NSW Crime Commission v Song

[2000] NSWSC 575

CITATION:

NSW CRIME COMMISSION v SONG [2000] NSWSC 575

CURRENT JURISDICTION:

Common Law

FILE NUMBER(S):

SC 11287/00

HEARING DATE(S):

26 May 2000

JUDGMENT DATE:

26 May 2000

PARTIES :

New South Wales Crime Commission

v

Suk Joon Song

JUDGMENT OF:

Adams J at 1

COUNSEL :	Mr Ian Temby QC (ex parte) (Applicant)
SOLICITORS:	Mr J M Giorgiutti (Applicant)
LEGISLATION CITED:	Criminal Assets Recovery Act 1990 Crimes Act 1900 Theft Act 1968 (UK)
CASES CITED:	AG's Reference (No 2 of 1982) 1984 1 QB 624 R v Long (1989) 44 A Crim R 416
DECISION:	Application refused.

THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ADAMS J

FRIDAY 26 MAY 2000

11287/00

NEW SOUTH WALES CRIME COMMISSION v

PROPERTY OF SUK JOON SONG

JUDGMENT

1 HIS HONOUR: This is an application made by the New South Wales Crime Commission for restraining orders under s10(3) of the Criminal Assets RecoveryAct 1990. When application was first made to me as duty judge in chambers on 25 May 2000, I indicated to the solicitor then acting for the Commission that I did not consider that a suspicion of the type alleged in paragraph 2 of the affidavit of Jonathan Lee Spark sworn 25 May 2000 had been established as reasonable. Although at that time I rejected the application, I had it in mind that it might be renewed on explanation being given of the reasons for my refusal. 2 Mr Temby, of Queens Counsel, has renewed the application today. I state, to make the matter clear, that I heard this application ex parte in accordance with the usual procedure. 3 The material paragraph of the affidavit states as follows: -

“I suspect that Suk Joon Song (“Song”) has engaged in a serious crime related activity or serious crime related activities (within the meaning of “serious crime related activity” as defined in section 6 of the Act) namely director fraudulently appropriating property, contrary to section 173 of the Crimes Act 1900 and money laundering contrary to section 73 of the Confiscation of Proceeds of Crime Act 1989.”

I should mention that the money laundering referred to is dependent upon there being the fraudulent appropriation of money alleged.

4    The point in question can be simply stated. 5    The sole shareholders and directors of the private company in question are a married couple, against whose property restraining orders are sought. Without describing the evidence in detail here it is reasonable to suspect that monies totalling possibly one million dollars have been taken from the company. I point out that the source of the money might just as easily have been otherwise. There are suggestions in the affidavit that the persons whose property is sought to be made the subject of the restraining orders had other business interests. 6    It is reasonable to suspect that the course of action undertaken in relation to the monies was done in order to conceal their source. In the circumstances, the suspicion that it is intended to conceal their source from the revenue is reasonable, but a number of other quite reasonable explanations are available, for example, that the use to which it is proposed to put the money makes it desirable to conceal its source. 7    The serious crime related activity, which is necessary to found an application of this kind for the purposes of the Criminal Assets Recovery Act 1990, is said to be an offence against section 173 of the Crimes Act 1900 (the Act) comprising the fraudulent appropriation of a company's property by a director. 8 Mr Temby has urged on me the argument that merely because the person or persons appropriating the company's property comprise the entirety of the directors, office holders and shareholders does not prevent a charge under section 173 of the Act from proceeding. Here, the only reasonable conclusion which can be drawn is that if the monies were those of the company (as to which, as I have said, there must be considerable doubt but there is a probably a reasonable suspicion) it must have known of and consented to their appropriation by the persons here in question. 9 Mr Temby has submitted that the mere fact that such an appropriation may be in fraud of the revenue is sufficient to make it relevantly dishonest or fraudulent for the purposes of section 173 of the Act. I disagree. It might be that if there were a risk to present or future creditors, and the purpose of the appropriation was to leave them with no recourse to the company's assets, then the appropriation may constitute a fraud of those creditors, and the mere fact that the creditors are contingent may not suffice to excuse criminal liability. However, in this case there is not the slightest suggestion that the company in question is insolvent, in the sense that it is unable to meet its debts as they fall due, or that it cannot continue to carry on business and remain solvent. 10 Mr Temby has referred me to AG's Reference (No. 2 of 1982) 1984 1 QB 624. That decision concerned the proper interpretation of s 2 (1)(a)(b) of the Theft Act 1968 (UK). I do not consider that this decision applies to section 173 of the Act, and at all events I would decline to follow it, having regard to the different sense in which the term "dishonest" is used in New South Wales to that which the term has in the criminal law of the United Kingdom (see R v Love (1989) 44 A Crim R 416). 11 An additional difficulty facing the applicant's submission is that there is no reason for suspecting that these funds have been taken improperly (to use a neutral term) from the company. They may well be loans or otherwise duly accounted for, and there is no reason for suspecting otherwise, so far as the company is concerned. If defrauding the revenue were a relevant offence for the purposes of making orders of this kind, I think that a reasonable suspicion that such an offence had been committed is created in all the circumstances, despite the real possibility of innocent explanation. However, such a crime does not form the basis for the exercise of the powers given by the Act. 12 For these reasons I consider that the suspicion sought to found the application is not reasonable and I decline to make the orders sought.

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Last Modified: 09/26/2000