Milne v The Queen

The High Court of Australia heard an appeal from the Court of Criminal Appeal of the Supreme Court of New South Wales concerning a conviction for money laundering under s 400.3(1) of the *Criminal Code* (Cth). The appellant, Milne, was accused of dealing with shares with the intention that they would become an "instrument of crime" by not declaring the resulting capital gain. The core of the dispute revolved around whether the shares, in the context of the alleged conduct, could be considered an "instrument of crime" as defined by the *Criminal Code*.

The legal issue before the High Court was whether the Court of Criminal Appeal had erred in its interpretation of the definition of "instrument of crime" within s 400.1 of the *Criminal Code*. Specifically, the Court had to determine if the shares, disposed of by the appellant with the intention of avoiding tax on the capital gain, could be considered property "used to facilitate the commission of, an offence." The Court of Criminal Appeal had adopted a broad interpretation of "facilitate" as "make easier," finding that the shares, even after disposition, remained capable of being used to facilitate a future offence.

The High Court allowed the appeal, quashing the conviction on the first count. The Court rejected the reasoning of the Court of Criminal Appeal that the shares, after their disposition, remained capable of being used for the future commission of an offence, finding this proposition untenable given the factual case presented by the Crown. The Court clarified that while the share swap created the Capital Gains Tax event and provided a basis for a future crime, and may have offered a "cloak" for deception, the shares themselves, in their disposed state, were not intended to be "used to facilitate" the commission of an offence in the way contemplated by the definition of "instrument of crime." The Court found that the trial judge had erred in refusing to direct the jury to acquit the appellant on the first count. Consequently, the High Court quashed the conviction and entered a verdict of acquittal for the first count, while amending the commencement of the sentence for the second count.