Nelson v Quinn - [2001] WASCA 297

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION: NELSON -v- QUINN [2001] WASCA 297

CORAM: McLURE J

HEARD: 13 JUNE & 29 JUNE 2001

DELIVERED : 27 SEPTEMBER 2001

FILE NO/S: SJA 1038 of 2001

BETWEEN: ED WYNN NELSON
Appellant
AND
WENDY LORRAINE QUINN
Respondent

Catchwords:

Criminal law - Sentence - Customs Act 1901 s 233(1)(a), s 234(1)(a), s 234(1)(d)(i) - Offences of smuggling, evasion and making false and misleading statements - Whether appropriate to discharge under s 19B of the Crimes Act 1914 (Cth) - Review under s 186(1)(b) of the Justices Act - Turns on its own facts

Legislation:

Crimes Act 1914 (Cth), s 19B

Customs Act 1901 (Cth), s 233, s 234, s 237

Justices Act 1902, s 186(1)(b), s 192, s 196(1)(b)

Result:

Appeal dismissed

Category: B

Representation:

Counsel:

Appellant: Mr A O Karstaedt
Respondent: Mr A A Jenshel

Solicitors:

Appellant: Max Crispe
Respondent: Australian Government Solicitor

Case(s) referred to in judgment(s):

Barendse v Comp-General (Customs) (1996) 93 A Crim R 210
Bushnell v Adams (1995) 30 ATR 78
CEO of Customs v Tonmill Pty Ltd [2001] WASC 77
Cobiac v Liddy (1969) 119 CLR 257
Dickman v Turton [2000] WASCA 1
House v R (1936) 55 CLR 499
L Vogel & Son Pty Ltd v Anderson (1968) 120 CLR 157
Lanham v Brake (1983) 52 ALR 351
McQuestin (1993) 69 A Crim R 522
O'Brien v M R Norton‑Smith Pty Ltd (1995) 31 ATR 128
O'Sullivan v Wilkinson [1952] SASR 213
R v Allsop (1976) 64 Cr App R 29
R v Matijevic [1997] FCA 992
Stitt v CBI Constructors Pty Ltd (1990) 5 WAR 427
Tan v R (1979) WAR 149
Ulf Weller (1988) 37 A Crim R 349
Uznanski v Searle (1981) 26 SASR 388
Wilson v Chambers & Co Pty Ltd (1926) 38 CLR 131

Case(s) also cited:

Anderson v Racing Penalties Appeal Tribunal, unreported; FCt SCt of WA; Library No 970504; 3 October 1997
Beavan v Rankine (1983) 36 SASR 120
Chow v DPP (1992) 28 NSWLR 593
Chullani v CEO of Customs, unreported; FCt SCt of WA; Library No 960660; 15 November 1996
Comptroller-General of Customs v Grills (1992) 110 FLR 431
Di Camillo v Wilcox [1964] WAR 44
Ex parte Freeman (1951) 68 WN (NSW) 11
Hayes v Weller (1988) 50 SASR 136
Jones v McDonald, unreported; SCt of WA; Library 980039; 6 February 1998
Kelly v JCT Wong & Rizoli Pty Ltd, unreported; SCt of NSW; 24 July 1999
Kelton v Uren (1981) 27 SASR 92
Kowald v Hoile (No 2) (1976) 14 SASR 314
Lanham v Brambles-Ruys (1984) 55 ALR 138
Ludwigs Canberra Bond Cellar Pty Ltd v Sheen (1982) 65 FLR 347
Matta v ACCC [2000] FCA 729
McInnes v Global Imports Pty Ltd (1993) 15 ATPR 41-206
Nisbet v Fullarton, unreported; FCt SCt of WA; Library No 930265; 14 May 1993
Paterson v Fenwick (1994) 115 FLR 462
Punch v R (1993) 9 WAR 486
Purdey (1992) 65 A Crim R 441
R v Amenores [1980] 2 NSWLR 34
R v Cole (1993) 66 A Crim R 498
R v Dodd (1991) 57 A Crim R 349
R v Geddes (1936) 36 SR(NSW) 554
R v Henry [1917] VLR 525
R v Inglis [1917] VLR 672
R v Jamieson [1988] VR 879
R v Luscombe [1999] 168 ALR 227
R v O'Neill [1979] 2 NSWLR 582
R v Pantano (1990) 49 A Crim R 328
Raiser v Sladic [1995] ACTSC 132
Re Stubbs (1947) 47 SR (NSW) 329
Riverside International Imports Pty Ltd v Luckman, unreported; SCt of Vic; 10 August 1989
Rowlands v Caporn [2001] WASCA 66
Slater v Marshall [1965] WAR 222
Stampalia v Racing Penalties Appeal Tribunal [2000] WASCA 24
Stitt v CBI Constructors Pty Ltd (1990) 93 ALR 325
Thu Trong Dinh v CEO of Customs [2000] VSC 151
TPC v Sun Alliance Australia Ltd, unreported; Fed Ct; 29 June 1993
Walker v Eves (1976) 13 SASR 249
Young v Geddie (1978) 22 ALR 232

McLURE J: The appellant was convicted in the Court of Petty Sessions Perth on charges that, on 3 August 2000 at Perth International Airport he:
1.knowingly or recklessly made to a Customs Officer a statement that was false or misleading in a material particular contrary to Section 234(1)(d)(i) of the Customs Act 1901.

