Nguyen v Comptroller-General of Customs - [2017] WASC 341

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CRIMINAL

CITATION: NGUYEN -v- COMPTROLLER-GENERAL OF CUSTOMS [2017] WASC 341

CORAM: BANKS-SMITH J

HEARD: 30 MAY 2017 & ON PAPERS FILED 2 & 7 NOVEMBER 2017

DELIVERED : 24 NOVEMBER 2017

FILE NO/S: SJA 1075 of 2016

BETWEEN: HOANG NAM NGUYEN
Appellant
AND
COMPTROLLER-GENERAL OF CUSTOMS
Respondent

ON APPEAL FROM:
Jurisdiction              :  MAGISTRATES COURT OF WESTERN AUSTRALIA
Coram  :MAGISTRATE E A WOODS
File No  :PE 117236 of 2014, PE 117237 of 2014, PE 117238 of 2014

Catchwords:

Criminal law - Appeal against sentence - Prohibited import - Importation of ice pipes - No legitimate use for ice pipes - Where use is for smoking illicit drugs - Where imported for commercial sale - Whether fine manifestly excessive

Costs - Appeal against costs order - Where offence under Commonwealth legislation - Whether costs regime for summary proceedings in Magistrates Court relevant

Legislation:

Criminal Procedure Act 2004 (WA), s 67
Customs Act 1901 (Cth), s 233, s 245, s 247, s 248, s 263
Customs (Prohibited Imports) Regulations 1956 (Cth), r 4I
Legal Profession (Magistrates Court) (Criminal) Determination 2016 (WA)
Official Prosecutions (Accused's Costs) Act 1973 (WA)

Result:

Leave to appeal granted
Appeal dismissed

Category: D

Representation:

Counsel:

Appellant: Mr D N Ryan
Respondent: Mr A C Willinge

Solicitors:

Appellant: Chelmsford Legal
Respondent: Australian Government Solicitor

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

Al Hussein v Commissioner for Consumer Protection [2014] WASC 296
Chan v The Queen (1989) 38 A Crim R 337
Chief Executive Officer of Customs v El Sayed [2003] NSWSC 1092
Chief Executive Officer of Customs v Kaufusi [2012] NSWSC 200
Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd [2003] HCA 49; (2003) 216 CLR 161
Chief Executive Officer of Customs v Pham [2003] NSWSC 971
Chief Executive Officer of Customs v Powell [2007] QCA 106; [2008] 1Qd R 109
Chief Executive Officer of the Australian Customs Service v Karam (No 2) [2013] NSWSC 33
Fry v Keating [2013] WASCA 109
Gill v The Chief Executive Officer of Customs [2009] WASC 222
Hickey v Chief Executive Officer of Customs [2017] QDC 27
House v The King [1936] HCA 40; (1936) 55 CLR 499
Legal Profession Conduct Commissioner v Morcom [2016] SASCFC 121
Ngo v The Queen [2017] WASCA 3
Oztran Aust Pty Ltd v Town of Port Hedland [2017] WASC 28
Parker v Comptroller-General of Customs [2007] NSWCA 348
Roffey v The State of Western Australia [2007] WASCA 246
Rowling v Murray (1993) 116 FLR 125
BANKS-SMITH J:

Introduction

The appellant is a pharmacist. At the relevant time, he was also the owner of a business in the suburb of Highgate known as 'Cloud 9 Smoke Shop & Accessories' (Cloud 9 shop).
The appellant pleaded guilty in the Magistrates Court to three counts of importing a prohibited import contrary to s 233(1)(b) of the Customs Act 1901 (Cth). The three counts related to the import of a total of 2001 ice pipes.
The appellant was fined $60,000 and ordered to pay the respondent's costs of $36,500.

Two grounds of appeal

The appellant seeks leave to appeal on two grounds of appeal: that both the fine and the costs orders were excessive.

