than that Mr Macdonald was unlikely to act in a way which rendered him liable to criminal prosecution if he were to obtain no benefit from it. However, as a matter of principle it is unclear why there can be no conspiracy in which one, or indeed more than one of the conspirators, take no unlawful step except to be the recipients of favours for which they have not agreed to provide any benefit in return.
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Further, it was not the case that the Obeids were not expected to take any step or do any act. The clear expectation was that they would coordinate with Mr Macdonald to take steps to obtain a benefit from the grant of the exploration licence, together with full knowledge of the process by which the grant would be achieved (as in fact happened). Whether or not those steps constituted criminal conduct was not the issue. If, for example, the act of a conspirator was to receive stolen money, he or she would commit the offence of dealing with the proceeds of crime. Whether such an offence would arise with respect to non-pecuniary benefits need not be addressed. Further, it was no part of the conspiracy, the subject of the charge, that Mr Macdonald obtained a benefit for his part in the arrangements. As will be seen in relation to issues considered below, there was evidence that the Obeids considered it either necessary or appropriate to distance themselves from the grant of the exploration licence by seeking to undertake dealings with the successful grantee through a corporate structure which did not readily reveal their involvement.
-
Again, apparently as a pragmatic consideration, Mr Moses Obeid drew attention to what he described as a difficulty the trial judge had in identifying any level of moral culpability on his part when it came to imposing a sentence. That matter can be put to one side. The sentence itself (which is not challenged) involved a significant period of imprisonment. The description of Mr Obeid’s moral culpability may or may not be satisfactory; it does not, however, demonstrate that a conspiracy in which the recipient of favours is not actively involved in the substantive offending through his own unlawful conduct cannot be a valid charge of conspiracy.
Authorities
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The substantive argument in support of this ground relied upon statements in cases of high authority, which undoubtedly articulate the elements of a conspiracy as involving agreement for unlawful acts by more than one person, and perhaps all conspirators. The question is, in this circumstance, whether those descriptions were intended as identifying an essential element of all conspiracies, or whether they were descriptive of the circumstances of the case before the court.
-
First, it should be acknowledged that the following passage in the third appellant’s written submissions is a correct statement of the law.
“152 To establish a common law conspiracy, there must be an agreement; it is not sufficient to establish merely that there is an intention that an unlawful act be committed: R v Rogerson … at 280-281. Nor is an intention that an unlawful act be committed established merely by knowledge of, or an expectation that, such an act will occur: Trudgeon at 256. Even a (mere) coincidence of two or more minds to effect this object or objects will not amount to a conspiracy: Murphy (1837) 8 Car & P 297 at 310-311; 173 ER 502 at 508; Cunningham (1978) 39 CCC (2d) 169 at 180-181.”
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None of those statements, however, addresses the present issue. For that purpose, the appellants relied upon the following passage in the reasons of French CJ in The Queen v LK: [19]
“62. A concise enunciation of the elements of conspiracy was given by the Court of Queen's Bench in Mulcahy v The Queen in 1868 in answer to questions proposed by the Lord Chancellor in relation to a prosecution under the Crown and Government Security Act. Willes J, delivering the opinion of the judges, said:
‘A conspiracy consists not merely in the intention of two or more, but in the agreement of two or more to do an unlawful act, or to do a lawful act by unlawful means. So long as such a design rests in intention only, it is not indictable. When two agree to carry it into effect, the very plot is an act in itself, and the act of each of the parties, promise against promise, actus contra actum, capable of being enforced, if lawful, punishable if for a criminal object or for the use of criminal means.’
The House of Lords concurred. Notwithstanding its statutory context, the statement of the common law in Mulcahy has been accepted and applied in this Court.”
19. (2010) 241 CLR 177; [2010] HCA 17. (References omitted.)
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The thrust of the principle which French CJ was considering, and which was articulated in Mulcahy v The Queen [20] , was that it was “not sufficient that the accused had intended to agree to commit the offence” but he “had to have intended to put the common design, the commission of the offence, into effect”. [21] By contrast, the suggestion in Mulcahy that the agreement involved consideration, “capable of being enforced, if lawful”, was expressly (and correctly) disavowed by the appellants. Otherwise, there is no authority for the proposition that each party to the conspiracy must agree to be responsible for some unlawful overt act in carrying out the agreement.