Particulars

In an Incoming Passenger Card dated 3 August 2000, the Defendant answered "No" to the question asking whether he was bringing into Australia:
•"Goods obtained overseas ... with a combined total price of more than AUD$400. Including gifts?"
•"Good/samples for business/commercial use?"
whereas the Defendant brought into Australia 11 items of specialised audio and audio/visual equipment ("the equipment") obtained by him overseas with a combined total price of more than AUD$400, and further or in the alternative brought into Australia goods/samples for business/commercial use, namely the equipment;
2.knowingly or recklessly made to a Customs Officer statements which were false or misleading in material particulars contrary to Section 234(1)(d)(i) of the Customs Act 1901.

Particulars

The Defendant, stated to a Primary Interviewing Customs Officer that he had nothing to declare, whereas the Defendant did bring into Australia 11 items of specialised audio and audio/visual equipment ("the equipment") obtained by him overseas with a combined total price of more than AUD$400 which required declaration and those items were goods/sample for business/commercial use;

3.knowingly or recklessly made to a Customs Officer a statement that was false or misleading in a material particular contrary to Section 234(1)(d)(i) of the Customs Act 1901.

Particulars

The defendant, stated to a Baggage Inspection Custom Officer:

•He did not pay for any of the 11 items of specialised audio and audio/visual equipment found in his baggage ("the equipment");
•They had no value, they were given to him as samples.
Whereas the equipment were in fact goods/samples for business use purchased overseas by the Defendant;

4.did attempt to evade payment of duty which was payable, contrary to Section 234(1)(a) read with Section 237 of the Customs Act 1901;
5.did smuggle goods, namely 11 items of audio and audio/visual equipment, contrary to Section 233(1)(a) of the Customs Act 1901.

Facts

The appellant pleaded guilty to each charge at the first available opportunity. The prosecutor stated the facts relied on. On 3 August 2000 the appellant arrived at the Perth International Airport on a Qantas flight from Singapore and presented to a primary interviewing officer an incoming passenger card signed by the appellant on which he had answered "no" to questions whether he was bringing into Australia any goods obtained overseas with a combined total price of more than AUD$400 and whether he was bringing into Australia any goods or samples for business or commercial use. They are the facts the subject of the first charge. The primary interviewing officer to whom the appellant had handed the incoming passenger card asked the appellant if he had anything to declare and the appellant said no. They are the facts the subject of the second charge.
After the appellant had collected his luggage and was waiting in the green channel (which is for people to leave the airport when they have nothing to declare) he was chosen for a random baggage search. The baggage search revealed a Sony DVD player and 13 boxes containing various electronic goods including mobile televisions. When asked by the Customs Officer how much he paid for the items, the appellant said he did not pay for them, that they were given to him by different companies to bring back to Australia. The appellant also said that the items of equipment had no value and were given to him as samples. They are the facts the subject of the third charge.
A Customs Officer advised the appellant that the equipment found in his luggage would be held under Customs control until he had arranged to enter them. The appellant is the sole director and shareholder of Nelson Corporation Pty Ltd which carries on the business of importing and wholesaling electronic and other equipment. Customs records showed that Nelson Corporation had made 241 entries with Customs for the importation of electronic goods since 1 September 1996 with a total declared Customs value of approximately $3.3 million.
On 9 August 2000, a Customs broker acting on behalf of Nelson Corporation lodged an entry for home consumption in relation to the equipment. For that purpose, the brokers lodged an invoice from a Singaporean company dated 1 August 2000 made out to Nelson Corporation in respect of some of the goods that were being held by Customs. The entry was finalised by Customs on 10 August 2000 and the total Customs' value of all the goods amounted to $3906.80. The Customs' duty payable on those goods was $48.01. GST was also payable on the goods in the amount of $397.50. The prosecutor said that the total amount payable to the revenue was about $445.51.
The prosecutor also informed the Court that the appellant was a very regular traveller having arrived in Australia on 20 occasions since 1991. Nelson Corporation was charged with, and pleaded guilty to, the same charges as the appellant pursuant to s 257(2) of the Customs Act.
The appellant was represented by counsel who did not take issue with the prosecution's statement of facts. The appellant's counsel informed the Court that the importation of the equipment on the relevant occasion was of sample goods for testing by the Australian Communications Authority ("ACA") and it was the appellant's understanding that the goods were going to be destructively tested by ACA or, alternatively, re‑exported and if the goods were re‑exported, no customs duty was payable.
The appellant's counsel also informed the Court that on the appellant's way out of Australia he had asked Customs' officials what he could do about the importation of goods for sampling or testing and was told to ring the Australian High Commission in Singapore. Whilst in Singapore the appellant had attempted to contact by telephone each of Austrade, the Australian High Commission and Australian Customs without success.
The appellant sought an order under s 19B of the Crimes Act on the basis of his clean record, his involvement in and support of community activities and, in particular, the effect of a conviction. The submissions concerning the effect of convicting the appellant were in the following terms:
"The effect of conviction of him, I might add, is going to be a severe one. I mean he's a person who's got to travel to the US. He's got to travel to Canada. He's got to travel to Hong Kong and to Singapore and now Malaysia. All of these places are going to say to him, 'Look, you've got a conviction for breaching Australia's import laws. You're not coming in.' ... Now Nelson Corporation is different. Nelson Corporation is a corporate entity. But unless Ed Nelson personally is freed up to travel to those places, Nelson Corporation is going to come to a speedy end. It's not hard to imagine that an importer who can't travel overseas to source goods, his organisation's [not] going to last very long. ... If you convict him, his business may well come to an end. He can't - - he can't get entry visas to places that export electronic goods."
The prosecution did not take issue with the submissions concerning the effect of any convictions on the appellant's capacity to travel.
As emerges from the prosecution's statement of facts, all the charges arise out of a single course of events in relation to the same equipment. The appellant was fined $1000, $500 and $500 for each of charges 1, 2 and 3 respectively which relate to making false or misleading statements in breach of s 234(1)(d)(i) of the Customs Act. The appellant was fined $150 for each of the evasion offence and the smuggling offence. Nelson Corporation was also fined the same amounts as the appellant.

