R (Cth) v Rapolti; R (Cth) v Russell; R (Cth) v Speedy Corporation Pty Limited - [2016] NSWCCA 264

Court of Criminal Appeal

Supreme Court

New South Wales

Medium Neutral Citation: R (Cth) v Rapolti; R (Cth) v Russell; R (Cth) v Speedy Corporation Pty Limited [2016] NSWCCA 264
Hearing dates: 27 May 2016 and 10 June 2016
Decision date: 25 November 2016
Before: Ward JA at [1]
Garling J at [2]
N Adams J at [3]
Decision:
Appeal dismissed.

Catchwords:
PRACTICE AND PROCEDURE – Crown appeal under s 5F(3A) Criminal Appeal Act (NSW) – where trial judge excluded evidence seized pursuant to search warrants under s 138 Evidence Act 1995 – whether ruling eliminates or substantially weakens the prosecution’s case – where first and second respondents contend that the evidence is not capable of making out the elements of the offences charged – where notice imposing rates of dumping duty affected by jurisdictional error – whether collateral challenge appropriate

SEARCH WARRANTS – where search warrant in relation to ‘evidential material’ issued pursuant to s 198 Customs Act 1901 (Cth) – subsequent decision to proceed with criminal offences – where search warrant under s 3E Crimes Act 1914 (Cth) issued in relation to documents containing those communications and executed at the premises of the CDPP - whether evidence improperly or illegally obtained – whether trial judge erred in interpretation of s 203R Customs Act - whether trial judge erred in excluding evidence pursuant to s 138 Evidence Act 1995 (NSW)
WORDS AND PHRASES – “obtained”
Legislation Cited: Administrative Decisions (Judicial Review) Act 1977 (Cth), s 16(1)(b)
Corporations Act 2001 (Cth),
Crimes Act 1900, s 356H(9)
Crimes Act 1914, ss 3E, 3C(1), 3UF, 3ZQU, 3ZQX, 3ZQY, 3ZQZA
Criminal Appeal Act 1912 (NSW), s 5F(3A)
Criminal Code (Cth), s 134.2
Criminal Procedure Act 1986 (NSW), ss 141(1)(b), 143
Customs Act 1901 (Cth), ss 183UA, 198, 203, 203R(1), 203S, 227AA, 243A, 243B, 269TB, 269TG, 269TH(1), s 269TJ, 269TK, 269ZI, 269ZZE(3), 269ZZK, 269ZZM, 269ZX
Customs Amendment (Anti-Dumping Improvements) Act (No 1) 2012 (Cth), Schedule 1
Customs Amendment (Anti-Dumping Improvements) Act (No. 3) 2012 (NSW), Schedule 3
Evidence Act 1995 (NSW), s 138
Listening Devices Act 1984 (NSW), ss 19, 22
Police Powers and Responsibilities Act 2000 (Qld), s 150(1)(a)
Cases Cited: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41
ASIC v Rich [2005] NSWSC 62
Attorney-General (Cth) v Breckler (1999) 197 CLR 83; [1999] HCA 28
Australian Crime Commission v Marrapodi [2012] WASCA 103
Chief Executive Officer of Customs of Customs v Labrador Liquor Pty Ltd (2003) 216 CLR 49
Dalley v R [2002] NSWCCA 284
DPP v Carr (2002) 127 A Crim R 151; [2002] NSWSC 194
Employment Advocate v Williamson (2001) 111 FCR 20; 185 ALR 590; [2001] FCA 1164
Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55
Fleming v The Queen [2009] NSWCCA 233
Flori v Commissioner of Police & Another [2014] QSCC 284
George v Rockett (1990) 170 CLR 104; [1990] HCA 26
GM Holden Ltd v Commissioner of the Anti-Dumping Commission (2014) 225 FCR 222; [2014] FCA 7078
Grollo v MacAuley [1995] FCR 533
House v The King (1936) 55 CLR 499
Jadwan Pty Ltd v Secretary, Department of Health and Aged Care [2003] FCAFC 288
Ma v Minister for Immigration and Citizenship [2007] FCAFC 69
Ousley v The Queen (1997) 192 CLR 69; [1997] HCA 49
Parker v Comptroller-General of Customs [2007] NSWCA 348; 243 ALR 574
Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476; [2003] HCA
Plaintiff S297/2013 v Minister for Immigration and Border Protection [2015] HCA 3
Rodway v The Queen (1990) 169 CLR 515
R v Camilleri (2007) 169 A Crim R 197; [2007] NSWCCA 36
R v Cornwell (2003) 57 NSWLR 82; [2003] NSWSC 97
R v Haddad; R v Treglia (2000) 116 A Crim R 312
R v Shamouil (2006) 66 NSWLR 228; [2006] NSWCCA 112
R v SJRC [2007] NSWCCA 142
Williams v Keelty (2001) 111 FCR 175; [2001] FCA 130
Texts Cited: Aronson & Groves, Judicial Review of Administrative Action (Lawbook Co, 5th ed, 2013)
Category: Principal judgment
Parties: Director of Public Prosecutions (Appellant/Crown)
Leslie Rapolti (First Respondent)
Gregory Russell (Second Respondent)
Speedy Corporation Pty Limited (Third Respondent)
Representation:
Counsel:
Mr I Bourke SC with Mr C Taylor (Appellant/Crown)
Mr T Game SC with Mr C O’Donnell SC and Ms L-C Hutchinson (First and Second Respondents)
Mr P McGuire SC with Mr B Neild (Third Respondent)
Solicitors:
Director of Public Prosecutions (Cth) (Appellant/Crown)
Laxon Lex Lawyers (First and Second Respondents)
Streeton Lawyers (Third Respondent)

File Number(s): 2014/00174892; 2014/00174998; 2014/00174972; 2014/00174991; 2014/00186183; 2014/00186216
Publication restriction: Nil
Decision under appeal

Court or tribunal:

District Court

Jurisdiction:

Criminal

Date of Decision:

2 December 2015

Before:

Sweeney DCJ

File Number(s):

2014/00174892; 2014/00174998; 2014/00174972; 2014/00174991; 2014/00186183; 2014/00186216

Judgment

WARD JA: I have had the advantage of reading in draft the comprehensive reasons of N Adams J, with which I agree. For the reasons that her Honour gives, the appeal should be dismissed.
GARLING J: I am grateful to N Adams J for her lucid exposition of the complex facts in this matter, and for her cogent reasoning explaining the principled basis for the order which she proposes. I entirely agree that the appeal should be dismissed.
N ADAMS J:

Background

The Commonwealth Director of Public Prosecutions (“CDPP”) appeals pursuant to s 5F(3A) of the Criminal Appeal Act 1912 (NSW) against a determination of Sweeney DCJ in the District Court at Sydney on 2 December 2015 excluding evidence sought to be led in a pending trial.
Speedy Corporation Pty Ltd (“Speedy”) faces seven charges under s 134.2 of the Criminal Code (Cth) (“the Code”) of dishonestly obtaining a financial advantage from a Commonwealth entity by deception and two counts of attempt to commit an offence under s 134.2. Two of its directors, Leslie Rapolti (“the first respondent”) and Greg Russell (“the second respondent”) are charged with aiding and abetting the offences of the corporate accused. Briefly, the allegation is that Speedy misled the Australian Customs and Border Protection Service (“Customs”) in order to avoid dumping duty.
The investigation of the respondents commenced in November 2011. On 1 July 2015, Customs merged with parts of the Department of Immigration and Border Protection to become the Australian Border Force (“ABF”). For convenience, I will refer to the agency as “Customs” throughout this judgment.
Section 134.2 of the Code provides as follows:

“134.2 Obtaining a financial advantage by deception
(1) A person commits an offence if:
(a) the person, by a deception, dishonestly obtains a financial advantage from another person; and
(b) the other person is a Commonwealth entity.

Penalty: Imprisonment for 10 years
(2) Absolute liability applies to the paragraph (1)(b) element of the offence.”

On 1 August 2013, a search warrant was issued under s 198 of the Customs Act 1901 (Cth) (“the s 198 warrant”) in relation to Speedy’s business premises. It was executed on 7 August 2013. Officers from Customs seized a computer tower and various business records. Criminal proceedings were initiated against the respondents nearly a year later, in June 2014. The respondents waived their right to a committal and were committed for trial on 14 April 2015.
The trial before Sweeney DCJ commenced on 9 November 2015. Prior to the empanelment of a jury, the first and second respondents made application to have various pieces of evidence, including the items initially seized under the s 198 warrant, excluded. A voir dire commenced and proceeded over eleven days until 23 November 2015, at which time her Honour reserved her decision.
Also on 9 November 2015, Australian Federal Police (“AFP”) officers executed a search warrant issued under s 3E of the Crimes Act 1914 (Cth) (“the s 3E warrant”) at the Sydney office of the CDPP to seize the documents that the respondents sought to exclude. The documents were then returned to the CDPP for use in the criminal proceedings.
On 2 December 2014, Sweeney DCJ made a ruling excluding the material seized under the Customs Act search warrant and other evidence held to have been improperly obtained. The other rulings do not form part of this appeal.
The threshold issue for this Court is whether the ruling of Sweeney DCJ “eliminates or substantially weakens the prosecution’s case”: s 5F(3A) of the Criminal Appeal Act. If it does not, then the appeal is not competent. Also raised by the respondents in relation to the threshold test was whether the relevant dumping notices were void for jurisdictional error. If the appeal is competent, the grounds of appeal are then, first, whether her Honour erred in her interpretation of s 203R of the Customs Act and secondly, in the alternative, whether her Honour erred in excluding the evidence obtained under the Customs Act search warrant pursuant to s 138 of the Evidence Act 1995 (NSW).

The Crown case

It is convenient to set out briefly the allegations against the respondents. It will become necessary to consider the evidence upon which the appellant relies to prove its case in more detail below in order to determine whether this Court has jurisdiction to entertain the appeal.
In 2012, Speedy was in the business of importing aluminium road wheels (“ARWs”) for motor vehicles into Australia and selling them domestically. Many of the ARWs were imported from the People’s Republic of China (“China”).
The imposition of dumping and countervailing duties on certain imported goods is a means of protecting domestic industries manufacturing like goods. On 5 July 2012, the then Minister for Home Affairs published notices introducing dumping and countervailing duties on ARWs exported from China to Australia. The powers to impose dumping and countervailing duties are found in ss 269TG and 269TJ of the Customs Act respectively.
The Crown alleges that Speedy, in late 2012 and 2013, imported into Australia ARWs that were manufactured in China and thus subject to dumping and countervailing duty. Speedy is said to have held out to Customs that the wheels were manufactured in Malaysia. By virtue of the Malaysia-Australia Free Trade Agreement (“MAFTA”), goods either produced entirely in Malaysia or that have a “regional value content” of at least 40% are not subject to the relevant duties. The Crown case is that Speedy arranged to have the ARWs merely trans-shipped through Malaysia in order to avoid dumping and countervailing duties and that no meaningful manufacturing work was done on them in that country.
The first and second respondents are alleged to have acted as accessories in this endeavour by providing false information in the Full Import Declaration (“FID”) to Customs with respect to shipments of ARWs and falsely claiming that the goods originated in Malaysia, thereby disguising the true origin of imported ARWs into Australia in order to avoid dumping and countervailing duties.
One particular importation, being that which formed the basis of Count 6 on the indictment, came to the attention of Customs when a shipment of ARWs imported by Speedy was examined and the wheels were found to have had their “Made in China” imprint ground off.
The s 198 warrant was executed at Speedy’s business premises on 7 August 2013. The hard drive of the computer tower seized in the course of the execution of the search warrant was found to contain email chains, Microsoft Network (“MSN”) chat logs and Skype chat logs between the first and second respondents and Victor Liu. Mr Liu is another director of Speedy who resides outside of Australia. In them, the directors discuss various strategies for avoiding dumping duty, including removing the “Made in China” label on ARWs and shipping wheels from a factory known as “YQ” in China to Malaysia for further work, such that they would meet the MAFTA place of origin requirements. YQ was a factory whose goods would otherwise attract combined dumping and countervailing duty of 84.3% under the 2012 notice. Shipping documents, invoices, packing lists and bills of lading were also located.
The Crown case is circumstantial. There is no direct evidence that YQ did or did not manufacture the wheels. There is also official documentation from Malaysia certifying that the wheels were manufactured in Malaysia. The Crown seeks to prove that the ARWs were manufactured in China largely through inferences to be drawn from the material seized, as explained through Customs Officer Christie Curtis (“Officer Curtis”). That material includes the shipping documents, invoices, packing lists and bills of lading as well as the electronic communications downloaded from the seized computer, summarised below at [28]-[46].
Some of the shipping documents purport to be issued by the Malaysian Ministry of International Trade and Industry (“MITI”). The Crown acknowledged that they are authentic documents bearing authentic signatures and government seals. The Crown case is that they are based upon the provision of false information by the Taiwanese company “Rota Oriens”. The Crown alleges that Rota Oriens provided to Speedy the Malaysian documentation certifying that the final process of manufacture of the ARWs occurred in Malaysia. Speedy then provided those documents to its broker, who in turn provided them to Customs.
The evidence of Officer Curtis is that she cross-referenced product names and codes from various invoices and compared them with product descriptions and codes in other invoices said to be from YQ. Based on these and other comparisons, she concluded that the wheels were in fact manufactured by YQ.