20. (1868) LR 3 HL 306.
21. LK at [63].
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No passage in the joint reasons of the other members of the Court in LK (Gummow, Hayne, Crennan, Kiefel and Bell JJ) is relied upon in support of the principle espoused by the appellants.
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French CJ in LK noted that the statement from Mulcahy had been approved in earlier decisions of the High Court. (It has also been criticised.) The first was a reference to The King v Kidman,[22] but that was only for the proposition that “the agreement to do an act itself is, in itself, an overt act in advancement of the intention to do the ultimate act agreed upon”, a matter which does not support the appellants’ contention. The second was a reference to The King v Boston,[23] but there the proposition was limited to the first limb of the statement in Mulcahy, namely that “[a] conspiracy consists not merely in the intention of two or more, but in the agreement of two or more to do an unlawful act, or to do a lawful act by unlawful means”.
22. (1915) 20 CLR 425 at 446-447 (Isaacs J); [1915] HCA 58.
23. (1923) 33 CLR 386 at 396 (Isaacs and Rich JJ); [1923] HCA 59.
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The third authority was The Queen v Rogerson. [24] It is true that Brennan and Toohey JJ (at p 281) quoted the whole of the extract from Mulcahy referred to by French CJ in LK, but they did so for a limited purpose. Thus, in introducing the extract, Brennan and Toohey JJ stated:
“What makes a conspiracy unlawful is the unlawfulness of its intended object or the unlawfulness of the means intended to effect its object.”
24. (1992) 174 CLR 268; [1992] HCA 25.
-
Following the quote, which was set out to explain that proposition, the joint reasons continued: [25]
“As the ‘very plot’ is the actus reus of the offence, the offence is complete before any further unlawful act is done or any further lawful act is done to carry the unlawful object into effect. When Willes J [in Mulcahy] spoke of an ‘unlawful act’, he was speaking of an act which has not occurred when the conspiracy is formed.”
25. Rogerson at p 281.
-
It should be added that no issue arose in Rogerson as to the acts done in furtherance of the conspiracy to pervert the course of justice. All the co-conspirators were involved in acts in the course of carrying out the conspiracy. However, the purpose of the conspiracy was to benefit then Detective Sergeant Rogerson who had been found with a known criminal closing a bank account and removing a large amount of money. The purpose of the conspiracy was to manufacture evidence that the money was legitimately obtained by Mr Rogerson by the sale of a car. The steps taken by two of the conspirators, Paltos and Karp, involving evidence of a sale by Rogerson and Nowytarger of a Bentley car to Karp, were not shown to have benefited either Mr Karp or Mr Paltos. The question in the High Court was whether there was sufficient evidence to support a finding that each of the respondents had the intent that, by producing the contract of sale to support a false story, police would be deflected from instituting a prosecution for an offence, the specific offence not being identified. [26] The offence was ultimately identified as possession of unlawfully obtained money resulting from the sale of drugs. There was nothing in the case concerned with the liability of a person who had taken no step in the course of the conspiracy, nor was to take any step pursuant to the conspiracy. [27]
26. Rogerson at p 287.
27. Although it is of no moment, the written submissions for Mr Moses Obeid stated that Mason CJ agreed with the analysis of Brennan and Toohey JJ in relation to this point: that is not apparent from the Chief Justice’s statement at p 279.
-
It is not necessary to determine whether Mr Macdonald would obtain some benefit from the carrying out of the unlawful acts. A conspiracy does not cease to be one in circumstances where one party acts out of friendship for another, or in the belief that he will benefit from such conduct, whether the belief is reasonable or misguided. However, in the present case the evidence supported an inference that Mr Obeid Snr was an influential member of a faction within the governing Labor party. Mr Macdonald was not a member of that faction but was a member of another faction with less power within the government and therefore might well have thought it valuable to provide a favour to a powerful powerbroker. However, to repeat the dispositive response, the validity of a charge of conspiracy does not depend upon the motives, good, bad or misguided, of one of the conspirators.