The Magistrate's Reasons

Counsel for the appellant requested the learned Magistrate to discharge the appellant without proceeding to conviction pursuant to s 19B of the Crimes Act 1914. The Magistrate said in his reasons:
"Well, a person as experienced as you apparently are, from the facts presented - both by the prosecution and your own counsel is almost incomprehensible. The exposure as you now are to the serious impediment placed on travel, as a result of convictions, is a matter that one would anticipate a person such as yourself would have kept very clearly in mind.
But it's also clear that you were very persistent in your endeavours to not only smuggle in and avoid the relatively minor duty, but you did so by means of recklessly and knowingly making false and misleading statements. And once you were exposed to the random checks that were instigated, you persisted in that course of conduct by making a further false and misleading statement, culminating in the final false and misleading statement about the method of acquisition of the items once they had been located in your baggage.
As a consequence of your actions, the company [for] whom you were acting, has committed the same offences. I take into account in considering penalty - so far as the company is concerned - that it is the one course of conduct. I also take into account that both yourself and the company have entered pleas of guilty at the first available opportunity.
I also take into account that you have - and it appears the company has - no prior record of convictions. I have concluded that the appropriate disposition of these matters is by way of fines.
The persistent nature of your offending and the difficulty of apprehending persons such as yourself, unless each and every passenger entering this country were exposed to the same thorough investigation which would create great difficulty for the vast majority of people who behave in a lawful fashion.
As a result it's my view that there needs to be - in considering penalty - both a deterrent element specific and general to ensure that others who might be minded to behave in the same or similar manner might be discouraged from doing so.
...
I have considered the submissions made in respect to the operation of section 19B of the Customs Act that - - your past record certainly stands you in good standing; but there is nothing exceptional about the circumstances of these offences. Certainly not - and your counsel quite properly didn't suggest that they were trivial.
But I don't see that it's appropriate in or inexpedient to inflict any punishment or to - not to proceed to conviction."

Application to Adduce Further Evidence and to Amend

The appellant was given leave to appeal by Parker J on 12 March 2001. At the commencement of the hearing of the appeal, the appellant sought leave to amend his grounds of appeal in accordance with a minute dated 8 June 2001 and to adduce further evidence by way of affidavit. In particular, the appellant sought leave to rely on affidavits sworn by the appellant on 5 and 12 June 2001 and on affidavits from Mr Evan Jones, Mr Gerard Harvey and Mr Johnson Kitto. The Court has power to permit amendments to the grounds of appeal and to permit further evidence: s 192 and s 196(1)(b) of the Justices Act 1902.
Counsel for the respondent objected to aspects of pars 6, 13, 15, 17, 18, 27 and 30 of the appellant's affidavit sworn on 5 June 2001. Otherwise the respondent did not oppose the appellant's application to adduce further evidence.
The respondent's objections to the appellant's affidavit of 5 June 2001 were (with one exception) based on alleged inconsistency with the appellant's plea of guilty to the charges. The appellant does not appeal against his convictions. Counsel for the appellant accepted that evidence which had the effect of going behind the plea of guilty would be inadmissible but said the matters objected to did not have that effect. It was not possible to rule on the competing submissions without going to the merits of the appeal. Accordingly, I ordered that the appellant have leave to rely on the appellant's affidavit sworn on 5 June 2001 save for pars 6, 13, 15, 17, 18, 30 and 27 (the latter paragraph containing hearsay evidence concerning the obstacles to the appellant entering foreign countries) and the other affidavits to which no objection was taken. I also ordered that pars 6, 13, 15, 17, 18 and 30 of the appellant's 5 June affidavit be admitted conditionally with the objections to be ruled on subsequently.
Some of the matters in dispute in the appellant's affidavit were reflected in the proposed amended grounds of appeal. I gave the appellant conditional leave to amend the grounds of appeal in terms of the minute dated 8 June 2001. In the event any of the grounds of appeal depend on inadmissible evidence, they too are to be excluded. The grounds of appeal, the subject of the order, are in the following terms:

Grounds of Appeal

1.The learned Magistrate erred in imposing a sentence that was excessive and, in particular, erred in not dealing with the matter pursuant to the provisions of s 19B of the Crimes Act 1914 (Cth).
2.The learned Magistrate did not acquire a proper understanding of the relevant facts or the relevant circumstances relating to the offences, alternatively, did not give appropriate weight and consideration to these facts and circumstances.