The evidence on the voir dire before Sweeney DCJ

The appeal book in this matter comprised eight lever arch folders containing all of the exhibits that were before Sweeney DCJ as well as the eleven days of transcript of the submissions and evidence of witnesses called on the voir dire. Much of that material was relevant to the four other applications to exclude evidence that are not the subject of this appeal.
Two categories of evidence were adduced on the voir dire that are relevant to this Court’s consideration. The first category is the evidence given by Officer Curtis. Her Honour relied upon that evidence in her assessment of the probative value of the search warrant evidence sought to be excluded. It is also relied upon by the respondents in this appeal in support of its contention that the Crown cannot prove its case, that being relevant to the question of whether this appeal is competent. That argument is considered below at [91]-[152]. The second category of evidence before her Honour concerned the application for and execution of the s 198 warrant, as well as the subsequent s 3E warrant.

Evidence adduced on the voir dire relevant to the strength of the Crown case

Evidence of Officer Curtis

Officer Curtis was called to give evidence on the voir dire. In cross-examination, she agreed that:

She believed that the ARWs were manufactured in China, but had no direct evidence that the shipments came from China.

Her evidence that the ARWs came from China was based on assumptions she had made from comparing certain documents.

Despite asserting that all ARWs came from a company in China known as YQ she had never made an inquiry with that company to verify that because “the relationship between China and Australia did not allow that at the time”.

When she checked the YQ website there was no information to suggest that the product description was unique to YQ.

She did not seek to obtain any information from YQ about the meaning of the codes that can be seen in the country of origin ARW data column in the schedule nor did she obtain any information from Speedy or Rota Oriens before making her assumptions.

She conceded that the product description she had assumed was unique to YQ could have been a generic product description. The same applied to the invoice stock item entries.

She did not know with any certainty that any single wheel was manufactured by YQ and agreed that the ARWs could have been manufactured by any number of companies and that she did not know which one.

She made no inquiries with any other wheel manufacturer to ascertain whether that was the case.

She was unable to say with any certainty in what factory or where in the world the wheels were made.

She made no inquiries in China or Malaysia about the sources of the ARWs.

She consciously decided not to make a mutual assistance request to Malaysia because she thought that it would take too long and did not think that she would be successful in obtaining a positive response.

A similar decision was made in respect of the Chinese authorities.

She agreed that if she did not know from which company the ARWs were sourced, she could not say what dumping rate if any would apply to them.

She was unable to point to any evidence that showed that 50% or more of the manufacture of the ARWs did not occur in Malaysia.

She had no information indicating that any work was done in Malaysia.

She believed that the Certificates of Origin stating that the country of origin was Malaysia were genuine, but that they were based on false information provided to the Malaysian authorities.

She does not have any information that false information was provided to MITI.

The conversations in the seized material

Sweeney DCJ had before her a schedule, prepared by the Crown, setting out the communications contained in the hard drive of the computer seized under the Customs Act search warrant. At the hearing of the appeal, Mr Bourke SC, who appeared on behalf of the CDPP, took the Court to the most relevant of those in answer to the respondents’ submission that the Crown is unable to prove its case even with the impugned evidence. It is convenient to extract the communications upon which the Crown relied in support of its submission that the Crown case is viable if this material were to be admitted at trial.
It was the Crown’s position that the exclusion of the evidence of the communications by the trial judge had the effect of eliminating the Crown case. Mr Bourke submitted that, although only a few of the communications seized refer to the specific shipments particularised in the indictment, the jury would be invited to view them as a whole, in which case it was open to the jury to conclude that the “whole thing was a sham”. The communications are relied upon by the Crown to demonstrate that, in 2012, the respondents had begun to consider ways of continuing to obtain ARWs from the same Chinese factories while persuading Customs that they were obtained elsewhere. Mr Bourke submitted that these communications were a “very, very important part of the Crown case” and that they were “extremely damaging”, as they suggested that Speedy had taken action to avoid the relevant duty.
Given that the Crown case relies heavily on inferences to be drawn from these conversations, it is necessary to extract some of them in full rather than attempt to summarise the meaning that they are said to convey:

“2 May 2012
To: Victor Liu
From: Greg Russell
“Just wanted to let you know the dumping investigation is in its final stages.”
To: Greg Russell
From: Victor Liu
“How is it?”
To: Victor Liu
From: Greg Russell
“I received a file from them which is the conclusion of their investigation. It is 114 page document that I haven’t completed reading but the general thrust of it is that they have determined that dumping is occurring from Chinese makers.””

There is reference made on 2 May 2012 to the Chinese factory YQ:

“To: Greg RussellFrom: Victor Liu
“So YQ is not on the list?”
To: Greg RussellFrom: Victor Liu
“Or YQ is at the higher end.”
To: Victor Liu
From: Greg Russell
“Not mentioned but they will be caught up in it. I mean if it is really a significant increase, then YL may be more appealing to us and or we do more with DG. I think we need to see the final outcome and then plan around it. But the feel of this document is that they have already made up their minds and any late submission will be a waste of time and effort…””

On 1 June 2012, overseas director Mr Liu suggests to the first respondent that the wheels be moved to a secondary country before importation into Australia:

“To: Les Rapolti
From: Victor Liu
Subject: Customs Duty Decision
“Hi Les, It seems Australian Customs are out of their mind. They protect one factory and do this to all Chinese wheel factory. When this will be affected? I really think China will do some punishments to Australia very soon.
So far, we only deal with 3 China factories, YL, YQ and PTH (Taiwan based factory but manufactured in China.)
I some some [sic] thoughts can make damages less, 1. deal with YL and pass through all the wheels through their company name (buy from YL but export as YL.) 2. bring in the un-finished wheels and finish in Taiwan then export to Aust. I do not think it is possible to tell Customs that were are willing to work with them for their investigation now. And it seems even YHI works with them but still got the same treatment. Basically, China wheel factories pretty much have same, how can they judge who should pay more duty and who does not. It does not make sense at all. Regards, Victor.””

In June 2012, there is discussion between the participants regarding the possibility of removing “Made in China” imprints from the ARWs:

“Date: 13 June 2012
To: Greg Russell (cc Rota; Les Rapolti)
From: Victor Liu
Subject: Speedy – Dumping Notice No. 2012/21
“Dear Greg, We can ship our shipments to other country and then change the container and ship to you. The cost is around USD5500 per container (estimate). Europe has the same anti-dumping tax to China made wheels a few years ago, so some of Chinese factories ship the wheels to Malaysia then to Europe. This can be done. Just all our wheels have “Made in China” country of origin, it means we will remove this from tooling in the future…””

On the Crown case, a “sham story” begins to form, whereby the respondents propose to represent to Customs that the wheels are manufactured in Malaysia. Mr Bourke highlighted a chat conversation between the second respondent and Mr Liu on 13 June 2012:

“To: Victor Liu
From: Greg Russell
“Do you have a maker in Malaysia?”
To: Greg Russell
From: Victor Liu
“not maker, I mean will still make in China and ship to Malaysia then to Australia.”
“as I know, many factories are still doing the same thing when they shpply [sic] to Germany and France.”
“no one can tell it is from China.”
“all the documents show it is from Malaysia and also the bill of lading.”
To: Victor Liu
From: Greg Russell
“so we have on the wheels “Made in Malaysia.”
To: Greg Russell
From: Victor Liu
“or we do not put the country of origin.”
To: Victor Liu
From: Greg Russell
“perhaps.”
To: Greg Russell
From: Victor Liu
“except us, no one puts MADE IN CHINA on wheels.”
To: Greg Russell
From: Victor Liu
“if they leave the Chinese factory in Speedy boxes, would the fact be kept secret or do you think we would get found out? Because if we do, then the penalties will be severe.”
To: Greg Russell
From: Victor Liu
“I think it might be like, ship in white box to Malaysia, then they change box in Malaysia.”
To: Greg Russell
From: Victor Liu
“Yes correct. That would be the way. Perhaps you could investigate the cost to do this so we can evaluate…””

Mr Bourke referred to similar communications, which he submitted evidenced a “sham arrangement”, on 28 June 2012 and 29 June 2012. He conceded that some of the communications have an exculpatory flavour. For instance, the second respondent’s replies to the emails and chat messages of Mr Liu express concern about the penalties that would be imposed if they were to be caught avoiding dumping duty:

“Date: 13 June 2012
To: Victor Liu (cc Rota; Les Rapolti)
From: Greg Russell
“…Shipping finished Chinese made wheels to us via another country is a short term solution for sure. It would be good just for clearing out orders already made (specifically YQ and Protech) and to give us the time to put other arrangements into place.
The penalties if and when caught would be horrendous and have the potential risk of putting us out of business. Too risky as a long term fix in my opinion, as it could not be kept a secret over time.
What capacity do we have to move manufacturing back to Taiwan or tow another country? What impact would this have on YQ in relation to your business manufacturing requirements in the US and SA?...”
…
To: Victor Liu
From: Greg Russell
“sure we know that. We are just worried about getting caught doing the wrong thing. I cannot say either Les or myself are comfortable with it.””

The first respondent sends a similar email to Mr Liu on 15 June 2012, in which he writes, “So, taking wheels from China, shipping them to Malaysia and then declaring that they were manufactured in Malaysia IS NOT AN OPTION unless you want to visit Greg and I in jail.”
The first respondent advances a new proposal in an email dated 29 July 2012. He suggests that, in order to obtain a more favourable rate of dumping duty than that attaching to YQ, Mr Liu create a new Chinese company that has never exported wheels to Australia before and therefore will be the subject of a new Customs investigation. Mr Bourke submitted that this was yet another example of the respondents’ planning of a “sham”.
In chat messages exchanged on 30 July 2013, the second respondent and Mr Liu discuss removing “Made in China” from the wheels and placing “Made in Malaysia” on the wheel boxes.
Mr Bourke drew the attention of the Court to the following chat messages on 3 August 2012, which, on one view, may be regarded as exculpatory of the second respondent:

“To: Victor Liu
From: Greg Russell
“That will help. All the back and forward discussion on the dumping duty and our only ray of light after weeks is possibly getting YL sorted out. I just worry about so much being with YQ.”
To: Greg Russell
From: Victor Liu
“evrerything [sic] will be legally, we have Malaysia government issued “certificate of country of origin” and the company in Malaysia is real.”
“they have the address on the certificate.”
To: Victor Liu
From: Greg Russell
“OK. Fingers crossed.”
To: Greg Russell
From: Victor Liu
“you only know Rota changed the source to Malaysia.”
To: Victor Liu
From: Greg Russell
“Yes that is correct.””