-
The second element of common ground 1 should be rejected.
Ground 1(3) – no agreement that Macdonald would not act “but for” the improper purpose
-
The third element of ground 1 was encapsulated in the following written submission: [28]
-
While, taken in isolation, the fact of the calls (the content of which was not the subject of evidence) does not give rise to an inference as to Mr Moses Obeid’s involvement in the conspiracy prior to 9 May 2008, the existence of a social relationship, together with the concentration of calls at times when independent evidence (referred to below) revealed that Mr Moses Obeid was involved in exploring the possibility of there being coal under Cherrydale Park, form the basis for an inference that some of his communications with Mr Macdonald were directed to exploring the possibility of exploiting the coal. That evidence, with further evidence as to Mr Moses Obeid’s involvement in January/February 2008 discussed below, provided ample support for the conclusion that Mr Moses Obeid was involved in the conspiracy from a date prior to 9 May 2008.
-
The substance of the challenge to this particular under the unreasonable verdict ground did not focus on the evidence, but on the scope of the judge’s conclusions based on events after 30 June 2008. It was true that that passage in the reasons, taken in isolation, did not support a finding as to earlier involvement of Mr Moses Obeid. [336] But the function of the Court in addressing ground 2 is not to review the judge’s reasons but to consider the evidence. The appellant’s submissions did not engage with this task. However, the evidence did not provide a basis for a reasonable doubt as to Mr Moses Obeid’s involvement as at 9 May 2008.
336. Moses Obeid, written submissions, par 340ff.
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Particular (c) in Mr Macdonald’s submissions stated that there was a reasonable hypothesis that Mr Macdonald was not aware that the Obeids owned a property in the Bylong Valley as at 9 May 2008. This was the factual matter upon which ground 3, alleging the failure to give a Shepherd direction, was based. However, there were several circumstances which supported the finding that Mr Macdonald knew of the Obeid family interest in Cherrydale Park well before 9 May 2008, when he took the first step in carrying out the conspiracy.
-
First, the uncontested evidence was that the sale contract with Mr Cherry as vendor was signed on 27 September 2007. On 4 and 12 September 2007 Mr Macdonald had lunch with Mr Obeid Snr in Sydney. [337] On 15 September, Mr Obeid’s diary recorded him attending Mr Macdonald’s wedding in Orange. On 16 September Mr Cherry’s solicitor sent a “list of all the inclusions” that would go with Cherrydale Park on a walk-in-walk-out basis. [338] The sale price was $3.65 million, of which $3.15 million was provided by way of vendor finance. A condition of the mortgage was that the water licences for the property would not be transferred until the mortgage was discharged.
337. Ex A, pp 143, 145.
338. Ex A, p 149.
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Mr Obeid Snr and Mr Macdonald spoke by telephone on six days between Tuesday, 18 September and the exchange of contracts on Thursday, 27 September. On 26 September, the Obeids’ solicitor, Mr Cordato, sent at 5.30pm an email containing a letter summarising the terms of the contract. The letter noted that there were “a number of water licences for domestic irrigation and stock” which were to remain in the name of the vendor until the loan advance was repaid. [339] At 5.36pm, Mr Obeid Snr called Mr Moses Obeid, who returned his call at 5.49pm. At 6.32pm Mr Macdonald’s Chief of Staff, Adam Badenoch, sent an email to an officer in the Department of Natural Resources seeking information in relation to eight water licences, being the licences identified in special condition 53 in the sale contract. Mr Badenoch gave evidence that he himself had no interest in any rural land or water licences. [340]
339. Ex A, p 167, par 13.
340. Tcpt, p 2313(43).
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There were powerful inferences available from this evidence that (i) Mr Macdonald knew of the purchase of Cherrydale at around the time the contract was signed and (ii) he had requested his Chief of Staff to make enquiries in relation to the water licences.
