Nguyen & Anor v Commissioner of the Australian Federal Police

[2015] HCATrans 88

[2015] HCATrans 088

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B51 of 2014

B e t w e e n -

MAU DUNG NGUYEN

First Applicant

DUONG THI BICH LIEN

Second Applicant

and

COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE

Respondent

Application for special leave to appeal

KEANE J
NETTLE J

TRANSCRIPT OF PROCEEDINGS

FROM CANBERRA BY VIDEO LINK TO BRISBANE

ON FRIDAY, 17 APRIL 2015, AT 12.53 AM

Copyright in the High Court of Australia

MR G.D. WENDLER:   If the Court pleases, I appear for the applicants.  (instructed by Brisbane Criminal Lawyers)

MR N.J. WILLIAMS, SC:   If the Court pleases, I appear with MR G.J.D. DEL VILLAR and MR A.S. McDOUGALL for the respondent.  (instructed by Australian Government Solicitor)

KEANE J:   Yes, Mr Wendler.

MR WENDLER:   Your Honours, can I confirm that there has been compliance with the provisions of section 78B of the Judiciary Act.

KEANE J:   Thank you.

MR WENDLER: This application raises for consideration the nature and ambit of the power given to the Parliament of the Commonwealth in section 77(iii) of the Constitution to make laws investing one of the closed categories of courts in Chapter III with federal jurisdiction in the nine categories of matters identified in sections 75 and 76 of the Constitution.

The power in section 77(iii) is, of course, not an omnipotent power but is circumscribed by the principle that the Commonwealth, when it selects what has sometimes been referred to by Justice Starke as a substitute tribunal or a conscript court – when it selects that court and invests it with federal jurisdiction it does so on the inviolable condition that it takes the court in its contemporary institutional setting.

The question in this application, or at least one of them, is whether or not that prohibition in section 77(iii) has been offended by virtue of the scheme that has been adopted in the Proceeds of Crime Act (Cth) which can be described as a civil forfeiture scheme having various dimensions in its application.

It may be appropriate at this point to identify by way of a flow chart the relevant sections of the Act which are pertinent to this particular application.  Can I invite your Honours to the legislation book and if I can just take your Honours through the sections that are relevant from the point of the application for a restraining order in relation to property, to the point where there is what is described in the legislation as an examination order and the role of a functionary described as an examiner appointed pursuant to the provisions of the regulations made under the Act.

The starting point in a flow chart of the scheme of the Act is effectively section 25.  Section 25, on page 30, identifies the authority, and there are only two authorities identified in the Act described as proceeds of crime authorities, one being the Director of Public Prosecutions and the other being the Federal Police Commissioner.  In this case the authority is the Federal Police Commissioner, the respondent.  The application is made under section 25, in this case for the restraining order which was made in accordance with section 19.  In other words, there was a restraining order in relation to property suspected of being the proceeds of indictable offences.  The process moves from that to ‑ ‑ ‑

KEANE J:   I think we are probably generally familiar with the steps.  The focus of your application is on the position of the approved examiner.  I think, in the interests of time, perhaps you can move to focus your submissions on what you want to say about the issue that throws up.

MR WENDLER: Yes, well, the starting point, of course ‑ the legal starting point must be the word “court” in section 77(iii). It must be the starting point. The position since this Court’s decision in the HCF Case is that “court” is not defined in such a way that it is limited simply to the judges that comprise the court.  That is a settled constitutional principle.  The HCF Case identified that the expression “court” means a court in its institutional setting, in its organisational setting whereby jurisdiction is exercised through the holistic process or understanding of what a court is as an institution. 

So, the word “court” also is identified in section 314 of the Act and it is also identified in section 39 of the Judiciary Act. But if we go back to section 77(iii), we have the word “court” in its wider sense. From there, the examination really is focused upon the way the legislation is structured and what the examiner is empowered to do and what, in fact, the examiner does.

KEANE J:   Is not your central proposition, though, that the approved examiner is made an officer of the court?

MR WENDLER:   Yes, but by virtue of the powers invested in him. 

