Motherwell v The Queen

[2005] HCATrans 755

[2005] HCATrans 755

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M4 of 2005

B e t w e e n -

SUZANNE HELEN MOTHERWELL

Applicant

and

THE QUEEN

Respondent

Application for special leave to appeal

KIRBY J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 9 SEPTEMBER 2005, AT 11.16 AM

Copyright in the High Court of Australia

MR L.C. CARTER:   May it please the Court, I appear with my learned friend, MS K.A. BLAIR, for the applicant.  (instructed by Patrick W. Dwyer)

MR J.D. McARDLE, QC:   If the Court pleases, I appear with my learned friend, MS C.M. QUIN, for the respondent.  (instructed by Solicitor for Public Prosecutions)

KIRBY J:   Yes, Mr Carter.

MR CARTER:   If the Court pleases.  This application has legitimate claims to special leave under all limbs of section 35A.  In the first place it is submitted that the individual miscarriage is so striking that the interests of justice require special leave to be granted on that basis alone.  But beyond that, it is submitted that the application squarely raises questions of practical significance to the administration of criminal justice that deserve and require the attention of this Court.

It is submitted that this case is the correct vehicle for that to occur, not only because the issues were ventilated before the sentencing judge and the Court of Appeal – and if I can pause at that point, it had been submitted by the Crown in reply that there is not the benefit of a considered view of the Court of Appeal because the issues were not raised there and I have my learned friend’s permission to say that that is an erroneous submission, that the submissions were advanced in the Court of Appeal.

Further, there is nothing hypothetical about the $160,000 pecuniary penalty order.  It has the legal character, as the Court will see from the provisions behind tab 1, section 74 of a civil debt being due to the Crown and it is only the bringing of this special leave application that interrupts enforcement.  May I just take two of my precious minutes to remind your Honours of the context.

KIRBY J:   They are precious to us as well, Mr Carter.

MR CARTER:   That is why there are only two minutes, your Honour, but it is important - your Honours are busy - that I bring up the personal position.  It was common ground that the applicant offended in the context of being a heroin addict.  Indeed, at the age of 54, she had a 28‑year history of addiction.  Her benefits, that is, moneys, were used to obtain, supply and use heroin.  She had spent some 349 days in custody after her arrest and then a further six and a half months in an intensive drug rehabilitation facility known as Bridgehaven conducted by the Salvation Army in Melbourne.  Her progress was described in viva voce evidence on the plea as remarkable, particularly have regard to the level of emotional strain placed upon her by the death of her mother and by the diagnosis of her grandchildren with cerebral palsy.  Still, she was sentenced to three and a half years imprisonment with a minimum of two years ‑ ‑ ‑

KIRBY J:   She was engaged in a very substantial sale to such a level as it was trafficking of a drug and it was a very substantial business.  A lot of people were caught up in it, which Parliament has said must not happen.

MR CARTER:   Indeed, your Honour, and the point that I am coming to is that she received, no doubt the judge balancing the objectives in sentencing legislation of punishment, deterrents both general and personal or specific, together with her demonstrated rehabilitation, a sentence that had the effect of her going back into custody until April of this year.  On top of that – I am coming now to the grounds of appeal – she has been ordered to pay to the state of Victoria the sum of $160,000. 

I intend to deal with proposed grounds 2 and 3 first.  Each of those attacks the defensibility of the exercise of the discretion in the circumstances of this case.  Ground 2 calls attention to the significance of the applicant’s heroin addiction and asks the Court to confront how the discretion to make the order can sensibly be defended in the following circumstances:  one, the crime was in order to support an addiction; two, the benefits strictly called were purely transitory and nothing was retained.  Indeed, there is some painful irony in the attribution of the notion “benefit” to a woman who was described in the Crown Prosecutor’s opening as having been observed by the covert police operatives at some point as so sick that she could not operate; three, in circumstances where she had demonstrated real prospects of rehabilitation and would need ongoing assistance; four, in circumstances where the matter went forward on the basis that her only asset was her house.

Her only asset at age 54 was her house and the judge had himself accepted that it would result in undue hardship for the State to obtain forfeiture of that house on the basis that it was tainted in the sense that that is where the drugs were sold from. 

CALLINAN J:   I do not understand that.  Why was it not tainted?  It was used as the place to sell the drugs.

MR CARTER:   Your Honour, there is no issue that it was tainted within the meaning of the Act.  What his Honour the sentencing judge was taken to was section 33(5) of the legislation and this goes to one of the special leave questions.  Section 33(5) specifically gives guidance to courts as to the circumstances in which forfeiture will be ordered including reference to hardship:

(b)      any hardship that may reasonably be likely to be caused ‑ ‑ ‑

CALLINAN J:   “May have regard to” not “must have regard to”.