Mr Bourke submitted that other communications between Mr Liu and the first and second respondents effectively have Mr Liu saying, “Well don’t you worry about it, I’ll tell you certain things and just accept that information.” For instance:

“To: Greg Russell
From: Victor Liu
“or you do not like this way.”
“just the wheels are made in Malaysia.”
“and you do not need to know what is going on.”
To: Victor Liu
From: Greg Russell
“OK we have found out what the requirements are from our customs broker.”
“For the goods to come from Malaysia without duty – they must have a Certificate of Origin from the Malaysian Government Department of Trade.”
“To be eligible for this certificate the wheels must have more than 40% of their production occurring in Malaysia.”
“So the Malaysian factory wheel factory would have to be prepared to declare to their government and supply in the appropriate documents as proof, that 40% of each wheels [sic] manufacture was carried out by them in Malaysia. This could also be subject to spot checks by government officials.”
…
To: Greg Russell
From: Victor Liu
“Malaysia side, it is not our concern, whenever they can provide the certificate, it means proved by government. And your Customs also decide by documents. You are worried too much.”
To: Victor Liu
From: Greg Russell
“So then if I understand this correctly, YQ will make the castings in China and then ship to Malaysia for machining, painting and packing and then under the certificate ship them to Australia duty free under the bi-lateral trade agreement between Australia and Malaysia?”
To: Greg Russell
From: Victor Liu
“I will tell you the wheels are made in Malaysia with YQ styles. Nothing related to YQ!””

Here it is convenient to interpose the respondents’ argument that, contrary to the construction of this exchange expressed by the Crown, these communications are consistent with an intention on the part of the first respondent legitimately to avoid duty by arranging for a degree of manufacturing to occur in Malaysia.
Mr Bourke referred next to an email sent by the second respondent to some of Speedy’s customers:

“Date: 15 January 2012
From: Greg Russell
Subject: Retention of some 2012 products in 2013
“Hello everyone,
Some good news!
We have had some luck come our way in regard some of our existing Chinese made wheel products which I had previously indicated would be discontinued, now being able to be manufactured in Malaysia, thus landing in Australia exempt of the dumping penalties...”

Mr Bourke pointed to communications that indicated that the respondents continued to use YQ as its manufacturer. For example, there is a reference in an email on 15 March 2013 to “YQ drawings”.
Communications between a person “Ben Hammond” and others on 13 May 2013 and 14 May 2015 refer to three shipping containers that had been held by Customs. Mr Bourke indicated at the hearing of the appeal that those containers relate to Counts 6, 15 and 24 on the indictment. Skype messages passing between “Joyce Liu” and the second respondent a few days later contain discussion of whether or not the cartons in those containers carry “Made in Malaysia” stickers:

“Date: 17 May 2013
To: Greg Russell
From: Joyce Liu
“Greg, for the previous shipments from Malysia [sic], there has [“]MADE IN MALAYSIA[“] sticker on the carton> [sic] Is that right? Please confirm?”
To: Joyce Liu
From: Greg Russell
“Yes, there has been that sticker on the outside of the carton.”
To: Greg Russell
From: Joyce Liu
“Greg, regret to tell you that, the 3 containers on the customs, there are no [“] MADE IN CHINA[“] sticker on the outside of carton.”
To: Joyce Liu
From: Greg Russell
“That will not help. Are there stickers on the wheels?”
To: Greg Russell
From: Joyce Liu
“no, I just be informed that they skip this p5rocess [sic] to stick the [“]MADE IN MALAYSIA[“] in both wheel and carton”
To: Joyce Liu
From: Greg Russell
“Wish us luck then.”
To: Greg Russell
From: Joyce Liu
“don[‘]t why [sic] it happened.”
To: Joyce Liu
From: Greg Russell
“OK then, as long as the wheels have no country on them then it can be considered an oversight in their packaging from Malaysia and that is what we will advisw [sic] customs if we are asked? I will let you know once we hear something.””

On 23 May 2013, Ben Hammond sends another email to the first respondent and Luke Tonkin:

“To: Les Rapolti; Luke Tonkin (cc Steve Morling)
From: Ben Hammond
“Good Afternoon,
I have spoken with Customs this morning and they are still not releasing this cargo. They have advised they have reason to believe these wheels may not be Malaysian origin. They would not elaborate further than that as to how or why they have these suspicions or how they intend to prove it should that be their ruling.””

On 28 May 2013, the second respondent and Mr Liu use Skype’s chat function to discuss what they are going to tell Customs about why the “MADE IN CHINA” mark has been ground off the wheels:

“To: Victor Liu
From: Greg Russell
“Just received today’s update Victor. Customs are of the opinion that the wheels have been made in China. This is because the origin markings in the castings have been ground off and painted over. They do not believe the country of origin certificate because of this. They want an explanation of why the origin markings have been ground off the wheels.
To: Greg Russell
From: Victor Liu
“well, the tooling is from China, since there is high penalty, we shipped the tooling to Malaysia to manufacture. After making the wheels, they noticed there is MADE IN CHINA mark, so they grind it off, for the future shipments, there will be no frungung [sic] marks.”

Mr Bourke highlighted that the first respondent then drafted a letter, which was to be sent by the Malaysian manufacturer Speedy Direct to Customs to explain the removal of the cast marks, in what the first respondent said was “poor English” because he wanted it to look “authentic – Asian”.
There was further correspondence on 5 June 2013 between the first respondent and Mr Liu with respect to what the Malaysian company should say to Customs:

“To: Greg Russell
From: Victor Liu
“Hi Greg, I think we need to discuss and let Malaysia side knows what to say, what not to say.”
To: Victor Liu
From: Greg Russell
“OK. I think we should have the phone number to them no later than tomorrow otherwise it will look odd.”
To: Victor Liu
From: Greg Russell
“At this time we have indicated that Malaysia are now in possession of the tooling and are working through it to remove the original [“]Made in China[“] cast marks. That[‘]s why some wheels in the shipment have been altered by grinding it off and some wheels where the tooling has been fixed – do not show any country of origin. I think the biggest problem Customs have with all this is the fact neither the wheels or the boxes have Made in Malaysia affixed or marked into them. From what the shipping agents tell me, it is mandatory in Australia to have some form of origin mark or label.”
…
To: Greg Russell
From: Victor Liu
“sure, I will give you the Malaysia phone number and person to contact within one hour.”
To: Victor Liu
From: Greg Russell
“Excellent. That will look very positive to them. I think the strategy for us now is to get on the front foot and demand a ruling be made in a slightly agitated manner. I keep telling them I am just the customer in all this. Rota assures me everything is in order and the Malaysian manufacturer has export documents issue [sic] by the Malaysian government – so what is the problem? I think we should apply some pressure back to them.”
To: Greg Russell
From: Victor Liu
“how about to talk to lawyer? Customs has no right to do this to us.”
“it is big damage to us.”
To: Victor Liu
From: Greg Russell
“I have considered that and I think we are getting close to needing some additional advice. I think we will wait to see what their response is to all the information provided over the next few days and I am sure they will issue us some sort of instruction over marking the wheels or cartons with country of origin. So I think best if we let it settle a bit before we seek legal help. We may not need it.”
To: Greg Russell
From: Victor Liu
“ok.”
“Let me talk to Malaysia side.”
To: Victor Liu
From: Greg Russell
“In terms of what recourse we have against them, the agents advise we have no recourse for anything. That is something I would like to take legal advice on. Just the cost alone of having them unload the containers, inspect the wheels and then repack on pallets and ship to us will be a substantial cost to us.”
To: Greg Russell
From: Victor Liu
“understand.”
“finished talking, they will provide the phone number and boss name, who Customs can talk to.”
“the boss is mom in the family, English is not that good.”
“it is better.”
To: Victor Liu
From: Greg Russell
“My mum[‘]s name is Madam Liew and her direct number is [number]. I[‘]ve just spoken to her and she is aware of it. We will just say Rota is our client and shifted their molds from China to our plant late from China to our plant late last year around November and we just manufacture for you and ship to Australia as per Rota request
We just grind the Made in China because they are not made in China.””

Mr Bourke submitted that it would be extraordinary if Mr Liu were explaining this to the second respondent for the first time. The Crown submission is effectively that the second respondent and Mr Liu are rehearsing the story that they plan to convey to Customs through the Malaysian company Speedy Direct. There is no written agreement between Speedy Direct and the intermediary Rota Oriens in Taiwan.
Mr Bourke submitted to this Court that, having regard to the totality of the communications, it would be open to a jury to infer that the ARWs were not worked on to the requisite degree in Malaysia but were in fact manufactured in China and merely transhipped through Malaysia.

Evidence on the voir dire relevant to the admissibility of the search warrant material

The respondents’ objection to the Crown’s reliance upon the material seized under the s 198 warrant in a trial for charges under the Code was that the material seized under a Customs Act search warrant is only admissible in prosecutions for specified Customs Act offences. Evidence was called on the voir dire relevant to this discrete issue.
The s 198 warrant was issued on 1 August 2013. Customs first considered criminal charges in February 2014 on the basis of the material seized pursuant to that warrant.
On 29 April 2014, Customs received advice from the CDPP to the effect that it could retain the documents seized under the s 198 warrant and use them as evidence in proceedings for the criminal charges. Court attendance notices (“CANs”) were prepared on 20 May 2014. In June 2014, the third respondent was charged with the substantive offence under s 134.2 of the Code and the first and second respondents with aiding or abetting the corporate accused.
On 26 October 2015, the respondents filed their Notice of Defence Response pursuant to ss 141(1)(b) and 143 of the Criminal Procedure Act 1986 (NSW), putting the Crown on notice that they would be seeking to have the material seized under the Customs Act search warrant excluded at trial under s 138 of the Evidence Act.
On 28 October 2015, the Sydney office of the CDPP advised Customs that it would be “prudent to get a s 3E warrant and have AFP execute the warrant on the evidence”. Customs then approached the AFP to request that they execute a s 3E warrant.
On 9 November 2015, Registrar Stephen Lister at the Downing Centre Local Court issued a s 3E warrant in relation to the premises of the Sydney office of the CDPP. The application was supported by the affidavit of Detective Sergeant Dwayne Robertson sworn on 9 November 2016.
The s 3E warrant was executed at the Sydney premises of the CDPP on 9 November 2014. This was the day that the respondents’ trial commenced in the District Court at Sydney before Sweeney DCJ. None of the respondents was given any notice that this search warrant was to be executed at that time.
The three witnesses who gave oral evidence relevant to the execution of both the s 198 warrant and the subsequent s 3E warrant were Detective Sergeant Robertson of the AFP and Officers Christie Curtis and Terry Baumgart of Customs. Their evidence can be summarised as follows.

Evidence of Detective Sergeant Robertson

Detective Sergeant Robertson gave evidence that on 29 October 2015 he received an email from Customs, dated 28 October 2015, requesting that he obtain and execute a s 3E warrant on the Sydney office of the CDPP. The email stated that the items to be seized were still in Melbourne, but were coming to Sydney.
The timeframe for the obtaining and execution of the search warrant was rather short as the respondents’ trial was to commence on 9 November 2015. Cross-examination on the voir dire exposed that Detective Sergeant Robertson had “cut and pasted” material in his supporting affidavit from a draft prepared by Officer Curtis.
On 30 October 2015, Detective Sergeant Robertson contacted Officer Curtis and made some enquiries. She told him, “Arising from the DPP advice that there is a different definition of the word ‘offence’, that requires the execution of a s 3E search warrant to hold those items because it does not meet the definition of offence.” He had concerns as to whether Customs had the power to continue to hold the documents, but did not raise this with Officer Curtis.
Detective Sergeant Robertson explained that he was obliged to query this unusual request because it was “very much outside of a normal practice” and “outside the normal actions of the AFP”. He was obliged to understand the request as the seeking and execution of a search warrant are significant powers that the AFP should exercise cautiously. He sought the advice of colleagues. A senior colleague expressed the view that he suspected that the requested action was not legal and that a former AFP officer had been criticised in court for doing the same thing.