Particulars

The relevant facts and circumstances, which emerge largely from the additional material placed before this Honourable Court by way of affidavits, include the following:
(a)the fact that the appellant made significant efforts to find out how best to import the items and to obtain a Carnet;
(b)in respect of the one item obtained from Punch Audio on which duty was payable, the appellant's belief that either no duty was payable or that any duty would be very little and would be recoverable when the item was re‑exported;
(c)the appellant's belief that the converters, as items intended for personal use, would be exempt from duty and Goods and Services Tax ("GST"), which would have been the case had they been cleared as accompanied baggage;
(d)the fact that Nelson Corporation was a net payer of GST with the result that no GST was or would have been avoided;
(e)the fact that the goods were imported for testing and evaluation and with the intention of re‑exporting them;
(f)the time constraints that the appellant was under to get the samples to Autobarn prior to 8 August 2000, which was the reason underlying the appellant's conduct;
(g)the fact that it was unusual for the appellant or his company to import products in the way that occurred on the relevant occasion, the usual way being to have the goods freighted and cleared by a customs agent;
(h)the fact that the only item obtained from Punch Audio on which duty was payable was in fact re‑exported, and that this occurred prior to any charges being brought against the appellant;
(i)the fact that the offences were an isolated occurrence resulting from an error in judgment for which the appellant has shown contrition and remorse, demonstrated in part by the appellant's pleas of guilty at the earliest available opportunity and his pleas of guilty at the earliest available opportunity on his company's behalf;
(j)the small amount of customs duty involved;
(k)the fact that the samples imported presented no risk of any harm.
3.The learned Magistrate erred in not giving appropriate weight to the relevant factors mentioned in s 19B, namely:
(a)The character, antecedents and age of the appellant, in relation to which the learned Magistrate ought to have found that the material before the Court very much favoured the appellant;
(b)The extent to which the offences were committed under extenuating circumstances, in relation to which the learned Magistrate ought to have found that there were significant and material extenuating circumstances;
(c)The extent to which the offences were of a trivial nature, in relation to which the learned Magistrate ought to have found that in all the circumstances the offences could properly be considered to be of a minor nature.
4.The learned Magistrate placed undue weight on the need for deterrence having regard to the unusual circumstances of the particular case.

5.The learned Magistrate erred in considering that there was nothing exceptional about the circumstances of the offences.
6.Further or in the alternative to 5, the learned Magistrate erred in considering that there was a need for exceptional circumstances to be shown.
7.The learned Magistrate erred in overemphasising what he described as the persistent nature of the appellant's conduct, and in not giving due consideration to the fact that there was essentially one course of conduct over a very limited period of time.
8.The learned Magistrate erred in not giving proper consideration to the very dire consequences for the appellant that have followed and will continue to follow from his convictions, namely the demise of his previously successful and productive import and export business, which may properly [be] considered to be out of all proportion to the seriousness of the offences.
9.The additional material presented to this Honourable Court by way of affidavits constitutes "some other reason that is sufficient to justify a review of the decision" within the meaning of s 186(1)(b) of the Justices Act.

The Further Evidence

The appellant intended to obtain some sample "in‑car theatre" products from Punch Audio in Singapore for evaluation and testing. Before leaving Australia he spoke to his Customs' agent, Mr Harvey, who told him that if the goods were going to be re‑exported, the best course would be to obtain a "carnet". A carnet is an international Customs' document that allows goods to be brought into Australia without the payment of Customs' duty and taxes (if these are payable) and without the need for a formal Customs' entry. The use of a carnet to cover the temporary admission of goods simplifies the importation and formal Customs' clearance, which otherwise can normally take two to seven days.
An in‑car theatre includes an LCD screen that can play a signal created by a VHS video, DVD player, TV tuner or playstation. Mr Harvey had previously advised the appellant that the LCD screens would not attract Customs' duty. Prior to departing for Singapore the appellant contacted the Customs' information service help line and explained that he might be obtaining goods overseas as samples and that they were to be tested and re‑exported. The Customs' clerk also recommended a carnet and informed the appellant that it would have to be obtained within the country of origin of the goods and suggested the appellant contact the Singapore Trade Centre or the Australian High Commission while in Singapore to arrange the carnet.
When in Singapore, the appellant purchased sample in‑car theatre products for testing from Punch Audio on the basis that the appellant would send them back for a refund or a credit towards the purchase of more stock at a later stage. In pursuit of a carnet, the appellant telephoned the Singapore Trade Centre and the Australian High Commission. The people he spoke to were unable to assist. He left a message for the Australian Trade Commissioner to call him but she did not. Before leaving Singapore, the appellant again tried to speak with the Trade Commissioner but without success.
Prior to leaving Australia, the appellant had arranged for a staff member of Nelson Corporation to fly to Melbourne on Saturday, 5 August 2000, to do a personal demonstration of the Punch Audio products to a Nelson Corporation customer, Autobarn, and then take the equipment to the ACA for testing. Further, Mr Evan Jones of Autobarn was putting pressure on the appellant to get the samples to them before 8 August 2000. The appellant says that to have declared the equipment on 3 August 2000 would have prevented this from occurring.
One of the five LCD screens purchased from Punch Audio was part of a kit that included a TV tuner with antenna ("TV tuner"). Of the equipment the subject of the charges, the only items on which Customs' duty was payable was the TV tuner ($41.95) and the converters ($6.06). The converters together with the DVD movies, were valued at $151. In relation to the TV tuner, the appellant says that it was his belief at the time that either no duty was payable or if duty was payable, it would be very little and would be recoverable by a drawback application once the goods were re‑exported. Further, the appellant says that the DVD movies and converters were for his personal use and it was his belief that they were exempt from Customs' duty and GST.
At the relevant time, Nelson Corporation was a net payer of GST. According to the appellant, any payment of GST made when goods are imported is refunded (if the goods are re‑exported) or offset against GST receipts (if the goods are on‑sold).
In October 2000 and before the appellant was charged, some of the goods obtained from Punch Audio, including the TV tuner on which the Customs' duty was payable, were re‑exported.
Nelson Corporation's main supplier of product and source of income is in Canada and the company has a branch in New Zealand. In addition to visiting those countries, the appellant is also required to visit Singapore and Korea. He says in his affidavit that because of and following his convictions he has made no overseas visits and has been unable to secure new product lines and expand sales. As a result, Nelson Corporation has reduced its full‑time staff from six to two. His business provides the latest technology products. The technology rapidly changes and it is imperative to keep up to date to remain competitive. There is no other suitably qualified person employed by Nelson Corporation who is able to assume the overseas travel duties which had, until his convictions, been performed by the appellant. The appellant says that unless he is able to travel, his business will fail. The respondent correctly observes that the appellant's fears concerning the effect of the convictions on his right to travel have not been tested. The appellant has not applied for and been refused a visa. The appellant's response is that refusal of a visa makes it more difficult to obtain one thereafter.
The appellant also swore in his affidavit of 5 June 2001 that he had no previous convictions of any nature.
Mr Evans of Autobarn confirmed that he placed some pressure on the appellant to get the product samples to Autobarn prior to 8 August 2000. Mr Harvey confirmed the appellant's evidence concerning the advice he gave. The appellant's counsel at the hearing in the Court of Petty Sessions, Mr Kitto, confirmed the appellant's evidence that up to the date of the hearing he was of the mistaken view that there was only one complaint and that was under s 234(1)(d)(i) against each of the appellant and Nelson Corporation (until advised to the contrary by counsel for the prosecution). Notwithstanding the appellant only became aware of the other charges on the day of the hearing, he instructed Mr Kitto to proceed rather than apply to adjourn.
The hearing of the appeal was not completed within the allocated period of one day. The adjourned hearing occurred on 29 June 2001. At the commencement of that hearing, applications to adduce further evidence were made. Leave was granted. The respondent relied on an affidavit sworn by Wendy Quinn on 21 June 2001 contradicting the appellant's assertion in his affidavit of 5 June 2001 that he had had no previous convictions. In fact, the appellant had convictions recorded in the late 1980s for driving‑related offences (.08 per cent and speeding) and an attempted stealing offence. In an affidavit sworn on 28 June 2001, the appellant swore that he had no recollection of being convicted for the offences at the time he swore his affidavit on 5 June 2001. This statement was challenged in cross‑examination. I am not persuaded that the appellant intended to mislead the Court as urged by the respondent. The attempted stealing took place when he was 18. He was driving a car in the company of friends and there was a hose and a petrol can in the car. The last of the convictions occurred on 25 August 1998 and the appellant could have taken steps after 25 August 1998 to have made a spent conviction application to remove the matters from his record. He did not do so.
The appellant also relied on an affidavit sworn by Maxwell Crispe on 29 June 2001 which exhibited a letter from the Canadian Consulate General setting out the terms of s 19 of the Canadian Immigration Act. The evidence establishes that the convictions will make it difficult for the appellant to enter Canada for five years although not necessarily so for Singapore and Malaysia.

