R v Anthony McGhee No. SCCRM 93/261 Judgment No. 4070 Number of Pages 5 Evidence Admissibility and Relevancy (1993) 68 a Crim R 220 (1993) 61 Sasr 208

[1993] SASC 4070

COURT IN THE SUPREME COURT OF SOUTH AUSTRALIA COX J

CWDS
Evidence - admissibility and relevancy - prosecution for possessing amphetamine for the purpose of selling it - police raided accused's house and found illegal drugs and scales and plastic packets etc. and also a large amount of cash - accused unemployed at the time - held, that the finding of the money was admissible evidence notwithstanding its tendency to prove past offences. Lewis (1989) 46 A Crim R 365, not followed.

HRNG ADELAIDE, 22 July 1993 #DATE 22:7:1993
Counsel for appellant:     Ms E A Sheppard
Solicitors for appellant:    Director of Public
   Prosecutions
Counsel for respondent:     Mr W P Boucaut
Solicitors for respondent: Gregory D Mcgee

ORDER
The finding of the money was admissible evidence notwithstanding its tendency to prove past offences.

JUDGE1 COX J The accused appears this morning on an information that charges him with two offences under s.32 of the Controlled Substances Act 1984 - possessing methylamphetamine for sale and possessing cannabis for sale. While he has not yet been arraigned his counsel, Mr Boucaut, has told me that he will plead guilty to the possession of amphetamine and guilty, without qualification, to possessing cannabis for sale. However, the Crown will not accept his qualified plea on the first count and so that charge will go to a jury. 2. According to the witness statements, on 31 October 1992 the police raided a house at Magill that was occupied solely by the accused. They found amphetamine and cannabis in the house, in each case in quantities that exceeded the prescribed amounts under the legislation. That means that if possession is proved, and I am told that there will not be any dispute about that, the accused will have the burden of satisfying the jury that his purpose in possessing the amphetamine was not in order to sell it. 3. Several small plastic bags containing a white powder were found in different parts of the house. The quantities varied from .06 grams to 2.40 grams. The police also found a larger bag containing about 140 grams of white powder. Scientific analysis showed that the powder in each case contained amphetamine. The total quantity of pure amphetamine was about 9 grams. The percentage strength, roughly 6.5, was within the usual range for amphetamine that is sold on the street. The prescribed quantity of amphetamine for the purpose of reversing the onus of proof under sub-s.(3) of s.32 of the Act is 2 grams. 4. The Crown seeks to support its case that the accused was intending to sell the drug by showing that certain other compromising articles were found in the accused's house - two sets of scales, one of them electronic, an electronic pager, an electronic diary, and a conventional notebook that contained entries which, it will be said, were records of drug deals. A large quantity of cannabis was seized from different places in the house. The police also found a pistol and holster and ammunition, wrapped together in a towel, and a scanner that was tuned to a police communications frequency. Objection has been taken to those last mentioned items and I have reserved my decision on them pending a clearer indication of the evidence and argument that the Crown seek to present with respect to them. 5. The subject of the present ruling is a wallet containing $900 in cash that the police say they found on a table in the loungeroom. One of the packets of amphetamine was inside the wallet. In a bedroom the police found a pair of jeans, apparently belonging to the accused, which contained $110 in cash. Also on the loungeroom table were the electronic instruments I have mentioned and two containers, with cannabis in them, and bongs and pipes. No objection is taken to the tender of any of that evidence, except the money in the wallet. Mr Boucaut has submitted that this particular evidence should not be received. The accused could have got the money in any of a vast number of ways. To connect it with the drugs that were found is mere speculation. If that view is wrong and the money is relevant to the accused's possession of amphetamine, it could only be because it represents the proceeds of past sales. So regarded, it would at the most be evidence of a criminal propensity or disposition on 31 October 1992 and highly prejudicial, and it should on that account be excluded on the principles laid down in Makin and all the propensity cases that followed it. Mr Boucaut relied in particular upon the Northern Territory case of Lewis (1989) 46 A Crim R 365. I am unable to accept this submission. The police (according to the witness statements) found amphetamine here in commercial quantities. There was also the sort of gear that is commonly