-
In an interview with journalists on 18 December 2012, Mr Moses Obeid said that they (the Obeids) had learnt of the mining authority held by Anglo-American in March or April 2008. Mr Obeid Snr corrected that to February-March. [341] Mr Obeid Snr also told the journalists that having spent the summer of 2008 at Cherrydale, he “went back to Parliament and it’s on record that I asked Ian [Macdonald] if the Department has any knowledge of a mine being planned for Bylong by Anglo. Within six or seven days one of his staff has called on my office and said to me that there was [sic] no plans known”. [342]
341. Ex AV, p 6095.
342. Ex AV, p 6112.
-
The first act of misconduct particularised in the indictment, which occurred on or about 9 May 2008, was the request by Mr Macdonald for information from his Department as to the volume of coal reserves in the Mount Penny area in the Bylong Valley. That step itself was supportive of the finding that Mr Macdonald, on or about that date, knew that the Obeids owned a property at Mount Penny. The timing of the various communications and activities referred to above provides ample support for that conclusion and no basis for a reasonable doubt as to Mr Macdonald’s knowledge of that fact as at 9 May 2008. It also supports the inference that Mr Moses Obeid was involved in plans to exploit a coal reserve at Mount Penny as at 9 May 2008.
-
There were two further “reasonable hypotheses” raised by Mr Macdonald which have not been addressed. Two (particulars (e) and (f)) concerned the possibility that Mr Macdonald would have engaged in the conduct alleged absent the improper purpose and that the Obeids did not appreciate that he would have done so. The underlying premise was that the prosecution needed to establish beyond reasonable doubt that Mr Macdonald would not have done what he did in order to benefit the Obeids “but for” the improper purpose.
-
In ground 1(3) a challenge was brought to the failure of the trial judge to find that there was no conspiracy because the prosecutor failed to allege that Mr Macdonald would not have done the acts the subject of the agreement “but for” the improper purpose. That ground was rejected on the basis that the trial judge in fact approached the matter on the basis that she did have to be so satisfied, and was. However, for the reasons given in considering the legal basis of the appellants’ submissions on that ground, the charge of conspiracy did not engage such an element.
-
Furthermore, the contention was factually incoherent. The improper purpose was to benefit the Obeid family by releasing confidential information and acting partially towards them. It would have made no sense for Mr Macdonald to take such steps in the absence of an agreement. The element of “wilful misconduct” required that the steps be taken pursuant to the agreement and in breach of Mr Macdonald’s public duties. By way of analogy, in Jackson and Hakim, [343] it would have been no answer to the charge against Mr Jackson of taking a bribe to release a prisoner that he had intended to direct the release of the prisoner in any event. On a proper understanding of the charge, the legal premise underlying these particulars fell away.
343. Jackson v R; Hakim v R (1988) 33 A Crim R 413 (NSWCCA).
-
Finally, particular (g) alleged that the conduct agreed upon was “not serious and meriting criminal punishment”. This was a restatement of ground 1(5) which alleged an error in the indictment in failing to include as an element the agreement that the conduct was serious and meriting criminal punishment. [344] As explained in relation to that ground, the parties to the conspiracy did not have to agree on the legal characterisation of their conduct. This particular had no relevance under ground 2.
344. See [77]-[81] above.
-
Otherwise, the various particulars of the unreasonable verdict ground have been addressed.
Distancing Obeid name from coal activities
-
In a section of the judgment not the subject of challenge, findings were made with respect to the attempted change to the legal ownership of Cherrydale Park. The purchase had been undertaken by Locaway Pty Ltd as trustee for the Moona Plains Family Trust, the primary beneficiaries of which were the four children of Mr Obeid Snr, who was the appointor. An attempt was made, commencing in February 2008, to alter the ownership. By a letter dated 14 February 2008, addressed to Mr Obeid Snr, at Coalpac Group Pty Ltd at Birkenhead, Mr Anthony J Cordato, solicitor, stated:
“We refer to our telephone discussion and confirm that you desire to appoint United Pastoral Group Pty Ltd as the new trustee of the trust to replace Locaway Pty Ltd.”
-
Mr Cordato advised that he had already written to the solicitor for the Cherrys, seeking their client’s consent to the substitution of United Pastoral Group Pty Ltd for Locaway Pty Ltd as mortgagor.