KEANE J:   Now, how do you make that proposition good given that, for example, we are familiar with cases of investigators or examiners if you like, who are not part of the court - cases, for example, where evidence is taken on commission, the cases of special investigators under the Corporations Laws from time to time where the evidence that they take can be admitted, even from overseas where depositions are taken prior to trial.  Now, none of these procedures have ever been thought to involve an attempt to insert into the court structure the examiner.

MR WENDLER:   No doubt about that.  Taking evidence on commission is something that is fairly ancient.  In fact, we can trace it back to the Court of Chancery.  In fact, since, I think, the English Judicature Acts of 1893, the common law courts ‑ ‑ ‑

KEANE J:   So what is it about this Act that takes this position to a different and impermissible level?

MR WENDLER:   A number of features which are outside what would ordinarily be considered a role of a commissioner appointed to take evidence on behalf of the court.  First, the examiner is immunised against being sued in relation to performance of his functions.  He has a power or a discretion to refer matters of law or not to the court for determination that can make final and binding determinations in relation to matters of law.  The examiner, presumably, can make findings whether offences have been committed under the Act in relation to the failure of a person who is to be ‑ ‑ ‑

KEANE J:   Where is the provision for the examiner to make a finding?

MR WENDLER:   Well, there are offences – if one goes to page 67 of the legislation book which sets out Division 4 of the Act, for instance, 195 there is a failure to attend an examination and there is a penalty of two years imprisonment.  Now, it must follow that a finding as to whether a person has attended or not attended, the reasons why a person has not obeyed a notice compelling a person to attend examination, that finding must be made by the examiner.

KEANE J:   Why do you say that?  Where is the provision empowering the examiner to make that finding rather than for it to be established as all other offences are established?

MR WENDLER:   Well, in the practical circumstances of one of these examinations someone has to make a finding whether or not ‑ ‑ ‑

KEANE J:   No, the examiner just reports what has happened. 

MR WENDLER:   The examiner is more than just a…..evidence.  For instance, the examiner issues the examination notice.  The examiner is appointed, effectively, by the respondents.  There is no involvement in the appointment of the examiner by the applicants.  When you contrast the ordinary process which is set out, for instance, in the Queensland Uniform Civil Procedure Rules in relation to taking evidence on commission, the thing that sort of springs out, the procedural aspect that screams out, effectively, is the control the court has over that process. 

Here the examiner has, effectively – the court has really no control over him.  He runs the process and engages in what might be regarded as core functions that one would associate with the court, for instance, making evidence rulings, compiling evidence on behalf of the court, evidence which is ultimately used in the making of a confiscation order or the not making of a confiscation order further down the line of the process. 

So the special position of the examiner in the circumstances of this legislation is such that the examiner is empowered in such a way that his function is effectively to collect evidence on behalf of the court to make rulings or not rulings in relation to the process.  For instance, an evidence ruling may occur as to his powers in relation to the Act itself.  There may be a challenge in relation to – within the context of the examination as to the construction of the Act as to his powers.  He can make that determination.  He can control the conduct of the lawyers involved in the process. 

So it is really a matter of analysis, and the question is whether in the wider context of the term “court” in section 77(iii) of the Constitution there is, in effect, a parachuting into the structure of the court the examiner as part of the court in the wider organisational sense. There are some what might be described as administrative functions which are not entirely categorised as judicial but are nevertheless part of the organisational structure of the court and, as I have already indicated to you, as long ago as the HCF Case, the position has been by this Court that one construes the word “court” in section 77(iii) in its wider context. So the question is whether we construe this legislation as coming within that principle.

That is the first matter concerning this, in my respectful submission, important application concerning the ambit…..nature of section 77(iii). But there is another aspect to it and that is the way the Court of Appeal effectively found a bifurcation of the matter arising under the Act. If I can just invite your Honours now to the application book and the reasons for judgment, what is challenged by the applicant is what appears on page 18 of the application book in paragraph [19] in the reasons for judgment of Justice Fraser. The applicants relied on the principle explained in Le Mesurier v Connor – the application of that principle in relation to the constitutionality in section ‑ ‑ ‑

KEANE J:   Just looking at what his Honour says at line 30:

Unlike the legislation held to be invalid in Le Mesurier v Connor, the POC Act does not make the Commonwealth official a functionary of the Supreme Court, it does not authorise that official to act on behalf of the Supreme Court, and it does not authorise that official to administer any part of the Supreme Court’s jurisdiction.