associated with drug dealing - scales, a supply of unused small plastic bags and so on. The discovery of a large amount of cash on the premises as well will generally be legitimate evidence to go to the jury to assist a Crown case that the person concerned was running a business. Often there will be supporting evidence that the accused did not appear to have any other business and here, I am told, the accused admitted that he was unemployed. It is true that he admits to dealing in cannabis but that, of course, does not exclude the possibility that he was also dealing in amphetamine. If the accused was running a drug business at the time of the raid then it would be reasonable in the circumstances, in the absence of any plausible alternative explanation, to regard the $900 cash, or at least a substantial part of it, as his working capital, with some of it available as a cash float for expected sales. Moreover, the cash itself in all the circumstances is evidence tending to prove the existence of an ongoing business. That was the view that I took in the rather similar case of Polain
(1989) 52 SASR 526. However, it is no doubt likely on that hypothesis that the money was also the proceeds of past dealings. In my opinion, that does not make the evidence any the less relevant and admissible in this case. 6. The appellant in Lewis was convicted by a jury of possessing cannabis for the purpose of supply. He carried the onus of proof on the aspect of purpose because of the quantity of cannabis involved. He appealed against his conviction on the ground that evidence of his possession of $2,750 in cash was wrongly admitted. The Full Court of the Supreme Court of the Northern Territory, by majority, accepted his submission and quashed his conviction. Martin J said -
    "In this case the only real issue in relation to the
    offence was the purpose for which the appellant possessed
    the cannabis, that is, a person's intention in relation to
    the cannabis then in his possession. The cash, if it was to
    be connected in some way with an intention to supply
    cannabis, could only be seen as the proceeds of prior sales
    or as the means of acquiring cannabis in the future. The
    latter hypothesis clearly has nothing to do with current
    possession, and the former going only to show criminal
    propensity, is inadmissible." (at 373) The evidence,
    therefore, should not have been allowed. Angel J
    considered that the money in the circumstances of the
    appellant's unemployment could assist to a conclusion of
    guilt with respect to past sales of cannabis, but he was not
    charged with that offence. In some cases evidence of past
    offences for which the defendant is not charged might
    nevertheless be admissible as relevant to a step in the
    proof of another offence charged, but here there was no
    nexus between the possession of the money and the offence
    with which the appellant was charged -
     "The money was not a unit in the collection of things.
    The money was not in a box with the cannabis. It was not
    indicative of constituing change for use as such in future
    drug transactions. The money was not in use for the purpose
    alleged in the information... In my opinion the
    circumstances in which the money was found do not enable an
    inference to be legally drawn as to the appellant's purpose
    with respect to the cannabis in his possession, and the
    money was inadmissible." (at 375-6) 7. Rice J dissented. It was not a mere disposition case. The appellant was unemployed and the onus on the issue of purpose rested on him.
    "The fact that a sizeable sum of money was found in the
    possession of the appellant, as opposed to no money at all
    being so found, tends to rebut a defence based on a purpose
    other than for supply. That purpose may be gleaned from
    evidence of what the appellant has done in the past
    including, for example, the fact of his being in possession
    of a large sum of money which is at least consistent with
being the proceeds of sale of cannabis." (367) 8. I must say, with respect, that I find the reasoning and conclusion of Rice J generally persuasive. If in a prosecution under s.32 of the South Australian Act the Crown can prove that the accused is running a retail drug business, then this may be the clearest way of discerning the purpose for which he is in possession of illegal drugs on a particular occasion. The possession of appropriate stock and plant and customer lists and so on, including what appears to be working capital, will itself be evidence tending to prove the existence of an ongoing business, and its relevance cannot be called in question merely because it proves that the defendant has committed offences in the past and thus has a criminal disposition. Proof of a criminal disposition - to sell prohibited drugs - is essential to the proof of an offence of possessing drugs for the purpose of sale under s.32. 