-
United Pastoral Group Pty Ltd was originally incorporated under a different name with the registered office of SJ Sassine & Co, an accountant who worked for the Obeids. On 15 February 2008, Mr Andrew Kaidbay was appointed as director and secretary and became the holder of what appear to be the issued capital of the company. In fact, the name of the company was not changed to United Pastoral Group Pty Ltd until 30 September 2008.
-
In October 2008, Mr Sassine sent Mr Cordato a trust deed. The deed was apparently dated 25 October 1994, but Mr Sassine stated that “[t]he new trustee as from Feb 2008 should be United Pastoral Group Pty Ltd”. The delay between mid-February and early-October 2008 is not explained, but it is apparent that Mr Obeid Snr considered it necessary to remove any association of the Obeid family from the ownership of Cherrydale Park.
-
As Mr Cordato was aware, the change in the trustee required the consent of the mortgagee. Accordingly, he wrote to the solicitors for Mr Cherry on 15 October 2008. Nothing appears to have occurred at that stage, and Mr Cordato followed up with a telephone discussion and a letter dated 9 February 2009. The solicitors replied on 12 February 2009 stating that Mr Cherry had already indicated to Mr Obeid Snr that “the reasons for the change would need to be provided before the request would be considered”.
-
On 16 February 2009, Mr Cordato responded: [345]
“The reason for the change in trustee is to protect the privacy of our clients …. The new trustee is a nominee company which has been incorporated for this purpose.”
Consent was refused. [346]
345. Ex A, p 3409.
346. Ex A, p 3557.
-
Mr Cherry was called as a witness and gave evidence of having spoken to Mr Obeid Snr in February 2009. The following exchange took place: [347]
“Q. And what was your conversation with Eddie Obeid?
A. Eddie Obeid said that what he really wanted to do was to remove him and the family name from coal; there was a lot of fuss going on in the valley at that particular point in time, so wanted to hide that factor, because he was interested in coal.”
347. Tcpt, p 483(10).
-
In relation to the solicitor’s statement that the reason for the change in trustee was “to protect the privacy of our clients”, Mr Cherry stated: [348]
“They didn’t want to tell me officially that they wanted to hide the fact that they were involved in coal, which is what Eddie told me personally on the phone.”
348. Tcpt, p 483(40).
-
As the prosecutor submitted at the trial, the various attempts, commencing in February 2008 and continuing for over a year, by the Obeids to change the legal ownership of Cherrydale Park were undertaken with the objective of distancing the Obeid family from ownership of the property. The step first taken by Mr Obeid Snr in February 2008 was not pursued for a few months, but was renewed within a month of the EOI package, which included a diagrammatic representation of the Mount Penny area which overlaid Cherrydale Park, being released on 9 September 2008. [349] As submitted at trial and on the appeal, the later steps by Mr Obeid Snr did not fall within the period of the conspiracy; nevertheless, taken as a whole, the conduct provided unequivocal evidence of an attempt to distance the Obeid interests from ownership of the land and thus support for the case that Mr Obeid Snr was implicated in the improper purpose of the conspiracy.
Statements to journalists
349. Crown written submissions, 18 December 2020, par 521.
-
In 2010, Ms Anne Davies wrote an article in the Sydney Morning Herald as a result of research she had undertaken in relation to coal in the Bylong Valley. Relevantly, she had spoken to Mr Moses Obeid. She gave evidence based on her notes on a voir dire (which was subsequently admitted in the trial) in the following terms: [350]
350. Tcpt, pp 3565(30)-3566(41).
“Q. Returning then to your note of question in relation to Justin Kennedy Lewis, do you recall what your question was?
A. I think I asked whether he knew Justin Kennedy Lewis and whether he knew Justin Kennedy Lewis had bought a property up there.
Q. At line 6, after your question, it says in the green notes, ‘no, I didn’t until January’. What does that relate to?
…
A. That was the answer that Moses Obeid gave me, that he didn’t know until January that Mr Kennedy Lewis had bought a farm in the valley.
…
A. Because that was what he told me that Justin Kennedy Lewis had said to him. So he was recounting the whole conversation. He said that he had bumped into Justin and that Justin had said, ‘Oh, I’ve bought a farm in the Bylong Valley’ and that he didn’t know until January and then he said that Justin Kennedy Lewis had said, ‘you guys have got a farm up the road’.