Admissibility

The respondent objects to the evidence in support of particulars (b), (c), (d), (e) and (h) of ground of appeal 2 on the basis it is inconsistent with the plea of guilty to the smuggling and evasion charges.
Section 4 of the Customs Act defines smuggling as any importation or attempted importation "with intent to defraud the revenue". Revenue is not defined however in its ordinary and natural meaning is wide enough to encompass tax payable under the goods and services taxation legislation. The appellant by his plea of guilty accepted as correct all the necessary elements of the charge of smuggling which in terms identified the smuggled equipment as "11 items of audio and audio/visual equipment" and which includes an intention to defraud the revenue.
The charge of evasion under s 234(1)(a) of the Customs Act does not apply to GST. Section 234(1)(a) provides that a person shall not evade payment of any "duty" which is payable. Duty is defined (in s 4 of the Customs Act) to mean a duty of Customs. Mens rea is a necessary ingredient to the evasion offence under s 234(1)(a) of the Customs Act: Wilson v Chambers & Co Pty Ltd (1926) 38 CLR 131; Stitt v CBI Constructors Pty Ltd (1990) 5 WAR 427 at 433.
Ground of appeal 2(c) and the evidence in support of that ground (par 15 of the appellant's 5 June affidavit) relates to the goods intended for personal use. The assertion that the appellant believed the converters as items for personal use would be Customs' duty and GST free is inconsistent with the plea of guilty to (at least) the smuggling offence. Accordingly, the condition of admissibility of that evidence (and the consequential amendment to the grounds of appeal) is not satisfied and leave is refused in relation to those matters.
Insofar as pars 6 and 13 of the appellant's 5 June affidavit deal with Mr Harvey's advice that Customs' duty was not payable on the LCD screens, the evidence is admissible because it does not look behind the plea of guilty. There is no suggestion that Customs' duty was payable on those screens. Paragraph 13 also deals with the appellant's belief concerning the Customs' duty in relation to the TV tuner. The substance of the evidence is the appellant thought that there may be duty payable on this item but that if any duty was payable it would be very little and would be able to recovered by a drawback application under the Customs Act once the goods had been re‑exported. That evidence does not contradict the plea of guilty.
In Barendse v Comp-General (Customs) (1996) 93 A Crim R 210 the court said (at 231):
"An intention to defraud the revenue has been described as an 'intention to prevent something getting into the revenue which the revenue is entitled to get': see Australian Films Ltd (1921) 29 CLR 195 at 218 ..."
It is essential to the concept of smuggling that the revenue is entitled to something. It is also essential that it be proved that there was an intention to deprive the revenue of that to which it was entitled. That "something" is the duty payable on goods imported into the country, which, in turn, is assessed on the Customs' value of the goods: Barendse at 231.
A lack of intention on the part of a defendant to cause a victim a loss or prejudice should absolve the defendant from criminal liability: Tan v R (1979) WAR 149. However, in this case the appellant is not disputing that Customs' duty and GST were payable at the time of importation. As I understand his position, he says:
(a)he understood that Customs' duty and GST was refundable on goods that were re‑exported;
(b)in the events that transpired, the Customs' duty for the TV tuner was refundable (because it was re‑exported);
(c)GST on the re‑exported goods was refundable; and
(d)there was no GST loss in relation to the goods which were not re‑exported because Nelson Corporation was in the relevant period a net payer of GST.
No issue was taken by the respondent to the assertions in (b) and (c). The statement in (d) is not correct. If the goods were on‑sold for a GST inclusive price and the GST paid to the Commonwealth as required, there would be a loss relating to the time value of money. Further, the appellant accepts that Customs' duty and GST were payable on the goods imported for personal use. He says that if the goods had been entered as accompanied baggage (which they were not), Customs' duty and GST would not have been payable. That proposition is not contradicted. In any event, there is no suggestion the Commonwealth has not suffered any financial detriment or prejudice (if only the time value of the moneys payable at the time of importation). See also R v Allsop (1976) 64 Cr App R 29 to the effect that transitory or ephemeral losses may be sufficient to establish an intention to defraud. For these reasons, the evidence in support of grounds 2(b), (d), (e) and (h) is admissible.
The last sentence of par 17 and the first sentence of par 18 of the appellant's 5 June affidavit are to the effect that the appellant did not intend to avoid paying Customs' duty and did not intend to avoid payment of GST. Prima facie this evidence contradicts the material elements of the smuggling and evasion offences. However, I do not interpret the statements as a denial of the requisite intention for the offences but rather a reference to the ultimate purpose or motive for the appellant's conduct which was to ensure the Punch Audio goods arrived in Melbourne in the time‑frame required by Nelson Corporation's customer Autobarn. In those circumstances and on that basis I allow the evidence. Finally, the appellant's statement in par 30 that he made a serious error of judgment by not declaring the goods is admissible. It does not go behind or contradict the guilty plea.