When Detective Sergeant Robertson reviewed the previous matter in which such a request had been made, he found that no legal advice was ever sought at that time as to the propriety and legality of obtaining a s 3E warrant in such circumstances. He thought that it was prudent to seek a solid opinion before a decision could be made for the AFP to accept the referral. The effect of the legal advice obtained from the AFP Legal Section was that it was lawful to proceed. That advice contained the following proviso, “for completeness I haven’t been able to find any case law indicating criticism of law enforcement for pursuing a similar process in the past”.
During Detective Sergeant Robertson’s evidence, the respondents called for the relevant legal advice. The CDPP made a claim of legal professional privilege with respect to that advice. Sweeney DCJ refused that claim on the basis that there was sufficient evidence before her to support a prima facie case that the obtaining and execution of the warrant was an abuse of the power contained in s 3E of the Crimes Act and that the legal advice given was in furtherance of that abuse.
Detective Sergeant Robertson agreed that the only purpose of the AFP being involved was to seize documents from Customs under the s 3E warrant and then to hand them back. There was to be no detailed analysis of the documents or use of the documents in evidence in any prosecution in which the AFP was involved. He agreed that he did not conduct any sample investigation to see if any background information that was provided to him was correct; he relied upon the information provided by Officer Curtis. Nobody else in the AFP made independent investigative enquiries because they relied upon the information provided by Customs and the involvement of the CDPP.
When Detective Sergeant Robertson seized the documents from Officer Curtis, he quickly perused them to make sure that they were correct documents. It took him half an hour or an hour to carry out that exercise. At the time of the execution of the search warrant, he and Officer Curtis were the only people present.
After Detective Sergeant Robertson satisfied himself that the documents fell within the terms of the s 3E warrant, he returned them to Officer Curtis. The documents were labelled and sealed, or placed in their exhibit bags. He did not remove any documents from their envelopes. The documents were identified by Officer Curtis and the CDPP solicitor with carriage as relevant to the case and he relied upon that information, their knowledge of the matter and the fact that the documents had already been seized and identified when forming his own views.

Scope of the s 3E warrant

In his affidavit, Detective Sergeant Robertson outlined that the search warrant was to be executed on the premises of the CDPP situated at Level 10, 175 Liverpool Street in Sydney. He stated that he based his application on the information that he obtained from his own inquiries and the inquiries of other AFP officers. He expressly stated that the material was initially seized under a s 198 warrant and transferred to the CDPP. He explained that that material now needed to be seized under a s 3E warrant because of the difference in the definition of the word “offence”. He stated that the trial was scheduled to commence on 9 November 2015. He stated that there were reasonable grounds for suspecting that there was evidentiary material at the premises of the CDPP; namely, documents including the hard drive of a computer that would provide evidence as to the commission of specified indictable offences. Detective Sergeant Robertson purported to rely on the summary of the affidavit in support of the s 198 warrant executed at the business premises of Speedy. However, he did not provide any details of that affidavit.
The s 3E warrant authorised Detective Sergeant Robertson to enter and search the premises of the CDPP and, inter alia, search for and record any fingerprints found at the premises; take samples of things found at the premises for forensic purposes; search the premises for any evidential material; seize any such material that may be found and seize any other thing found at the premises that the executing officer believes to be evidential material or tainted property (within the meaning of the Proceeds of Crime Act). He was further authorised, inter alia, to seize any other thing found at the premises that would present a danger to a person or could be used to assist a person to escape from lawful custody if the officer believed that such seizure would be necessary to prevent its concealment, loss or destruction or its use in committing an offence.
In executing the warrant, Detective Sergeant Robertson was authorised to obtain any assistance and use force against persons or things as reasonable and necessary in the circumstances.

Evidence of Officer Terri Baumgart

Officer Baumgart is a Senior Investigator with Customs. The s 198 warrant was obtained in her name and she executed it at the premises of Speedy at St Mary’s on 7 August 2013. At the time of the execution of the warrant, the understanding of Officer Baumgart was that the warrant was in relation to alleged breaches of s 234 of the Customs Act. Such a breach would be civil in nature and could result in imposition of a fine. The matter would be prosecuted by the Australian Government Solicitor (“AGS”), rather than the CDPP. She attended the premises to search for evidence that Speedy had avoided dumping duty by rerouting ARWs through other countries.
Officer Baumgart stated that her investigative responsibilities were limited to breaches of the Customs Act. At that time, she was not aware of any breach of s 134 of the Code. It was not part of her general investigatory responsibilities as a Customs officer to investigate breaches of the Code.

Evidence of Officer Curtis relevant to the search warrants

Officer Curtis gave evidence that she knew that the powers to search under the s 198 warrant were limited. She also knew that the alleged breaches of s 234 of the Customs Act that were the subject of her investigation were not criminal in nature. At the time that she made the retention application to the Magistrates Court in Victoria on 21 October 2013 under s 203S of the Customs Act, Customs was considering offences under the Customs Act. It was not until she received advice from the CDPP in February 2014 that she began considering criminal charges. On 29 April 2014, she received advice from the Melbourne office of the CDPP that she could retain the documents seized under the s 198 warrant to proceed with the criminal charges.
On 28 October 2014, she was advised by the Sydney office of the CDPP that it would be prudent to obtain a s 3E warrant. That warrant was executed at the office of the CDPP in Sydney on 9 November 2015. She was present to hand over the evidence to the AFP officer Detective Sergeant Robertson at that time. She gave evidence that he handed the material back to her “almost immediately” after she gave it to him. She said that Detective Sergeant Robertson did not look at any of the documents individually and agreed that what happened was a “round robin” of documents.

Relevant statutory provisions

Before turning to her Honour’s reasons, it is convenient to set out the relevant statutory provisions. Section 198(1) of the Customs Act relevantly provides that:

“A judicial officer may issue a warrant to search premises if the judicial officer is satisfied by information on oath that there are reasonable grounds for suspecting that there is, or within the next 72 hours there will be, any evidential material, other than evidential material that is also a forfeited good, on or in the premises.” [emphasis added]

Section 183UA of the Customs Act includes a definition of “evidential material” as follows:

“"evidential material", in relation to an offence, whether the offence is indictable or summary, means a thing relevant to the offence, including such a thing in electronic form.” [emphasis added]

That section defines the word “offence as follows:

“"offence" means:
(a) an offence against this Act; or
(b) an offence against the Commerce (Trade Descriptions) Act 1905 ; or (c) an offence against section 72.13 or Division 307 or 361 of the Criminal Code.”

An offence under s 72.13 of the Code is an offence with respect to importing or exporting unmarked plastic explosives. An offence under Division 307 or 361 of the Code relates to the import or export of border controlled drugs or plants or international firearm trafficking.
Section 203R of the Customs Act provides that:

“Retention of things seized as evidentiary material
(1) Subject to any law of the Commonwealth, a State or a Territory permitting the retention, destruction or disposal of a thing seized as evidential material by an officer of Customs under a search warrant or by an authorised person under subsection 203B(3), 203C(3), 203CA(4) or 203CB(3), the officer or authorised person must return it if:
(a) the reason for its seizure no longer exists or it is decided that it is not to be used in evidence; or

(b) 120 days after its seizure:
(i) proceedings in respect of which the thing may afford evidence have not been started; and
(ii) an order permitting the thing to be retained has not been made under section 203S; and
(iii) an order of a court of the Commonwealth or of a State or Territory permitting the retention, destruction or disposal of the thing has not been made;

whichever first occurs.”

Section 227AA of the Customs Act provides:

“Evidence may be used in prosecutions etc.
(1) To avoid doubt, if, when exercising powers under this Act, an officer obtains evidence of the commission of an offence against Part 9.1 of the Criminal Code, then that evidence may be used, or given to another body for use, in:
(a) investigating the offence; or
(b) proceedings for the prosecution for the offence.

(2) To avoid doubt, if, when exercising powers under this Act, an officer obtains evidence of the commission of an offence against Subdivision B of Division 72 of the Criminal Code, then that evidence may be used, or given to another body for use, in:
(a) investigating the offence; or
(b) proceedings for the prosecution for the offence.”

Part 9.1 of the Criminal Code deals with “serious drug offences”.
Section 138 of the Evidence Act is as follows:

“Discretion to exclude improperly or illegally obtained evidence
(1) Evidence that was obtained:
(a) improperly or in contravention of an Australian law;
(b) in consequence of an impropriety or of a contravention of an Australian law;

is not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting evidence that has been obtained in the way in which the evidence was obtained.
(2) Without limiting subsection (1), evidence of an admission that was made during or in consequence of questioning, and evidence obtained in consequence of the admission, is taken to have been obtained improperly if the person conducting the questioning;
(a) did, or omitted to do, an act in the course of the questioning even he or she knew or ought reasonably to have known that the act or omission was likely to impair substantially the ability of the person being questioned to respond rationally to the questioning;
(b) made a false statement in the course of the questioning even though he or she knew or ought reasonable to have known that the statement was false and that making the false statement was likely to cause the person who was being questioned to make an admission.

(3) Without limiting the matters that the court may take into account under subsection (1), it is to take into account:
(a) the probative value of the evidence; and
(b) the importance of the evidence in the proceeding; and
(c) the nature of the relevant offence, cause of action or defence and the nature of the subject-matter of the proceeding; and
(d) the gravity of the impropriety or contravention; and
(e) whether the impropriety or contravention was deliberate or reckless; and
(f) whether the impropriety or contravention was contrary to or inconsistent with a right of a person recognised by the International Covenant on Civil and Political Rights; and
(g) whether any other proceeding (whether or not in a court) has been or is likely to be taken in relation to the impropriety or contravention; and
(h) the difficulty (if any) of obtaining the evidence without impropriety or contravention of Australian law.”

The decision of Sweeney DCJ

Her Honour’s decision on 2 December 2015 dealt with the five separate categories of evidence over which the respondents took objection. Her Honour upheld all five objections. This appeal relates only to her Honour’s rejection of evidence obtained by Customs pursuant to the s 198 warrant.
Sweeney DCJ set out the relevant evidence and the relevant statutory provisions, being ss 198, 183UA and 203R of the Customs Act. Her Honour then addressed the submissions advanced by both parties.
Her Honour observed that offences against s 134 of the Code have a different character to the offences against s 234 of the Customs Act. The statutory scheme applicable to the issue of a search warrant under the Customs Act is limited by the operation of s 183UA. The word “proceedings” in s 203R must be construed as proceedings for the offences specified in s 183UA. Her Honour observed that ss 183UA, 198 and 203R all appear in the same Part of the Act, headed “powers of officers”, and that they must be read as operating together. She then had regard to decisions of Grollo v MacAuley (1996) FCR 533; (1995) 80 A Crim R 175, Williams v Keelty (2001) 111 FCR 175; (2001) 184 ALR 411; (2001) 39 ACSR 127; 19 ACLC 1535; [2001] FCA 1301; ASIC v Rich [2005] NSWSC 62; 220 ALR 324; (2005) 188 FLR 416; (2005) 52 ACSCR 374; and Fiori v Commissioner of Police and Anor [2014] QSC 284. Her Honour stated that:

“These principles must be no less applicable to the accused in this situation where material seized pursuant to a warrant issued for investigating breaches of Customs Act offences is sought to be used in a trial for offences under the Criminal Code, which put the individual accused in jeopardy of imprisonment if convicted and the corporate accused in jeopardy of more serious penalties than apply to the Customs Act offence. Potential loss of liberty is a more serious outcome that any considered in the abovementioned cases.”