Legislative provisions and ice pipes

The Customs (Prohibited Imports) Regulations1956 (Cth) control the importation of specified goods for the purpose of the Customs Act. Under reg 4I, goods commonly known as ice pipes cannot be imported into Australia without the permission of the relevant Minister or an authorised officer.
According to the Explanatory Statement issued at the time of the introduction of the restriction, ice pipes are used for smoking or inhaling methylamphetamine and do not have any legitimate use. Their availability for import and sale undermines efforts to reduce abuse of methylamphetamine. Whilst amphetamine-type stimulants can be administered in a range of ways, smoking in its crystalline form is particularly dangerous due to high drug purity levels.[1]
[1] Explanatory Statement, Select Legislative Instrument 2011 No 232.
Ice pipes are defined in reg 4I as being a device that is capable of being used for administering methylamphetamine or any other sch 4 drug,[2] by the drawing or inhaling of smoke or fumes resulting from heating the drug, in the device, in a crystal, powder, oil or base form.
[2] Customs (Prohibited Imports) Regulations 1956 (Cth), sch 4.
Section 50 of the Customs Act provides that the prohibition of goods may be prescribed by regulation. Section 51 describes goods that have been prescribed as prohibited as 'prohibited imports'.
Section 233 of the Customs Act provides that:
233Smuggling and unlawful importation and exportation
(1)A person shall not:
…
(b)import any prohibited imports[.]
…
(1AA)A person who contravenes subsection (1) commits an offence punishable upon conviction:
(a)in the case of an offence against paragraph (1)(a) or an offence against paragraph (1)(d) in relation to smuggled goods - as provided by subsection 233AB(1); or
(b)in any other case - as provided by subsection 233AB(2).
Section 233AB(2) relevantly provides:
233ABPenalties for offences against sections 233 and 233A
(2)Where an offence is punishable as provided by this subsection, the penalty applicable to the offence is:
(a)where the Court can determine the value of the goods to which the offence relates, a penalty not exceeding:
(i)3 times the value of those goods; or
(ii)1,000 penalty units;
whichever is the greater; or
(b)where the Court cannot determine the value of those goods - a penalty not exceeding 1,000 penalty units.
In the present case no value was ascribed to the imported goods so the maximum penalty for each offence was 1,000 penalty units.
At the time of offending, one penalty unit was equivalent to $170 pursuant to s 4AA of the Crimes Act 1914 (Cth).
These proceedings were 'Customs prosecutions' as defined by s 244 of the Customs Act. The maximum penalties that could be imposed in the Magistrates Court were provided for by s 245 of the Customs Act:[3]
[3] There have been minor amendments to s 245 since the date of the offences: the current versions are referred to in these reasons and the differences are of no significance to these proceedings.
245Institution of prosecutions
(1)Customs prosecutions may be instituted by the Comptroller-General of Customs by action, information or other appropriate proceeding:
(a)in the Supreme Court of a State;
(b)in the Supreme Court of the Australian Capital Territory;
(c)in the Supreme Court of the Northern Territory;
(d)in a County Court or District Court of a State;
(e)in a Local Court, being a Local Court of full jurisdiction, of South Australia or of the Northern Territory; or
(f)in a court of summary jurisdiction of a State, of the Australian Capital Territory or of the Northern Territory.
…
(4)Where a Customs prosecution for a pecuniary penalty that, but for this subsection, would exceed 200 penalty units is instituted in a court referred to in paragraph (1)(f), the amount of that penalty that exceeds 200 penalty units shall be taken to have been abandoned.
Accordingly, by s 245(4) the maximum penalty for each importation offence because of the jurisdictional limit was $34,000, being a total of $102,000. But for the jurisdictional limit, the maximum penalty for each offence was $170,000, being a total of $510,000.
In Gill v The Chief Executive Officer of Customs,[4] Hall J commented on matters relevant to the maximum penalty for offences against s 233, as follows:
Customs prosecutions brought in higher courts often relate to the evasion of duty, but they can also be brought, as here, to deal with the importation of items which are prohibited regardless of value. The fact that Customs prosecutions can relate to a vast range of conduct from large evasions of duty to small importations of prohibited substances such as chemicals or steroids is relevant in considering the significance of the maximum penalty.
The respondent submitted that to determine whether a sentence is manifestly excessive it is necessary to view it in the perspective of the maximum sentence prescribed by law for the crime. It was also submitted that it is important to note that the maximum penalty on summary conviction is a jurisdictional limit rather than the maximum penalty for the offence: Johnson v Hayter [2001] WASCA 118 at [10]. However, in my view, it is important to bear in mind that the maximum penalty is not one that is confined to the importation of drugs or steroids like those involved here. The Customs (Prohibited Imports) Regulations 1956 (Cth) also list a range of other things which cannot be imported (either at all or without permission) including certain breeds of dog, human embryo clones, weapons, certain toys, items containing specific concentrations of lead or other metals, and some chemicals. In these circumstances, the maximum penalty cannot necessarily be understood as an indication of the seriousness with which the legislature views the importation of anabolic steroids in particular. Any assessment of the seriousness of these offences by reference to the maximum penalty needs to take into account the range of conduct that the offence encompasses.
[4] Gill vTheChief Executive Officer of Customs [2009] WASC 222 [24] ‑ [25].

Agreed facts and evidence

The proceedings before the magistrate proceeded on the basis of agreed facts, to the following effect:

Charge 1 of 3

(a)On 2 July 2014 two parcels arrived in Perth from a Chinese supplier, addressed to Nam Nguyen at his pharmacy's address.
(b)The parcels were intercepted by a Customs officer and opened.
(c)Each was found to contain 250 ice pipes individually wrapped in bubble wrap.
(d)The 500 ice pipes were each labelled 'SWEET PUFF Holland'.
(e)The paperwork attached to the consignment described the contents of the parcels as 'Glass container samples' with a value of US$40.

