Mamo v Director of Public Prosecutions
[2014] VCC 315
•25 March 2014
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CIVIL DIVISION | Revised Not Restricted Suitable for Publication |
CONFISCATIONS LIST
Case No. CI-13-00928
| FRANK MAMO | Applicant |
| v | |
| DIRECTOR OF PUBLIC PROSECUTIONS | Respondent |
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JUDGE: | HIS HONOUR JUDGE LACAVA | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 3 March 2014 | |
DATE OF JUDGMENT: | 25 March 2014 | |
CASE MAY BE CITED AS: | Mamo v Director of Public Prosecutions | |
MEDIUM NEUTRAL CITATION: | [2014] VCC 315 | |
REASONS FOR JUDGMENT
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Subject:Confiscation – exclusion application – whether applicant has proved restrained property is not “derived property” – whether s26 of Confiscation Act 1997 can be availed of to provide relief to an applicant who fails in an exclusion application under s22 – application of the principle “generalia specialibus non derogant”
Legislation Cited: Confiscation Act 1997, s3, 7A, 18, 20, 22, 26
Cases Cited:Chalmers v R [2011] VSCA 436; Director of Public Prosecutions & Anor v Moloney (2011) 33 VR 23; Director of Public Prosecutions v Vu (2006) 14 VR 249; Director of Public Prosecutions v Gibson [2012] VSC 297; JR Mokbel Pty Ltd v Director of Public Prosecutions (Vic) [2007] VSC 119
Judgment: Applications dismissed.
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APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr J Snow | Malkoun & Co Lawyers |
| For the Respondent | Mr S McGregor | Solicitor for Office of Public Prosecutions |
HIS HONOUR:
1 The applicant is the registered proprietor of a property situated at 2/36 Timele Drive, Hillside (“the property”).
2 On 5 March 2013, Judge Parsons made a restraining order (“the restraining order”) in respect of the property pursuant to s18 of the Confiscation Act 1997 (“the Act”). The restraining order was made on the basis of information contained in an affidavit of Noelene Ford, a Detective Senior Constable of the Victoria Police. That affidavit makes it clear that the police suspected the applicant of growing cannabis at the property based upon surveillance and the fact that the electricity supplier to the property recorded the property to be using 14kWh per day, which is much higher than the average household. The affidavit also makes it clear that when the property was raided by the police and a search warrant executed, the police did not locate cannabis growing at the property. They did locate 112 cannabis plants growing at another property linked to the applicant at Melton. That crop had a weight of 161 kilograms.
3 The affidavit of Detective Senior Constable Ford deposes that at the property the police located an electrical bypass, drugs and other paraphernalia usually associated with the growing of cannabis hydroponically.
4 The order of Judge Parsons in terms makes it clear that the purpose of making the restraining order was, inter alia, to satisfy any forfeiture order that may be made under Divisions 1 or 2 of Part 3 of the Act. Although his Honour’s order does not refer to the grounds upon which the order is made, the application makes it clear the respondent was seeking the restraining order on the basis that it was being asserted the property was “tainted”.
5 On 4 October 2013, the applicant pleaded guilty before her Honour Judge Nicholson to three charges on Indictment C1308885. Charge 1 was cultivation of a drug of dependence in a commercial quantity (cannabis L). That is an “Automatic Forfeiture Offence” within Schedule 2 of the Act.
6 Charge 2 was a charge of possession of a drug of dependence (Methylamphetamine) and charge 3 was possession of “a substance, material, documents or equipment for trafficking in a drug of dependence”. Charges 2 and 3 were both committed at the property “at Hillside”. Neither of those offences is a Schedule 2 offence within the Act. The prosecution summary made it clear that included within charge 3 was stolen electricity and, that the other items alleged to be possessed “at Hillside” were used in connection with the cultivation of the cannabis crop “at Melton”. Those items found at the Hillside property included hydroponic growing fertilizers and equipment.
7 On 24 September 2013, the applicant filed an application for exclusion of the property from the restraining order. The application is supported by an affidavit of the applicant dated 21 November 2013 and an affidavit of the applicant’s solicitor, Anthony Malkoun, sworn 9 September 2013. The ground upon which the property is sought to be excluded from the operation of the restraining order is that the property is not “tainted property”. The respondent relies upon the affidavit of Simon O’Keefe, sworn 5 February 2014, and the affidavit relied upon in support of the application for a restraining order.