MR CARTER:   Yes, but the point in this case, your Honour Justice Callinan, is that application had been made for both forfeiture of the house and pecuniary penalty order.  The application for forfeiture of the house, whilst it was common ground that the property was tainted, was refused and that brings really then to the ‑ ‑ ‑

KIRBY J:   Does that not indicate that the primary judge, the sentencing judge, did take into account the addiction of your client in refusing to take a roof over her head away from her?

MR CARTER:   Yes.

CALLINAN J:   And she was trafficking in different drugs from heroin, too, so she was ‑ ‑ ‑

MR CARTER:   No, your Honour, and not heroin either, with respect ‑ ‑ ‑

KIRBY J:   Methylamphetamine. 

CALLINAN J:   That is what I am saying.  It was not heroin she was trafficking in, was it?

MR CARTER:   No.

CALLINAN J:   No, so she is creating or feeding the addictions of others in another drug.  Why should we be sympathetic to that?

MR CARTER:   This is why, your Honour, because there is an absurd contradiction, with respect, in saying on the one hand we accept that because of hardship you can except your house, but then on the other hand saying the making of the pecuniary penalty order can be justified because your house is available as security to enforce it and that is precisely the submission made underpinning the reasoning of the President, with respect, and adopted by my learned friends in this Court.

CALLINAN J:   Why is it contradictory?  Just tell me what the contradiction is again.

MR CARTER:   The contradiction is that although the sentencing judge does not provide reasons for declining forfeiture it is apparent from the course of proceedings that it is accepted that it would hardship.  On the other hand ‑ ‑ ‑

CALLINAN J:   That is what happens when you commit crimes, you suffer hardship yourself.

MR CARTER:   Hardship is there by the three and a half years, your Honour.  There is a real issue unresolved on the authorities, with respect, as to whether the purpose of confiscation legislation is to inflict further punishment by means of deterrence or whether it is to recover ill‑gotten gains.  Here, of course, there is nothing to recover because it has gone up her arms.  To finish the contradiction ‑ ‑ ‑

KIRBY J:   I want to make it clear to you, Mr Carter, that I do have the same sympathy for your client as an understanding as the President evinced because he said that the addiction to heroin can be taken into account in looking back at the entirety of the punishment which is inflicted on a person.  But he said you cannot use that to set aside the Confiscation Act which is going to often apply to people who are in her position, probably very often.

MR CARTER:   Your Honour, with respect, the President in his reasons misconstrues the purpose of this legislation in such a way as to ascribe to it an additional purpose of punishment which is at odds with some of the authorities. 

KIRBY J:   Whatever the Court has said about it, that would be the consequence of making orders under the Act.  It is an extra burden that people have to carry.  It is like in the sex crimes of the declarations under the statutes the person is a sexual offender, it is just an extra burden.

MR CARTER:   Your Honour, we are talking here of an order for $160,000 against a person with no assets other than the house.

CALLINAN J:   There were 400 telephone calls in 80 days related to drugs, is that not correct.

MR CARTER:   In fact, there were 400 calls on which sound was recorded and the Crown’s position was that the substantial majority of those contained references to drugs.

CALLINAN J:   No, according to his Honour, the trial judge, at page 83:

there were 700 phone calls, with 400 odd of them related to drugs and some of them related to sales.

MR CARTER:   Yes, but, your Honour, it is contained in the application book and it has been referenced in the submissions, the prosecutor was asked about that and at page 52 of the application book, line 5, the prosecutor indicated:

No, 402 where people actually – the phone was answered and responded to and a substantial number of those related to drugs.

But it is not the biggest point. 

Your Honours, the practical issue here which is how can the order be justified in circumstances where the only asset is the house.  There is authority from intermediate courts that is very much at odds with the approach taken by the President.  Behind tab 6 is a decision of the New South Wales Court of Criminal Appeal in Pepin.  At page 333 point 1 in the judgment of his Honour Justice Smart:

I do not pretend to be able to envisage all the various possibilities.  However, they are likely to be cases where the accused has not retained or will not be retaining the proceeds of crime or the value of the property forfeited far exceeds the extent of any benefit derived.

That, with respect, is this case.  By reason of the addiction – and I should indicate that Chief Justice Hunt at Common Law agreed with that aspect of Justice Smart’s reasoning.  Where the divergence arises is to whether hardship is a factor absent legislative articulation of it to consider with respect to pecuniary penalties. 