Q. … The reference to ‘Justin K Lewis’, … there is [‘Q. did you get him to buy it?’]
…
Q. And the response in quotation marks ‘not at all’, who said that?
A. That was what Moses Obeid said to me.
Q. And was that in response to a question about whether he got Justin Kennedy Lewis to buy the property?
A. Yes.
Q. Lines 23 and 24, on the green notes, ‘we don’t go around buying farms for the sake of it’, do you recall who said that?
A. Yes, that was Moses Obeid and he said to me, ‘look why would we’ –
…
A. So he said to me, ‘we don’t go around buying farms for the sake of it’. It was him – he was sort of outraged at the suggestion I had made that they were buying farms under the cover of somebody else’s name.”
-
There was ample documentary evidence that Mr Moses Obeid, a friend of Mr Lewis, had taken steps to arrange for him to purchase Coggan Creek. Accordingly, the statement made to the journalist, Ms Davies, was a fabrication. The judge’s acceptance of the submission that this was a deliberate lie was not challenged on the appeal. [351]
351. Judgment at [1971].
-
In December 2012, both Mr Obeid Snr and Mr Moses Obeid were interviewed by two journalists, Mr Shanahan and Ms Jiminez over three days, being 18, 20 and 21 December 2012. Mr Obeid Snr participated in the interview on 18 December 2012 only. [352]
352. Judgment at [1960].
-
The prosecution identified 36 lies which were said to have been made attributable to Mr Moses Obeid in the course of the interview. Consideration of that case led to an interlocutory judgment (R v Macdonald (No 15)) to which is annexed a schedule of lies and admissions. [353] The judge then returned to that document and made the following finding:
“1968 Having regard to all the evidence in the trial and in light of the various factual findings I have made in the course of my deliberations to date, I am satisfied that each of the ten lies attributed to Moses Obeid was a deliberate misstatement of the truth. I am also satisfied that each lie was material to the issues in dispute in the trial and each was told by Moses Obeid in an attempt by him to conceal both the existence of a conspiracy in which Mr Macdonald as the Minister for Mineral Resources agreed to breach his Ministerial duties and obligations in connection with the granting of an EL at Mount Penny for the improper purpose alleged, being an agreement into which Moses Obeid had intentionally entered and in which he actively participated throughout its currency.
1969 I am further satisfied, and direct myself accordingly, that it is safe to draw an inference of guilt adverse to Moses Obeid from having told each of those ten deliberate lies, in circumstances where I am satisfied that had he truthfully answered the questions put to him and/or volunteered information to the journalists about the acquisition of the properties adjoining Cherrydale Park and the circumstances in which he and members of his family became involved with mining companies who had applied for an EL at Mount Penny including Cascade Coal P/L, the mining company ultimately granted that EL, he would, unquestionably, have been at risk of implicating himself as a co-conspirator in the conspiracy charged.”
353. See fn 111 above.
-
After then identifying the circumstances in which the interviews were conducted, namely the commencement of a public inquiry by the ICAC on 12 November 2012, the terms of which were set out at [1972], the judge continued:
“1975 Having reasoned to the conclusion that Moses Obeid was a participant in the conspiracy charged, including, but not limited to, what he has been shown to have said and done as overt acts in furtherance of the conspiracy, it is sufficient to emphasise what I consider to be the most egregious lies told by him, lies which I am satisfied were told with a ‘consciousness of guilt’ and a fear of the truth being revealed. Those lies principally concern his dealings with Monaro Mining NL and the involvement of Mr Brook and include the following:
(1) Monaro Mining NL, via Mr Brook, was the source of the information about the EOI process commencing in late July or early August 2008.
(2) He met Mr Brook because he wanted someone to assist with the negotiations with Anglo American P/L as to the ‘exit strategy’. Meanwhile, separately, Mr Brook was speaking to Monaro Mining NL.
(3) The Obeids had nothing to do with Monaro Mining NL or their EOI application or with the tender process as they wanted to ‘remain out of it’.
(4) The Obeids told Mr Brook that they were happy to remain as landowners and wait for him to return with a deal and if Mr Brook could not pay for the land then the Obeids would do a deal in relation to the land in order to get equity in the deal.
