R v Barrett

[2024] NSWSC 433

Supreme Court

New South Wales

Medium Neutral Citation:

R v Barrett [2024] NSWSC 433

Hearing dates:

31 January 2024 (last written submission 29 February 2024)

Date of orders:

24 April 2024

Decision date:

24 April 2024

Jurisdiction:

Common Law

Before:

N Adams J

Decision:

Application under the Costs in Criminal Cases Act 1967 (NSW) for a costs certificate is refused.

Catchwords:

CRIMINAL PROCEDURE — Costs — Costs in Criminal Cases Act 1967 (NSW) – blackmail – Plutus Payroll tax fraud – hung jury – legal aid refused for retrial – stay refused – discontinuation of proceedings by CDPP – credibility of witness – history as investigative journalist – whether if prosecution had all relevant facts it would have been reasonable to institute proceedings – application refused

Legislation Cited:

Commonwealth Constitution, ss 75(iii), 77(iii)

Costs in Criminal Cases Act 1967 (NSW), ss 2, 3, 3A, 4

Crimes Act 1900 (NSW), s 249K

Criminal Code 1995 (Cth), s 400.3(1)

Director of Public Prosecutions Act 1986 (NSW), s 7(2)(b)

Evidence Act 1995 (NSW), s 184

Judiciary Act 1903 (Cth)

Proceeds of Crime Act 2002 (Cth)

Cases Cited:

Chahal v Director of Public Prosecutions [2008] NSWCA 152; (2008) A Crim R 580

DAO v R (No 3) [2016] NSWCCA 282

Dietrich v The Queen (1992) 177 CLR 292; [1992] HCA 57

Higgins v R (No 2) [2022] NSWCCA 82

Honeysett v DPP [2023] NSWCCA 215

Macleod v Australian Securities and InvestmentsCommission (2002) 211 CLR 287; [2002] HCA 37

Mordaunt v Director of Public Prosecutions & Anor [2007] NSWCA 121; (2007) 171 A Crim R 510

Nadilo v Director of Public Prosecutions (1995) 35 NSWLR 738

R v Barrett (No 6) [2021] NSWSC 1342

R v Barrett (No 7) [2021] NSWSC 1349

R v Hausman; Hausman v R; R v Rostankovski; Rostankovski v R [2022] NSWCCA 24

R v John Fejsa (1995) 82 A Crim R 253

R v Jonathon Harold Manley (2000) 49 NSWLR 203; [2000] NSWCCA 196

R v Pavy (1997) 98 A Crim R 396

Rodden v R (2003) 112 NSWLR 162; [2023] NSWCCA 202

SolomonsvDistrictCourtofNSW (2000) 211 CLR 119; [2002] HCA 47

Category:

Costs

Parties:

Rex (Crown)
Steven John Barrett (Applicant)

Representation:

Counsel:
T McDonald SC (Crown)
Dr G D Woods KC (Applicant)

Solicitors:
Commonwealth Director of Public Prosecutions (Crown)
O’Brien Lawyers (Applicant)

File Number(s):

2018/216184

Publication restriction:

Nil

Judgment

The application

1. On 31 July 2018, Stephen Barrett was issued with a Court Attendance Notice charging him with one count of blackmail contrary to s 249K of the Crimes Act 1900 (NSW). That offence carries a maximum penalty of ten years imprisonment. Although it is an offence contrary to NSW law, Mr Barrett was prosecuted by the Commonwealth Director of Public Prosecutions (“CDPP”) (by agreement with the NSW Director of Public Prosecutions (“DPP”)) because his charge arose in the context of a large-scale taxation fraud investigated by the Australian Federal Police (“AFP”) which I will refer to as “the Plutus Conspiracy”.

2. Five years later, on 14 July 2023, the CDPP discontinued the proceedings against Mr Barrett.

3. Mr Barrett now makes application for a costs certificate under the Costs in Criminal Cases Act 1967 (NSW) (“the Act”). The application is opposed.

Background

4. The facts giving rise to the charge brought against Mr Barrett are somewhat unusual. In order to understand the case brought against him, it is necessary to understand the context of the blackmail and the persons who it is alleged were blackmailed. For the purposes of his trial before Johnson J in April and May 2021, Mr Barrett made certain factual admissions pursuant to s 184 of the Evidence Act1995 (NSW). I propose to extract [9]-[31] of those agreed facts in full to provide the factual background to the charge brought against Mr Barrett:

“Fraud and Money Laundering

1. Between about 1 March 2014 and 17 May 2017 (relevant period), A. CRANSTON, Jason Cornell ONLEY (ONLEY) and Dev MENON (MENON) (the Principal Offenders) and others including Daniel ROSTANKOVSKI (collectively, the Offenders) participated in a criminal enterprise to dishonestly obtain by deceptive means a financial advantage, namely large sums of money due and payable by legitimate businesses to the Australian Taxation Office (ATO) (the Tax Debt Monies). The Tax Debt Monies totalled in excess of $105 million. The Offenders did not remit the Tax Debt Monies to the ATO, thereby obtaining a financial advantage and causing a loss to the Commonwealth. The Offenders diverted the Tax Debt Monies elsewhere for their own benefit knowing and believing it to be the proceeds of crime.

2. A.CRANSTON is the son of Michael Cranston who, until at least 17 May 2017, was employed by the ATO as the Deputy Commissioner of Taxation.

3. Throughout the relevant period, MENON was a lawyer acting as a partner in the law firm ‘Clamenz Lawyers’.

4. The Offenders used a company called Plutus Payroll Australia Pty Ltd (ACN 169 205 127) (Plutus) as a façade to disguise their criminal conduct. Behind that façade, the Offenders offered and purported to provide payroll services to legitimate independent businesses (Clients). Those services included to pay from monies Plutus received from Clients the wages and superannuation payments due and payable to or for the Clients’ workers and also the Pay As You Go Withholding tax (PAYGW) and Goods and Services tax (GST) due and payable to the ATO.

5. The Offenders caused Plutus to enter into payroll contracts with the Clients, which included terms promising to remit PAYGW and GST to the ATO. The Offenders did so knowing and intending that a significant portion of the PAYGW and GST owed to the ATO would instead be misappropriated for the personal betterment of the Offenders.

6. The Offenders caused the funds received from the Clients pursuant to the payroll services contracts to be deposited into bank accounts held by Plutus. They then caused those funds to be transferred into accounts held by other companies (the Second Tier Companies), whose directors and bank accounts were controlled by the Offenders. The Offenders then caused money to be transferred out of the Second Tier Companies’ bank accounts into bank accounts held by the Offenders, or by individuals and entities associated with the Offenders.

7. The Second Tier Companies were incorporated by or at the direction of the Offenders in order to evade detection by law enforcement authorities.

8. The Second Tier Companies were named:

   a.   ACN 169 184 909 Pty Ltd, trading as Keystone Pay;

   b.   Sonar Consultants Pty Ltd (subsequently renamed as PPA Services Australia Pty Ltd (ACN6O5 903 660));

   c.   Uneek Consulting Services Pty Ltd (subsequently renamed as PPA Contractors Australia Pty Ltd (ACN 605 218 273));

   d.   PPA NT Pty Ltd (ACN 613 037 175);

   e.   PP Services (WA) Pty Ltd (ACN 613 042 587);

   f.   PP Australia NSW Pty Ltd (ACN 613 037 442);

   g.   PP Aus Holdings Pty Ltd (ACN 613 038 654); and

   h.   PPA (SA) Pty Ltd (ACN 613 038 234).

9. The Offenders caused the Second Tier Companies to enter into arrangements with Plutus whereby the Second Tier Companies purported to provide the payroll services that Plutus had contracted to provide to its Clients, in that the Second Tier Companies received Clients’ funds from Plutus, processed wage and superannuation payments to and for the Clients’ workers and were to remit the PAYGW tax and GST owed to the ATO. The Offenders caused the Second Tier Companies to remit only some of the tax refund due and payable to the ATO.

10. The Offenders recruited and paid persons to be registered as directors and/or office holders of the Second Tier Companies. Those persons acted as directors and/or office holders in name only, with no actual authority or control over the operations of the Second Tier Companies, or of bank accounts held by those companies. The Offenders exercised control over the Second Tier Companies and their directors and office holders.