Section 19B of the Crimes Act

All the grounds of appeal go to a single issue which is whether the Magistrate erred (or there is reason for a review under s 186(1)(b) of the Justices Act) because of the failure to discharge the applicant without proceeding to a conviction under s 19B of the Crimes Act.
Section 19B(1)(b) of the Crimes Act provides:
"(1)Where:
(a)...
(b)The Court is satisfied, in respect of that charge or more than one of those charges, that the charge is proved, but is of the opinion, having regard to:
(i)the character, antecedents, cultural background, age, health or mental condition of the person;
(ii)the extent (if any) to which the offence is of a trivial nature; or
(iii)the extent (if any) to which the offence was committed under extenuating circumstances;
that it is inexpedient to inflict any punishment, or to inflict any punishment other than a nominal punishment, or that it is expedient to release the offender on probation;
the court may, by order:"
dismiss the charge(s) or discharge the person without proceeding to conviction upon his giving security (with or without sureties) that he will comply with specified conditions.
A question of construction of s 19B(1)(b) arises as to whether the consequences of a conviction are relevant and, if so, at what stage of the analysis. The authorities are to the effect that the consequences can be relevant when considering "inexpedience": Cobiac v Liddy (1969) 119 CLR 257 at 265; McQuestin (1993) 69 A Crim R 522 at 525 ‑ 527.
The majority (Barwick CJ, Kitto and Owen JJ) in Cobiac v Liddy said (at 265):
"The only point taken on appeal, in argument, and dealt with in the judgments below was that there was no material upon which he could exercise his discretion ... . But at least the appellant's age was undoubtedly a fact which the Magistrate was entitled to consider. Age in this context is a relative matter, relative to all the circumstances which exist or are about to exist. The expediency which the Magistrate is required to consider is not limited to the age itself, although age is one of the factors which give rise to the question whether it is expedient in all the circumstances to exercise the powers given by the subsection. In our opinion, the Magistrate was entitled to consider whether, having regard to the age of the appellant and the circumstances which included the penalties which he had resolved to impose on the other charges, ... and having regard also to the fact that to send the appellant to gaol would subject him to distress by reason of his being thereby prevented from caring for his aged sister, it was expedient to take the course ... rather than to convict him."
Windeyer J took a slightly different approach. He said (at 275 ‑ 276):
"The statutory conditions for its exercise were that he should be 'of opinion that, having regard to the character, antecedents, age, health, or mental condition of the person charged ... it is expedient to exercise' the power. That means I think that the Magistrate must be of the opinion that the exercise of the power is expedient because of the presence and effect of one or more of the stated conditions, namely, character, antecedents, age, health or mental condition. One of these by itself, or several of them together taken together, must provide a sufficient ground for a reasonable man to hold that it would be expedient to extend the leniency which the statute permits. The act speaks of the court exercising the power it confers 'having regard to' the matter it states ... its, or their, existence must, it seems to me, reasonably support the exercise of the discretion the statute gives. ... but they are wide words. None of the matters they connote is necessarily to be regarded in isolation from the others, or apart from the whole of the circumstances of the offender and the offence. ... The position of his aged sister was perhaps a matter which went more to the expediency of not sending him to gaol, and thus leaving her uncared for, than a matter comprehended by the statutory list of things which were to be regarded. But I see no reason for excluding from his 'antecedents' the fact that he was living with and caring for his sister."
Adopting Windeyer J's approach, the appellant's relevant antecedents would include the role played by him in the business conducted by Nelson Corporation and the requirement connected therewith for the appellant to frequently travel overseas for the purposes of the business.