1976 It is clear beyond question that Moses Obeid was aware of an imminent EOI process which would include Mount Penny before his first meeting with Mr Brook on 3 July 2008. It is equally clear that Moses Obeid’s dealings with Mr Brook were in relation to a joint venture, first with Monaro Mining NL and then Cascade Coal P/L, and that Moses Obeid provided the list of companies to Mr Brook which facilitated his approach to Monaro Mining NL.
1977 I am also satisfied that until the first Wentworth Hotel meeting Mr Brook was ignorant of the forthcoming EOI process. I am also satisfied that he had no relevant experience in the mining sector in New South Wales, and no knowledge of coal companies in New South Wales who might apply for the grant of an EL until Moses Obeid provided him with the list of companies the DPI proposed as invitees to that process. Furthermore, the evidence that Mr Brook kept Moses Obeid apprised of all his dealings with Monaro Mining NL, and that Moses Obeid instructed Mr Rumore in relation to the Share Option Deed between Voope P/L and Monaro Mining NL (pursuant to which the Obeid family via the interposition of Voope P/L, a company the Obeid family controlled, sought a share in the mining venture) clearly establishes Moses Obeid was concerned to ensure that control over Monaro Mining NL’s successful tender for the Mount Penny Coal Release Area would vest in his family.
1978 I am satisfied that the lies listed above were deliberately told by Moses Obeid to conceal his family’s interests in the Mount Penny EL; their dealings with Monaro Mining NL in that connection; the role Mr Brook played in those dealings; his knowledge of Monaro Mining NL’s application for the grant of an EL over the Mount Penny Coal Release Area; and the source of that knowledge.”
-
Although the trial judge based her findings in respect of this evidence in part on earlier findings adverse to Mr Moses Obeid, taking the evidence as a whole, the statements to the journalists relied on as lies by the prosecutor should be accepted as such and provide significant support for the prosecution case.
Ground 2 – Conclusions
-
As has been noted, in dealing with a circumstantial case, and particularly one involving a conspiracy, the manner in which the unreasonableness submissions were formulated under common ground 2 was problematic. [354] Rather than consider whether there was a reasonable hypothesis consistent with an innocent explanation in respect of each particular matter relied upon by the trial judge, it was necessary to engage in an assessment of the whole of the evidence in order to articulate a reasonable doubt as to the correctness of the verdict.
354. See [346]-[347] above.
-
It may readily be accepted that some of the material relied upon was more powerful than other elements. However, each of the verdicts was capable of support in circumstances where the indispensable elements were established beyond reasonable doubt, but only on the evidence and the inferences drawn from the evidence. The Court is of the view that the prosecution proved beyond reasonable doubt the existence of a conspiracy as alleged in the indictment, and that each of the co-accused were participants in it at the time at which it was formulated, namely prior to 9 May 2008. We do not entertain a reasonable doubt in that respect. There is therefore no need to consider whether the trial judge had a particular advantage which might have explained all or some aspects of a doubt which we entertained.
PART D ORDERS
-
The nature of the charge and the complexity of the evidence justify a grant of leave to appeal, to the extent that that is necessary, pursuant to s 5(1)(a) of the Criminal Appeal Act. Such leave should be granted with respect to each appellant.
-
However, in each case the appeal must be dismissed.
Annexure A and B (1462036, pdf)
**********
Endnotes
Amendments
09 October 2023 - Changes to quote in [553].
16 April 2024 - [20] 1st line - changed "were" to "was"
[21(6)] and index - changed "partiality" to "impartiality"
[45] 1st line - "third" inserted before "appellant's"
[47] 2nd sentence - changed "appellant" to "appellants"
[50] after "French CJ" changed "Mulcahy" to "LK"
[52] - deleted "of" before "a false story"
Heading above [82] - changed "partiality" to "impartiality"
[92] 1st line - replaced "is" with "are" before "obscure".
[96] - changed "appellant" to "appellants"
fn 34 - changed "55" to "at 69"
fn 60, 61 and 65 - insert "third" before "appellant's"
Decision last updated: 16 April 2024
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