8 In summary form, the argument of the applicant directed to the exclusion application is that charge 1 (the Schedule 2 offence) was committed at a factory in Melton, not at the Hillside property, which was in fact purchased several years earlier by the applicant and thus the property could not be shown to have been derived from the offending that constituted the Schedule 2 offence. Further, because the Melton factory where the Schedule 2 offence occurred is separate by some distance from Hillside, then the property is not “tainted”.
9 Relevantly, the expression “tainted property” is defined in s3 of the Act as follows:
“‘tainted property’, in relation to an offence, means—
(a) in the case of civil forfeiture, a civil forfeiture restraining order, a civil forfeiture order or a civil forfeiture exclusion order, property that—
(i)was used, or was intended to be used in, or in connection with, the commission of the Schedule 2 offence; or
(ii) was derived or realised, or substantially derived or realised, directly or indirectly, from property referred to in subparagraph (i); or
(iii) was derived or realised, or substantially derived or realised, directly or indirectly, from the commission of the Schedule 2 offence; or
(iv) is likely to be used, or intended to be used in, or in connection with, the future commission of the Schedule 2 offence.”
10 Given the basis upon which the plea before Judge Nicholson was conducted and the finding on the property of hydroponic growing fertilizers and equipment, it could be strongly argued in my view that the property was “tainted” within subparagraph (a)(i) of the definition. If the property was used for the storage of these items, it could be strongly argued that the property was used “in connection with” the commission of a Schedule 2 offence. However, before me the respondent did not contend the property was “tainted property” within the Act, rather the Director proceeded on the basis the property was “derived property” for the purposes of the Act especially s22(1)(a)(iia).
11 In order to succeed on his application for exclusion of the property from the restraining order, the applicant must satisfy each of the requirements of s22 on the balance of probabilities. The onus is on the applicant.
12 Section 22 of the Act relevantly provides as follows:
“22 Determination of exclusion application—restraining order—automatic forfeiture
(1)On an application made under section 20, where the restraining order has been made in relation to a Schedule 2 offence for the purposes of automatic forfeiture—
(a)the court may make an order excluding the applicant's interest in the property from the operation of the restraining order if the court is satisfied that—
(i)the property in which the applicant claims an interest was lawfully acquired by the applicant; and
(ii)the property is not tainted property and is not, or will not be, subject to a tainted property substitution declaration under section 36F; and
(iia)the property is not derived property; and
(iii)the property will not be required to satisfy any pecuniary penalty order or an order for restitution or compensation under the Sentencing Act 1991.”
13 It was not argued here that the property was not lawfully acquired by the applicant. But the requirements of the section are conjunctive. The property falls within the definition of “derived property” within the Act and cannot be excluded on that basis alone.
14 For the purposes of civil forfeiture, the expression “derived property” is defined by s7A of the Act in the following terms:
“7A Meaning of derived property—civil forfeiture
In relation to civil forfeiture, a civil forfeiture restraining order, a civil forfeiture order or a civil forfeiture exclusion order, derived property means—
(a) property used in, or in connection with, any unlawful activity; or
(b)property derived or realised, or substantially derived or realised, directly or indirectly, from any unlawful activity; or
(c)property derived or realised, or substantially derived or realised, directly or indirectly, from property of a kind referred to in paragraph (a) or (b).”
(my underlining)
15 When police raided the property there was an illegal electricity bypass set up and the electricity was stolen. The theft of this electricity was included in the facts constituting charge 3. Even leaving aside that there was found on the property hydroponic fertilizers and equipment, the fact of the electricity bypass alone is enough to regard the property as “derived property” within s7A(a) of the above definition, because the property was used in connection with unlawful activity, namely, stealing electricity. The respondent relies upon the principles in Chalmers v R [2011] VSCA 436 where the Court considered the meaning of the phrase “in connection with” in the context of a forfeiture application following conviction for a schedule 1 offence, namely, murder. I accept those submissions. The applicant’s application for exclusion of the property from the restraining order must fail.
16 Realising the difficulties he faced in seeking to have the property excluded from the restraining order, Mr Snow, who appeared as counsel for the applicant, concentrated his argument on the second application of the applicant. I now turn to consider that application.