The Nature of the Offences

The nature and scope of convictions under the Customs Act were considered by the High Court in L Vogel & Son Pty Ltd v Anderson (1968) 120 CLR 157. In that case, as here, the appellants were convicted of more than one offence in respect of each evasion of duty. They contended that, in each case, the importing with intent to defraud the revenue, the presentation of a false invoice as genuine, the making of a false entry and the production of a document or documents containing an untrue statement or untrue statements were merely steps by which the ultimate offence of evading payment of duty was committed. Kitto J (who heard the matter at first instance) said (at 161):
"Each step was undoubtedly one of a connected series of steps, but each was a separate and distinct piece of conduct for all that, and each involved its own deliberate contravention of the act. Moreover, the ultimate step, the successful getting of the goods through the Customs without payment of full duty, far from being merely the sum of the means employed to that end, was itself a separate piece of conduct in furtherance of the general intent, for it resulted from the defendants' deliberately putting aside the opportunity that still remained to them, even after what they had already done, to pay the full amount of the duty."

The judgment of Kitto J quoted above was approved by the High Court on appeal (at 168). Kitto J also made observations concerning the nature of Customs Act offences. He said (at 164):
"Not only are the defendants guilty of a sustained course of conscious wrongdoing, but the offences are in field in which punishments for deliberate offences must be severe. The Customs laws represent the judgment of parliament upon an important aspect of the economic organisation of the community, and the object of the penal provisions is to make that judgment as effective as possible. It is important to remember that Customs' officers have of practical necessity to rely extensively upon the information supplied to them by importers, for the flow of commerce could not be maintained if every importation had to be fully investigated. Moreover, detection of frauds is not always easy. No doubt ordinary conceptions of honesty and of civic responsibility suffice to ensure a great deal of fair dealing with the Customs, but for some people little seems to matter but fear of the consequences of discovery. The Customs Act makes those consequences potentially drastic. It is for the courts to make them, in suitable cases, drastic in fact, for otherwise traders who are not saved by qualms of conscience from willingness to defraud their fellow citizens may weigh the profits they hope for against the penalties they have cause to fear and find the gamble worthwhile."
Thus, the circumstances in which it is appropriate to invoke s 19B of the Crimes Act in connection with offences of this kind have been described as rare, exceptional and special or singular: Ulf Weller (1988) 37 A Crim R 349 and 350 (Jacobs J) and 355 ‑ 356 (Perry J); Uznanski v Searle (1981) 26 SASR 388 at 394 per Sangster J.

The Appeal - Whether a Reviewable Error

I propose to deal firstly with the question whether the Magistrate made a reviewable error applying the well‑known test in House v R (1936) 55 CLR 499 at 504 ‑ 505 per Dixon, Evert and McTiernan JJ. The question is whether the court exercising the discretion has misapprehended the principles on which the discretion is to be exercised, misunderstood relevant facts, failed to take into account relevant circumstances or taken into account extraneous considerations: Uznanski v Searle (1981) (above) at 389 per King CJ.
It is incorrect to rely on evidence which was not before the Magistrate at the relevant time to conclude that the Magistrate erred. In those circumstances, the question is whether there is sufficient reason to justify a review of the decision under s 186(1)(b) of the Justices Act: Dickman v Turton [2000] WASCA 1 at par 17 per Miller J.
Grounds of appeal 1 and 3 to 8 can be separated into three categories. They are that the Magistrate erred:
(a)in construing s 19B as requiring exceptional circumstances and (ground 6);
(b)by not giving appropriate weight or proper consideration to the factors mentioned in 19B or to the consequences of the convictions and in finding that there were no exceptional circumstances (grounds 3, 5 and 8);
(c)by placing undue weight on the need for deterrence and the persistency of the appellant's conduct when there was one course of conduct (grounds 4 and 7).
There is nothing in the Magistrate's reasons to indicate that his reference to "exceptional circumstances" is to a statutory requirement for the exercise of the discretion under s 19B of the Crimes Act. Rather, it appears to be an observation, consistent with the authorities, that in relation to offences of the type under consideration, the exercise of the discretion in the appellant's favour required exceptional circumstances. The Magistrate did not err in approaching the exercise of the discretion in this way.
There is no suggestion that the Magistrate failed to have regard to the statutory criteria in s 19B(1)(b) of the Crimes Act. He was specifically referred to them by the appellant's counsel and made express reference to some of them in his reasons. Indeed, the appellant's complaint is not that the Magistrate failed to take into account these matters but rather that he failed to give them appropriate weight.
Indeed, properly understood, grounds of appeal 1, 3, 4, 5, 7 and 8 are little more than an assertion that the Magistrate's failure to exercise the discretion in the appellant's favour under s 19B of the Crimes Act was unreasonable or plainly unjust without identifying any specific error in the reasoning or approach taken by the Magistrate. I will approach the matter on that basis.
There is nothing in the appellant's age, character or record which separately or together warrant a conclusion on the material before the Magistrate that it was inexpedient to enter a conviction against the appellant. Indeed, as Cox J noted in Lanham v Brake (1983) 52 ALR 351 at 359, it is commonly the case in offences of this nature that the offender has no record and is of good standing in the community.
Further, the appellant's antecedents in the sense in which that term is used by Windeyer J in Cobiac v Liddy and the consequences of the convictions are two sides of the same issue but are on different sides of the discretionary balance. The Magistrate accepted at face value the appellant's submission that any convictions would be a serious impediment to his overseas travel. I infer the Magistrate also had regard to the impact that impediment would have on the business of Nelson Corporation. However, the appellant's considerable prior experience and involvement in the importing business and his frequent overseas travel connected with that business (and consequential familiarity with the regulatory framework and the consequences of breaching it) weighs against an order under s 19B of the Crimes Act. Indeed, it is the point made by the Magistrate when he said that the impediment to travel as a result of the convictions is a matter which it is to be expected the appellant would have kept clearly in mind. The nature of the appellant's business affected by the convictions is such that his conduct is less readily excusable or justifiable. There is a further aspect to this matter which I address below.
At no stage before the Magistrate or on appeal did the appellant submit that the offences were of a trivial nature. They are not. Customs' offences attract heavy penalties which reflect the need for general and specific deterrence. The practical need for, in effect, self‑assessment carries with it consequential difficulties of detection: see L Vogel & Son Pty Ltd v Anderson (above); Bushnell v Adams (1995) 30 ATR 78 at 81; CEO of Customs v Tonmill Pty Ltd [2001] WASC 77 at [26]; R v Matijevic [1997] FCA 992 at [16]. Accordingly, it is entirely appropriate for the Magistrate to consider and give significant weight to the need for deterrence and to the persistent nature of the appellant's conduct in considering whether or not it was inexpedient to proceed to conviction.
In the appellant's favour is that the charges relate to a single course of events involving a small amount of revenue, whether it be judged on a gross or net basis. However, the Magistrate's reasons and the penalty imposed do not support a conclusion that he failed to consider those matters. In particular, there is no suggestion that any such failure is reflected in the amount of the fines.
Section 19B(1)(b)(iii) refers to "extenuating circumstances" by which is meant circumstances which excuse in some appreciable degree the commission of the offences or lessen the appellant's guilt: O'Sullivan v Wilkinson [1952] SASR 213 at 218 per Paine AJ; O'Brien v M R Norton‑Smith Pty Ltd (1995) 31 ATR 128 at 131 per Wright J. Into this category falls the inquiries made by the appellant before leaving Australia and in Singapore. However, it is unlikely the facts put to the Magistrate on this issue effectively communicated the relevance or mitigatory aspects of the appellant's conduct in this regard.
For these reasons, I am not satisfied that the Magistrate was in error either in his reasoning or in the result in refusing to make an order under s 19B of the Crimes Act. In those circumstances, it is not this Court's role to intervene unless s 186(1)(b) of the Justices Act 1902 applies.