11. As at 1 February 2017, the directors of the Second Tier Companies included:

    a.   Ben Alaban;

    b.   Angelo Coppola;

    c.   Ashley Mills;

    d.   Alexander Nappa;

    e.   Anthony Palumberi; and

    f.   Angela Veoland.

12. By about August 2015, ROSTANKOVSKI became a participant in the criminal enterprise. His principal role was to recruit, manage and control the persons registered as directors and/or office holders of the Second Tier Companies, including Anthony Palumberi and Alex Nappa.

13. Throughout the relevant period, A. CRANSTON was a director and shareholder of a company, Aventis Partners Pty Ltd (Aventis), and was further the sole shareholder and sole director of another company Prescott Page Recoveries Pty Ltd (generally referred to by the Principal Offenders as ‘Prescott Page’) (Prescott Page). Between about 1 March 2014 and 1 February 2017, the Principal Offenders caused a portion of the proceeds of the criminal enterprise, comprising not less than $1.18 million, to be diverted from bank accounts held by the Second Tier Companies through Aventis and then to Prescott Page. Other portions of the proceeds of the criminal enterprise were diverted elsewhere.

14. The Offenders’ conduct contravened offences of fraud and money laundering under the Crimes Act 1900 (NSW). Those offences were and are serious indictable offences within the meaning of section 249K(2) of the Crimes Act 1900 (NSW).

Blackmail

1. From about September 2016, HAUSMAN and ROSTANKOVSKI began to plan to blackmail the Principal Offenders.

2. On or around 15 December 2016, in furtherance of the blackmail plan, HAUSMAN engaged a lawyer named Sevag CHALABIAN (CHALABIAN), of the law firm ‘Lands Legal’ to assist in receiving and dealing with the blackmail monies. CHALABIAN provided assistance until around 18 May 2017.

3. On 1 February 2017, A. CRANSTON, MENON, ONLEY, Simon ANQUETIL, ROSTANKOVSKI and BARRETT each attended at the office of Clamenz Lawyers at Suite 4602, 19-29 Martin Place, Sydney.

4. On that date, the AFP were using covert audio recording devices to lawfully record conversations occurring at Clamenz Lawyers’ office, in three meeting rooms known as the Opera Room, the Harbour Room and the Bridge Room.

5. The Principal Offenders agreed to and did pay blackmail monies into the Lands Legal trust account.

6. Initially, between 1 February 2017 and 15 February 2017, payments totalling about $4.82 million were made by the Principal Offenders to the Lands Legal trust account

7. A second demand for the payment of $20 million was made by HAUSMAN and ROSTANKOVSKI to the Principal Offenders on or about 15 February 2017.

8. Between about 15 February 2017 and 18 May 2017, payments totalling about $19.42 million were paid by the Principal Offenders to the Lands Legal trust account.

9. The Lands Legal trust account held the blackmail monies on behalf of HAUSMAN and ROSTANKOVSKI.

10. Payments of the blackmail monies from the Lands Legal trust account were made at the direction of ROSTANKOVSKI and HAUSMAN.”

    5. For the purpose of these reasons, I propose to refer to the meeting at Clamenz Lawyers on 1 February 2017 as “the blackmail meeting” and to Mr Cranston and the other persons at that meeting as “the Plutus conspirators”. As the Agreed Facts disclose at [25], Mr Barrett attended the blackmail meeting with Mr Rostankovski and was recorded threatening to publish a story exposing the Plutus conspiracy. Although he had no independent knowledge of the conspiracy beyond what Mr Hausman and Mr Rostankovski had told him days earlier, he represented to the conspirators that he had personal knowledge of the fraud. It is common ground that Mr Barrett then left the meeting, and it was after he left that Mr Rostankovski demanded money from the conspirators in return for Mr Barrett not publishing the story. It was also common ground that the conspirators subsequently paid $19.42 million to Mr Rostankovski and Mr Hausman over the ensuing months.

    6. The central issue at trial was whether Mr Barrett was a “dupe” who had been used by Mr Hausman or whether he had knowledge of a blackmail when he made the threat at the meeting.

    7. Mr Barrett contends that he was used by Mr Hausman and Mr Rostankovski and was kept unaware of the fact that they were extorting money from the Plutus conspirators. Although Mr Barrett is recorded threatening the conspirators at the blackmail meeting that he was investigating the matter, he relied on the fact that he left the room before the actual demand was made by Mr Rostankovski. He also relied on the fact that he was an experienced investigative journalist who at all times was simply pursuing a story in the public interest. He explained that the payment was for his journalistic skills. He contends that the only basis to infer that he was criminally concerned in the blackmail depends on the evidence of Mr Hausman who, he contends, is a “proven fraudster and prodigious liar”.

    8. The Crown relied on the evidence that Mr Barrett did not investigate or publish any story. Nor did he go to police to report the fraud. There was no contact between he and Mr Hausman from mid-February to mid-May 2017 at which time Mr Hausman gave Mr Barrett some more documents to confront the conspirators with and also paid him $2,000.

The co-offenders

9. Mr Hausman pleaded guilty to both the blackmail offence and a money laundering offence. He was sentenced by Abadee DCJ to an effective term of 8 years imprisonment with a non-parole period of 6 years, after a discount of 50% was applied for his combined plea of guilty and offer of assistance. He gave evidence at Mr Barrett’s trial and Mr Chalabian’s trial both before Johnson J.

10. Mr Rostankovski pleaded guilty before Abadee DCJ as well but did not agree to give evidence against the alleged co-offenders. In addition to the blackmail offence contrary to s 249K(2) of the Crimes Act, he also pleaded guilty to one count of aiding and abetting Adam Cranston in the substantive tax fraud and money laundering. He received an effective sentence of 10 years and 5 months imprisonment with a non-parole period of 7 years and 2 months.

11. The Crown appealed against what was said to be the manifest inadequacy of both of these sentences and both offenders appealed against what was said to be the severity of the sentences. All appeals were, effectively, dismissed: R v Hausman; Hausman v R; R v Rostankovski; Rostankovski v R [2022] NSWCCA 24.

12. A further co-offender was Sevag Chalabian. He was the solicitor who advised Mr Hausman on the methods of receiving and remitting the blackmail funds so as to avoid detection. He was charged with dealing with proceeds of crime of at least $1 million contrary to s 400.3(1) of the Criminal Code1995 (Cth). He defended the charge and his trial proceeded before Johnson J in early 2022. The jury returned a guilty verdict on 12 April 2022. Mr Chalabian was sentenced to 12 years imprisonment with a non-parole period of 7 years and 6 months.

13. Although Mr Chalabian was a co-offender of both Mr Hausman and Mr Rostankovski, it was not the Crown case that he was a co-offender of Mr Barrett or that Mr Barrett knew about his involvement. The relevance of Mr Chalabian to this application is that Mr Barrett relies on some of the answers provided by Mr Hausman at Mr Chalabian’s trial (which took place after Mr Barrett’s trial) in support of this costs application.

Procedural history

14. This matter has had a most unfortunate procedural history.

15. Mr Barrett’s first trial was listed to commence on 15 June 2020 but had to be postponed due to the Covid-19 pandemic.

16. Mr Barrett’s trial subsequently commenced before Johnson J on 4 April 2021. A jury was empanelled on 6 April 2021. The jury retired to consider their verdict on 13 May 2021. It was unable to agree on a verdict, either unanimous or majority, and was ultimately discharged on 26 May 2021. Mr Clive Stein SC appeared for Mr Barrett at that trial instructed by Andrew O’Brien, solicitor.

17. On 4 June 2021, the matter was listed before R A Hulme J who allocated a new trial date of 8 November 2021. Mr Barrett’s legal representative, Mr O’Brien, withdrew from the matter at that time.

Mr Barrett’s inability to fund a second trial

18. Following Mr O’Brien’s departure from the matter, Mr Barrett subsequently made an application for legal aid for his second trial.

19. On 30 July 2021, Mr Barrett’s application for legal aid was refused.

20. On 19 August 2021, the decision to refuse legal aid funding for Mr Barrett’s trial was confirmed by the Legal Aid Review Committee.

