Parker v Comptroller-General of Customs

[2008] HCATrans 236

[2008] HCATrans 236

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S1 of 2008

B e t w e e n -

STEPHEN EDWARD PARKER

Applicant

and

COMPTROLLER-GENERAL OF CUSTOMS

Respondent

Application for special leave to appeal

KIRBY J
HEYDON J
KIEFEL J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 13 JUNE 2008, AT 10.32 AM

Copyright in the High Court of Australia

MR J.T. GLEESON, SC:   May if please the Court, I appear with MR M.J. DARKE for the applicant.  (instructed by Yeldham Price O’Brien Lusk)

MR D.J. FAGAN, SC:   May it please the Court, I appear with my learned friend, MR G.M. ELLIOTT, for the respondent.  (instructed by Australian Government Solicitor)

KIRBY J:   Yes, Mr Gleeson.

MR GLEESON:   Your Honours, the case for special leave depends upon three propositions.  The first is ‑ ‑ ‑

HEYDON J:   Can I just interrupt to go to page 168 – I am sorry, Mr Gleeson – which is the draft notice of appeal.  Ground 1 says you were denied procedural fairness.  If that ground is made out on an appeal were special leave granted, would not the matter just go back to the Court of Appeal for consideration in the light of a proper hearing?

MR GLEESON:   Yes, your Honour, if we were denied procedural fairness and it was material we would have a right to ‑ ‑ ‑

HEYDON J:   Why would it be necessary for this Court to bother with ground 2, which would involve a debate about the correctness of a decision on legislation which was repealed 13 years ago?

MR GLEESON:   It would not, your Honour.

HEYDON J:   It would not be precisely the same with grounds 3 and 4, but one ordinarily would not get into those grounds which are highly interwoven with specific facts.  So is it not ground 1 or nothing?  Ground 1 solves all your problems?

MR GLEESON:   Ground 1 solves all of our problems.  That is the first submission I want to make.

HEYDON J:   And grounds 2, 3 and 4 are highly unattractive?

MR GLEESON:   Ground 3 - I do want to say a little bit about that as a separate point, because it raises an Evidence Act issue which takes it beyond just the position of Mr Parker, but I want to deal with that at the end.  I agree that ground 1 is our first and best point.

KIRBY J:   It only solves your problems if it is material to the outcome below and of course the argument contrary to that is that it was obiter statements and that it was separated, isolated and was not relevant in Justice Basten’s ultimate conclusion.

MR GLEESON:   Your Honours, can I deal briefly with those two questions; the first briefly to show that Mr Parker was denied procedural fairness and then secondly to show it was material.

KIRBY J:   Does Stead say that in every case of a breach of procedural fairness that you would have to have it set aside, that there is such a flaw, or is there some qualitative element in the matter that if it is not a material or significant breach of procedural fairness you do not give relief?

MR GLEESON:   There is a materiality test in the sense that the decision might in some realistic sense have been given. 

KIRBY J:   A might question.  If it might have affected you have to have it done again.

MR GLEESON:   Yes, your Honour.

KIRBY J:   Well, that sounds correct - similar to the disqualification for apparent bias, the might test.

MR GLEESON:   Your Honours, the denial of procedural fairness can be seen because at page 11 of the first application book at paragraph 26, Mr Parker obtained a finding from the trial judge that the seizure of the documents was an impropriety and a contravention of Australian law in the O’Neill sense ‑ ‑ ‑

KIRBY J:   I think your documentation has shown and has certainly established for my satisfaction that the trial was conducted on a basis and the appeal was conducted on a basis that Customs did not contest the decision of Justice Dunford in O’Neill, is it?

MR GLEESON:   Yes, and our documentation also establishes, with respect, that the court of its own motion said, “We propose to go into O’Neill notwithstanding you are both comfortable it is correct”. 

KIRBY J:   Was that put to counsel – I mean courts do not have to accept what counsel say is the law.  We are not engaged in a theoretical exercise here.  Courts are engaged in applying the law. 