Her Honour concluded that evidence seized under the s 198 warrant could only be used in proceedings for the offences specified in s 183UA of the Customs Act, such as the s 234 offences specified in the warrant. Accordingly, her Honour held it would be improper for the Crown to use the material so seized in a trial for offences against s 134.2 of the Code. Her Honour then stated that her conclusion was reinforced by the terms of s 227AA of the Customs Act (extracted above at [78]), stating:

“The offences specified [in s 227AA] involve plastic explosives and serious drug offences. It is clear the legislature has chosen to broaden the Customs officers [sic] powers in respect of the prosecution of offences it regards as more serious but it has not extended the power generally or more broadly than those offences.”

Her Honour was not satisfied that the s 198 warrant was executed for the improper purpose of obtaining evidence to use in criminal proceedings; it was executed for the purpose of the investigation of potential offences against s 234 of the Customs Act. However, at the point that a decision was made to proceed with charging the respondents with offences under the Code, the Customs officers were obliged to return the material. By retaining the material at that time, intending to use it in a criminal trial, Customs obtained the material by an impropriety contrary to s 203R and the applicable principles derived from the case law.
Her Honour then turned to consider whether the execution of the s 3E warrant by the AFP “cured” the impropriety in Customs retaining the material seized under the s 198 warrant for use in the respondents’ trial.
Her Honour concluded that the obtaining and execution of the search warrant by Detective Sergeant Robertson and the sharing of the seized material with Officer Curtis was not a genuine exercise of the power conferred by ss 3E and 3ZQU in the course of an investigation, but an artificial exercise of the powers in an attempt to “launder” the material improperly held by Officer Curtis. This conclusion was based on: the evidence of Officer Curtis as to the purpose of seeking the 3E warrant; the records of correspondence and discussion between the CDPP and AFP and within the AFP; the evidence of Detective Sergeant Robertson that the course requested was outside the usual powers of the AFP; the circumstances of the execution of the warrant and the almost immediate handing back of the material seized pursuant to the warrant; the fact that Detective Sergeant Robertson did not examine or analyse the material before it was made available to Ms Curtis and the terms of s 3E of the Crimes Act.
Her Honour went on to conclude that the AFP in a corporate sense participated in “an improper use of that power” and “an abuse of power”. Her Honour went on to observe that the proper course, when Customs chose to prosecute the respondents for offences under s 134 of the Code, would have been to return the seized material to Speedy and then to seek the AFP’s assistance in executing a s 3E warrant on Speedy in order to obtain the material for use in the proposed criminal proceedings. Her Honour observed: “That would have been a proper exercise of the section 3E power and the evidence could therefore easily have been obtained without impropriety”.
Her Honour then considered the relevant factors in s 138(3) of the Evidence Act, including the probative value of the evidence. Sweeney DCJ highlighted the problems in the evidence of Officer Curtis revealed during her cross-examination, stating:

“The evidence of Ms Curtis on the voir dire seemed to reveal some suspicion and assumptions by her underpinning the Crown case. Probing of the Crown case during her evidence seemed to cause it some damage. The electronic communications seem to contain some which support the Crown case and some which are exculpatory. The assessment of that evidence and the resolution of the effect of it is properly a matter for the tribunal of fact.”

Her Honour then concluded:

“Weighing otherwise in the balancing exercise are, as I have said above, that the improprieties in obtaining the evidence were serious, deliberate on the part of Crown authorities and could easily have been avoided by proper exercises of the search warrant powers available to customs and the AFP.
Section 138 of the Evidence Act provides that evidence improperly obtained is not to be admitted unless the desirability of admitting it outweighs the undesirability of admitting evidence obtained in the way it was obtained. Weighing the relevant factors and because of the seriousness of the improper use of the search warrant powers, I have decided the evidence should not be admitted.”

Threshold question: is the appeal competent?

The respondents raised a threshold issue as to whether the appeal is competent. It is necessary to consider the question of the competency of the appeal as a preliminary issue. Section 5F(3A) of the Criminal Appeal Act provides that an appeal against an evidentiary ruling can only be brought by the “Attorney General or the Director of Public Prosecutions” if the decision or ruling “eliminates or substantially weakens the prosecution’s case”.
The respondents conceded that if the Crown had a viable case the exclusion of the subject evidence would substantially weaken it. However, the respondents advanced the contention that the evidence that emerged during the 11-day voir dire in this matter demonstrates that the Crown does not have a viable case in any event. In those circumstances, it was submitted, the jurisdictional gateway in s 5F(3A) is not satisfied because it cannot be said that a ruling substantially weakens a prosecution case that is doomed to fail in any event.

The respondents identified two issues in support of a submission that the Crown is incapable of proving the elements of the offence charged even if the seized material were admissible. The first is that, based upon the evidence of Officer Curtis on the voir dire, the Crown cannot prove that the relevant ARWs were in fact manufactured in China, or indeed where in the world they were manufactured. The second is that there is a defect in the notice under the hand of the then Minister for Home Affairs Jason Clare MP, issued under s 269TG of the Customs Act on 5 July 2012, imposing the relevant duty on ARWs imported from China. The respondents rely upon a decision of Mortimer J in GM Holden Ltd v Commissioner of the Anti-Dumping Commission (2014) 225 FCR 222; [2014] FCA 7078 (“GM Holden”) that the relevant notice was void for jurisdictional error.

The respondents’ first submission: the evidence of Officer Curtis does not establish that the ARWs were manufactured in China

Submissions on behalf of the first and second respondents

The first argument is that the evidence adduced on the voir dire shows that there is no evidence that the relevant shipments originated in China. It was submitted on behalf of the respondents that there is no evidence that Speedy provided false information to Customs in relation to each shipment because there is no evidence that the nine shipments did not originate in Malaysia. This submission relies upon the weaknesses in Officer Curtis’ evidence summarised above at [25].
It was submitted that, although there is some circumstantial evidence to establish dishonesty, including emails and Skype and MSN chat logs, it cannot overcome the gaps in the proof regarding the allegedly false statements. Even if the evidence were admitted, it could not prove that the ARWs were manufactured and exported from China nor that they were not at least partially manufactured in Malaysia.

Submissions of behalf of the third respondent

The third respondent adopted the submissions made on behalf of the first and second respondents and added that it cannot be proved that the ARWs were manufactured in China or by any Chinese manufacturer attracting the imposition of duty and countervailing duties, nor that they were shipped to Malaysia in order to avoid the payment of the same.
It was further noted that there is no evidence to prove the non-existence of the Malaysian manufacturers Zinaco and Speedy Direct, nor any evidence to prove that they did not contribute to the process of manufacturing the ARWs in Malaysia. On the contrary, the inquiries made into the authenticity of the Certificates of Origin stating that the ARWs were manufactured in Malaysia confirmed their authenticity.
The third respondent finally submitted that evidence given during the voir dire demonstrates that the Crown is unable prove that the respondents either obtained a financial advantage through avoidance of payment of duty or engaged in deceptive behaviour in order to obtain such an advantage. Therefore, the elements of the offences under s 134.2(1) of the Code with which they have been charged cannot be established.

Submissions on behalf of the Crown

The Crown submitted that the Crown case is circumstantial and that it is ultimately a matter for the tribunal of fact whether it is satisfied beyond reasonable doubt of the respondents’ guilt. The Crown relied upon the electronic communications between the first and second respondents and other persons, including overseas director Mr Liu, as extracted above at [28]-[46].
Mr Bourke submitted to this Court that, having regard to the totality of the communications, it is open to a jury to infer that the ARWs were not worked on to the requisite degree in Malaysia but were in fact manufactured in China and merely transhipped through Malaysia. The Crown submitted that the evidence of Officer Curtis was that there was no direct evidence that the ARWs came from China, rather than no evidence at all. That does not mean that the Crown case is incapable of being proved.
The Crown relied upon the findings of Sweeney DCJ, extracted above at [89], in relation to the evidence of Officer Curtis.
Mr Bourke conceded that this Court was not bound by the findings of Sweeney DCJ on this question.

The respondents’ second submission: there is no evidence that the relevant duty applied

The respondents’ second submission was that there is no evidence that dumping duty was in fact payable on the ARWs imported by Speedy from China as the 27 June 2012 notice purporting to impose dumping duty was affected by jurisdictional error. Hence, the Crown is incapable of establishing an element of the offence; namely, that the respondents obtained a financial advantage.
The arguments urged upon this Court by the respondents to support this submission involved principles of administrative law of some complexity. At the conclusion of the first day of the hearing, the parties were invited to file and serve further submissions addressing the validity of the 2012 dumping duty notices and the retrospective effect, if any, of the 2015 notice. Further submissions on behalf of the Crown were filed on 3 June 2016 and further submissions in reply for the first and second respondents were filed on 8 June 2016.
It is convenient to set out the decision of Mortimer J in GM Holden before turning to consider the respondents’ submissions.

GM Holden v Commissioner of the Anti-Dumping Commission

The applicant GM Holden sought judicial review of, inter alia, the decision of the Minister for Home Affairs to impose anti-dumping measures under the Customs Act in relation to certain ARWs imported from China. The applicant sought an order in the nature of certiorari quashing that decision. The applicant did not seek judicial review of the countervailing duty notices.
The background to that case is as follows. In September 2011, an Australian manufacturer of ARWs made an application pursuant to s 269TB of the Customs Act seeking that the Minister for Immigration and Border Protection publish dumping and countervailing duty notices in relation to certain ARWs imported from China.
The first respondent, then called the Chief Executive Officer of the Australian Customs and Border Protection Service (“the CEO”) and now known as the Commissioner of the Anti-Dumping Commission, performed an investigation. The CEO subsequently provided a report to the Minister recommending that dumping and countervailing duties be imposed in respect of goods that had been the subject of its investigation and like goods, with an exception for goods from exporters in respect of whom the CEO’s investigation had been terminated.
As part of the investigation process, GM Holden had completed an importer questionnaire and facilitated a visit by Customs to its premises. The applicant provided written submissions to the CEO on several occasions.
The Minister for Home Affairs, performing the responsibilities of the Minister for Immigration and Border Protection at the relevant time, accepted the recommendations of the CEO and on 27 June 2012 published a dumping duty notice under s 269TG and a countervailing duty notice under s 269TJ of the Customs Act in relation to ARWs that had been the subject of an investigation under Pt XVB of the Customs Act and to like goods exported to Australia from China after 31 May 2012. Goods from Chinese exporters in respect of which investigations had been terminated were excluded from the operation of the notices.
Division 9 of Part XVB of the Customs Act provided for merits review of dumping duty and countervailing duty notices by the Trade Measures Review Officer (“TMRO”) on the application of an “interested party”. The TMRO is restricted to making recommendations to the Minister, who is not bound to accept them: s 269ZZK(1), (2). The review framework requires the TMRO to focus on whether the CEO should reinvestigate the Minister’s findings of fact, or conclusions based on findings of fact, forming the basis of the decision to issue a dumping duty notice: ss 269ZZE(3), 269ZX. The Anti-Dumping Review Panel (“ADRP”) now performs the functions of the TMRO: Schedule 1 of the Customs Amendment (Anti-Dumping Improvements) Act (No 1) 2012 (Cth).
On 8 May 2013, the TMRO conducted a review of the 27 June 2012 dumping duty notice on the application of GM Holden that became the basis for the proceedings before Mortimer J in the Federal Court. The TMRO largely affirmed the Minister’s decision, but recommended that the Minister direct the CEO to reinvestigate the calculation of the dumping margins for all “residual exporters.” The TMRO agreed with GM Holden’s position that exporters who had not answered the exporter questionnaires could not fall within the definition of “selected exporter” in s 269T because it was not possible to describe their exportations as having been “investigated” just because they had been sent a questionnaire.
Following reinvestigation, the CEO recommended that the Minister reaffirm the decision to issue the 2012 dumping and countervailing duty notices. The Minister subsequently affirmed his previous decision by issuing another dumping duty notice pursuant to s 269ZZM on 8 May 2013.
GM Holden then made application to the Federal Court for judicial review of the Minister’s decision on a number of grounds. The only successful ground of review was Ground 12:

“12. In making the CEO Decision, the Dumping Declaration and the May 2013 Minister’s Decision, the CEO and the Minister erred in the construction or application of the term “investigated” in the definition of “selected exporter” in s 269T of the Customs Act by finding that the exportations of non-cooperating exporters were “investigated” for the purposes of the phrase “selected exporters” (ADJR Act s 5(1)(f)) and constituted jurisdictional error or a failure to exercise jurisdiction.”