21. On 29 September 2021, Mr Barrett sought a stay of his trial on Dietrich principles: Dietrich v The Queen (1992) 177 CLR 292; [1992] HCA 57. He contended that he was unable to receive a fair trial without legal funding and that he was not able to fund a second trial.

22. On 20 October 2021 Johnson J refused Mr Barrett’s application for a stay on the basis that the evidence before his Honour did not satisfy him that Mr Barrett did not have access to funds to obtain legal representation: R v Barrett (No 6) [2021] NSWSC 1342.

23. On 21 October 2021, Johnson J vacated the trial date of 8 November 2021 for a number of reasons: Covid-19 restrictions with respect to jury trials were still in place, Mr Barrett had health issues, and he remained unrepresented. The matter was placed in the Arraignment List on 10 December 2021: R v Barrett (No 7) [2021] NSWSC 1349.

24. On 10 December 2021, R A Hulme J adjourned the matter to 11 February 2022.

25. On 11 February 2022, a new trial date of 6 February 2023 was fixed before Johnson J.

26. In June 2022, Johnson J retired and the matter was allocated to me on 9 August 2022.

27. On 12 December 2022, a pre-trial mention of Mr Barrett’s trial was listed before me. On that date, Mr Barrett sought an adjournment of the 6 February 2023 trial date. He relied on a number of medical reports and the fact that he was still unrepresented at that time. Although he had been refused legal aid by Legal Aid NSW, it emerged that he had not as yet sought financial assistance from the Federal Financial Legal Assistance Scheme. That scheme had funded Mr Cranston’s lengthy trial. I vacated the trial date on 6 February 2023 to ensure that Mr Barrett could obtain legal representation and re-listed the matter for trial on 11 September 2023. It was apparent throughout legal argument that day not only that Mr Barrett did not wish to represent himself at his second trial, he would not be able to. He found it very difficult to answer my questions and it was apparent that a trial could not proceed with him self-represented. This was one of the reasons that I acceded to his request for a further adjournment of the matter. I listed the matter for directions before me on 24 March 2023 to ascertain the results of the request for Federal Financial Legal Assistance.

28. At the next mention, over three months later, on 24 March 2023, Mr Barrett remained unrepresented. On that date, he foreshadowed the making of another Dietrich application. He also foreshadowed an application for a permanent stay of the proceedings or a temporary stay until funding was provided. The court was advised that Dr Greg Woods KC would assist Mr Barrett amicus. I listed the second stay application for hearing on 5 July 2023 and timetable orders were made for the filing of the notice of motion and supporting evidence.

29. Mr Barrett’s notice of motion, seeking not only a temporary stay of the proceedings until funding was arranged by the CDPP but also a permanent stay based on Mr Hausman’s unreliability, was filed on 14 April 2023. Relevantly for this application, the applicant filed lengthy written submissions dated 20 June 2023 including numerous criticisms of Mr Hausman’s credibility. He also filed affidavits of Stephen Barrett sworn on 13 April 2023, Anne Marie Barrett sworn on 13 April 2023, Andrew O’Brien affirmed on 13 April 2023 and Leslie Frank Lord affirmed on 14 April 2023.

30. On the Crown’s application, the matter was relisted before me on 30 June 2023 for mention. Dr Woods KC appeared for Mr Barrett. The Crown foreshadowed that it would not oppose a temporary stay should Mr Barrett’s fresh application for legal aid fail. It is to be inferred that the CDPP also accepted that a trial could not proceed with Mr Barrett representing himself. By that time, Mr Barrett had made another application for legal aid to Legal Aid NSW on the basis of further material. I also requested that the CDPP approach the Commonwealth Attorney General as to whether, given that Mr Cranston had received considerable funding for his trial, a grant could also be made to Mr Barrett.

18. I vacated the hearing of the stay application listed on 5 July 2023 and instead listed the matter for further directions on 14 July 2023. At that time, I noted the long history of the matter and stated that it would be desirable for Legal Aid to advise the court no later than 9:15am on Friday, 14 July 2023 of the results of Mr Barrett’s fresh application for legal aid.

19. On 7 July 2023, an email was received from the Crown (with Mr Barrett’s legal representative, Mr O’Brien, copied into it) informing the court that the Director of Public Prosecutions had determined that there be no further proceedings against Mr Barrett and that the Crown would seek leave to file a nolle prosequi at the mention on 14 July 2023.

20. On 13 July 2023, a number of emails were received by my chambers. The first one was from Mr O’Brien advising the court that in the light of the correspondence received from the Crown an adjournment would be sought for Mr Barrett to consider a possible application for costs. The second one was from Legal Aid Grants Division confirming that as at that date no new application had been received by the Grants Division. The third email was from the CDPP advising that instead of filing a nolle prosequi on 14 July 2023 the Crown would file a formal document discontinuing proceedings on the basis of the NSW Director of Public Prosecutions determination to take no further proceedings in respect of count 1 pursuant to s 7(2)(b) of the Director of Public Prosecutions Act 1986 (NSW).

21. On 14 July 2023, the CDPP discontinued the proceedings against Mr Barrett and I vacated the trial date of 11 September 2023. Mr Barrett foreshadowed making a costs application and was given 28 days to consider his position.

22. The CDPP at no time placed on the record whether the proceedings were discontinued because of a decision that there was no reasonable prospect of conviction or, on a discretionary basis having regard to the prospect of a lengthy trial with Mr Barrett being self-represented. I accept that the reason for the position taken by the CDPP is irrelevant for the purposes of applying the statutory test.

The costs application

36. On 10 August 2023, an email was received from Mr O’Brien attaching a letter of the same date advising of Mr Barrett’s intention to make a costs application.

37. On 31 August 2023, due to the inability of the parties to arrive at a suitable date for the hearing of the application by agreement, I made timetable orders for the filing of Mr Barrett’s notice of motion, supporting evidence, and submissions and listed the matter for hearing on 31 January 2024, that day being the first available date suitable to both parties and the court.

38. On 28 September 2023, I extended the time for both the filing of the Crown’s evidence in reply and submissions and the applicant’s submissions in reply.

39. Ahead of the hearing on 31 January 2024, a joint court book comprising approximately 4000 pages was provided on 30 January 2024. Before turning to consider the material placed before the court on this application it is helpful to first consider the statutory test I must apply, and the principles derived from the relevant decisions concerning applications of this nature.

Legal principles

40. As Meagher JA observed in DAO v R (No 3) [2016] NSWCCA 282 at [1]:

“It is a long established common law rule that the Crown neither receives nor pays costs, particularly in criminal proceedings. That position was modified in New South Wales, in respect of criminal proceedings, first by the enactment of s 81 of the Justices Act 1902 (NSW) (now repealed), and later by the enactment of the Costs in Criminal Cases Act 1967 (NSW) (the Costs Act): see Allerton v Director of Public Prosecutions (1991) 24 NSWLR 550 at 560. The Costs Act provides for the issue of a certificate ‘in any proceedings relating to any offence, whether punishable summarily or upon indictment’: s 2. The person to whom the certificate has been granted may apply to the Director-General of the Attorney General’s Department under s 4 of the Act for payment from the Consolidated Fund of the costs incurred ‘in the proceedings to which the certificate relates’. See the discussion in Solomons v District Court of New South Wales (2002) 211 CLR 119; [2002] HCA 47 at [12], [15].”

41. Kirby P had earlier described the Act in these terms in Nadilo v Director of Public Prosecutions (1995) 35 NSWLR 738 at 743:

“[The Act] is reforming legislation with a beneficial purpose designed to confer valuable privileges upon persons who succeed in criminal prosecutions. The Act overcomes the normal rule that, by the Royal Prerogative and by the common law, the Crown neither seeks nor pays costs in criminal proceedings: see Attorney- General of Queensland v Holland (1912) 15 CLR 46 at 49; Latoudis v Casey (1990) 170 CLR 534 at 556; Ex parte Hivis; Re Michaelis (1933) 50 WN (NSW) 90 at 92; Acuthan v Coates (1986) 6 NSWLR 472 at 479.”