Review - Justices Act

I turn to the question whether there is some other reason that is sufficient to justify a review of the decision pursuant to s 186(1)(b) of the Justices Act. There is a distinction between an appeal from the exercise of a discretionary decision and a review under s 186(1)(b) of the Justices Act. In an appeal this Court cannot substitute its discretion for that of the Magistrate unless the Magistrate has made an error of the type described in House v R (above). A review under s 186(1)(b) is a merits review.
A sufficient reason for a merits review can be the admission of materially relevant evidence which was not before the court below. Much of the further evidence in this case provides additional detail and explanation of the submissions put to the Magistrate.
The further evidence does not advance the position concerning the effect of the convictions on the appellant's ability to travel. Indeed, it goes no further than that the appellant will face difficulty in entering Canada for five years and may have difficulties entering other countries. The evidence as to the financial consequences of travel restrictions on the appellant substantiates the submissions put to the Magistrate by the appellant's counsel.
However, the further evidence adds to and explains the significance of the appellant's efforts in Australia and in Singapore to ascertain how to import the goods without incurring liability at the time of importation to pay Customs' duty and GST and to obtain a carnet. In addition, the further evidence concerning Nelson Corporation's need to get the Punch Audio samples to Autobarn prior to 8 August 2000 puts the appellant's deliberate and persistent conduct in a broader context. The appellant's motive in acting as he did was to enable Nelson Corporation to take advantage of a commercial opportunity at the same time believing that the net financial prejudice to the Commonwealth revenues would, in due course, be insignificant. His intention to defraud the revenue was an incidental by‑product caused by his inability to put the necessary arrangements in place which would have relieved him of an obligation to pay Customs' duty and GST at the time of importation on the goods for business use. The goods for his personal use got caught up with the business importation. The additional evidence is sufficient reason to justify a review of the decision under s 186(1)(b) of the Justices Act.
I regard the appellant's conduct prior to and whilst in Singapore, his belief that in due course the Commonwealth would not be financially prejudiced in any significant way and the motive for his conduct (in the context of the other matters) as constituting relevant extenuating circumstances for the purposes of s 19B(1)(b)(iii) of the Crimes Act. Other relevant circumstances in considering inexpedience and the exercise of the discretion include the appellant's relevantly clean record (in the context of a significant history of importing), and the fact that he has been indirectly affected by the financial penalties imposed on Nelson Corporation for the same conduct.
However, I would not exercise the discretion under s 19B of the Crimes Act in the appellant's favour based only on these matters because of the nature of the offences, the appellant's background and the repetitively deliberate conduct. I would exercise the discretion in the appellant's favour if, in addition to those matters, I was prepared to place significant weight on the financial consequences of the convictions for the appellant. On one view, those consequences may be regarded as disproportionate to the circumstances of the offence and the offender. However, I am not prepared to place significant weight on the financial consequences because they result from foreign countries making judgments about whether or not to permit the entry of foreign nationals based, inter alia, on their convictions. As the convictions in this case are otherwise appropriate, it is for those countries to assess whether they should be an impediment to the appellant's entry. Accordingly, I am not prepared in the exercise of my discretion to set the convictions aside and make an order under s 19B of the Crimes Act. The appeal will be dismissed.