MR GLEESON:   Yes, we accept that, your Honour.  So for that reason, in the supplementary book, at pages 12 to 13 of the affidavit we sought to prove that ‑ ‑ ‑

KIRBY J:   I should have said that there is an affidavit of Mr David Lloyd at page 180 of the application book.  Are you reading that affidavit?

MR GLEESON:   I read that affidavit.

KIRBY J:   This is an affidavit of Mr David Lloyd, solicitor.  Do you have any objection to the reading of that affidavit, Mr Fagan?

MR FAGAN:   No.

KIRBY J:   The Court reads an affidavit of David Anthony Lloyd sworn 14 February 2008, there being no objection.

MR GLEESON:   That affidavit establishes factually on pages 181 to 182 that the court did not raise with counsel that it proposed to examine the correctness of O’Neill.  The detailed annexures to prove that are found behind it and the respondent does not challenge that proposition in its submissions.  Can I then come to the critical question of materiality?

KIRBY J:   It is not only materiality.  Well, I suppose it is connected.  It is the way Justice Basten dealt with it.  Mr Fagan says this was just an isolated bit of obiter that did not really deal with the issue materially to the decision in hand.

MR GLEESON:   Let me show that Mr Fagan is wrong by three references. 

KIRBY J:   Yes.

MR GLEESON:   Firstly, if your Honours would go to pages 158 to 161 of the first application book, that is the section of the judgment where his Honour is examining the discretion under section 138(3) and in those nine paragraphs you will not find his Honour bringing to account the O’Neill contravention.  That is the first proposition ‑ ‑ ‑

KIRBY J:   You say it is the absence of the reference to it because it is an important finding that tends to favour illegality that ought to have resulted in at least the enlivening of the section 138 discretion.

HEYDON J:   Your best sentence is the first sentence of paragraph 124.

MR GLEESON:   That is my second point, that when his Honour expressly says, “I am now going to boil down what is the unlawfulness that I have to consider in the discretion”, the unlawfulness he is there dealing with is not the O’Neill point.  It is the separate unlawfulness which his Honour regarded as rather minor and trivial, namely that the notice to produce did not specifically identify the bottle of brandy illegally dealt with.  That is the second ‑ ‑ ‑

KIRBY J:   His Honour does not actually say that I do not take into account the illegality found in O’Neill.

MR GLEESON:   Your Honour, it is harder, with respect, to find a clearer sentence which says:

In the result, the unlawfulness of the conduct of customs officers turned on the failure adequately to identify ‑ ‑ ‑

KIRBY J:   Anyway, in the scales this was, for your point of view, an important element in the scales on your side and you wanted to be there and to be manifestly taken into account when the scales are being weighed.

MR GLEESON:   So, first of all, he has not expressly referred to it.  Secondly, when he said, “Here is the critical unlawfulness I am speaking about”, he speaks about the other unlawfulness.  The third matter, which is to take Mr Fagan’s point at its highest is if one goes to back paragraph 109 on page 154 where Mr Fagan says, “Well, here is Justice Basten saying notwithstanding I have found O’Neill to be wrong, I will just treat that as an irrelevant excursion”, your Honours will note in 109 ‑ ‑ ‑

KIRBY J:   He says it is in the structure of the reasons.  It is the way the reasons were structured.

MR GLEESON:   Yes, but the place for which and the way in which he does that so‑called setting aside is not in the exercise of the discretion but is in his analysis of the failure to train and educate alleged contravention in propriety.  It is only for that purpose that he says he has put O’Neill aside, not for the purpose of the discretion.  Finally, if there be any doubt, when one looks at how his Honour concluded that section, the failure to train case in paragraph 118 – I will come to the paragraph as a whole, but if one goes straight to the last sentence, his Honour’s conclusion is Customs:

did not act improperly, for the purposes of s 138, in failing to instruct its officers to operate otherwise.

So what his Honour has found is Customs knew of O’Neill.  They made a decision to ignore it because they had a legal advice to the contrary.  I do not think there is anything improper in them doing that.  Accordingly, the whole failure to train case has been dismissed by his Honour and nothing is carried forward into the discretion from the failure to train case ‑ ‑ ‑

KIRBY J:   Yes, but his Honour does in 114 record that Mr O’Halloran of AGS had expressed the opinion that O’Neill was wrong and in 118 his Honour says that Customs accepted it and gave instructions to its officers that:

Customs did not ignore the decision in O’Neill but obtained their own advice in relation to it.