By virtue of s 269T(1) of the Customs Act as it then was, a “selected exporter” was an exporter of goods the subject of the application, or like goods, “whose exportations were investigated for the purpose of deciding whether or not to publish” a dumping duty notice or a countervailing duty notice. [1] Section 269T deemed an exporter who was not a selected exporter to be a “residual exporter”.
1. The definition of “selected importer” in s 269T of the Customs Act was repealed by the Customs Amendment (Anti-Dumping Improvements) Act (No. 3) 2012 (NSW).
The classification of an exporter as “selected” or “residual” bore upon the calculation of the size of the dumping margin for particular exporters. Mortimer J observed at [192]:

“The scheme assumes, in my opinion, that the latter category [selected exporters] have had their exports investigated in accordance with the Customs Act, and at least some information is available on which the Minister can base calculations of normal value and export price, whereas such information is not available for residual exporters.”

The CEO found that there were 117 entities that exported ARWs from China to Australia in the investigation period. A questionnaire was issued to all 117 entities. The CEO regarded the sending of the exporter questionnaire as sufficient to bring all 117 entities within the definition of “selected exporter” in that they had been the subject of an investigation. Those entities were then divided into “selected cooperating” and “selected non-cooperating” categories depending on whether and how they responded to the exporter questionnaires. 112 entities were categorised as “selected non-cooperating” exporters.
The dumping duty margin for selected non-cooperating exporters was set at 29.3%, while the margin for selected cooperating exporters ranged between <2% and 9.9%.
The issue for Mortimer J, expressed at [204], was whether the CEO correctly construed the definition of “selected exporter” in s 269T, enabling all of the Chinese entities to be characterised in that way. Mortimer J found that the CEO misconstrued the term “selected exporter” by, among other things, placing a gloss of “cooperating” or “non-cooperating” on the words of the statute. The statutory definition turned only on whether a particular exporter had been “investigated.”
At [210], her Honour held that simply identifying the entities as exporters and then sending them a questionnaire was insufficient for the CEO to conclude that they had been “investigated”. Sending a questionnaire to an entity cannot constitute an enquiry into the transactions, or “exportations”, of that entity in exporting ARWs: at [213]. Her Honour concluded that the CEO misconstrued the terms “selected exporter” and “residual export” in s 269T of the Customs Act. That misconstruction was adopted and acted on by the Minister when he accepted the recommendation of the CEO as to dumping margins for those entities that the CEO identified as “selected non-cooperating exporters” and published notices under s 269TG using those margins.
Although the TMRO identified an error in the approach taken, on further investigation the CEO adhered to the position originally taken and recommended, in Report 204 to the Minister, the same dumping margins based again on the same group of “selected non-cooperating exporters”, using the lowest export price and the highest normal value so as to produce a margin of 29.3% and not considering that calculation to be affected by the constraint imposed by s 269TG(3B).
Her Honour found at [225] that the recommendations in the CEO report; the Minister’s decision to issue the dumping notice based on those recommendations; the CEO’s recommendations on reinvestigation in Report 204; and the Minister’s affirmation of the reviewable decision were affected by jurisdictional error. The parties were then invited to file draft proposed orders reflecting her Honour’s reasons.
Her Honour made a formal order on 14 August 2014 setting aside the decision made by the Minister for Home Affairs on 8 May 2013 under s 269ZZM(1) of the Customs Act insofar as it affirmed the reviewable decision made on 27 June 2012 to publish dumping duty and countervailing duty notices under sub-ss 269TG(1) and (2) and sub-ss 269TJ(1) and (2) of the Customs Act. Her Honour made a further order that, pursuant to s 16(1)(b) of the Administrative Decisions (Judicial Review) Act 1977 (Cth), the matter consisting of the reviewable decisions made on 27 June 2012 be referred to the Minister for further consideration under s 269ZZM(1) of the Customs Act in accordance with law.

The 2015 notice

A subsequent dumping duty notice issued by the Minister on 23 September 2015 purported to have effect from 5 July 2012. The dumping duty imposed on wheels manufactured at YQ in China was 64.1%. The retrospective effect of the 2015 notice generally and for the purposes of these proceedings was the subject of submissions from the parties.

Submissions on behalf of the first and second respondents

Mr Game SC for the first and second respondents submitted that the validity or otherwise of the 2012 dumping duty notices is relevant to the “gateway” to s 5F(3A) of the Criminal Appeal Act, being whether the ruling of the trial judge eliminates or substantially weakens the prosecution’s case. That gateway is a jurisdictional fact of which the Court must be satisfied before considering the appeal.
Mr Game contended that the Crown would be unable to prove that shipments of ARWs from YQ factory were dutiable. That is because, it was submitted, the effect of the finding of jurisdictional error in GM Holden was to render invalid, or void, the dumping duty notice issued by the Minister on 27 June 2012 even in the absence of an order setting aside the decision of the Minister. The decision was in law “no decision at all”. It was further submitted that the 2015 notices were also affected by jurisdictional error and therefore of no legal effect. In any case, the 2015 notices did not and cannot have retrospective application.
When asked whether this was an issue that would be more properly dealt with in the pending permanent stay application in the District Court, Mr Game submitted that this Court has no choice but to consider the validity and effect of the 2012 and 2015 notices by reason of the threshold issue in s 5F(3A). Their validity or otherwise is justiciable in these proceedings by way of collateral challenge because of the threshold enquiry posed by s 5F(3A). The existence of dumping duty at the relevant time goes to the heart of proof of the second element of the offence alleged against the corporate respondent, from which flows the derivative liability of the individual respondents.
Mr Game cited authority in favour of the proposition that it is open to the accused in a criminal proceeding to challenge the validity of administrative action. In Attorney-General (Cth) v Breckler (1999) 197 CLR 83; [1999] HCA 28, Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ stated at 108 [36]:

“If the determination of a complaint by the Tribunal be characterised as activity of an administrative nature, then in the absence of legislative prescription to the contrary, the determination would be open to collateral review by a court in the course of dealing with an issue properly arising as an element in justiciable controversy of which the court was seized. This proposition recently was applied in this Court in Ousley v The Queen.”

It was submitted that a collateral challenge is not limited to invalidity on the face of the record. On this point, Mr Game cited the observations of McLure P in Australian Crime Commission v Marrapodi [2012] WASCA 103 at [46]:

“However, it cannot have been intended that separate judicial review proceedings are required in cases where a valid administrative act is an element of the offence charged (or is a condition of the availability of a power on which the offence depends).”

It was submitted that that there is nothing in Part XVB of the Customs Act, properly construed, that would have the effect of displacing the right of the respondents to raise in these proceedings the validity of the 2012 and 2015 notices.
Mr Game submitted that it is settled law that decisions affected by jurisdictional error are without legal effect. He relied upon the decision of the High Court in Minister for Immigration v Bhardwaj (2002) 209 CLR 597; [2002] HCA 11 (“Bhardwaj”). Gaudron and Gummow JJ (McHugh J agreeing) stated at 614-615 [51]-[53]:

“…only if the general law so requires or the Act impliedly so directs, are decisions involving jurisdictional error to be treated as effective unless and until set aside.
There is, in our view, no reason in principle why the general law should treat administrative decisions involving jurisdictional error as binding or having legal effect unless and until set aside. A decision that involves jurisdictional error is a decision that lacks legal foundation and is properly regarded, in law, as no decision at all. Further, there is a certain illogicality in the notion that, although a decision involves jurisdictional error, the law requires that, until the decision is set aside, the rights of the individual to whom the decision relates are or, perhaps, are deemed to be other than as recognised by the law that will be applied if and when the decision is challenged.” [citations omitted]

The proposition that an administrative decision that involves jurisdictional error is no decision at all was affirmed by the High Court in, among other cases, Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476 at 506 [76] (per Gaudron, McHugh, Gummow, Kirby and Hayne JJ) and Plaintiff S297/2013 v Minister for Immigration and Border Protection [2015] HCA 3 at [31] (per French CJ, Hayne, Kiefel, Bell, Gageler and Keane JJ).
Mr Game’s submission hinged on this proposition. Accordingly, there was no need, it was submitted, for Mortimer J to make an order quashing the 2012 notice. The fact that a remedy may be available to the respondents by way of Federal Court challenge does not mean that the impugned decisions are valid until they are successfully challenged. Moreover, it was submitted that the retrospective attempt to “cure” the problem by revoking the 2012 notice and imposing the 2015 notice was also bad for jurisdictional error (and therefore incapable of applying retrospectively) for two reasons. First, because the text of the 2015 notice suggests that the Minister did not carry out the statutory preconditions for an exercise of power under s 269ZZM (as set out in s 268ZZB). Secondly, because the 2015 notice purported to be the result of a review of the void, and therefore unreviewable, 2012 notice.

Finally, in ASIC v Rich, Austin J was concerned with the issue of whether material seized pursuant to a warrant issued under the then provisions of Part1AA of the Crimes Act, which contemplated criminal offences committed contrary to various sections of the Corporations Act 2001 (Cth), could subsequently be used in civil penalty proceedings brought by ASIC. His Honour referred to a number of authorities, including Williams v Keelty, and confirmed the general principle that where a coercive power has been conferred it may be exercised only for the purpose for which it was conferred. Austin J’s conclusion at [305] (a passage cited by Sweeney DCJ in her reasons) was as follows:

“The constraint upon use of the seized materials as evidence in a civil proceeding is not itself an express statutory constraint. It is, as I have shown, an implied limitation emerging out of the structure and purposes of the search warrant legislation, combined with the general proposition that if a power is conferred for a particular purpose it is limited by the purpose for which the power is conferred.”

The s 198 warrant was obtained to locate documents to be used in a prosecution for breaches of sub-ss 234(1)(a) and (d) of the Customs Act. Prosecutions for those breaches are civil rather than criminal in nature. Although the elements of those offences must be proved beyond reasonable doubt (see Chief Executive Officer of Customs v Labrador Liquor Pty Ltd (2003) 216 CLR 49), such proceedings are conducted as civil proceedings for the recovery of penalties in accordance with Part XIV of the Customs Act. Convictions can only result in the imposition of pecuniary or monetary penalties calculated in accordance with s 234(2) of the Customs Act.
It seems to me that if the principles in the decisions cited above establish that material seized under a warrant in respect of criminal proceedings cannot be used in civil proceedings, a fortiori material seized for use in civil proceedings cannot be used in criminal proceedings. As her Honour observed in her reasons, “Potential loss of liberty is a more serious outcome than any considered in the abovementioned cases.”
I am satisfied that her Honour did not err in her construction of the relevant legislation. Her Honour construed the relevant provisions, being ss 183UA, 198 and 203R as informed by s 227AA, and concluded that the use to which things seized under a s 198 warrant may be put is restricted to the use of those things as evidence in proof of offences as defined in s 183UA(1), unless they fall within the terms of s 227A.
I can find no error in the approach taken by the trial judge concerning the construction of s 203R of the Customs Act.

