R v Clark

Case [2023] SASCA 15

Supreme Court of South Australia

(Court of Appeal: Criminal)

R v CLARK

[2023] SASCA 15

Judgment of the Court of Appeal  

(The Honourable President Livesey, the Honourable Justice Bleby and the Honourable Justice David)

23 February 2023

CRIMINAL LAW - PROCEDURE - ADJOURNMENT, STAY OF PROCEEDINGS OR ORDER RESTRAINING PROCEEDINGS - STAY OF PROCEEDINGS

CRIMINAL LAW - PARTICULAR OFFENCES - PROPERTY OFFENCES - THEFT

CRIMINAL LAW - PARTICULAR OFFENCES - PROPERTY OFFENCES - MISAPPROPRIATION - FRAUDULENT CONVERSION BY PERSONS ENTRUSTED WITH PROPERTY

EQUITY - TRUSTS AND TRUSTEES - DISCRETIONARY TRUSTS

Crown appeal on an issue antecedent to trial.

The respondent is charged on Information with 46 counts of theft, contrary to s 134(1) of the Criminal Law Consolidation Act 1935 (SA) (‘CLCA’), and seven counts of dishonestly dealing with documents, contrary to s 140(4) of the CLCA. The property the subject of the first 15 counts of theft was held on a discretionary trust by a trustee company, First Rundle. Another company, First Rundle B, was the primary beneficiary under the trust deed.

The respondent was the sole director and shareholder of both companies. He held the shares in First Rundle B on trust for MF.

The balance of the theft counts also concerned property held on a discretionary trust by First Rundle. At the time of the dealings the subject of these charges, the trust deed had been varied to add MF as a primary beneficiary.

At the request of the trial judge, the prosecution particularised the ‘owners’ of the property, for the purposes of the elements of the offence of theft, as First Rundle and First Rundle B in respect of the first 15 counts, and First Rundle, First Rundle B and MF for the purposes of the balance of the counts.

The trial judge stayed the first 15 counts on the basis that the prosecution could not prove beyond reasonable doubt that the First Rundle and First Rundle B did not consent to the respondent dealing with those funds to meet various personal and other expenses, as required by s 134(1)(b). This was because the respondent was the sole director and shareholder of both those companies. The judge declined to stay the balance of the counts in respect of which MF was particularised as an owner.

The Director contends on appeal that the trial judge erred in staying Counts 1 to 15.

The respondent cross-appeals against the failure to stay the balance of the theft charges, challenging the rulings made by the judge to the effect that:

•where multiple owners of property are particularised, the prosecution need only prove lack of consent of one owner to establish the offence of theft; and

•where the accused is a trustee of a discretionary trust, and the property the subject of the charge comprises funds held on that trust, the objective elements of theft can be established where the owner particularised on the Information is only a potential beneficiary of the trust.

Held, by the Court, allowing the appeal, dismissing…

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R v Clark [2023] SASCA 15
Case
[2023] SASCA 15
Decision Date

CaseChat Overview and Summary

The Supreme Court of South Australia, constituted by Livesey P, Bleby and David JJ, considered an appeal and a cross-appeal concerning a District Court judge's decision to stay certain counts of an information. The respondent faced 46 counts of theft and seven counts of dishonestly dealing with documents. The trial judge had stayed counts 1 to 15, finding that the prosecution of these counts was "foredoomed to fail" and thus constituted an abuse of process, while refusing to stay the remaining charges. The Director of Public Prosecutions appealed this decision, and the respondent sought to cross-appeal the refusal to stay the other charges.

The central legal issue before the Supreme Court was whether the trial judge erred in ordering a stay of counts 1 to 15. Specifically, the appeal questioned whether the prosecution could establish, beyond reasonable doubt, the absence of consent from the owner of the trust funds to the respondent's dealings with them, as required by section 134(1)(b) of the Criminal Law Consolidation Act 1935 (SA). The respondent, being the sole director and shareholder of both the trustee and beneficiary companies, argued that his actions were implicitly consented to. The court also considered the respondent's cross-appeal regarding the refusal to stay the remaining charges.

The Court reasoned that the trial judge's determination that the prosecution was "foredoomed to fail" was an error. The prosecution's case relied on proving the absence of consent from the legal owners of the trust funds. Given the respondent's sole control over the companies acting as trustee and beneficiary, the question of consent was a matter of fact to be determined at trial, not a basis for a pre-trial stay. The Court held that the evidence the prosecution proposed to lead *could*, if accepted, prove the absence of consent, meaning the prosecution was not incapable of succeeding. Therefore, the stay of counts 1 to 15 was not warranted.

Consequently, the Supreme Court allowed the Director's appeal, setting aside the order that stayed the prosecution on counts 1 to 15. The Court dismissed the respondent's cross-appeal. The final outcome was that all charges against the respondent were to proceed to a hearing in the District Court.