MR GLEESON:   Accepting all that, what his Honour has done there is to say, “In terms of your failure to train case, I find there was nothing improper when you had O’Neill, which was against you, you had a legal advice which said it was wrong.  I find nothing improper in ignoring O’Neill.  Therefore, when I come to my discretion, which is then pages 158 to 161, there is nothing to carry forward into the discretion on the failure to train case”.  So that illustrates that whatever his Honour was doing in 109 in putting aside his views about O’Neill, the result of that little putting aside exercise was to say, “Your failure to train case fails and so all I am left with considering” ‑ which is 124 – “is a fairly minor problem with your notice to produce.  If that is the only contravention or impropriety you can establish, the other factors in the discretion count in favour of the evidence”. 

KIRBY J:   It is a very ancient saga, the legislation has been changed.

MR GLEESON:   We have accepted all of that, your Honour.  It is ancient.  It is important to Mr Parker for the reasons I have mentioned.  Put simply, his one right of appeal in an important matter for him has miscarried because of the way the Court of Appeal approached it.

KIRBY J:   Is there anything else?  You said you had two points that you were advancing?

MR GLEESON:   That is our primary point.  The other matter relates to really in the draft notice of appeal the paragraph 3 question.  We accept that it is unnecessary for the Court to embark upon that for the purpose of an appeal because if the matter is remitted a proper consideration of the question of impropriety, of deliberateness, of recklessness, can be undertaken by the Court of Appeal once the O’Neill contravention has been brought to account in the discretion.

HEYDON J:   So that boils down to the proposition that if you get ground 1, you will be happy.

MR GLEESON:   Yes.

KIRBY J:   What would happen though if this Court were of the view, as Justice Basten obviously was, that O’Neill was wrong?  If that were so then you have really suffered in the end no material injustice.

MR GLEESON:   Not necessarily.  The case is a weaker case, but what still has not happened is that there has never been a bringing forward into the discretion of an examination of whether it is improper for a law enforcement body to go about deliberately collecting evidence contrary to what it knows to be the only decision of a court of federal jurisdiction on the point.

HEYDON J:   The officer in question in due course becoming a Supreme Court judge.

MR GLEESON:   Yes, your Honour, and an important court in the federal system exercising the jurisdiction in these important federal matters.

KIRBY J:   I suppose the best the respondent could hope for would be to put on a notice of contention saying it was wrong and then have that matter dealt with in this Court in the exercise by this Court of the discretion which miscarried on your argument in the Court of Appeal.

MR GLEESON:   It would not be necessary for this Court to consider that for the reasons I have mentioned.  That is all we wish to put, your Honour.

KIRBY J:   Yes, very well.  What do you say about this ancient warrior, Mr Fagan?

MR FAGAN:   Your Honours, on a fair reading of this judgment of Justice Basten from pages 154 continuously through to 159 it just cannot be said that his Honour has not approached the question upon the basis that one of the illegalities that had to be considered was that which flowed from an assumption that O’Neill’s Case was correct.  If O’Neill’s Case was correct then once the requirement to produce documents relating to the bottle of brandy had been issued and not been complied with, on O’Neill’s Case the warrant could only be executed to seize documents that also related to that bottle of brandy and its illegal dealings.  The warrant could not be executed to seize documents that related to goods imported over the past five years, the five year documents, if O’Neill’s Case was correct.

Now, when the Court of Appeal came to consider the exercise of the discretion, it was proceeding on the basis that the whole seizure which had taken place under the warrant was entirely illegal anyway because Customs had acknowledged in the proceedings that the original notice requiring production of documents relating to a bottle of brandy was too obscure to be capable of compliance with by the recipient.  The bottle of brandy was not sufficiently identified and the receiver of this notice to produce could not really comply with it.  So when he did not comply with it, to go on and execute the warrant, it was accepted it resulted in a wholly unlawful seizure.