Where is the error in what his Honour has said?

MR WENDLER:   There are effectively two, with respect, in that passage.  Where his Honour identifies that – or uses the phrase that the Act does not authorise the official to act on behalf of the Court, by implication it does because the restraining order – or the examination order – is made by the court.  So the court makes the examination order, in that sense activating the role of the examiner and the court also has a role in revoking the examination order so the examiner, in that sense, is under the control of the court.

NETTLE J:   Why is that any different to an order for the taking of evidence de bene esse?

MR WENDLER:   It is different because of the power that this examiner has in the context of the legislation.  We get back once again to this concept in the definition of “court” in the wider sense. 

NETTLE J:   What is the difference?  What specifically is the difference that you identify in that regard?

MR WENDLER:   Taking evidence conditionally – this is not taking evidence conditionally.  Your Honour’s example is taking evidence de bene esse is a conditional taking of evidence.  But this is not a conditional taking of evidence because it is ultimately used in relation to the materialisation of a confiscation order.  It is not, as it were, a sort of preliminary hearing of things.  The evidence is used, ultimately, in the context of the making or not making ultimately of a confiscation order. 

The other aspect which, with respect, offends section 77(iii) of the Constitution in that aspect is the fact that his Honour has bifurcated the matter, in other words, part of the matter resides in the court and the other part of the matter resides in the examiner. But when there is a matter in a federal jurisdiction it is a matter – there is no bifurcation in relation to the jurisdiction referable to the matter.

Now, what his Honour has done in the finding his Honour has made is in fact a bifurcation.  The matter under 314, being the matter arising under the Act, arises in one part of the process in the court and then is separated and resides in the examiner, so they are the two aspects which the applicants submit offend the constitutionality of section 314.

The applicants raise another aspect in its constitutional attack on section 314 and that is the attack on the process that is enlivened by virtue of the investigative jurisdiction.  It is taken that the -…..the Kable doctrine is a prohibition of the legislative power and in a certain aspect it must follow also that it is a prohibition on the legislative power in relation to the competence of the State to make laws. 

It is also a prohibition on a federal power, a prohibition in effect that applies, we submit, on the application of section 77(iii) because what the Commonwealth has effectively put in place is a civil confiscation scheme which first avoids the application of section 74 of the Judiciary Act and in the normal course section 74 would pick up State procedure and apply it as surrogate federal law but there is this entire procedure that is in operation which first prevents, under section 32, the applicants challenging the restraining order until there has been an examination order.

Now, that is an astonishing aspect of this legislation; that you cannot get involved in the civil process unless there has been first this examination process which forensically, potentially leaves one of the parties at a disadvantage.  The applicants have no role in the identification and choosing of the examiner.  The entire civil process is completely alien to what would have been the case had there simply been a process where section 74 was in operation, to pick up the Uniform Civil Procedure Rules in the State of Queensland, which would have involved the court having complete control of the process of leading or not leading confiscation. 

I see the light is on, your Honours. I rely on the written submissions. The issue here is essentially one going to the construction and operation of section 77(iii) in its relation to legislation…..and the legal relationship between the Kable doctrine which has hitherto been applied as the prohibition on a State and not necessarily in federal law.  In principle there is no reason why it cannot operate in relation to federal law as well.  If the Court pleases.

KEANE J:   In this matter, the decision of the Court of Appeal is not attended by sufficient doubt to warrant the grant of special leave to appeal.  Special leave is refused with costs.  I am sorry, Mr Williams, we should mention we do not need to trouble you.

MR WILLIAMS:   May it please the Court.

KEANE J:   The application will be refused with costs. 

AT 1.13 PM THE MATTER WAS CONCLUDED