Charge 2 of 3

(a)On 9 July 2014 two more parcels arrived in Perth from the Chinese supplier, again addressed to Nam Nguyen at the pharmacy address.
(b)The parcels were intercepted by a Customs officer and found to contain 250 ice pipes and 251 ice pipes respectively, individually wrapped in bubble wrap.
(c)Each of the 501 ice pipes was also labelled 'SWEET PUFF Holland'.
(d)The paperwork attached to the consignment described the contents of the parcels as 'Glass container samples' with a value of US$20.

Charge 3 of 3

(a)On 2 May 2014 a consignment addressed to the appellant arrived in Australia from India.
(b)The consignment contained 1,000 'SWEET PUFF' ice pipes.
(c)The declared value of the importation was AU$3,195.27.
(d)The contents of the parcel were described as 'borosilicate glass pipes 14cm'.
(e)The parcel was not intercepted by Customs and was cleared for delivery to the accused.
(f)Analysis of the appellant's computer and emails showed:
(i)the accused ordered the 1,000 'Sweet Puff glass pipe - 2.5mm thick, 14cm long - with Balancer' from the supplier in India and paid US$3,100 by PayPal on 14 April 2014; and
(ii)email correspondence from the appellant to the Indian supplier dated 14 May 2014 complaining about broken pipes due to the way they had been packed.

Customs investigations after interception of goods from China

On 7 July 2014, after the consignment the subject of charge 1 was intercepted and held by Customs, the appellant contacted the Customs Information Service by telephone and email, stating the pipes were used in the store to smoke tobacco, as candleholders and as kerosene lamps, and attaching to an email photos said to show ice pipes in those forms.
On 24 July 2014, Customs executed a warrant and searched the Cloud 9 shop and found:
(a)154 damaged and broken ice pipes labelled 'SWEET PUFF Holland';
(b)151 undamaged ice pipes labelled 'SWEET PUFF Holland' of various sizes and colours, on display for sale and in boxes as stock;
(c)the appellant's diary containing handwritten notations on five dates indicating dates of arrival of 'SWEET PUFF' from China and India;
(d)consignment documentation for an earlier importation of 'Glass container samples' from the Chinese supplier dated 14 June 2014; and
(e)'SWEET PUFF Holland' ice pipes that were identical to the ice pipes imported on display for sale for $60 ‑ $120 each.
During the Customs investigations, the appellant told officers that:
(a)the goods intercepted by Customs were not ice pipes but tobacco pipes;
(b)he was expecting tobacco pipes;
(c)they were sold as tobacco pipes to him;
(d)items in the shop identical to the imported items were tobacco pipes;
(e)the shop is a tobacco shop and that is what he sells;
(f)he did not contact Customs about importing the pipes until the first consignment was stopped;
(g)he had arranged for the Police and Tobacco Department to come to the shop to ensure everything was legal;
(h)broken ice pipes found by Customs officers at the shop were like that because some people liked to make their own. He could not remember if they were broken in transit or were originally one pipe; and
(i)he did not know if the pipes were effective for smoking tobacco as he did not smoke.
Customs officers also searched the appellant's residence, and found six ice pipes labelled 'SWEET PUFF Holland'.
They also located a sketch of an ice pipe drawn by the appellant with dimensions specified for the pipe length, pipe diameter, bulb thickness and bulb diameter. When asked why he drew it with dimensions and how he came up with those specific sizes, the appellant said 'I like drawing. I'm an artist as well. Before I became a pharmacist'.
Subsequent analysis of the appellant's computer revealed many emails between the appellant and the Chinese supplier, including:
(a)between 9 and 14 April 2014 the appellant made enquiries about ordering clear, green, red and blue 'Sweet Puffs' for 73 cents each, providing specifics as to glass thickness and pipe length requirements. The supplier then wrote to the appellant stating, 'I have to tell you that every order to AU has a risk that AU custom may check the box. If they deduct it, we will ship it free ... In 5 years, we only met 4 case like that'. The appellant replied 'Put a fake little flower inside and put it in a paper box like this. I have a gift shop so it is ok!!! Can you do it like this? Let me know ASAP so I don't have to order it from India'. The appellant provided an internet link to a photo. The supplier replied, 'Putting flower was used two years ago. We do not think it works if meet problems [with Customs]' but said they could do it and it would 'cost about 20 days'. The appellant responded 'Don't put flowers. Just send it normally'; and
(b)on 16 May 2014 the appellant instructed the Chinese supplier 'Send to my shop address. Cloud 9 Smoke Shop. [address]'. The supplier responded 'Ok. But we advise writing a common name. Your shop name take a word "smoke", that is not good. And please make sure your info have never met problems at custom'. The appellant replied, 'Ok good idea use Nam Nguyen. Send to my pharmacy [address]'.