42. The Act provides an exception to the general rule that costs orders are not made in criminal proceedings. Under the Act, costs can be awarded to a defendant who is acquitted of criminal charges or, relevantly, is the subject of a direction that there be no further proceedings, on a limited basis. Section 2 of the Act provides the power for the court to make such an order, s 3 sets out the statutory test to be established before a costs certificate can be granted and s 4 sets out the effect of a certificate being granted. Sections 2, 3 and 4 of the Act are in these terms:

2   Certificate may be granted

(1)  The Court or Judge or Magistrate in any proceedings relating to any offence, whether punishable summarily or upon indictment, may:

(a)  where, after the commencement of a trial in the proceedings, a defendant is acquitted or discharged in relation to the offence concerned, or a direction is given by the Director of Public Prosecutions that no further proceedings be taken, or

(b)  where, on appeal, the conviction of the defendant is quashed and:

(i)  the defendant is discharged as to the indictment upon which he or she was convicted, or

(ii)  the information or complaint upon which the defendant was convicted is dismissed,

grant to that defendant a certificate under this Act, specifying the matters referred to in section 3 and relating to those proceedings.

…

3 Form of certificate

A certificate granted under this Act shall specify that, in the opinion of the Court or Judge or Magistrate granting the certificate:

(a)  if the prosecution had, before the proceedings were instituted, been in possession of evidence of all the relevant facts, it would not have been reasonable to institute the proceedings, and

(b)  that any act or omission of the defendant that contributed, or might have contributed, to the institution or continuation of the proceedings was reasonable in the circumstances.

…

4   Payment of costs

(1) A person to whom a certificate has been granted under this Act may apply to the Director-General for payment from the Consolidated Fund of costs incurred in the proceedings to which the certificate relates. The application is to be accompanied by a copy of the certificate.

(2) The Director-General may, if of the opinion that, in the circumstances of the case, the making of a payment to the applicant is justified, determine the amount of costs that should be paid to the applicant, not exceeding the maximum amount referred to in subsection (3). (Emphasis added.)

…

43. As the Court of Appeal recently observed in Rodden v R [2023] NSWCCA 202 at [10]:

“The effect of the grant of such a certificate is that, pursuant to s 4 of that Act, the grantee may apply to the Secretary of the Department of Communities and Justice for payment from the Consolidated Fund of costs incurred in the proceedings to which the certificate relates. (Section 4 of the Costs Act refers to the Director-General of the Attorney General’s Department but it was common cause that that statutory function is now performed by the Secretary or his delegate.)”

44. The legislative scheme has been considered in numerous decisions of this Court and the relevant principles are well settled. In R v Pavy (1997) 98 A Crim R 396, the court observed that the question is to be determined in this way:

“The primary test to be applied when deciding whether a certificate should be granted is to be found in the wording of s 3(1)(a): if the prosecution had been in possession of all the relevant evidence as it is now known before the proceedings had begun, would it have been reasonable to institute proceedings? The section calls for:

‘ … a hypothetical exercise in the sense that the question is whether it would have been reasonable to prosecute at the time of (the) institution (of the proceedings) if the hypothetical prosecutor had possession of evidence of all the relevant facts including those established even after the trial and on (the) application (see Allerton v DPP (1991) 24 NSWLR 550 per Blanch J, Regina v Warwick Ian McFarlane (unreported 12 August 1994).’”

45. As to what is meant by “relevant facts”, in Chahal v Director of Public Prosecutions [2008] NSWCA 152; (2008) A Crim R 580 Ipp JA (Giles JA agreeing) observed at [29]:

“’All the relevant facts’, as this phrase is used in s 3(1)(a), are facts relevant to the reasonableness of the institution of the criminal proceedings. That is because, in that section, the ‘relevant facts’ are concerned solely with that issue. Section 3A(1) is a definition section relating to the meaning of ‘all the relevant facts’ in s 3(1). Therefore, the word ‘relevant’ in the phrase ‘relevant facts’ in s 3A(1) must carry the same meaning as that word in s 3(1), namely, facts relevant to the reasonableness of the institution of the criminal proceedings.”

46. As Wood CJ at CL noted in R v Jonathon Harold Manley [2000] NSWCCA 196; (2000) 49 NSWLR 203 at [12], endorsing the observations of the trial judge (Blanch J), the test for unreasonableness is not based on whether there is any reasonable prospect of conviction, whether a jury would be likely to convict, whether there is a prima facie case, whether there is reasonable suspicion or whether the prosecution was malicious. As the Court of Criminal Appeal observed in R v John Fejsa (1995) 82 A Crim R 253 at 3, there is no “all-embracing definition” of what is reasonable. Such a judgment is best left to the circumstances of the particular case. Despite this, it is well-established that a decision to prosecute will not generally be unreasonable where questions of credibility or reliability are in issue.

47. The relevant principles guiding an application where the Crown case was heavily reliant on the credibility of one or more witnesses were stated in Mordaunt v Director of Public Prosecutions & Anor [2007] NSWCA 121; (2007) 171 A Crim R 510 (“Mordaunt”) by McColl JA (Beazley and Hodgson JJA agreeing) as follows at [36]:

“Section 3 calls for an objective analysis of the whole of the relevant evidence, and particularly the extent to which there is any contradiction of expert evidence concerning central facts necessary to establish guilt or inherent weaknesses in the prosecution case; matters of judgment concerning credibility, demeanour and the like are likely to fall on the other side of the line of unreasonableness, being matters quintessentially within the realm of the ultimate fact finder, whether it be Judge or Jury; it is not sufficient to establish the issue of unreasonableness in favour of an applicant for a certificate that, in the end, the question for the jury depended upon word against word; in a majority of such cases it would be quite reasonable for the prosecution to allow those matters to be decided by a jury; it would be different where the word upon which the Crown case depended had been demonstrated to be one which was very substantially lacking in credit.”

(Emphasis added.)

48. More recently, in Higgins v R (No 2) [2022] NSWCCA 82, the Court of Criminal Appeal held at [20] that, “it is well established that where there are questions about the credibility of witnesses, it will generally not be unreasonable for a prosecutor to allow those questions to be decided by the tribunal of fact, usually a jury. The administration of justice usually leaves to the tribunal of fact determinations about the credit of witnesses.” The CCA went on at [21] to observe that, “There is no single bright line test as to when it would not be reasonable for a prosecution to have been instituted”. Further, it was noted (at [24]) that the assessment of reasonableness “must turn on the precise and peculiar facts and circumstances of the case”.

Threshold jurisdictional point

49. The CDPP’s initial position, in its written submissions, was that the Act has no application to Mr Barrett’s proceedings because the prosecution was brought by the Commonwealth. It was submitted that the fact that the CDPP was a “party” in the “matter” attracted the operation of s 75(iii) of the Commonwealth Constitution: Macleod v Australian Securities and Investments Commission (2002) 211 CLR 287; [2002] HCA 37 at [6]-[10].

50. It was further submitted that s 75(iii) in turn engaged s 77(iii) of the Constitution and s 39(ii) of the Judiciary Act 1903 (Cth). The effect of these provisions was that, despite the fact that Mr Barrett was charged with a state offence, the court was exercising federal jurisdiction in hearing his matter.

51. The CDPP submitted, in reliance upon the decision in Solomons v District Court of NSW [2002] HCA 47; (2002) 211 CLR 119 (“Solomons”), that the court had no power to grant a certificate because a NSW state court exercising federal jurisdiction does not have power to grant a costs certificate under the Act.

52. In written submissions filed on behalf of Mr Barrett, it was argued that although the prosecution was brought by the Commonwealth DPP, the fact that the prosecution related to an offence under state law rather than a law of the Commonwealth rendered Solomons inapplicable such that this Court retained its jurisdiction to grant a costs certificate under the Act. Mr Barrett submitted that the “mere fact” that, by arrangement, a prosecution of an offence under a NSW law was pursued by the CDPP did not limit the application of the Act or the jurisdiction of this Court.

53. At the hearing of the matter, I queried with senior counsel for the CDPP how it was that this Court could not make a costs order under the Act in relation to a State offence (as opposed to a Commonwealth offence as in Solomons). I also queried the applicability of the passages in Solomons relied upon by the CDPP given that that decision was concerned with a Commonwealth offence.

