NSW Crime Commission v Attallah

[2003] NSWSC 1000

CITATION:	NSW Crime Commission v Attallah [2003] NSWSC 1000 revised - 20/05/2010
HEARING DATE(S):	29-30 October 2003
JUDGMENT DATE:	3 November 2003
JURISDICTION:	Common Law
JUDGMENT OF:	Michael Grove J at 1
DECISION:	See par 24
CATCHWORDS:	CRIMINAL ASSETS RECOVERY - FOCUS UPON "GROSS RECEIPTS" NOT NOTIONAL PROFIT - ASSESSMENT
LEGISLATION CITED:	Criminal Assets Recovery Act 1990
PARTIES :	New South Wales Crime Commission v Joseph Attallah
FILE NUMBER(S):	SC 13053/00
COUNSEL:	I.Temby QC (Plaintiff) In person (Defendant)
SOLICITORS:	J.M. Giorgiutti (Plaintiff)

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

MICHAEL GROVE J

Monday 3 November 2003

13053/00 - NSW CRIME COMMISSION v JOSEPH ATTALLAH

JUDGMENT

1 HIS HONOUR: By amended summons filed on 15 November 2000 the plaintiff, the New South Wales Crime Commission (the Commission) sought, inter alia, a proceeds assessment order against Joseph Attallah (the defendant) pursuant to s27 of the Criminal Assets Recovery Act 1990 (the Act). On 16 December 2002 such an order was made for an amount to be later assessed and the matter is before the Court for the purpose of that assessment.

2 The defendant has appeared from custody and is unrepresented. The circumstances surrounding his asserted expectation of legal representation are recorded in the transcript as are my reasons for refusing adjournment. I note in passing that the particular solicitor mentioned appears to be the same as the one about whom, in address, the defendant complained concerning alleged failure to call witnesses at his recent trial.

3 On 9 November 2000 the defendant was arrested in possession of a quantity of illicit drugs. He was again arrested on 11 April 2001. In due course he was presented for trial at Sydney District Court upon indictment that between 31 May 1999 and 11 April 2001 he supplied not less than a large commercial quantity of heroin and between the same dates he supplied a large commercial quantity of cocaine. He was convicted on both counts. Relevantly included in his record of prior offences are convictions for possession of heroin at Campsie Petty Sessions on 20 October 1983 (fined $500); conviction for supply of prohibited drug at Penrith District Court on 12 August 1986 (eight years imprisonment with a non parole period of five years) and convictions on two counts of supplying prohibited drug at Newcastle District Court on 19 March 1992 (minimum term of four years imprisonment with additional term of one year and four months and two years fixed term to be served concurrently).

4 A restraining order pursuant to the Act in respect of the defendant’s assets was obtained on 15 November 2000 and the relevant period specified in s27(1) of the Act commences on 16 November 1994.

5 The evidence shows, and I accept, that during the relevant period the defendant conducted brothels, first at Mons Street, Condell Park and later at Clements Avenue, Bankstown. Drugs were sold by him or on his behalf to prostitutes working at the premises and to others who were referred to at times as “outside girls” and as customers. There is direct evidence of the defendant’s activity in connection with drugs from two former prostitutes, [name removed] and Jenny Sampson (recorded in documents to which I will later make reference as Vanessa and Rebecca respectively) which includes observation of his physical handling of drugs and the delivery of nightly “supplies” to the brothel. When supplies ran out, an employee would make a telephone call after which the defendant would arrive with more drugs.

6 The assessment required to be made is facilitated by s28. Of significance is s28(4) which precludes subtraction of expenses or outgoings incurred by the defendant in relation to his illegal activity, in effect, as was put by senior counsel for the Commission, what must be looked at are gross receipts in distinction from some calculation of profit. It is convenient to look first to evidence relating to the brothel at Bankstown. The evidence includes timesheets referrable to individual prostitutes. These are voluminous and have been analysed by Detective Sergeant Gallina.