Other ice pipe offence sentences referred to

During the course of sentencing, counsel for each party referred to one example of sentencing for ice pipe importation convictions.
The appellant referred to a media release published by the Australian Border Force that referred to a 2015 conviction on a guilty plea of a Brisbane man for importing 20,800 ice pipes under the same provision and said that he was fined $17,500.
The respondent referred to a Western Australian decision of Chief Magistrate Heath in which a part time pharmacist was apparently convicted on an early plea of guilty of importing 100 ice pipes and aiding and abetting in the importation of 50 ice pipes and was fined $7,500 and $2,500 respectively.

The sentencing remarks

The learned magistrate said the following with respect to sentencing:[5]
[5] ts 6 - 9.
(a)the appellant maintained in his dealings with Customs about the imports from China that the pipes were tobacco pipes;
(b)he said there were none at his home although six were found there along with his drawing;
(c)as to the appellant's intention:[6]
[6] ts 6.
In relation to both of those emails, it is my view that they clearly show an intention on the part of the accused to try and avoid detection by Customs. There is knowledge attributed to him by those emails that he was trying to disguise the import of the pipes as something else, and that his knowledge as to the use of the pipes was more extensive than he would like the court to have imagined. In relation to that behaviour and those emails, in my view, is all designed to avoid detection and to avoid knowledge being attributed to him as to the normal and usual use of these pipes that were intercepted by Customs.
(d)the seized pipes are not ornamental and do not bear a resemblance to candle holder pipes, despite the content of the emails;
(e)they are the kind of pipes that are part of the use of illicit substances and are prevalent in the community;
(f)there is no use for the pipes other than as ice pipes;
(g)there was a considerable commercial benefit in importing them;
(h)there could be only a limited discount for the guilty plea;
(i)it was naïve to the extreme to suggest that a pharmacist did not know that the pipes were to be used as ice pipes; and
(j)the offences were serious and there was a significant number of pipes.
Her Honour also took into account that there were no prior convictions relevant to sentencing, the appellant's professional status and his plea of guilty.
She took account of personal references that spoke highly of the appellant but noted the deliberateness of the offences.[7]
[7] ts 7, 9.
Her Honour considered that the commercial nature of the enterprise required specific deterrence. She considered general deterrence was required because of the prevalence of the drug, the difficulty in intercepting such imports in parcels and the potential for profit. Her Honour considered a global fine was appropriate taking into account the similar nature of the offences but noted there were three separate imports and there was planning involved.[8]
[8] ts 8 - 9.
Her Honour specifically referred to the relevance of s 16A of the Crimes Act for the purpose of sentencing.[9]
[9] ts 7.

Costs ordered

As to costs, the magistrate had regard to a schedule of costs provided by the respondent.[10] The schedule of costs set out professional fees ($42,671.97), disbursements ($375.64), counsel fees ($13,811.42) and expert fees ($2,541) in the total of $59,400.03. The professional fees were made up of 12 separate lump‑sum items for (variously) initial advice, drafting the prosecution notice, preparation for and attendance on seven court dates and two separate sums for preparation for trial.
[10] ts 9.
There is no reference to any particular determination in the schedule provided and no disclosure of rates. The schedule was handed to the magistrate by counsel for the respondent in the context of a submission that the magistrate had power to order costs under s 263 of the Customs Act and after noting that the solicitors for the respondent, the Australian Government Solicitors, operated as a law firm.[11]
[11] Hearing on 8 September 2016, ts 12.
The magistrate indicated she would not reduce disbursements including expert fees, but that she intended to make reductions in the areas of counsel fees and professional fees. Her Honour said:[12]
The reductions, obviously, in the bill of costs apply to the attendance at court for various appearance[s] which, in my view, mostly are commonplace and not taxing for counsel and not of long duration, and so I have reduced the total of the bill to a sum of $45,916. Obviously, that is a considerable sum, and that needs to be reflected in the overall scheme of things, but, notwithstanding that, there are three charges before the court which need to be reflected also in the global fine.
[12] ts 10.

In settling on the figure of $45,916, her Honour initially overlooked the fact that the prosecution, although itemising costs and disbursement in the sum of $59,400.03 in its schedule, was seeking a costs order of only $36,500. When that fact was brought to her Honour's attention, she said that the costs order could then be $36,500 'if that's what has been agreed and discussed'.[13] There was no evidence that the appellant had agreed to a cost order in that amount, and the respondent on this appeal does not suggest otherwise.
[13] ts 11.

Law relating to sentencing appeals

Both grounds of appeal are concerned with the exercise of discretion. The established principles are well known, as summarised in House v The King:[14]
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.
[14] Housev The King [1936] HCA 40; (1936) 55 CLR 499, 504 ‑ 505.
As to whether a sentence is excessive, as stated in Chan v The Queen:[15]
To determine whether a sentence is excessive, it is necessary to view it in the perspective of the maximum sentence prescribed by law for the crime, the standards of sentencing customarily observed with respect to the crime, the place which the criminal conduct occupies in the scale of seriousness of crimes of that type and the personal circumstances of the offender.
[15] Chan v The Queen (1989) 38 A Crim R 337, 342. See also Ngo v The Queen [2017] WASCA 3 [54] - [55].
It is also apparent that the magistrate had regard to the totality principle in imposing a global fine for the three charges. In Roffey v The State of Western Australia,[16] the principle was summarised as follows:
The appellant relies on the totality principle which comprises two limbs. The first limb is that the total effective sentence must bear a proper relationship to the overall criminality involved in all the offences, viewed in their entirety and having regard to the circumstances of the case, including those referable to the offender personally: Woods v The Queen (1994) 14 WAR 341.
[16] Roffey v The State of Western Australia [2007] WASCA 246 [24]. The common law totality principle remains relevant to sentencing under the Crimes Act: Ngo v The Queen [25].