54. The CDPP was given leave to file further written submissions on this threshold point and it was agreed that I could proceed to hear the merits of the case.

55. On 29 February 2024, the CDPP emailed my chambers and submitted that it was accepted the court does have a power to grant the application. Its submissions to the contrary were withdrawn. In response to that email that same day, Mr Barrett’s lawyers advised that in light of the Crown’s concession he did not wish to make any further submissions. On 1 March 2024, the parties were informed that I considered my decision to be formally reserved from that date.

56. The concession by the CDPP that the court has the power to grant this application obviates the need for me to consider the matter further. I propose to proceed on the basis that I have the power to grant a certificate under the Act.

The “relevant facts”

57. As noted above, ahead of the hearing on 31 January 2024, a joint court book was provided on 30 January 2024 including the applicant’s submissions dated 15 September 2023, the Crown’s submissions dated 23 October 2023, and the applicant’s submissions in reply dated 30 November 2023. Mr Barrett also relied on the submissions he filed on the stay application.

58. In addition to the lengthy submissions, the applicant’s evidentiary material included a notice of motion dated 11 October 2023 and the affidavits of:

1. Stephen Barrett sworn on 14 September 2023 (providing examples of the investigative journalistic work that he was involved in between 1984 and 2009 featured in the media including TV, newspapers and books);

2. Andrew Michael O’Brien affirmed on 18 September 2023 (providing a brief chronology of the proceedings and annexing the Trust Account Statement dated 6 July 2021 detailing the cost of Mr Barrett’s legal representation in relation to his first trial);

3. Mark Allen Jones sworn on 18 September 2023 (detailing Mr Barrett’s assistance in a particular criminal investigation); and

4. Report of Tamar Macks, clinical psychologist, dated 19 December 2023 (in relation to Mr Barrett’s treatment for anger and anxiety resulting from the criminal charges against him that were causing tension in his household).

59. The Crown’s evidentiary material included the affidavit of Edward Brendan McGinness, solicitor, affirmed on 23 October 2023 with the Exhibit EBM-1 which comprised:

1. The Crown’s documentary trial Exhibits (A to AE) (Annexure A);

2. The transcript of the trial of Stephen Barrett (Annexure B);

3. The Crown Case Statement in the matter of R v Stephen Barrett dated 31 October 2022 (Annexure C);

4. The evidence of Daniel Hausman in the trial of R v Sevag Chalabrian (Annexure D);

5. Mr Hausman’s undertaking to co-operate and assist dated 15 March 2021 (Annexure E).

60. The supplementary material provided included transcripts of the examination of Mr Hausman on 12 and 13 May 2022 and Exhibits 6A and 12 from the trial proceedings.

61. In all, over 4,000 pages of material was tendered on this application. There were objections made to some of the affidavit evidence. I ruled on them at the time and do not consider it necessary to go through them for the purposes of these reasons.

The trial before Johnson J

62. The trial before Johnson J proceeded over six weeks. I do not propose to summarise all of that evidence. Rather, I propose to focus on the evidence that specifically implicates Mr Barrett in the blackmail (as opposed to the co-offenders).

63. The Crown’s evidence at that trial included a jury bundle (Exhibit A) that comprised:

1. Admissions pursuant to s 184 of the Evidence Act 1995 (NSW) (including the portion extracted above at [4]);

2. Electronic material and the transcript of the crucial conversation on 1 February 2016 between Mr Barrett and the subjects of the blackmail (portions of which I will extract below);

3. Documents seized at Mr Barrett’s premises; and

4. Documents seized at Channel Nine.

64. The Crown also tendered a summary of telephone intercepts, surveillance device recordings, SMS and call charge records of conversations including, or about, Mr Barrett. Mr Hausman’s telephone was at this time being intercepted and some of the conversations between he and Mr Barrett were recorded, whilst others were not. Mr Parncutt gave evidence to explain the discrepancies.

65. Some examples of the conversations recorded by the intercepted telephone calls and surveillance devices include:

1. A telephone call between Mr Barrett and Mr Hausman on 28 January 2017, arranging a meeting at Buzz café in Newtown with Daniel Rostankovski. Mr Hausman gave oral evidence at trial about the conversation that took place at the café.

2. A call between Mr Barrett and Mr Hausman on 29 January 2017, in which Mr Hausman tells Mr Barrett: “we’re putting it together”.

3. A telephone call from Mr Barrett to Mr Hausman after Mr Barrett left the blackmail meeting, in which Mr Barrett says: “You know what I think should happen, (indistinct) just play, play the game as you will, but your other ace up the sleeve now is if there’s any shit, ah, get the, get the lawyer that Anthony spoke to, he should be briefed on the situation” and later in the conversation, after the possibility of drafting a deed is mentioned, Mr Barrett says: “There no need to write me into any deed or anything like that.” He also discusses what will “frighten” the Plutus fraudsters.

1. On 3 February 2017, Mr Barrett again spoke to Mr Hausman about what to say if he speaks to Dev Menon. Mr Hausman says Mr Barrett needs to give the Plutus fraudsters “a final poke” and Mr Barrett replies: “Mate, it’s not a drama, I’m happy to do it… but it has to be done properly.”

2. On 16 May 2017, Mr Barrett spoke to Mr Hausman about a document filed with the Supreme Court. Mr Barrett says: “I can still do what I gotta do because – I’ve seen it, right” and later he says: “The mere fact I’m goin’ to the Supreme Court will put the fuckin’ fear of God in ‘em.”

66. The Crown called evidence from a number of witnesses including:

1. Mr Hausman, who had pleaded guilty and received a discount of 50% for his combined guilty plea and offer of assistance;

2. Amy Meyer, Mr Hausman’s personal assistant;

3. Ashley Mills, Anthony Palumberi, Ben Alaban, Alexander Nappa, Angela Yeoland and Angelo Coppola (shadow directors of the Plutus money laundering entities);

4. AFP officers, including expert evidence from Mark Parncutt;

5. Grant Williams and Brady Hall (fellow journalists in contact with Mr Barrett); and

6. Sandra Billitteri from the ATO.

Crown case at the trial

67. As outlined above, Mr Hausman and Mr Rostankovski were the principal blackmailers.

68. Mr Hausman is a former business partner of Mr Cranston. By late 2015, he became aware of the fraudulent scheme. He already knew Mr Barrett. They had met in 2009. In 2010, Mr Hausman paid Mr Barrett $1,000 to travel to Melbourne to interview two businessmen who owed Mr Hausman money. He told Mr Barrett to inform them that he was a journalist from “60 Minutes” doing a story about how billionaire business people “threw over” small contractors. There was an agreement to pay Mr Barrett a further $20,000 if Hausman’s outstanding fees were paid. The invoice was never paid, and no story was ever published by Mr Barrett.

69. I pause to note that this evidence was adduced as evidence relevant to the relationship between Mr Barrett and Mr Hausman and not as tendency evidence. In fact, an “anti-tendency” warning was given to the jury by Johnson J about it.

70. Mr Rostankovski was introduced to Mr Hausman in 2015. Mr Hausman became aware that Mr Rostankovski was working with the conspirators in the manner outlined in the Agreed Facts extracted above. Mr Barrett first met Mr Rostankovski in January 2017 with Mr Hausman which, on the Crown case, is when Mr Barrett became involved in the blackmail.

71. Mr Hausman gave evidence that the threat to expose the Plutus tax fraud by Mr Barrett provided the main leverage for the blackmail and was the reason he contacted Mr Barrett and invited him to become involved.

72. On 27 January at 4:56pm, Mr Hausman telephoned Mr Barrett and spoke to him for eight minutes. The contents of this call were not captured by the intercept, but Mr Hausman gave evidence that in the early afternoon of 27 January 2017 he arranged to meet Mr Barrett at the Four in Hand hotel in Paddington. Mr Barrett contended at his trial that he did not meet with Mr Hausman at the Four in Hand and the relevant conversation was over the telephone. In any event, Mr Hausman’s evidence was that during that meeting he informed Mr Barrett of the plan to meet the Plutus conspirators and he explained to Mr Barrett what his role would be. Mr Hausman gave evidence that Mr Barrett confirmed that he understood that his role would be to attend the meeting and show his journalistic credentials.