KIRBY J:   When you look at what the President said in his reasons, he said:

the engagement in the trade by those who need to support a habit will be relevant to the penalty to be imposed overall; but must have less relevance - indeed limited relevance – to the objects of the Confiscation Act.

What is wrong with that?

MR CARTER:   The error there, your Honour, if I can point up the contrast with the dicta that I have just taken you to from the New South Wales Court of Criminal Appeal is that there is a glossing over the reality that the money has gone.  This is not a case of a baron driving in a sports car.  This is a case of a woman with a ‑ ‑ ‑

KIRBY J:   The Confiscation Act is not the confiscation of profits of barons.  Most people, many people, who are involved in the drug trade are feeding their own habits.  Whether this is a sensible way to deal with this area of the law is not our concern.  This is what Parliament has provided.

MR CARTER:   Your Honour, in my respectful submission, the statement made by his Honour there about the purposes of the statute, there had been a similar statement earlier in the reasons at page 125, that the purposes include “the suppression of the drug trade” is tantamount to saying that the purposes embrace deterrence and punishment.

KIRBY J:   It would be hard to say that one of the reasons behind Parliament’s enacting the Confiscation Act was not to attempt to suppress the drug trade.  That is the history of how it came in.  They started, we had very minor offences and then they became more and more, and more and more severe and then ultimately when that was not doing the desired result they added confiscation of profits of crime.  That is how it happened.  I have sat there and watched these things over 30 years.

MR CARTER:   Your Honour, that with respect, is at odds with the ‑ ‑ ‑

CALLINAN J:   It seems to me to be quite unseemly that this woman should retain property which she could not have been able to hold onto unless she had been dealing on a widespread scale, as she was, creating other havoc in the community.  What is the community to think of that?  The effects of what she did to the rest of the community would be enormous.

MR CARTER:   Your Honour, there was no appeal in respect of the three and a half year term of imprisonment.

CALLINAN J:   No, I am not talking about that.  I am talking about the situation.  Here is this woman who must have got thousands of dollars out of dealing in drugs and she is to remain owning a valuable piece of property which probably in value does not nearly amount to the amount of money that she must have made out of it, no matter how she used the money.

MR CARTER:   Your Honour, again I join issue with the notion of making when the factual rubric of this matter is an addiction accepted increasingly as an illness.

CALLINAN J:   She is still making the money, she is dealing in drugs and whether she injected herself with drugs bought from the proceeds or not does not alter the fact that the money is the result of illegal dealings.

MR CARTER:   Again, your Honour, this comes back to the contradiction that we point up with the reasoning underpinning the refusal of his Honour the sentencing judge to forfeit the house.  If that was to be the position then the order ought to have been, “It doesn’t matter, the house goes”.

If I could come back to this question of the purpose of the legislation which, in my submission, it is a question that it is time this Court grappled with, and with respect, your Honour Justice Kirby’s statement about the purpose including punishment is at odds with some statements contained in intermediate courts.

KIRBY J:   I just find it hard to accept that, given the history of the addition of this extra sanction that it is not intended to have any punitive effect.

CALLINAN J:   I agree with that view. 

MR CARTER:   Your Honour, could I take you to the R v Fagher, which is in the list of authorities behind tab 5.  In the judgment of Justice Hunt at page 78E, having considered the question of hardship, at the end of the paragraph:

This is particularly so as the pecuniary penalty is in no sense intended to be a punishment ‑ ‑ ‑

CALLINAN J:   That is one judge’s view.  That does not bind us.  Was there any parliamentary support for that?

MR CARTER:   Your Honour, the parliamentary support found for that, with respect, is behind tab 1, when one looks at the purposes of the Act.  The purposes of the Act – 1(a):

to provide for the forfeiture of the proceeds of certain offences ‑ ‑ ‑

CALLINAN J:  

whatever the form into which they have been converted –

including injection, buying drugs.

MR CARTER:   There is other dicta to the same effect from Justice Roden in the same authority, at Fagher at page 71F:

indeed by the Minister’s Second Reading Speech . . . when the measure was presented to Parliament.  The fact that the Act is directed towards preventing the retention of ill-gotten gains, rather than the imposition of a punishment -

That again is the point of special principle raised by this matter.

KIRBY J:   The problem is that Justice Winneke indicated that he also accepted it had relevance.  He did say “limited relevance” but he accepted that it had relevance but in the end it could not contradict the Confiscation Act because the Confiscation Act, of its very character, is going to apply to a lot of people in the position of your client.

MR CARTER:   If that is right, your Honour, then there is an issue of double punishment here because the punishment and deterrence ‑ ‑ ‑

KIRBY J:   It is not double punishment.  It is part of the sanction that society has imposed on people.