Ground 1 - lack of comparative sentences

The parties were unable to point to any reported cases dealing with ice pipe importation sentences. In addition to the examples cited by the parties before the magistrate, there is reference in Legal Profession Conduct Commissioner v Morcom[17] to a conviction of the practitioner apparently recorded in his absence as follows:
On 6 August 2013, the Practitioner was convicted by a Magistrate in Victoria of importing 12 ice pipes and an electronic shock device, and making a false declaration to Customs that he was not in possession of prohibited or restricted goods on 17 January 2012. The Magistrate imposed a fine of $8,000.
[17] Legal Profession Conduct Commissioner v Morcom [2016] SASCFC 121 [30].
Those few examples do not provide grounds for suggesting any established tariff with respect to ice pipe importation. The Chief Magistrate's decision provides some assistance. There are too few disclosed facts relevant to sentencing in either the Queensland example or Morcom to assist.
On this appeal, the appellant also referred to three examples of convictions relating to different prohibited imports which it said were broadly comparable.
In Gill v CEO of Customs, the offender pleaded guilty to six charges. Five related to importing medicines or steroids, being 87 tablets of valium, containing a total of 870 mg of Diazepam; 500 tablets of Dronabol containing 5,000 mg of Methandenone; 3 (1 ml) ampoules of Sustanon 250 or testosterone; and 16 (1 ml) ampoules of Nandrolone in 50 ml concentration and 3 (1 ml) ampoules of Nandrolone at 100 ml concentration. The sixth charge related to failure to disclose the substances when he brought them into the country in his luggage. It appeared the substances were for personal use. He pleaded guilty at the first opportunity. On appeal, a fine of $27,000 was reduced to $8,000. The court had regard to a number of sentences for similar offences relating to steroid and medicine importations in the Magistrates Court in allowing the appeal.[18]
[18] Gill v CEO of Customs [38], annexure A.
In Chief Executive Officer of Customs v El Sayed,[19] the offender was convicted of a number of charges, including, relevantly, 15 kg of tobacco leaf. It was disguised as packaged tableware. He was fined $5,000 with respect to the tobacco leaf. However, the court was also obliged to impose a mandatory penalty of $2,877,500 on a charge of evading duty.
[19] Chief Executive Officer of Customs v El Sayed [2003] NSWSC 1092.
In Chief Executive Officer of Customs v Kaufusi,[20] the offender imported in 176 hessian bags in a container some 3,949 kg of kava. It was described as 'root or tuber vegetables'. The offender had prior convictions. It was said that kava has a significant impact on Aboriginal communities. General and specific deterrence were relevant. The offender entered an early plea of guilty. He was fined $897,000. The maximum penalty based on value was $7,897,999.80.
[20] Chief Executive Officer of Customs v Kaufusi [2012] NSWSC 200.
In my view, these cases also provide little guidance. The circumstances of offending are quite different for each.
However, lack of guidance from case law as to a range for sentencing does not leave the discretion at large and does not mean that a particular sentence may not be considered manifestly excessive.