Orders

Orders of the court

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Background

Background to the litigation

For the reasons that follow, the judge erred in ordering the stay of Counts 1 to 15. He did not err in refusing to order a stay of the remaining counts of theft. We allow the appeal, dismiss the cross-appeal and set aside the stay. All charges should proceed to hearing in the District Court.Procedural background The respondent is charged on Information with 46 counts of theft, contrary to s 134(1) of the CLCA, and seven counts of dishonestly dealing with documents, contrary to s 140(4) of that Act. On 14 April 2022, the trial judge stayed the trial of Counts 1 to 15 on the basis that the prosecution of those counts was foredoomed to fail and, in consequence, that to permit the prosecution to proceed would amount to an abuse of process.[1][1] [2022] SADC 45. The judge declined to stay the prosecution of the balance of the charges pending an appeal by the Director. Similarly, he declined to give the respondent permission to appeal to press what has become the cross-appeal. The Director made an urgent application to this Court on 22 April 2022, seeking a stay of the trial of the balance of the charges pursuant to s 158(6)(c) of the Criminal Procedure Act 1921 (SA) (‘CPA’). On 26 April 2022, this Court granted a stay to avoid the exercise of its appellate jurisdiction being rendered inutile.[2][2] Cf. R v Elliot (1996) 185 CLR 250 at 257 (Brennan CJ, Gummow and Kirby JJ); R v Rolfe [2021] HCATrans 137 at 3-4 (Gleeson J). On the granting of the stay of the trial pending appeal, the Director did not oppose the respondent raising questions by way of cross-appeal. On 27 April 2022, both the appeal and the cross-appeal were listed for hearing before this Court. Pursuant to s 157(1)(c)(i) of the CPA, the Director of Public Prosecutions has a right of appeal against a decision on an issue antecedent to trial on any ground that involves a question of law alone. By s 151 of the CPA, the term ‘issue antecedent to trial’ is defined to mean a question as to whether proceedings on an information, or a count of an information, should be stayed on the ground that they are an abuse of process of the court. The appeal The Court’s powers on an appeal against a decision on an issue antecedent to trial are governed by s 158(6) of the CPA. The Director’s sole ground of appeal is in the following terms:The trial Judge erred in staying counts 1 through 15 on the Information on the basis that the prosecution can never establish beyond reasonable doubt that First Rundle Pty Ltd, or First Rundle B Pty Ltd, respectively the trustee and the beneficiary of the First Rundle Trust, as owners of the trust funds within the meaning of s 130 of the Criminal Law Consolidation Act, 1935 (SA) did not consent to the respondent dealing with the trust funds as he did, in circumstances where the defendant was the sole director and sole shareholder of both First Rundle Pty Ltd and First Rundle B Pty Ltd. The question for this Court on the appeal is essentially whether the evidence which the prosecution proposes to lead could, if accepted, prove an absence of consent as required by s 134(1)(b) of the CLCA. Section 134 is in the following terms:134—Theft (and receiving)(1) A person is guilty of theft if the person deals with property—(a) dishonestly; and(b) without the owner's consent; and(c) intending—(i) to deprive the owner permanently of the property; or(ii)to make a serious encroachment on the owner's proprietary rights.Maximum penalty: (a) for a basic offence—imprisonment for 10 years;(b) for an aggravated offence—imprisonment for 15 years.(2) A person intends to make a serious encroachment on an owner's proprietary rights if the person intends—(a)to treat the property as his or her own to dispose of regardless of the owner's rights; or(b)to deal with the property in a way that creates a substantial risk (of which the person is aware)—(i) that the owner will not get it back; or(ii)that, when the owner gets it back, its value will be substantially impaired.(3) It is possible to commit theft as follows:(a)a person may commit theft of property that has come lawfully into his or her possession;(b)a person may commit theft of property by the misuse of powers that are vested in the person as agent or trustee or in some other capacity that allows the person to deal with the property.Example—Suppose that land is vested in a trustee in a fiduciary capacity. She is empowered under the instrument of trust to mortgage the land for the purposes of the trust. The trustee dishonestly mortgages the land as security for a personal liability that is unrelated to the trust. In this case, the trustee commits theft of the interest created by the mortgage.(4) If a person honestly believes that he or she has acquired a good title to property, but it later appears that the title is defective because of a defect in the title of the transferor or for some other reason, the later retention of the property, or any later dealing with the property, by the person cannot amount to theft.(5) Theft committed by receiving stolen property from another amounts to the offence of receiving but may be described either as theft or receiving in an instrument of charge and is, in any event, punishable as a species of theft.(6) If a person is charged with receiving, the court may, if satisfied beyond reasonable doubt that the defendant is guilty of theft but not that the theft was committed by receiving stolen property from another, find the defendant guilty of theft.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

We grant permission to appeal on the second ground of cross-appeal but dismiss the cross-appeal.Conclusion We allow the appeal and set aside the order staying the prosecution on Counts 1 to 15. We dismiss the cross-appeal.

Ratio Decidendi

Legal Principle Established

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