MR CARTER:   The sentencing judge did not indicate that the three and a half years was tempered by reference to the $160,000 order.  If the purpose of this legislation, in addition to the recovery of ill‑gotten gains which, in my submission, is the history of the matter, I rely on that dicta, I have provided a short analysis in the written submissions about which the Crown have agreed, if that be the purpose to then say this order can be justified in part by reference to punitive purposes, does give rise to a question of double punishment.

These are questions, it should be said, your Honours, that do have increasing frequency in our courts over the last 20 years as this legislation has come into being that it is unresolved the question of the purpose.  I have not orally touched on the question of the level of evidentiary satisfaction to make an order of $160,000 but that indeed is something ‑ ‑ ‑

KIRBY J:   I think you would be wasting your time on that point.

MR CARTER:   His Honour the sentencing judge, having been referred ‑ ‑ ‑

KIRBY J:   He is only required to assess.  He is not required to work it out to ‑ ‑ ‑

CALLINAN J:   I think there was more than adequate basis for it, 36 people a day came to her house from 20 May to 7 August - 2,882 visitors.

MR CARTER:   As the primary judge said, what in the end you need to do is to be able to make a dollars assessment but what he also indicated was that the big problem with the cases, having been taken to them, is that they do not deal with the level of evidentiary satisfaction that is required.

CALLINAN J:   I think the assessment was moderate; I have to tell you that.

MR CARTER:   There was no evidence called by the Crown in respect of this issue having been joined ‑ ‑ ‑

KIRBY J:   But the trial judge or the sentencing judge did indicate how he had got to his $160,000.  It is not the sort of thing we would get into, I am afraid.

MR CARTER:   No, that is why I go to grounds 2 and 3 first, your Honours. 

KIRBY J:   You were sensible to do that.

MR CARTER:   In my respectful submission, justice requires that there be a grant of special leave so that the matters can be properly addressed rather than on the erroneous basis that the Court of Appeal dealt with it.

KIRBY J:   Thank you, Mr Carter, for putting your submissions under fire.  Mr McArdle, what do you say about the suggestion that the Court of Appeal of Victoria is taking a different line to the Court of Criminal Appeal of New South Wales?  That would be matter then, would it not, under the Judiciary Act to attract our attention?

MR McARDLE:   Your Honour, the position I think is really this at the end of the day.  It might be considered in some exceptional circumstances of punishment.  This is not one of those cases.  This is a case, your Honours, where there was a continuing amphetamine shop being run in Thornbury.  The police had videos and surveillance and all sorts of things.  The police would have it that on an average over a period of 80 days there were 36 visitors to the house ‑ ‑ ‑

CALLINAN J:   And business was better on pension days.  That says a lot about the conduct.

MR McARDLE:   Yes.

KIRBY J:   It also says the variety, range and number of our fellow citizens who are using these drugs.

MR McARDLE:   Yes, I suppose so.

CALLINAN J:   That means the magnitude of the problem which has to be dealt with.

KIRBY J:   Or the wisdom of the way we are dealing with it.

CALLINAN J:   There is also another issue which is not touched upon.  A large amount of money must have passed through her hands.  Nobody ever suggested she paid any income tax on it, which is an awful burden on the rest of the community, too.  Money that is being paid out in pensions is being absorbed in the sale of drugs.  Presumably large sums of money are being made and no income tax - the financial impact upon a community is enormous, apart from the heath impact.

MR McARDLE:   Yes.  Your Honour, can I just develop that.  The State, it might be thought, is entitled to recover what it can because it is the State which largely bears the financial burden of the havoc that is created by these ‑ ‑ ‑

CALLINAN J:   It is the health problems and all the other problems.

KIRBY J:   But this is easy to say to people who do not have the addiction and addiction is a health problem, people who are addicted to heroin.  There are many features in this present applicant’s story which command admiration of her attempts to and I hope success in removing herself from addiction to heroin.

MR McARDLE:   Presumably, your Honours, those matters personal were taken into account in relation to her prison sentence which has never been the subject of an appeal. 

KIRBY J:   It is just the disparity between the Victorian court and the New South Wales court that concerns me, but you say this is not the proper vehicle to consider that disparity, given the justification of the order actually made.

MR McARDLE:   Might I offer you another example in the sort of reasoning that might be advanced.  A person does not do this because they have a drug addiction because drug addictions are seen to be health problems and deserving of sympathy.  Supposing they have a gambling addiction and they say, “The profits I’ve made on my little, or big, amphetamine business have gone, lost at the racetrack or the casino or wherever.  Please don’t make an order against me”.  This applicant was very lucky.  She must have stood a very substantial risk of losing her house over this.  The sentencing judge declined to make such an order.