Ground 1 - submissions

The appellant says the fine of $60,000 is manifestly excessive taking into account in particular that:
(a)the three offences reflected one course of conduct;
(b)the appellant made some attempts to ascertain whether he could import the ice pipes legally and had contacted the Tobacco Board prior to the date of the importing the subject of the charges;
(c)he did not attempt to deceive Customs in that the ice pipes were sent to his pharmacy address and he did not seek to alter their appearance;
(d)he fully cooperated with Customs when they came to his shop;
(e)he could have sourced ice pipes legally within Australia;
(f)the number of ice pipes imported was not high compared with other cases (presumably a reference to the Queensland example);
(g)his delay in pleading guilty was in part due to conflicting advice; and
(h)he has no relevant record and was a professional person otherwise of good character.
I add that there were before the magistrate some nine character references from family members and colleagues. Some were aimed at least in part at addressing the impact on the appellant of a conviction in the context of the appellant's unsuccessful application for a spent conviction order. There was also a letter from the appellant to the court in which he spoke of remorse but he maintained that the pipes were used for tobacco or as portable vaporises and said he was pleading guilty because he regrets that he did not keep records of the inquiries he said he made about importing the ice pipes.
In my view, the magistrate took into account the above matters to the extent required. She noted there were separate importations involving different circumstances. It is clear that her Honour did not accept on the evidence before her that the appellant, as a pharmacist, had no knowledge of the use that is made of ice pipes. It follows that she did not accept that the appellant was being forthright with Customs when he claimed that the pipes were for tobacco use, a matter repeated in his letter to the court. The magistrate identified that the appellant knew there was some risk as to the importation of the ice pipes, as evidenced by the various emails, but proceeded regardless.
Her Honour noted that some of the delay with respect to the plea of guilty ought not to be sheeted home to the appellant.
Her Honour was clearly aware of the character references, in light of the debate revealed in the transcript on the application for a spent conviction order.
The communications with the Tobacco Board placed before the court did not refer to importing but to the sale and display of tobacco and associated products such as hookah pipes. They did not specifically refer to ice pipes or disclose details of pipes of the intended shape or size, however described. There is some reference to water pipes and glass pipes in the communications but I do not consider the magistrate was obliged to give any particular weight to such correspondence, taking into account its lack of specificity.
The respondent focuses on the potential commercial benefit, quantifying it as between $118,000 and $238,000 (calculated on the basis of the difference between a retail price of between $60 per unit and $120 per unit, less the 73c cost per unit, had the ice pipes all in fact been sold). There is no doubt that potential commercial benefit is relevant in assessing the level of a sentence and its capacity to deter.[21] However, the respondent's quantification is no more than an assessment of potential revenue before tax and overheads. Regardless, there was clearly intended to be a commercial benefit. The ice pipes were to be sold in the appellant's shop at a significant mark up. They were not for personal use. It is not necessary to precisely quantify such commercial benefit in order to accept it as relevant to sentencing.[22]
[21] Al Hussein v Commissioner for Consumer Protection [2014] WASC 296 [25]; Oztran Aust Pty Ltd v Town of Port Hedland [2017] WASC 28 [22] ‑ [24].
[22] The respondent refers to CEO of Customs v Kaufusi [34] ‑ [37] as supporting reliance upon how much commercial benefit is to be gained (Respondent's outline [75]) - but the court there was in fact discussing the meaning of 'value' for the purpose of valuing kava as a drug.

Determination - ground 1

The magistrate considered matters relevant to the exercise of discretion under s 16A of the Crimes Act. In particular, her Honour referred to both general and specific deterrence. She considered the offences to be serious, taking into account the only use for which such pipes can be used is to smoke an illegal drug which is a known problem in the community. Her Honour expressly took into account the plea of guilty, whilst noting that it came late in the proceedings. Importantly, she did not accept the appellant's claim that he did not know what the pipes were for. The importation was for commercial benefit, rather than personal use. Her Honour was entitled to take into account all of those matters. It also appears she gave regard to principles of totality in imposing a single global fine. Whilst in my view the penalty imposed was at the higher end of a range that might have been imposed on a sound exercise of discretion, it was not manifestly excessive. I have taken into account in assessing the seriousness of the offence that the maximum penalty is not confined to ice pipes but to a range of imports including drugs and weapons. Whilst the pipes themselves may appear somewhat innocuous, the use for which they are put is not.
Against a possible maximum fine of $510,000 for the three offences, capped at $102,000 by the jurisdictional threshold, I do not consider the fine is manifestly excessive. I do not infer an error in the manner in which the magistrate's discretion has been exercised. Whilst I would grant leave to appeal, the appeal on this ground is dismissed.