7 A typical sheet has four squared columns under the “working name” of the prostitute. In the first column is recorded a time and in the fourth column a room number. The centre columns record the “split” of fees between the prostitute and “the house”. However, in the upper block where the name was written there was endorsed in red ink “minus” figures which were referred to as “subs” or subtractions. These were “contras” against the prostitute’s share of the fee which had been paid to the house, often by credit card, by the customer. On occasions these “subs” represented cash advances against the fees earned but I accept the evidence that the larger amounts are the cash equivalents of drugs used by the prostitute, of which the defendant was the supplier. An interview with Miss Sampson contained this telling exchange:

“Q58. And you said that Joe Attalla supplied you with drugs?
A. Yeah, yeah. He’d, he’d either give it to me or he’d give it to Jackie to give to me. Always, always make sure that we had our stuff to start work ‘cause he knew that we couldn’t work without it otherwise we were sick and what’s good a, well what use is a sick prostitute, not very good. Anyway someone who’s not sick and not hanging out is a lot handier to have y’know they’re gunna work obviously a lot better.”

8 It was routine for a prostitute to use heroin in the evening before “work” and in the morning afterwards.

9 A consequence of the costing of quantities of drugs consumed by the prostitutes, which frequently exceeded their earnings from the provision of sexual services, was that they became permanently indebted to the defendant and thus were providing services to customers in order to meet that debt, or more likely to inhibit the extent of its growth, rather than being in receipt of earnings.

10 Miss Sampson described a method of acquiring cash on occasions. There was a scale of fees relative to the particular acts of sexual congress engaged in with the customer. She would persuade him to contract with the “house” for a cheaper service but pay her an additional amount “in the room” for a more expensive one. The customer was not always aware which was in fact delivered.

11 However, this cash, which she described as “extra money” was used to purchase cocaine which she herself consumed. She said she had “a fairly wild coke habit” and estimated that she earned and spent between at least $300 and up to $900 a night on these purchases. All of the extra money was used to purchase drugs “without any doubt”.

12 An accounting analysis by Det Sgt Gallina (Exhibit B to his affidavit of 22 January 2002) computes $313,282 as representing “subs” referrable to drug purchases by prostitutes between June 1999 and October 2000. A deduction from total “subs” has been made for “shift fees” and amounts which are smaller than the charged rate for drugs, although it should be recognized that it remains possible that some of the smaller amounts might have been for drug purchase. I am satisfied that the computation is accurate and provides an appropriate guide for the purposes of assessment.

13 After 3 November 2000 “subs” for drugs ceased to be recorded in the stated manner. On that date one Victor Razzak was murdered on the premises. No doubt there was a significant police presence following this event. The defendant directed the change in recording which was made other than on the timesheets. The change itself offers some confirmation that the recordings were not of advances for innocent purposes. The figure of $313,283 is derived from “subs” for drugs over seventeen months and an extrapolation at the same rate for a further five months (until April 2001) produces a figure of $405,425. I accept the Commission’s submission that this can appropriately be rounded down to $400,000 for present purposes. As abovementioned, Miss Sampson was spending between $300 and $900 per day from her extra money to satisfy her craving for cocaine. She said this was done throughout from between 1997 and December 2000. An extremely conservative approach to this evidence would lead to an assessment of $300,000. This would be achieved by taking the lower figure of the range of expenditure for one thousand days which itself is a period of less than three years as against the stated period of three to four years.

14 Next, it should be taken into account that Miss Sampson’s evidence is that her second daily heroin consumption (the morning administration) was not recorded in the timesheets. On the same approach to selection of one thousand days and at the evidenced charge of $150, there can be computed a sum of $150,000.

15 Miss Sampson first became associated with the defendant when she was working as a street prostitute on Canterbury Road and heard that there was “like a protection house” nearby in Mons Road, Condell Park. Initially she obtained heroin from a manageress (Jackie) but when the defendant “knew I wasn’t a spy or whatever” he supplied it to her directly himself. She was working at Mons Street for about eight months. A daily expenditure of $250 can be represented by a total of $60,000. Having regard to the system which inevitably would seem to put a drug using prostitute into debt to the defendant supplier, Miss Sampson recalled a debt of $7,000 on “her account” at the time she ceased at Mons Road. The defendant “wiped” the debt although later, at Bankstown, he made occasional jocular reference to it. Allowing for this, the previously mentioned sum can be reduced to $53,000.