KIRBY J:   The sentencing judge had both matters in mind.  Both balls were in the air.  He refused to make the order for the forfeiture of her interest in her home but he did make the order under the Confiscation Act.  He obviously exercised his discretion with both matters in mind.

MR McARDLE:   Yes, presumably with a level of sympathy and perhaps a level of optimism as to her future. 

KIRBY J:   I think I have had enough now, Mr McArdle.

MR McARDLE:   Thank you, your Honours.  I am sorry if I have had that effect upon you.

KIRBY J:   No, as always, you have been helpful and wily. 

MR McARDLE:   I see.  Thank you.

KIRBY J:   Anything in reply, Mr Carter?

MR CARTER:   Just two matters, your Honour.  This is not an application for special leave against sentence based on the matter of high public interest in heroin addiction about which this Court by majority refused special leave 12 months or so ago and to that extent your Honour Justice Callinan’s comments in respect of the level of moral culpability, and that is taken care of by the three and a half ‑ ‑ ‑

CALLINAN J:   I do not know about that.  I do not jump to instant agreement with what Justice Hunt said in New South Wales, far from it.

MR CARTER:   Your Honour, that is why special leave should be granted.

KIRBY J:   I once dissented in a case where Justice Callinan argued it most vigorously, which would have upset Justice Hunt.

MR CARTER:   Your Honours, it is not just, with respect, difference between Victoria and New South Wales.  I have included in the bundle, time has prevented going to all of it, but in Queensland in the judgment of Chief Justice Macrossan in Ashworth, he doubts whether a transitorily received sum of money could be properly considered as a benefit at all.  In Tasmania in Delaney there is reference to the New South Wales authorities, it is indicated that the questions are still uncertain.  In Victoria in Dam, a single judge decision referred to in the reasons of the President, it is left in the air.  If the issues were resolved following full argument in the applicant’s favour it would secure not only justice for her, but it would lead to greater consistency throughout the Commonwealth in the administration of what has become a very significant piece of legislation ‑ ‑ ‑

KIRBY J:   But the problem for you is that the President does not exclude relevance.  On the contrary, he says, it must have less relevance and therefore he has accepted that it has some relevance.

MR CARTER:   But, your Honour, as has been explained in writing and again no issue has been joined by the Crown, his Honour arrives at that conclusion, having made an error in respect of making a reference to some suggestion of moneys in the bank account.  There was not.  That has been dealt with in writing, no issue has been joined.

CALLINAN J:   I have to tell you, Mr Carter, I drew some legislation in Queensland, some confiscation legislation, before I came here and I was under no doubt that my instructions contemplated that this could be an element of the punishment.  Let me say this to you, I do not think on any view of it what was done here amounted to punishment.  It seemed to me to be a legitimate order soundly based on evidence of confiscation.  I do not think your point even arises.

MR CARTER:   Your Honour, with respect, what Chief Justice Macrossan said in Queensland was that the legislation ‑ ‑ ‑

CALLINAN J:   Who in Queensland?

MR CARTER:   Chief Justice Macrossan, I am sorry, in Ashworth, my learned friend corrects me, states that the various courts on a number of occasions have attempted to clarify some of the more troublesome aspects involved in the assessment of the derived benefits.  He says the deepest examination has been in Fagher.  These issues have now been left unresolved throughout the Commonwealth for at least 15 years.  The special leave should be granted, in my submission.

KIRBY J:   Yes, thank you very much, Mr Carter. 

We are not convinced that this application raises issues of general principle or of law.  Nor do we consider that a miscarriage of justice has occurred.  The trial judge made the challenged order under the Confiscation Act 1997 (Vic). However, he refused to order the forfeiture of the applicant’s interest in her home.

The Court of Appeal took the applicant’s addiction to heroin into account as is indicated by what Justice Winneke, the President, said.  He said, relevantly:

the engagement in the trade by those who need to support a habit will be relevant to the penalty to be imposed overall; but must have less relevance – indeed, limited relevance – to the objects of the Confiscation Act.

We therefore do not consider that the Court of Appeal of Victoria has taken a view different from that expressed in authorities in other States. 

We do not consider that the issue that was pressed upon us, namely inconsistency with decisions in other States, arises in this case, or if it arises, that this would be a suitable vehicle for the consideration of that issue.  It is of the nature of the offences for which confiscation orders may be made that they will concern persons who are sometimes addicted to heroin or other drugs.  That consideration cannot, therefore, contradict the making of an order under the Act.  Special leave to appeal is accordingly refused.

AT 11.47 AM THE MATTER WAS CONCLUDED