Ground 2 - costs appeal

As mentioned, it is not in dispute that the proceedings were 'Customs prosecutions' for the purpose of pt XIV of the Customs Act: see s 244. The proceedings were instituted by the Comptroller-General in the Magistrates Court, as allowed by s 245(1)(f). The Magistrates Court has both civil and criminal summary jurisdiction.
Section 247 provides that:
Every Customs prosecution in a court referred to in subsection 245(1) may be commenced prosecuted and proceeded with in accordance with any rules of practice (if any) established by the Court for Crown suits in revenue matters or in accordance with the usual practice and procedure of the Court in civil cases or in accordance with the directions of the Court or a Judge.
Section 248 provides:
Subject to the provisions of this Act the provisions of the law relating to summary proceedings in force in the State or Territory where the proceedings are instituted shall apply to all Customs prosecutions before a Court of summary jurisdiction in a State or Territory, and an appeal shall lie from any conviction order for condemnation or order of dismissal to the Court and in the manner provided by the law of the State or Territory where such conviction or order is made for appeals from convictions or orders of dismissal, and notwithstanding anything to the contrary in the law of the State or Territory, an appeal shall lie from an order of dismissal to any court to which and in the manner in which an appeal lies from a conviction.
There is no doubt that the court can order costs of a prosecution against an offender. Section 263 of the Customs Act deals with both the power to order costs and the recovery of such costs. It provides:
In a Customs prosecution, whether commenced before or after the commencement of this section, a court may award costs against a party, and, where an amount of costs is awarded against a party other than the prosecutor, section 259 and any provision of a law of a State or Territory that, by virtue of an Act other than this Act, applies in relation to the recovery of pecuniary penalties under this Act apply in relation to the recovery of the amount of costs so awarded as if it were a pecuniary penalty adjudged to be paid by the party under this Act.
Section 259 permits penalties to be recovered by levy by sale goods.
These provisions have been analysed in a number of cases.[23] The three questions that arise are:
(a)does s 247 operate so that all Customs prosecutions, including those instituted in the Magistrates Court, are to proceed in accordance with the usual practice and procedure of that court in civil cases?
(b)does s 248 operate so that despite s 247, in the case of summary proceedings in the Magistrates Court the provisions in force relating to summary proceedings (including those relating to criminal proceedings) apply?
(c)does s 263 operate exclusively as to costs so that s 247 and s 248 have no role with respect to costs in any event?
[23] Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd [2003] HCA 49; (2003) 216 CLR 161; Parker v Comptroller-General of Customs [2007] NSWCA 348; Chief Executive Officer of Customs v Powell [2007] QCA 106; [2008] 1Qd R 109.
In short, the appellant contends that by s 248, the magistrate ought to have taken into account the provisions of the State law as to costs of summary proceedings in the Magistrates Court in the exercise of her discretion.
The respondent says that there is no room for the application of s 248 or State law provisions as to costs and by s 263, the magistrate was entitled to exercise her discretion without regard to any determinations or scales that may apply under State law.
The first two questions are answered, in my view, by the close analysis of the Court of Appeal in CEO of Customs v Powell.[24] Having considered the history of the respective provisions in the context of the Queensland legislation, the court held that a Customs prosecution in a Magistrates Court in Queensland may be brought, by virtue of s 247, under the Uniform Civil Procedure Rules 1999 (Qld) or in accordance with the court's directions, or, by virtue of s 248, under the Justices Act 1886 (Qld).
[24] See also Rowling v Murray (1993) 116 FLR 125, 133 in which the court relied on the provisions of the Justices Act1886 (Qld) (which included provisions as to procedure in summary criminal jurisdiction) to permit amendment of a complaint, referring to s 248.
The Magistrates Court in Queensland has both civil and criminal jurisdiction. Relevantly, the Justices Act provides for the determination in a summary manner of certain offences where a person may be liable for punishment or penalty. It contains proceedings for the hearing of such matters. It provides for the court to make orders in its discretion as to costs.[25]
[25] Justices Act s 22A, pt 3 div 1, pt 6 div 8.
Similarly, the Magistrates Court in Western Australia has civil and criminal jurisdiction. The proceedings against the appellant were instituted under the Criminal Procedure Act 2004 (WA). It is not in issue between the parties that it was open for the prosecution to proceed in that manner, and that course is consistent with the approach in CEO of Customs v Powell.
Part 3 of the Criminal Procedure Act applies to prosecutions in courts of summary jurisdiction and so applies to criminal proceedings in the Magistrates Court. By s 67(2) of the Criminal Procedure Act, if an accused is convicted, the court may order the accused to pay all or part of the prosecutor's costs.
By s 67(3) of the Criminal Procedure Act, the amount of costs so ordered may be determined in accordance with a determination made for the purpose of the Official Prosecutions (Accused's Costs) Act 1973 (WA). Determinations are made under the Legal Profession Act2008 (WA). A relevant determination has been made under that Act: the Legal Profession (Magistrates Court) (Criminal) Determination 2016 (WA) (Determination).[26] For the purposes of determining the amount of costs that are payable to a prosecutor, the Determination is not binding. It is to be used as a guide or by analogy.[27]
[26] Published by way of schedule to the Legal Profession (Magistrates Court) (Criminal) Report 2016 (WA).
[27] Fry v Keating [2013] WASCA 109 [76].
I see no reason to depart from the approach in CEO of Customs v Powell and consider it is applicable to the position in this State. Accordingly, in my view the first and second questions are answered 'no' and 'yes' respectively.
Further, as to the third question, s 263 does not deny reference to the Determination. It is clear that the courts have not construed the power to award costs under s 263 of the Customs Act as excluding reference to the practice and procedure as to costs of the relevant State court under s 247. For example, in Chief Executive Officer of the Australian Customs Service v Karam (No 2),[28] the court referred to s 263 but noted that by s 247 costs were to be determined 'in accordance with the usual practice and procedure of the court in civil cases', being s 98 of the Civil Procedure Act 2005 (NSW) and pt 42 of the Uniform Civil Procedure Rules 2005 (NSW).[29]
[28] Chief Executive Officer of the Australian Customs Service v Karam (No 2) [2013] NSWSC 33 (noting that the parties accepted that was the appropriate course).
[29] CEO of Customs v Karam [54] ‑ [55].