9. Of course, this reasoning will not ordinarily be open if the evidence simply proves that the defendant was engaged in the past in an illegal business that is now over and done with. That would bring the propensity rules clearly into play. Furthermore, the court will always have to consider the question of discretionary exclusion, where evidence of this sort is tendered, and be on guard against admitting prejudicial evidence on continuity grounds that are quite fanciful or speculative. However, where the evidence points to an established and ongoing business, it will not usually be unfairly prejudicial to a defendant to admit evidence of it on a prosecution under s.32 even if that does incidentally tend to prove actual past sales. The only way in which that could prejudice a defendant is in the unlikely event of his having committed offences in the immediate past and possessing on the occasion charged the visible means, but by a singular coincidence no longer the present intention, of committing more such offences in the immediate future. Cf. Bilick (1984) 36 SASR 321, at 327. 10. As I have indicated, the evidence of a current illegal business needs to be substantially probative, not merely speculative, if it is to involve proof of past illegal transactions. There will need to be an appropriate factual relationship between the postulated business items, and that must be judged according to all the circumstances of the case. However, it is necessary to be realistic about that aspect of the matter. In the present case the wallet that contained $900 in cash also contained a small packet of amphetamine, and the wallet was on the table with other things that might plausibly have been used in a retail drug business. However, I do not think that this physical conjunction or proximity is crucial to the admission of the disputed evidence. It is common in these cases for the physical means of drug dealing - the drugs and scales and so on - to be found in different parts of an offender's house. Here, for instance, some of the drugs were found in a piece of PVC pipe in a utility at the back of the accused's house. I cannot think that an unusually large sum of money would be admissible evidence if it was also found in the drainpipe but not if it was found somewhere else on the premises. However, as I say, if close proximity to drugs is required, then it is satisfied in this case. 11. Illegal bookmakers used to be, and perhaps still are, prosecuted for being in hotels for the purpose of betting. It was commonplace in such prosecutions for the evidence led to establish their illegal purpose to include customer records and large amounts of cash, though no doubt this coincidentally constituted evidence of past offences. I am not aware that evidence of a defendant being found with a large amount of money, for no obvious good reason, has generally been excluded in any prosecution in this State for possessing drugs for the purpose of sale where the money, taken with other circumstantial evidence, tends to prove an ongoing illegal drug business. 12. See also Forman (1989) 52 SASR 391 which dealt with the proof of telephone calls as tending to prove the existence of a business of selling drugs. It was relevant for the Crown in that case to prove that the appellant was running such a business, because he was being tried for possessing heroin for sale. The Full Court rejected an argument that, if the evidence of the intercepted telephone calls was admissible, it should nevertheless have been excluded because of its prejudicial effect. The members of the Full Court held that the evidence of the calls was highly probative and that there was virtually no prejudice to the appellant which did not derive from the probative force of the evidence. So far as I can tell from the witness statements, the same must be said about the cash found in the present case. 13. A few days ago, in the case of Fragnito, 21 July 1993, the Court of Criminal Appeal heard an argument about the propriety of prosecuting counsel cross-examining a defendant on a drug trading charge about his assets, with the object of showing that he had too many luxury possessions for a man who was unemployed, and Lewis was cited by his counsel in support of the argument that the cross-examination should not have been allowed. The Court did not find it necessary to comment on the Northern Territory decision, because it was distinguishable on the facts. 14. In my opinion, Lewis is distinguishable on the facts from the case before me. If it is not, I respectfully decline to follow it. 15. The evidence as to the discovery of the wallet and cash will, therefore, be admitted. It will be necessary to warn the jury as to the use to which the evidence may be put and the use to which it may not be put.