Ground 2: Her Honour erred in finding that by reason of any impropriety caused by retaining the seized material that material should, pursuant to s 138 of the Evidence Act, not be admitted into evidence

Submissions on behalf of the Crown

Mr Bourke submitted on behalf of the Crown that the evidence could not be said to have been “obtained unlawfully” for the purposes of s 138 because Customs initially came into possession of it pursuant to a lawful search warrant. It would be an absurd result, it was submitted, to find that the nature of the holding of evidentiary material had become unlawful due to the formation in the mind of a Customs official an intention to use the material in criminal proceedings. Further, Officer Curtis acted on legal advice to the effect that she was entitled to retain the material even after preferring criminal charges against the respondents. It was submitted that, in these circumstances, any impropriety or contravention of law in retaining the material would be regarded as of minimal significance.
It was submitted on behalf of the Crown that the findings of Sweeney DCJ as to the use of the s 3E warrant being “a serious misuse of the power” were either “not open” or “unreasonable or plainly unjust”. The s 3E warrant was a validly issued document. Her Honour found Detective Sergeant Robertson to have been “conscientious”. The warrant was executed at the Sydney office of the CDPP and therefore did not involve any invasion of the privacy of the respondents. The re-seizure pursuant to the s 3E warrant, it was submitted, did not encroach on the rights of any individual. Moreover, the step was taken as a result of legal advice. It was submitted that it would be “an affront to common sense” to find that the circumstances surrounding the s 3E warrant amounted to a serious impropriety.
Mr Bourke submitted that it would produce “absurd results” to require evidential material to be returned to the respondents upon a decision to prosecute criminal charges against them. Such an exercise would involve “document shuffling” of the same nature as that found to have been seriously improper by Sweeney DCJ in this case. It could not be guaranteed that the AFP would cooperate in the execution of a s 3E warrant in those circumstances.
On the second day of the hearing of the appeal, the Crown relied upon a further argument as part of this second ground; namely, that the seized material was not obtained improperly within the meaning of s 138(1)(b) of the Evidence Act, in that any impropriety arose after a time when the material was lawfully seized under the s 198 warrant.

Submissions on behalf of the respondents

Given that I accept the submissions of the first and second respondents on this point, I will summarise them shortly. Mr Game on behalf of the first and second respondents submitted that the evidence went from being lawfully obtained to being obtained as a consequence of an impropriety at the point when the intention of Customs diverged from the intention stated on the s 198 warrant. However, Sweeney DCJ did not rely upon the retention of the evidence as the sole impropriety; her Honour also relied upon the fact, purpose and timing of the s 3E warrant. The first and second respondents submitted that the mechanism of the s 3E warrant was used to frustrate the means by which the admissibility of the evidence would be determined.
Mr McGuire SC on behalf of the third respondent submitted that consideration of the coercive power of search warrants must be the starting point in determining whether it was “not open” and “unreasonable or plainly unjust” for her Honour to find that the improprieties were “serious”. It was also submitted that it is necessary to consider the combined effect of the actions of Customs and the AFP when assessing the gravity of the impropriety. In relation to gravity, the third respondent submitted that the application for and execution of the s 3E warrant were in direct response to the respondents’ putting in issue the admissibility of the evidence obtained pursuant to the s 198 warrant. In these circumstances, it could not be said that her Honour fell in to error in the House v The King sense in finding that the relevant impropriety was serious.

Consideration

Ground 2 was relied upon by the Crown in the alternative to Ground 1.
The resolution of Ground 2 turns on whether certain findings were open to her Honour to make on the evidence. Each party proceeded on the basis that the decision by Sweeney DCJ was akin to a discretionary decision. Hence, in order to succeed on this ground the Crown has to establish House error: House v The King (1936) 55 CLR 499.
I am satisfied that this ground is to be considered consistent with the principles in House v the King. As this Court observed in Fleming v The Queen [2009] NSWCCA 233 at [22] when considering a decision made pursuant to s 138, “The decision which the trial judge was required to make was discretionary and must be viewed in accordance with the principles in House v The King (1936) 55 CLR 499”. The decision being made is an evaluative one. As Branson J observed in Employment Advocate v Williamson (2001) 111 FCR 20; 185 ALR 590; [2001] FCA 1164 at [78],

“…the balancing exercise which subs 138(1) requires the court to undertake involves the court in an exercise of judgment (ie the reaching of a conclusion based on the application of very general standards such that different minds might reasonably reach different conclusions on the same material) rather than in an exercise of simply identifying the preferable of two or more available options.”

On its terms, s 138 of the Evidence Act includes balancing concepts of “desirability” and “undesirability”.The relevant considerations are not limited to those mandatory considerations set out in s 138(3) of the Evidence Act.

The steps to be taken in considering whether evidence should be excluded under s 138 were explained by Basten JA in Parker v Comptroller-General of Customs [2007] NSWCA 348; 243 ALR 574 at [57]:

“The exercise of the discretionary power conferred by this provision involves two steps. The first is to determine whether evidence sought to be adduced was in fact obtained improperly or unlawfully in one of the senses identified in pars (a) and (b). The second step is to consider whether despite that conclusion, the discretionary considerations favour its admission. The importance of giving appropriate weight to the effect of any impropriety or unlawfulness is reflected by means of a qualified proscription – the evidence “is not to be admitted unless”. In carrying out the balancing exercise, the Court is required to take into account the factors identified in sub-s (3)…”

The Housev The King errors upon which the Crown relied were that the following two findings by her Honour, leading to her conclusion, were “not open” or were “unreasonable or plainly unjust”. The first impugned finding was that the use of the s 3E warrant was an “abuse of power” and a “serious misuse of power”. Her Honour identified two improprieties: the failure to return the seized material and the manner in which the s 3E search warrant was subsequently obtained and executed. The second impugned finding related to both improprieties, which her Honour found were “serious, deliberate on the part of the Crown authorities and could easily have been avoided.”
I have already addressed the first of these two improprieties in relation to Ground 1, where I found that there was no power to retain the seized material. The error advanced under this Ground requires consideration of the second impropriety; namely, the obtaining and execution of the s 3E warrant.
Her Honour did not make separate findings as to whether either the first act of retention or the second act of seeking the s 3E warrant was individually such a grave impropriety as to warrant the exclusion of the evidence under s 138. Rather, it was the combined effect of these two acts that led to her Honour’s determination. Her Honour found that the retention of the seized material was a deliberate impropriety, then posed the question whether the execution of the s 3E warrant “cure[d]” it. Her conclusion was that it did not. Rather, her Honour concluded:

“…..the obtaining of the warrant and the execution of the search warrant by Federal Agent Robertson on Ms Curtis, and the sharing of the seized material with her, was not a genuine excise of the power conferred by sections 3E and 3ZQU, in the course of the investigation, but an artificial exercise of the powers in an attempt to launder the material improperly held by Ms Curtis.”

The question of whether the impugned findings were “open” to her Honour is to be assessed in the context that it was the cumulative effect of these two discrete matters that led to her Honour’s ultimate conclusion.
Turning to the s 3E warrant, I accept that it was a validly issued document. There was no finding by her Honour that it was obtained as a result of any misleading information provided to the issuing officer. There was evidence that Detective Sergeant Robertson had acted in a conscientious manner. I also accept that, consistent with her Honour’s findings, the AFP warrant was taken out as a form of “insurance” on the basis of the advice from the CDPP that it would be “prudent” to do so.
Despite these findings, the hurdle that the Crown faces in establishing House v The King error is that they do not inevitably lead to a conclusion that it was not open to her Honour to find that the obtaining and execution of the s 3E warrant was improper. The question is not whether Sweeney DCJ should have arrived at a different conclusion; it is whether, having regard to all of the material before her Honour, it was open to her to find that the execution of the AFP warrant was a serious misuse of power and that both improprieties were serious, deliberate and easily avoidable. As Smart AJ observed in DPP v Carr (2002) 127 A Crim R 151; [2002] NSWSC 194 at [82]:

“The fact that a police officer has acted lawfully, honestly and with integrity does not prevent the impropriety being serious.”

The evidence before her Honour concerning the s 3E warrant disclosed the following.
First, Officer Curtis gave evidence that the purpose of seeking the s 3E warrant was so that she could retain possession of the seized material in the face of views expressed by the CDPP that it would be “prudent” to obtain a further warrant.
Second, the evidence of Detective Sergeant Robertson was that he had doubts about whether he was permitted to do what was being asked of him. He sought an internal advising because of his concern that the request was outside the usual powers of the AFP.
Third, the terms of the search warrant were to seize the documents from the CDPP. The documents were not in fact in the possession of the Sydney office of the CDPP at the time the search warrant was obtained; they were in Melbourne with Officer Curtis.
Fourth, the terms of the search warrant did not reflect what was being sought. It sought fingerprints and other evidence (summarised above at [67]) that clearly would not have been expected to be obtained at the premises of the CDPP, where the warrant was to be executed.
Fifth, the circumstances of the execution of the warrant were unusual. Officer Curtis was in Melbourne with the documents. She flew to Sydney and met Detective Sergeant Robertson at the Sydney offices of the CDPP, where she simply handed the documents over to him. He then handed them back to her around half an hour to an hour later. Detective Sergeant Robertson did not examine or analyse the material before he gave it back. This is reflected in the property seizure record that Detective Sergeant Robertson completed.
Sixth, the timing of the execution of the search warrant coincided with the application to have the seized material excluded. It was executed at the office of the CDPP at 175 Liverpool Street in Sydney while all of the relevant parties were in the District Court at the Downing Centre before Sweeney DCJ, less than 200 metres away. Moreover, there seems no doubt that it was obtained in direct response to the respondents giving notice that they sought to challenge the admissibility of the seized material. A decision was made at that time, on the advice of the CDPP, to try to circumvent the respondents’ objection.
Seventh, the only involvement of the AFP was to execute the s 3E warrant. The AFP was not otherwise investigating any charges against the respondents. Despite this, they initiated and participated in the “round robin” involved. There was no intention that the AFP would analyse the documents or use them in any prosecution in which the AFP was involved. Nobody in the AFP made any independent inquiries about any of the respondents; the application for and execution of the warrant were in complete reliance upon the information provided by Customs.
Finally, no notice was given to the respondents that the warrant regarding their property was to be executed on the Sydney office of the CDPP.
The authorities make clear that the power to issue and execute a search warrant is one to be exercised with great care: George v Rockett (1990) 170 CLR 104; [1990] HCA 26 at [4]-[5].
In light of all of this material, it could not be said that it was not open to her Honour to find that the use of the s 3E warrant was an “abuse of power” and a “serious misuse of power”. Her Honour did not find that it would never be open to investigators in a similar situation to return the relevant material and execute an appropriate search warrant in order to have the power to seize the material for use in criminal proceedings. The impropriety found by her Honour in this matter arose from the particular circumstances of this case as set out above at [210] – [217], in particular the timing, method and place of the execution of the s 3E warrant, rather than the fact that it was obtained per se.
The second impugned finding by her Honour was that the improprieties were “serious, deliberate on the part of the Crown authorities and could easily have been avoided.” This finding concerned two of the mandatory requirements in s 138(3), being sub-s (e) (whether the impropriety or contravention was deliberate or reckless) and sub-s (h) (the difficulty of obtaining the evidence without impropriety).
The Crown placed particular reliance upon s 138(3)(e), submitting that the improprieties were relatively innocent. The Crown relied upon the decision of this Court in R v Camilleri (2007) 169 A Crim R 197; [2007] NSWCCA 36 where McClellan CJ at CL observed at [35] :

“Where a breach of the law is innocent, and the alleged offence serious there must be powerful countervailing considerations before the evidence should be rejected.”