In Hickey v Chief Executive Officer of Customs,[30] the offender was ordered to pay costs of a Customs prosecution. The magistrate calculated those costs in accordance with the scale of fees for such summary proceedings in the Magistrates Court, as provided for by the Justices Act. On appeal, the court noted that by both s 263 of the Customs Act and s 157 of the Justices Act the court was empowered to order costs as seem to be 'just and reasonable'. The court found no error on the part of the magistrate as to the award of costs.[31]
[30] Hickey v Chief Executive Officer of Customs [2017] QDC 27.
[31] Hickey v CEO of Customs [63] ‑ [67].
The respondent says that s 248 has no role for three reasons:
(a)s 248 is said to operate 'subject to the provisions of the [Customs Act]' and so s 263 has primacy;
(b)s 248 is general whereas s 263 specifically deals with costs; and
(c)s 263 refers to s 259, and if s 248 were intended to apply the State provisions as to costs and recovery of costs, then there is no need for s 263 to refer to s 259.
I do not consider the words 'subject to this Act' where appearing in s 263 warrant a different approach. The phrase is not to be treated as if there is a conflict between s 263 and s 248. There is a role for such phrases if there is a conflict, but in this case there is none: both the Commonwealth and State provisions empower the magistrate to order costs in favour of the respondent. Whereas the Customs Act on its face does not proscribe the manner of the exercise of discretion, the State provision provides some assistance. That does not create a conflict.[32]
[32] See generally Pearce DC and Geddes RS, Statutory Interpretation in Australia (8th ed) [12.4].
Whilst s 263 specifically refers to costs, it does so only at a general level. There is no inconsistency in a State provision that then provides for matters that may be taken into account in the exercise of discretion and provides a practical framework for summary proceedings which is not provided by the Customs Act. The court did not doubt the application of s 247 with respect to costs in CEO of Customs v Karam, despite also referring to s 263.
In Chief Executive Officer of Customs v Pham,[33] the Court considered that s 263 was inserted 'for more abundant caution' in case the words of s 247 were not wide enough to include (relevantly) an entitlement to order costs. Again, as CEO of Customs v Karam shows, the court has considered that a reference to its State rules of practice and procedure includes a reference to the provisions as to costs. The reference in s 248 to applying State 'provisions of the law' is even broader than the expression used in s 247 to applying 'rules of practice,' and so in my view there is no real question that s 248 would cover State provisions as to costs.
[33] Chief Executive Officer of Customs v Pham [2003] NSWSC 971 [44].
The third reason is not compelling. The reference in s 263 to s 259 has the effect of empowering Customs to levy and sell goods. The fact that the power of sale is expressly granted by the Customs Act again does not give rise to an issue of primacy. Some State legislation dealing with recovery of penalties may not provide for levying and sale. Even where it does, there is no suggestion in this case of any resulting conflict. The grant of the power provides to Customs consistency of power to recover payment by levy and sale, regardless of the jurisdiction of the prosecution.
Further, the respondent also submitted that the provision of the Criminal Procedure Act dealing with costs would not to be picked up and applied by s 68(1) of the Judiciary Act 1903 (WA) as the Customs Act expressly made contrary provision for costs in s 263 The respondent referred to the discussion in Ngo v The Queen.[34] That case concerned conflicting express provisions in Commonwealth and State legislation as to reductions from a head sentence in the case of a guilty plea. There is no express conflict between s 263 of the Customs Act and s 67 of the Criminal Procedure Act. The Criminal Procedure Act does not include matters to which the court must have regard in assessing costs. As in Hickey v CEO of Customs, the court still retains its discretion as to costs. It may have regard to the Determination but is not obliged to.
[34] Ngo v The Queen [17] - [34].

Determination - ground 2

I am not satisfied that the magistrate erred in the exercise of her discretion. Assessing costs, whether for the purpose of s 263 or under s 67(2) of the Criminal Procedure Act, remains a discretionary task. In my view, the respondent should have drawn the magistrate's attention to the existence of the Determination, as that is a matter to which she was entitled to have regard as part of the provisions that apply to summary determination of a prosecution in the Magistrates Court. However, the magistrate was not obliged to have regard to it or to assess costs in accordance with it. I acknowledge that there are some differences between the respondent's schedule and the amounts that may have been allowed had the Determination been applied. For example, under the Determination, there is no allowance for preparation prior to the issue of proceedings, whereas the respondent's schedule included an item for such preparation and claimed an amount of some $9,000.
However, bearing in mind that the respondent sought less for costs than was included in its schedule and that the magistrate was initially inclined to grant more than the amount sought, I am not persuaded that the magistrate's decision would have been different had her attention been drawn to the Determination. In the circumstances of the case, it was open to her Honour to find that an allowance for the respondent's preparation was justified in any event. It was also open to her Honour to assess costs in the manner undertaken by her. She had clearly reviewed the costs claimed. I do not infer an error in the manner in which the magistrate's discretion has been exercised.
Accordingly, I would grant leave to appeal on ground 2 but dismiss the appeal.