Now, when his Honour Justice Basten has considered in the straight run of pages from 154 through to 159 first of all the argument about O’Neill’s Case and assuming it to be correct, recognising in paragraph 118, as his Honour did, from line 50:

there was no deliberate or reckless disregard of an established constraint on power, nor can Customs fairly ‑ ‑ ‑

HEYDON J:   That is questionable.  It may not matter much one way or the other.  It is questionable reasoning in my opinion.  It is reckless, is it not, to ignore the opinion of a Supreme Court judge when it is the only authority on a point?

MR FAGAN:   I submit not, your Honour, when there was legal debate about it, advice had been taken from the Australian Government Solicitor, there had been conflicting opinions expressed by the Australian Government Solicitor and the question of recklessness also has to be considered at different levels.  The way the case was conducted by Mr Parker was to accept that the operative personnel who had obtained the issue of the warrant from the superior officer and then gone out and executed it, had all acted in good faith.

The only case that was run before the trial judge was an assertion that there was a failure to educate about O’Neill’s Case.  So when one tracked up to higher echelons in Customs, what one found were these conflicting opinions from the Australian Government Solicitor’s office advising about whether this decision was correct or not.  In my submission, with respect, your Honour, it was not reckless for those – not prima facie or necessarily reckless for those senior Customs officers to have concluded that with this conflict of advice about an existing decision of a District Court judge that a view may be taken that it was erroneous and that it was correct to proceed as they had done.

KIRBY J:   That may all be so, but given the way the matter was conducted both at trial before Justice Simpson and in the Court of Appeal and given that you did not, as it were, despite a few hints, take head on the suggested incorrectness of O’Neill, then it is pretty unsatisfactory, is it not, that you then get the actual exercise by the Court of Appeal of its discretion without giving the present applicant the benefit of the conclusion that there was illegality and that that was a matter to be taken into account in the 138 decision.

MR FAGAN:   Your Honour, I respectfully submit that that really has been fully recognised at pages 154 to 157.  The whole of that discussion in Justice Basten’s judgment only arises because it proceeds from what is stated in 109 that:

Accordingly, the complaint that the trial judge failed to address the issue must be addressed on that basis –

that O’Neill’s Case was correct.  His Honour goes on then to examine all the evidence about that and identifies that ‑ ‑ ‑

KIRBY J:   You say that when you come to the paragraphs following the heading “Application of discretion” just before ‑ ‑ ‑

MR FAGAN:   That heading is at the top of 158 in the supplementary book, your Honour.

KIRBY J:   ‑ ‑ ‑ 119, you do not read that without regard to the fact that at 109 the judge has, whatever his misgivings, accepted the correctness of O’Neill and that therefore that was still in his mind when he came – it is just that there is no an identification.  It is quite an important consideration, but you say it is self‑evident in paragraph 109 that that was a matter that he was prepared to take into account in favour of the exclusion of the evidence.

MR FAGAN:   Yes, your Honour.  I submit that that is the only fair reading of his Honour’s judgment.

KIRBY J:   We would be involved in this Court in this very old case really parsing and analysing the reasons of Justice Basten and we should not jump to the conclusion that he excluded that factor when at paragraph 109 he has said that you did not dispute the correctness of it and that is how he will approach the matter.

MR FAGAN:   That is so, your Honour.

HEYDON J:   But how do you get around the first sentence of paragraph 124, “turned on”, that fulcrum, pivotal, necessary condition?

MR FAGAN:   Quite so, your Honour, but bear in mind the way the applicant ran the case from first instance was primarily to focus on the restrictions that O’Neill’s Case imposed if it was correct and the failure to heed them, as indicating a failure of system in Customs, the failure to train was the argument and that is how in our submissions we have traced through the written and oral submissions at each level of the courts below to show that that was always the way in which that was put.

But when his Honour came to consider this culmination of the application of the discretion, his Honour did clearly have it before him and had just considered at pages earlier that the seizure under the warrant was excessive on two grounds.  One was that the notice had not been clear enough in the first place to create the default which would entitle a warrant to be exercised and his Honour had only just finished considering at great length that the warrant was excessive in another respect on the law which had been accepted by Customs in the case. 