73. I pause to note that Mr Barrett relies upon what is said to be Mr Hausman’s inconsistent evidence about where the first meeting was when he subsequently gave evidence at Mr Chalabian’s trial. I will deal with that submission below at [129]-[130].

74. On 28 January at 9:34am, Mr Hausman again contacted Mr Barrett by telephone and arranged for the two of them to meet with Mr Rostankovski at 10:45am at the Buzz café in Newtown. Mr Hausman’s evidence was that at Buzz café they provided Mr Barrett with more details of the scheme including the existence of dummy directors, the involvement of Adam Cranston, and the plan to blackmail the involved parties. Mr Hausman gave evidence that Mr Barrett appreciated the significance of the information he had been given at that time and said, “Son, you’ve got a tiger by the tail.”

75. Mr Hausman’s evidence was that at that same meeting, Mr Barrett asked if he could run the story. Mr Hausman told him that his role was simply to attend the meeting and throw down his business card.

76. The Crown case was that at one of these meetings Mr Hausman paid Mr Barrett $2,000 in cash for agreeing to be involved. Mr Barrett disputes that he was paid any money at that time.

77. On 29 January at 1:04pm, Mr Hausman sent a WhatsApp message to Mr Rostankovski: “From SB [Steven Barrett]: ‘If what you tell me is spot on… Then we have a tiger by the tail… Let’s meet pissibly [sic] Tuesday arvo’.” At about 1:28pm, Mr Barrett contacted Mr Hausman by phone and told him he could meet Tuesday if it was “alright with you blokes” but that “it doesn’t matter if not, Wednesday.” At 9:51pm, Mr Rostankovski confirmed to Mr Hausman via WhatsApp that Tuesday afternoon was suitable.

78. On 30 January at about 9:49pm, Mr Hausman and Mr Rostankovski discussed their plan during which time Mr Rostankovski referred to Mr Barrett as “the guy we met in Newtown” and the two men discussed Mr Barrett’s role in the planned blackmail meeting that Thursday. On 31 January, between 8:13am and 9:22am, Mr Rostankovski and Mr Hausman finalised the time of the meeting over WhatsApp.

79. On or about 31 January, Grant Williams spoke to Mr Barrett on the phone. He was the National Executive Producer of “A Current Affair” and Network Deputy Director of News and Current Affairs for the Nine Entertainment Network. Mr Barrett informed him of a major upcoming scandal regarding a tax rort involving a relative of the Deputy Commissioner of Taxation. Mr Williams confirmed that “A Current Affair” would be interested in the story but he did not commission Mr Barrett to formally or informally investigate for Channel Nine.

80. Mr Williams did not speak with Mr Barrett again until 18 May 2017 after the AFP had searched his premises and Mr Hausman and Mr Rostankovski had been arrested.

81. On 1 February at around 9:15am, Mr Rostankovski and Mr Barrett met Mr Hausman at a café on the corner of Castlereagh Street and King Street in the Sydney CBD. Mr Barrett took handwritten notes during this meeting, recording the names of two of the shadow directors (Mr Nappa and Mr Palumberi) and the names of the companies of which they were directors. Mr Hausman’s evidence was that at this café the men had another conversation about Mr Barrett’s role in the blackmail, which involved Mr Hausman explaining that they would confront the conspirators with an ultimatum whereby they either paid Mr Hausman and Mr Rostankovski $5 million or they would release the material they had on the conspiracy to the media.

82. On 1 February at 9:33am, Mr Rostankovski and Mr Barrett attended the blackmail meeting and met with Mr Cranston and Mr Menon. Mr Barrett introduced himself as a journalist and said he was aware of an allegation of a tax fraud involving Plutus. He told them that he had been approached by “de facto”, “shadow” directors Mr Palumberi and Mr Nappa. Mr Barrett told Mr Menon and Mr Cranston that he wanted to interview them and that if they declined to be interviewed “then I’ve gotta tell you which way it could go…”.

83. Some specific extracts from that transcript include the following:

“Barrett:    Um just to have a listen to things ahh because Anthony contacted me, and I know Anthony, right…

Menon:    Anthony …

Barrett:    Sonar … (indistinct)…

Menon:    Yes, Anthony Palumberi yeah”

84. This was not truthful. Mr Barrett did not know Anthony Palumberi (one of the shadow directors); he had been told by Mr Hausman to say that he knew him.

85. Mr Barrett went on to suggest he was going to write a story about the fraud. Each time he did so he used conditional language. Some examples of this are as follows:

“Barrett: …   And where I’m up to with it, if, if I go the distance on it…”

“Barrett: …   right, um if, if somebody shows me evidence of this allegation which I’ve been told about at this stage…”

“Barrett: …   that’s the allegation right, now I don’t know if it’s true or

not”

“Barrett: …   how strong right, I’ve been told a very serious story, and if I go the full distance on it, I’ll be coming back to ask personally, professionally….”

“Barrett:   If I ask you to be interviewed on television, because you know I, with your rule with the Aventis and the car crash you had up in, in, in Queensland about a year ago and things like that. I mean, that’s all good colourful background for me, as to who you are, right, do you understand what I mean?”

“Barrett: …    people have told me things where I’ve taken my notes right, but if I continue down this track, which I think is an enormous story, if it is true…”

“Barrett: …   if, if I’m going into an investigation to, to, to highlight certain allegation because, I mean, I don’t have to tell you where this is could go, I could have to go and sit down with the, with Scott Morrison the treasurer…”

(Emphasis added.)

86. Mr Barrett told the conspirators that he knew certain friends from his friend Anthony (who he did not know). In fact, everything Mr Barrett told the conspirators had come directly from Mr Hausman and/or Mr Rostankovski including the following:

“Barrett:    The, the allegation is that you blokes have set up a skimming operation where money should have been remitted back to the taxation department, right and then all of a sudden these people here, who were what you term as unders or under, under the Corporations Act, there known as defacto directors, and then all of a sudden, like one bloke I think what’s his name, Anthony, Anthony who is a friend of my friend. He, he got hit with a bill the other day for six million. Which you blokes through your companies should of paid to the Australian Taxation Department and didn’t. These shadow directors have now been lumbered with the Australian Taxation bill to pay up, so that’s where the allegation, it’s a very serious allegation…”

“Barrett: …   I’ve got two names now, Anthony who I know through a mutual friend…

Menon:    Yes

Barrett: …    Alex Nappa, right and the serious allegation that they’re talking about comes under the corporations act section two thousand and one the year section nine, right, which is as you know is prima facie…”

87. After Mr Barrett had left the room at about 9.50am, Mr Rostankovski threatened Mr Menon and Mr Cranston with exposure and told them that “you’ll probably be arrested this afternoon”.

88. At 11:07am, whilst the blackmail meeting was ongoing, Mr Barrett contacted Mr Hausman by telephone. Mr Barrett asked if Mr Rostankovski had come back yet and then said, “you know what I think should happen? Just play the game as you will but the other ace up the sleeve now is, if there’s any shit get the lawyer that Anthony spoke to…he should be briefed on the situation.” Mr Hausman told Mr Barrett that the Plutus conspirators were going to pay the blackmail demand. Mr Barrett responded that there was “no need to write [him] into the deed or anything like that” and “the bottom line with me is that they will know…the thing that they’ll be most frightened about with me is…if I…get my hands on any fucking documents”.

89. At 12:06pm on 1 February, Mr Rostankovski left the meeting and called Mr Hausman. He informed him that the Plutus conspirators would pay them, via Chalabian, a million dollars that day. While the deed was being negotiated and drafted by Mr Menon and Mr Chalabian, Mr Barrett remained in contact with Mr Hausman and Mr Rostankovski. At 5:17pm on 1 February, Mr Menon sent a text confirming that $250,000 had been sent.