16 The foregoing relates to what was referred to as “in-house” dealing. The evidence of Vanessa was that, after a night’s activity, the defendant would call to collect the takings from the sale of drugs. The amount was usually between $4,000 and $10,000 but was, on some days, as low as $2,000. That daily figure is consistent with her evidence as to drug delivery and dealing. The evening delivery by the defendant consisted of a standard stash of ten half gram deals of heroin, ten quarter gram deals of heroin and thirty deals of cocaine. The evidence is that the charge for a half gram of heroin was $150. There is no direct evidence of the charge for a quarter gram but for the purpose of assessment the Commission submits that a charge of $80 (slightly above a pro rata charge for the larger quantity) would provide a reasonable basis for estimate. I agree and adopt it for this purpose. Cocaine was charged at $50 a deal.

17 Sale of all the delivered drug at those rates would return $3,800. As already noted, if supply was exhausted, the defendant, after a telephone call was made, would appear with further drug supplies.

18 Focussing upon the evidence of the morning collection of the usual sum of $4,000 to $10,000 (sometimes as low as $2,000) and the return on an unsupplemented sale of the “standard” delivery for $3,800, it would again be an extremely conservative approach to postulate a daily gross return of $3,500. Over a period of one thousand days (less than three years) a total of $3,500,000 can be calculated. From 31 May 1999 to 10 April 2001 (the period of the indictment upon which the defendant was ultimately tried, less one day, that is 680 days) a similar daily rate computes at $2,380,000.

19 The defendant did not comply with directions to put any evidence upon which he wished to rely upon affidavit. He addressed after the close of evidence and an indication by senior counsel for the Commission of the basis upon which orders were sought. To a large extent, the defendant spent his address proclaiming the invalidity of his conviction, his innocence of any drug dealing, the fact that the prostitutes who gave evidence against him had had their police statements “induced”, an insistence that the brothels conducted by him were drug free, that he had in fact remonstrated with prostitutes whom he had incidentally found using drugs, that if they had drugs they must have purchased them from “outside”, that he had a caring attitude to the “girls” who worked in his “business” and that he had a desire to lead a normal life with his wife and four children.

20 I do not accept these protestations but, as was attempted at the hearing, focus should be had upon the statutory task. More towards the relevant issue, the defendant stated that “subs” recorded on the timesheets were misinterpreted as representing in any part a contra against a prostitute’s earning for drugs supplied by him, or by anybody else as I understood him. He asserted that the amounts in red ink were records of cash paid to the individual prostitute by the house in response to a demand for payment for services which she had already rendered to customers. I reject this contention. I am satisfied that the “subs” were, to the extent and with the qualification already mentioned, records reflecting drug purchases from the defendant by the prostitute identified in the time sheets.

21 The calculations abovementioned can be summarized as follows:

(a)	In-house sales from timesheets	$400,000
(b)	Miss Sampson: (i) cocaine	$300,000
(ii) morning heroin	$150,000
(iii) Mons Road	$53,000
(c)	Drug sales for 1000 days	$3,500,000
TOTAL	$4,403,000

22 Alternatively if one assumed drug sales for the lesser period of 680 days the total reduces to $3,283,000.

23 The Commission seeks an assessment in the sum of $2,000,000. It is submitted that it can be confidently concluded that the gross proceeds from drug sales by the defendant over the relevant period was well in excess of that sum. I find that this is so.

24 I order the defendant to pay to the Treasurer the sum $2,000,000 as the value of the proceeds derived by him from illegal activities that took place after 16 November 1994.

25 I order the defendant to pay the Commission’s costs of the hearing of this assessment application.

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Last Modified: 05/25/2010