HEYDON J:   If he was assuming when he got to application of discretion to admit evidence, the correctness of O’Neill, there would be the two illegalities found by Justice Simpson, would there not?  There would be the minor one and there would be the O’Neill one.  Now, the O’Neill one is not mentioned, point one.  Point two, the language actually used seems to exclude the possibility of the second and more serious illegality.

MR FAGAN:   It would be going too far, your Honour, to say that it excludes.  It is true that his Honour has not recapitulated it, but I am submitting that that is quite understandable in view of the detailed treatment of it over the preceding four pages.  To say that the discretion has miscarried would involve the proposition that his Honour has proceeded without taking into account a relevant consideration, namely, another head of illegality.  But it is very plain that his Honour did take that into consideration.  There is a compression of expression in this paragraph, it is true, but to infer from the not mentioning of the O’Neill’s basis of illegality that his Honour has not considered that, would fly in the face ‑ ‑ ‑

HEYDON J:   Which are the words that involve the compression of expression?

MR FAGAN:   Just saying that in the result the unlawfulness turned on the failure adequately to identify.  Now, it also turned on, one might say, the circumstance that the warrant enabled officers to seize the five year documents whereas if O’Neill’s Case were correct, that was not authorised.  But his Honour had fully taken that into account.  His Honour had not acted on the basis of failing to heed a relevant consideration in the exercise of discretion.  The omission to mention that again when it has just been dealt with it at length is more understandable when this particular point that his Honour is citing in paragraph 124 was alone quite sufficient to make the entire seizure invalid, so that his Honour was proceeding to assess the relevant consideration under section 138 heeding the circumstance that every document seized, it had not been justified, but that that was in all of the circumstances which had been debated. 

The segment that I have identified at pages 154 to 155 under heading (e) is just the last of a series of sections in which his Honour Justice Basten

considered each of the separate arguments that the appellant in the Court of Appeal had raised.  There were two more, for example, at pages 146 and 147.  All of those have been – heed has been paid to them in the exercise of the discretion.  It must follow from the circumstance that they have been deliberated upon so fully in the judgment.

KIRBY J:   If the Court were minded to grant special leave in the matter, would it be a correct answer to the point which has been isolated by Mr Gleeson to say that O’Neill was in fact wrongly decided because the complaint – first of all, you say the judge, Justice Basten, assumed and accepted that and took it into account, and Mr Gleeson says even if it was incorrectly decided, it still has to be raised to give the applicant a proper disposition of his one chance of appeal.  So it does not seem to arise on a notice of contention in this Court.  Would you be raising that point or not?

MR FAGAN:   We would wish to, your Honour.  I would have thought we would be, with respect, entitled to say that the courts – if we have misconstrued the judgment and that somehow it really did turn upon rejection of the O’Neill decision, that we could seek to support what the Court of Appeal did on the basis that ‑ ‑ ‑

KIRBY J:   You say that might go to materiality?

MR FAGAN:   It would go to materiality and if – the difference between us really is that it is our submission that the Court of Appeal has decided the case on the basis that O’Neill was right.  But if the court has not done that, so we get past that base, then the proper construction is that the court has decided the case on the basis that O’Neill was wrong.  In that case we would seek to support the judgment.

KIRBY J:   Yes.  I understand the way you put it.  Anything else?

MR FAGAN:   No, your Honour.

KIRBY J:   Thank you very much.  Anything in reply, Mr Gleeson?

MR GLEESON:   No, your Honour.  The issue is joined.

KIRBY J:   Yes, the Court grants special leave to the applicant to appeal on ground 1 in the draft notice of appeal, page 168 of the application book.  It is assumed that the matter would be disposed of by argument in less than a day.

MR FAGAN:   Before your Honour finally disposes of that matter, may we take from the discussions that we have had that it would be appropriate to file a notice of contention, or should we file it and your Honours deal with that at the time?

HEYDON J:   That is a matter for you.

KIRBY J:   That is a matter for you and you are still within time because we have only just indicated the grant of special leave.  So you have the time allowed by the Rules to file your notice of contention, not a day more.

AT 11.00 AM THE MATTER WAS CONCLUDED