90. At 8:05am on 3 February, Mr Barrett contacted Mr Hausman. Mr Hausman told him that Mr Rostankovski would meet up with Mr Barrett that morning and informed him that there had been “some developments” but that the situation “need[ed] a final poke”. Mr Hausman suggested that Mr Barrett call Mr Menon and say that Mr Palumberi had contacted him, in order to put the pressure on Mr Menon. Mr Barrett was hesitant to mention the deed because “that just blows the whole cover mate, that just shows it was a complete rort from day one” and suggested instead that he tell Mr Menon that he was anticipating a further call and documents from Mr Palumberi and wished to meet Mr Menon to discuss that further material.

91. At 8:42am on 3 February, Mr Barrett called Mr Hausman for three minutes and nine seconds. At 11:26am on 3 February, Mr Barrett called Mr Hausman for 23 seconds. At 11:30am on 3 February, Mr Hausman texted Mr Rostankovski and told him to “call steve barrett asap. He’s still waiting and has to go. We need to keep him on side and he was a bit funny.” (Emphasis added.)

92. Between 1 and 15 February 2017, $4.82 million was received into the Lands Legal Trust Account (set up to receive the blackmail monies).

93. Although a second demand for $20 million was made by Mr Hausman and Mr Rostankovski on 15 February 2017, the Crown did not allege that Mr Barrett was involved in the second demand.

94. On 16 February 2017, Mr Barrett attempted to call Mr Hausman but the call did not connect. Mr Hausman called him back and a conversation took place which was not captured by the telephone intercept on Mr Hausman’s service.

95. Later on 16 February 2017, Mr Hausman texted Mr Chalabian “Trust me I’ve had Journo [Barrett] up my areas/plus we have enough LVR [leverage] – they call D [Rostankovski] every day to see if he’s ok. If they can do 5m in 10 days – they can do another 15-20 in 8 weeks and we then do lunch. Keep the pressure on that scumbag Dev [Menon] as he knows with what we have, if released to Journo [Barrett], as well as the other 2 Cunts Jay Onley and Adam Cranston, Who’s daddy is michael Cranston, deputy comm of T.. who sent the Fukin assessment letters out…they’re all going to long bay. They will pay. But it’s in their nature to fight. Go get em you animal xx.”

96. There was no further contact between Mr Barrett and Mr Hausman after 16 February 2017 until 10 May 2017. In the interim period, Mr Barrett went about his life. There is no evidence that he investigated the Plutus fraud during that time.

97. In the meantime, a blackmail deed was finalised on 6 March 2017 which varied an earlier first blackmail deed to make the minimum blackmail amount payable by the conspirators to Mr Hausman and Mr Rostankovski $25 million. The Plutus conspirators were required to make weekly payments of no less than $1.5m commencing 3 March 2017. As at 1 May, there was approximately $5 million outstanding. Approximately, $19.4 million had been paid between 16 February and 26 April 2017. By early May, it became clear to Mr Hausman that the conspirators were not going to continue to pay the blackmail amounts. It was at this time that Mr Hausman reached out to Mr Barrett again.

98. On 1 May at about 2:53:16pm, Mr Hausman texted Mr Rostankovski via WhatsApp: “I’d be playing the line of the Journo has met with you at the request of one of the directors and wanted to hand the Journo Steve Barrett copy of affidavit from SM [Christian Maddison] blowing it all up which says ‘dev [Menon] engineered it’. Dev will freak But you have control on basis balance of $5m is paid. The directors are livered [sic] – your call x.”

99. Later that day, at about 10:39:26pm, Mr Hausman sent another WhatsApp message to Mr Rostankovski saying, “I might through [sic] steve Barrett a copy of the affidavit and get him to call dev sating [sic] he’s awaiting instructions since Plutus and dev the engineer and the 2 muppets are in the affidavit.”

100. On 10 May at about 7:47pm, in the Project PP Group chat Mr Chalabian, Mr Hausman and Mr Rostankovski arranged to meet with “journo” [Barrett] at 6pm on 11 May to “put a plan together”.

101. A few minutes later, at about 7:50pm, Mr Hausman contacted Mr Barrett via telephone for one minute and 52 seconds. They made tentative plans to meet around midday the next day, after Mr Hausman and Mr Rostankovski met with Mr Chalabian. They agreed that Mr Hausman would call Mr Barrett at 11:30am the next day to confirm. Neither the meeting nor the call took place.

102. Five days later, on 15 May at about 1:29pm, Mr Barrett contacted Mr Hausman via telephone for about eight minutes. This call was intercepted. At 1:40pm, Mr Barrett contacted Mr Hausman again and the conversation lasted one minute and 34 seconds. During the second conversation, Mr Hausman told Mr Barrett that he would be meeting that evening with “some relevant blokes, ah, and we’re gunna put a strategy together.” Mr Barrett asked Mr Hausman to give him a call the next day and told him that he thought it was “smart that you and I get our head together just so there’s no hiccups, right?” Mr Hausman agreed.

103. At about 6:32pm that day, Mr Hausman called Mr Barrett for one minute and 24 seconds to discuss their meeting the following day. Shortly after that conversation, at 6:47pm, Mr Hausman texted his partner Jessica Van Schreven: “Still going. Meeting Journo tomorrow morning.”

104. On the same day, Mr Hausman also texted the ‘Project PP’ group chat with images which included media articles on the Plutus’ garnishee and an affidavit affirmed by Christian Madison. At 10:17pm, Mr Hausman sent a WhatsApp message to Mr Chalabian asking for more incriminating material on Mr Menon to provide to Mr Barrett. Between 10:17pm and 1:24am, Mr Hausman and Mr Rostankovski texted back and forth about the material they were putting together for Mr Barrett, with Mr Hausman indicating he wanted to have everything together by the following day, 16 May 2017.

105. On 16 May 2017 at 10:31am, Mr Barrett called Mr Hausman for six seconds. Mr Hausman then met Mr Barrett at a café near the Art Gallery of New South Wales. Mr Hausman’s evidence was that he and Mr Barrett had a conversation during which Mr Barrett asked what he needed to do next. Mr Barrett requested to speak to Mr Chalabian for some legal advice, and informed Mr Hausman that he had a contact in the ATO and a connection with “ScoMo” [Scott Morrison] that he wanted to use.

106. Sometime on 16 May 2017, Mr Hausman’s personal assistant Amy Meyer picked Mr Barrett up from the vicinity of the Opera House and dropped him and Mr Hausman at a café in the Botanic Gardens. She then withdrew approximately $20,000 in cash from a safety deposit box and returned to the café. Mr Hausman’s evidence was that after a brief conversation, Mr Barrett, Mr Hausman and Ms Meyer returned to the car and Mr Hausman paid Mr Barrett $2,000 for continuing to participate in putting pressure on the Plutus conspirators.

107. On 16 May at 12:26pm, Mr Hausman sent a message via WhatsApp to Mr Chalabian and Mr Rostankovski in the Project PP Group chat: “Met with Journo. He’s on it. Meeting him again tomorrow in which time he will make the call to other lawyer. Could you please confirm other lawyers mobile please – he has all docs to review I put together last night and I’ve gone into detail relevant such that he will push the right buttons whereby sev should then receive a call. He needs one day to digest and also make a couple of internal calls. I’ve juiced him up 2 today and promised him 8 on success. Tomorrow will be the day. Please push through the lawyers number so I can confirm the one I have is correct. Ta.” (Emphasis added.)

108. On 16 May at 12:46:30pm, Mr Hausman sent his partner Jessica Van Schreven a message via WhatsApp of a photo of a wad of cash with the caption “how you deal with a Journo”.

109. Mr Barrett accepts that he was paid $2,000 by Mr Hausman at that time but maintains that he was paid for his freelance work as a journalist.

110. On 16 May at 1:36pm, Mr Barrett called Mr Hausman for three minutes and 24 seconds and the two agreed that they should obtain material from a Supreme Court file relating to one of the tax fraud second tier companies for the purpose of putting pressure on the Plutus conspirators. Mr Barrett predicted “the mere fact that I’m goin’ to the Supreme Court will put the fear of fuckin’ God in ‘em.” Mr Hausman told Mr Barrett that “all you need to say is, I’m aware that there’s an affidavit by – by this guy called Maddison. That’s all you have to say”. (Emphasis added.)