17 On 5 February 2014, the applicant filed an application under s26(4) of the Act seeking an order under s26(1) seeking “such orders in relation to the Hillside property as the court considers just”. In written submissions dated 6 February 2014, the applicant submitted an order was sought under s26 “to ameliorate the effect of the restraining order”. In submissions in reply what was sought was a fine in lieu of automatic forfeiture.
18 The issue raised by the application is whether s26 can be used as the gateway for relief under the Act that the applicant seeks where the restraining order remains on foot. In my judgment, s26 cannot be used for the purpose that the applicant seeks to use it. Where the property is restrained by a restraining order made in relation to a Schedule 2 Automatic Forfeiture Offence, the applicant must succeed on an exclusion application brought under s22 in order to have the restrained property excluded from the effect of the restraining order. In my view, he cannot seek to invoke the discretion of the Court to vary the order to ameliorate the effect of its terms using the s26 power. To do so would be to ignore the clear purpose of the Act.
19 Section 26(1) of the Act empowers the Court at any time after the making of a restraining order to “make such orders in relation to the property to which the restraining order relates as it considers just”. Section 26(5) set out examples of the kind of order that the Court may make under ss(1). None of the examples there listed provide a statutory basis for the kind of relief now sought by the applicant which in effect is to seek to have the Court make orders preventing automatic forfeiture (or a fine in lieu) in circumstances where the applicant cannot prove the property is not derived property within s22(1)(a)(iia).
20 In Director of Public Prosecutions & Anor v Moloney (2011) 33 VR 23, the Court of Appeal considered the operation of s26, concluding at paragraph 48:
“… Section 26(1) empowers the court to make orders in relation to the property to which the restraining order relates, either at the time ‘when it makes a restraining order’ or ‘at any later time’ as it considers just. Clearly, any order made by the court under this provision at the time when the restraining order is made can only be an ancillary order. This tends to be confirmed by the examples contained in s 26(5) which all assume the continuing existence of a restraining order. Section 26(5)(a) confirms that the court is empowered to vary the property to which a restraining order relates and such an order could only be made ‘at a later time’. As regards such orders that might be made ‘at any later time’ after the restraining order has been made, perhaps the court is thereby empowered to wholly discharge a restraining order,[1] although it may be that the provisions of ss 20, 21, 22 and 24 impliedly exclude such a power under s 26.[2] At any rate, it could not be the case that the limited grounds for making an exclusion order contained in ss 20, 21, 22 and 24 could be subverted by a power under s 26 to discharge a restraining order whenever the court considers it to be ‘just’. For those reasons, we do not think that the language of s 26 supports the respondent’s contention that the court has a general discretionary power under s 18, when making a restraining order, either ex parte or inter partes.”
(my underlining)
[1]See Director of Public Prosecutions v Vu (2006) 14 VR 249 at [51]
[2]Again, see Vu at [51]
21 This approach is consistent with the explanatory memorandum to which the respondent here refers. It is also consistent with the well known approach to statutory interpretation that the general does not detract from the specific, generalia specialibus non derogant. In this regard, the respondent relied upon Director of Public Prosecutions v Gibson [2012] VSC 297 per Emerton J as an example of the application of this approach.
22 The applicant relies upon a decision of Hargrave J in JR Mokbel Pty Ltd v Director of Public Prosecutions (Vic) [2007] VSC 119 at paragraphs 70, 72 and 78 where his Honour held that the words of s26 are not ambiguous and provide a broad unfettered power to the Court to make orders in relation to restrained property as it considers just. The Mokbel decision preceded the decision of the Court of Appeal in Moloney and the correct principles to be applied here must be informed by the decision in Moloney. I therefore reject the approach contended for by the applicant.
23 The applicant referred to a number of discretionary factors which he contends should be applied here. However, having concluded that s26(1) of the Act does not give me the power to ameliorate the effect of the restraining order in the way sought or, to substitute a fine in lieu of automatic forfeiture of the property, it is not necessary that I deal with those discretionary considerations. Similarly, it is not necessary that I deal with those cases cited by the applicant in submissions that deal with application of discretion where the applicant has been convicted of a Schedule 1 offence and not a Schedule 2 Automatic Forfeiture offence. Those cases are concerned with whether or not forfeiture orders should be made. They are not automatic forfeiture cases.
24 For these reasons, the application under s26(1) of the Act must also fail.
25 I will hear the parties on costs.
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