This was a deliberate decision to involve the AFP in the obtaining and execution of the s 3E warrant in a “round robin” exercise at the offices of the CDPP at a time when a voir dire was being conducted on the very issue of the admissibility of the seized material and in circumstances where the respondents were ignorant of what was occurring. Although her Honour did not expressly make this finding, it is to be inferred from her reasons that the latter of these two acts exacerbated the conduct such that there may have been a different ultimate result had Customs not taken that second step.
As for the complaint concerning her Honour’s consideration of s 138(3)(h), I do not accept that it would have been impractical for the material to have been returned and then the appropriate search warrant executed. There would have been no impropriety had the material been returned to the respondents once a decision was made not to proceed with any civil prosecution under the Customs Act. A s 3E warrant could have then been executed in circumstances where officers from the AFP and Customs ensured compliance with the terms of both the Customs Act and the Crimes Act. A mere concern about possible disposal of that material does not mean that those relevant statutory obligations need not be observed. I am satisfied that there are means by which the relevant officers could ensure that such a concern would not materialise and still comply with the relevant legislation.
Nor do I accept that the fact that the search warrant was executed at the office of the CDPP rather than the premises of Speedy reduced the impropriety. The Crown submission was that the gravity of any impropriety in the execution of the warrant was reduced by reason of the fact that it did not invade the privacy of the respondents. On the contrary, the whole procedure took place without the respondents’ even being aware that it was occurring. The finding by Sweeney DCJ was that the stratagem employed by Customs was not a genuine exercise of the power under s 3E of the Crimes Act but rather an artificial attempt to cure the impropriety in retaining the material seized pursuant to the s 198 warrant.
The Crown’s final argument concerned the necessary causal connection between the relevant impropriety and the “obtaining” of evidence. It relied upon three cases to support a submission that there must be such a connection: R v Haddad; R v Treglia (2000) 116 A Crim R 312; Dalley v R [2002] NSWCCA 284; and R v Cornwell (2003) 57 NSWLR 82; [2003] NSWSC 97.

In R v Haddad; R v Treglia, Spigelman CJ noted obiter at 327 that:

“The nature of the causal relationship between an ‘impropriety’ or ‘contravention’ and the evidence said to have been ‘obtained’ either directly or ‘in consequence of’ an ‘impropriety’ or ‘contravention’ is not the subject of any authoritative decision.
The Crown’s basic premise is that the requisite causal relationship cannot exist if the ‘evidence’ – relevantly a tape recording of a conversation – has been brought into physical existence at a time prior to any contravention or impropriety. It is by no means clear that s 138 must be given so restrictive an ambit.
Sections 19 and 22 [of the Listening Devices Act] form part of an integrated scheme for controlling infringements of privacy…It is at least arguable that the formulation ‘obtained in contravention’ should be construed so as to encompass the entirety of an integrated scheme, particularly a scheme designed to protect fundamental freedoms. The formulation ‘obtained improperly,’ not presently relied upon, may well be even broader.”

A different approach was taken in the subsequent decision in Dalley v R. That case concerned non-compliance with the statutory requirement in s 356H(9) of the Crimes Act 1900 (NSW) that, within one day of the issue of a detention warrant, police must provide the authorised justice with an affidavit setting out certain information. Simpson J, as her Honour then was, found that there had been a contravention of s 356H(9) by failure to provide the affidavit. Her Honour held at 184:

“In my opinion, the provisions of subs (9) are mandatory. The failure to verify the application was a clear contravention of s 356H(9). It is plain that, by s 356H, the legislature sought to effect a delicate balancing exercise between the recognised need for urgency in police investigation of crime and protection of individuals subjected to detention. Subsection (9) is, in my view, designed to ensure that a proper written record is made within a reasonable time after a detention warrant is issued by telephone such that retrospective review of the procedures is possible. The availability of retrospective review is, in truth, something of an insurance policy against cavalier or lackadaisical use of what are significantly intrusive powers.”

Despite this, her Honour also held that non-compliance with s 356H(9) did not attract the provisions of s 138 because the contravention did not occur until 24 hours after the appellant’s admissions and incriminating statements. In those circumstances it could not be said that any evidence was obtained as a result of, or in consequence of, the contravention of s 356H(9). Spigelman CJ and Blanch AJ agreed with Simpson J.
The third case to which the Crown referred was the decision of Howie J in R v Cornwell. In that case, application was made by the accused under s 138(1) to exclude evidence obtained by listening device under the authority of a s 198 warrant. The basis for the application was there was a misstatement of fact in an affidavit in support of the warrant. His Honour (at 88) was not persuaded that any impropriety occurred in relation to the making of the affidavit. Further, his Honour stated at 89:

“But even if I were wrong in that finding, I am completely unpersuaded that the impropriety resulted in the issuing of the warrant and thus the obtaining of the conversations to which objection is taken. The accused must satisfy the court that there is a causal connection between the impropriety and the obtaining of the impugned evidence; R v Dalley [2002] NSWCCA 284. If the court cannot be satisfied of that matter, the section has no application. I appreciate that the connection between the improper conduct and the obtaining of the evidence may be indirect.”

The reasons of Sweeney DCJ disclose that her Honour found that it was from the point of time when s 203R mandated the return of the material that the impropriety arose. No impropriety prior to that time was found by her Honour. It was the decision to retain it from that time onwards when there was no power to do so which constituted the impropriety. The Crown relied upon the definition of the word “obtained” in the Macquarie Dictionary as “to come into possession of; get or acquire; as by effort or request”. I am satisfied that the word “obtained” applies to this factual situation in that the material was retained as a result of an impropriety, being the decision to retain it. Even if I am wrong in this conclusion, there was no discrete finding that retention of the seized material alone resulted in its exclusion. This is because the impropriety found by Sweeney DCJ was the combined effect of both the retention of the material and the “obtaining” of it by way of the s 3E warrant. In these circumstances, even if it were to be accepted that retaining the material prior to the execution of the 3E warrant could not be described as obtaining it improperly, seizing it again under the s 3E warrant clearly could.
In undertaking the balancing exercise under s 138 of the Evidence Act, her Honour made findings that involved the application of general principles concerning the exercise of coercive powers about which minds might reasonably differ. No error in the exercise of this discretion has been demonstrated. The findings made by her Honour were open to be made on the evidence. Her Honour’s findings were not “unreasonable or plainly unjust” within the meaning of House v the King.

ORDERS

I propose that the Court dismiss the appeal.

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Endnotes

Decision last updated: 25 November 2016

Medium Neutral Citation:	R (Cth) v Rapolti; R (Cth) v Russell; R (Cth) v Speedy Corporation Pty Limited [2016] NSWCCA 264
Hearing dates:	27 May 2016 and 10 June 2016
Decision date:	25 November 2016
Before:	Ward JA at [1] Garling J at [2] N Adams J at [3]
Decision:	Appeal dismissed.
Catchwords:	PRACTICE AND PROCEDURE – Crown appeal under s 5F(3A) Criminal Appeal Act (NSW) – where trial judge excluded evidence seized pursuant to search warrants under s 138 Evidence Act 1995 – whether ruling eliminates or substantially weakens the prosecution’s case – where first and second respondents contend that the evidence is not capable of making out the elements of the offences charged – where notice imposing rates of dumping duty affected by jurisdictional error – whether collateral challenge appropriate SEARCH WARRANTS – where search warrant in relation to ‘evidential material’ issued pursuant to s 198 Customs Act 1901 (Cth) – subsequent decision to proceed with criminal offences – where search warrant under s 3E Crimes Act 1914 (Cth) issued in relation to documents containing those communications and executed at the premises of the CDPP - whether evidence improperly or illegally obtained – whether trial judge erred in interpretation of s 203R Customs Act - whether trial judge erred in excluding evidence pursuant to s 138 Evidence Act 1995 (NSW) WORDS AND PHRASES – “obtained”
Legislation Cited:	Administrative Decisions (Judicial Review) Act 1977 (Cth), s 16(1)(b) Corporations Act 2001 (Cth), Crimes Act 1900, s 356H(9) Crimes Act 1914, ss 3E, 3C(1), 3UF, 3ZQU, 3ZQX, 3ZQY, 3ZQZA Criminal Appeal Act 1912 (NSW), s 5F(3A) Criminal Code (Cth), s 134.2 Criminal Procedure Act 1986 (NSW), ss 141(1)(b), 143 Customs Act 1901 (Cth), ss 183UA, 198, 203, 203R(1), 203S, 227AA, 243A, 243B, 269TB, 269TG, 269TH(1), s 269TJ, 269TK, 269ZI, 269ZZE(3), 269ZZK, 269ZZM, 269ZX Customs Amendment (Anti-Dumping Improvements) Act (No 1) 2012 (Cth), Schedule 1 Customs Amendment (Anti-Dumping Improvements) Act (No. 3) 2012 (NSW), Schedule 3 Evidence Act 1995 (NSW), s 138 Listening Devices Act 1984 (NSW), ss 19, 22 Police Powers and Responsibilities Act 2000 (Qld), s 150(1)(a)
Cases Cited:	Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 ASIC v Rich [2005] NSWSC 62 Attorney-General (Cth) v Breckler (1999) 197 CLR 83; [1999] HCA 28 Australian Crime Commission v Marrapodi [2012] WASCA 103 Chief Executive Officer of Customs of Customs v Labrador Liquor Pty Ltd (2003) 216 CLR 49 Dalley v R [2002] NSWCCA 284 DPP v Carr (2002) 127 A Crim R 151; [2002] NSWSC 194 Employment Advocate v Williamson (2001) 111 FCR 20; 185 ALR 590; [2001] FCA 1164 Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55 Fleming v The Queen [2009] NSWCCA 233 Flori v Commissioner of Police & Another [2014] QSCC 284 George v Rockett (1990) 170 CLR 104; [1990] HCA 26 GM Holden Ltd v Commissioner of the Anti-Dumping Commission (2014) 225 FCR 222; [2014] FCA 7078 Grollo v MacAuley [1995] FCR 533 House v The King (1936) 55 CLR 499 Jadwan Pty Ltd v Secretary, Department of Health and Aged Care [2003] FCAFC 288 Ma v Minister for Immigration and Citizenship [2007] FCAFC 69 Ousley v The Queen (1997) 192 CLR 69; [1997] HCA 49 Parker v Comptroller-General of Customs [2007] NSWCA 348; 243 ALR 574 Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476; [2003] HCA Plaintiff S297/2013 v Minister for Immigration and Border Protection [2015] HCA 3 Rodway v The Queen (1990) 169 CLR 515 R v Camilleri (2007) 169 A Crim R 197; [2007] NSWCCA 36 R v Cornwell (2003) 57 NSWLR 82; [2003] NSWSC 97 R v Haddad; R v Treglia (2000) 116 A Crim R 312 R v Shamouil (2006) 66 NSWLR 228; [2006] NSWCCA 112 R v SJRC [2007] NSWCCA 142 Williams v Keelty (2001) 111 FCR 175; [2001] FCA 130
Texts Cited:	Aronson & Groves, Judicial Review of Administrative Action (Lawbook Co, 5th ed, 2013)
Category:	Principal judgment
Parties:	Director of Public Prosecutions (Appellant/Crown) Leslie Rapolti (First Respondent) Gregory Russell (Second Respondent) Speedy Corporation Pty Limited (Third Respondent)
Representation:	Counsel: Mr I Bourke SC with Mr C Taylor (Appellant/Crown) Mr T Game SC with Mr C O’Donnell SC and Ms L-C Hutchinson (First and Second Respondents) Mr P McGuire SC with Mr B Neild (Third Respondent) Solicitors: Director of Public Prosecutions (Cth) (Appellant/Crown) Laxon Lex Lawyers (First and Second Respondents) Streeton Lawyers (Third Respondent)
File Number(s):	2014/00174892; 2014/00174998; 2014/00174972; 2014/00174991; 2014/00186183; 2014/00186216
Publication restriction:	Nil
Decision under appeal	Court or tribunal: District Court Jurisdiction: Criminal Date of Decision: 2 December 2015 Before: Sweeney DCJ File Number(s): 2014/00174892; 2014/00174998; 2014/00174972; 2014/00174991; 2014/00186183; 2014/00186216