178. I have also considered the evidence given by Mr Hausman subsequent to the trial. Significant reliance was placed on this evidence by the applicant.

179. In relation to the evidence given by Mr Hausman at the Chalabian trial, it would appear from the material available to me that the relevance of cross-examining Mr Hausman about Mr Barrett at the Chalabian trial (given he was not a co-offender of Mr Chalabian) was because it was already known that Mr Hausman had been untruthful to police in his first interview on 16 May 2017. Although Mr Hausman gave evidence favourable to Mr Barrett at the Chalabian trial to the extent that he accepted that he was a journalist eager to tell the story of the Plutus fraud, at no time during the Chalabian trial did Mr Hausman resile from his evidence that Mr Barrett was involved in the criminal enterprise.

180. I am not satisfied that there is any meaningful inconsistency between what Mr Hausman said about Mr Barrett at Mr Barrett’s trial when compared with what he said at Mr Chalabian’s trial. At Mr Barrett’s trial his evidence was that Mr Barrett wanted to pursue the story and he told him not to do so until Mr Hausman told him he could, whereas in the Chalabian trial he simply agreed that Mr Barrett was “chasing down a story”.

181. Given the fact that the jury at Mr Barrett’s trial already knew that Mr Hausman was a liar, had pleaded guilty, was in jail and an accomplice warning was given by Johnson J, it is difficult to see how the evidence given at the Chalabian trial really takes that matter any further.

182. As for the evidence he gave in the PoCA hearing, again it was submitted that had police been aware of that when they instituted the proceedings it would not have been reasonable to have done so. Having now read that evidence, it is to be accepted that Mr Hausman was evasive in questioning and it would be open to a jury to find that he dealt with property in breach of a restraining order, but police were already aware that he was dishonest. He was a principal in the blackmail of a very large amount of money involving a significant degree of deception. The fact that he may have disposed of property in breach of a court order (a fact that he never squarely admitted) does not mean that he was not being truthful about Mr Barrett’s involvement in this enterprise. I am not persuaded that that evidence has the significance that Mr Barrett contends it does.

The delay from January to May

189. The Crown relied on the delay between when Mr Hausman first approached Mr Barrett about this story on 27 January 2017 and when he received the Maddison affidavit on 16 May 2017 as being inconsistent with any desire by Mr Barret to investigate a story. The uncontradicted evidence was that there was no contact between the two men from 16 February 2017 until 10 May 2017 and no investigation undertaken by Mr Barrett during that time.

190. Mr Barrett has always maintained that he was waiting to get the relevant material from Mr Hausman and that when he was provided with the Maddison affidavit on 16 May 2017 that was the “smoking gun”.

191. In his evidence at trial, Mr Hausman rejected questions put to him in cross-examination to the effect that by 3 February Mr Barrett was after him for “the documents to write the story”, but he maintained that he was aware that Mr Barrett wanted to ultimately publish a story about this. Mr Hausman explained that Mr Barrett understood that he was not to run anything until he and Mr Rostankovski had achieved what they wanted to achieve. In Mr Hausman’s evidence, he said that he:

“...made it clear to him [Barrett] that he [Barrett] couldn't do the story until after the blackmail demand was met. I made that very clear. I said to him, after that, after the money has been paid and he gets his balance, after that, I said words to the effect ‘After it's finished’, I said words to the effect of ‘I don't give a fuck what you do’. I'm pretty sure that's in my statement’.”

192. Mr Hausman agreed that Barrett repeatedly said that he “wanted to run a story” and also said, “I’m going to go and do some research on this, the company, what's happening with the father”. But the Crown case was always that there was no inconsistency between Mr Barrett threatening the conspirators and wanting to one day publish a story.

193. Mr Hausman had documentary evidence pointing to the Plutus conspiracy which he did not provide to Mr Barrett until 16 May 2017 when he wanted him to put more pressure on the conspirators. But, as the Crown submitted, that does not mean that Mr Barrett could not have made other inquiries of his own nor chased up Mr Hausman, especially in circumstances where it is now known that Mr Hausman was in possession of material which would have assisted Mr Barrett’s desire to publish a story.

194. Mr Barrett disputed that the delay meant that he was not investigating the matter during that time. He relied on the evidence that he was a freelance journalist working on several other matters during that time. But the relevant facts include that he already has some leads, including the names of two directors and relevant company details. He was cross-examined at his trial about why he did not conduct an ASIC search which would have provided him with the address of key players and allowed him to visit and interview them. He agreed he did not do that but provided no explanation for this. Further, he had obtained Mr Menon’s business card at the meeting but did not approach him either. As the Crown noted in its submissions, the internet searches in the material provided to Mr Barrett at the Art Gallery meeting on 16 May could also have been obtained by him in the intervening period.

195. Mr Barrett’s affidavit evidence on this application reveals that, as at 2017, he was no longer involved in investigative journalism. His company, Box One Media, provided services to people in need of public relations assistance, such as Mr Charif Kazal. Mr Williams described Mr Barrett as “an informant” to people like Mr Williams; he fed them small bits of information which, if useful, would result in a small payment to him. Mr Barrett appears to have been largely reliant upon the small amounts of money he was receiving from Mr Williams and from other sources during that time.

196. It would be a matter for a jury what they made of this material.

Mr Barrett’s professional experience

197. I have summarised this evidence above. Although it is more detailed than what was adduced at trial, it was always available. In any event, evidence was adduced at the trial about his experiences as a journalist including from Ray Martin and Brady Halls.

198. The concessions made by Mr Hausman at Mr Barrett’s trial suggest that there could have been little doubt in the jury’s mind that Mr Barrett was an experienced journalist and that is why he was involved in the scheme. Beyond that I do not find the detailed evidence about the specific cases that Mr Barrett has worked on in the past to assist on this application in the manner contended for. Even a cursory consideration of them shows that they are all very different to Mr Barrett’s actions in the present matter.

199. In all of the criminal cases relied upon by Mr Barrett in his affidavit, he cooperated with police at some stage of the investigation. He did not do so in this matter. He provided explanations for that. It was a matter for the jury to assess Mr Barrett’s explanations as to why he did not go to police with what he knew about the Plutus fraud in the present matter.

Conclusion

200. There are certainly a number of unusual features of this case and questions that may never be answered. There is no doubt that Mr Barrett was an experienced journalist. After first meeting with Mr Hausman he contacted Channel Nine on 31 January 2017 and hinted at this story. There is some force in Mr Barrett’s submission that he would not have done that if he was going to be involved in a blackmail of the suspects. But even on the Crown case Mr Barrett had not been fully informed of the details of the blackmail at that time and the story had been fed to him as a “Robin Hood” venture. After contacting Channel Nine, he made no further enquiries until provided material by Mr Hausman on 16 May 2017. Even then, he did not immediately act on that material despite the fact that Mr Hausman’s evidence was that he appreciated the significance of the affidavit when it was provided to him that day. The rational inferences to be drawn from this were matters for a jury.

201. I have also considered Mr Barrett’s submission that there was nothing unusual about him being paid for his journalistic work by Mr Hausman. But it is difficult to see what he was being paid for. Mr Hausman had provided the material to Mr Barrett, not the other way around. Mr Barrett made no inquiries. All he did was attend the blackmail meeting, lie about knowing the shadow director Anthony Palumberi (on instructions from Mr Hausman about what to say) and leave. On any view, it is difficult see what journalistic service he had performed for Mr Hausman. The circumstances of the payment to Mr Barrett were a quintessential jury matter.

202. Having considered all of the relevant facts, I do not consider that the Crown case against Mr Barrett was a strong one. But that is not the relevant test. The test is whether if the prosecution had been in possession of the relevant facts before charging him, it would not have been reasonable to institute the proceedings in the first place.

203. I have concluded that although there are some unanswered questions about aspects of the Crown case, the central question of whether Mr Barrett was a participant in a blackmail, or an innocent journalist used by the principal offenders was a matter properly for a jury to determine. I am not satisfied that had the Crown been in possession of the relevant facts outlined above before the proceedings were instituted, it would have been unreasonable to institute the proceedings.

204. For these reasons, I would refuse the application.

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Decision last updated: 24 April 2024