R v Easton

[1993] QCA 255

IN THE COURT OF APPEAL [1993] QCA 255

SUPREME COURT OF QUEENSLAND

C.A No. 126 of 1993

Brisbane

[R v. Easton]

T H E Q U E E N

v.

GLEN PAUL EASTON

(Appellant)

The Chief Justice
Pincus J.A.

Demack J.

Judgment delivered 15 July 1993

Joint Reasons of Pincus J.A. and Demack J., the Chief Justice separately. All concurring as to the order made.

APPEAL AGAINST CONVICTION ALLOWED. CONVICTION SET ASIDE.

DIRECT THAT A VERDICT OF ACQUITTAL BE ENTERED

CATCHWORDS:	CRIMINAL LAW - misappropriation of property - whether cheque applied by appellant to his own use - meaning of "applied" discussed
Counsel:	Mr P Alcorn, for the appellant. Ms L Clare, for the respondent.
Solicitors:	Legal Aid Office for the appellant.
The Director of Prosecutions for the respondent.
Hearing Date:	21 June 1993

IN THE COURT OF APPEAL

Q	UEENSLAND
B	risbane

Before The Chief Justice

Mr Justice Pincus
Mr Jutice Demack

[ R. v. Easton]

C.A. No. 126 of 1993

T H E Q U E E N

v.

GLEN PAUL EASTON

(Appellant)

JUDGMENT - THE CHIEF JUSTICE

Judgment delivered 15.07.93

The reasons which have been prepared by Pincus J.A. and

Demack J. sufficiently set out the issues arising on this appeal and refer to the relevant portions of the evidence. While I agree with their conclusion that the conviction must be set aside, the approach which I take differs from theirs and it is necessary for me to state my reasons. The way in which the case was put to the jury by the learned trial judge and the way in which the summing-up proceeded call for the appeal to be allowed but, in my opinion, there was evidence presented by the Crown in the trial on which a jury, properly directed, might have convicted.

As Pincus J.A. and Demack J. point out, s. 408C of the Criminal Code is regarded as deriving from sources including the English Theft Act 1968. That English legislation, although sharing some features with the Queensland provision, is in other ways differently worded. The offence under the English s. 1(1) is committed when a person dishonestly "appropriates" property belonging to another with an intent which is specified. Section 3(1) then defines what can amount to "appropriation": it is provided that "any assumption by a person of the rights of an owner" will suffice. The Queensland section by contrast does not refer to "appropriation" and relies instead on the concept of "application". The offence constituted by the Queensland section refers to the action of one "who dishonestly applies to his own use or to the use of any person - (a) property belonging to another; ...".

The Queensland Attorney-General in moving the relevant bill in the House on its second reading said that it proposed "to make provision for the dishonest appropriation of property". He seemed to regard the concepts of "application" and "appropriation" as identical.

Certain English legislation prior to the 1968 Theft Act shared similar concepts. Section 20(1)(iv)(b) of the Larceny Act, 1916 referred to instances where a person "fraudulently converts to his own use or benefit, or the use or benefit of any other person, (any) property". The authors of the seventh edition of Smith and Hogan's work on Criminal Law at p. 503 make reference to the Eighth Report of the Criminal Law Revision Committee, Cmnd 2977, para. 35, at p. 19, where it appears that the Committee considered that "dishonestly appropriates" in the clause of the bill they were recommending meant the same as "fraudulently converts to his own use or benefit, or the use or benefit of any other person", that being the phrase in the 1916 statute. The Committee, however, also thought that the phrase they recommended had the advantage of being shorter and, as they hoped, clearer. It is true that the 1968 English Act in adopting a reference to "dishonestly appropriates" added a statutory rider which fixed, perhaps artificially, some at least of the meaning of the word "appropriation" appearing in the statute but this brief examination of the background shows that there have been pronouncements to the effect that "applies", "appropriates" and "converts" can, in the context under discussion, all amount to the same thing.

In the field of civil wrong the idea of conversion of the property of another to one's use is familiar enough and the standard method of pleading the tort of conversion involved a reference of this kind: see, e.g. Bullen & Leake & Jacob's Precedents of Pleading, 13th ed. at 957 and ff. The essence of conversion in the modern view is a dealing with the requisite intention with some item of property in a way inconsistent with the rights of the owner as in cases where a person deals with another's goods as his own. In Caxton Publishing Company Limited v. Sutherland Publishing Company (1939) A.C. 178 at 189 there is a reference with approval to some observations of Atkin J. in Lancashire and Yorkshire Railway, London and North Western Railway, and Graeser, Lim. v. MacNicoll (1919) 88 L.J.R.K.B. 601 at 605 where Atkin J. said:

"It appears to me plain that dealing with goods in a manner inconsistent with the right of the true owner amounts to a conversion, provided that it is also established that there is also an intention on the part of the defendant in so doing to deny the owner's right or to assert a right which is inconsistent with the owner's right. That intention is conclusively proved if the defendant has taken the goods as his own or used the goods as his own. Here there is no question but that the defendant did use the goods as his own. He poured them - the carbolic acid - into his own vat or tank."

In the Caxton Publishing Company case, Lord Russell of Killowen considered that there had been a conversion when appellants dealt with infringing copyright material in a way inconsistent with the rights of the owner, this occurring when they commenced to get the offending sheets stitched together for the purpose of incorporating them with their own property into a composite article, namely, a book. He considered that in this way they had dealt with them unequivocally as their own.

Under s. 408C of the Code an intention of a certain kind, namely, a dishonest one is a necessary element of the offence. An impression is created that the offence which is constituted by the section will depend on circumstances that would, at least in some ways, be akin to those involved in the tort of conversion. In the Code section the action will, in addition, be accompanied by a dishonest intent. Cases from the civil field are likely to be illuminating and give assistance in defining that part of the criminal offence in s. 408C which consists of a conversion or application to a use other than that of the owner. Some of the cases taken from the field of tort may, indeed, be more enlightening than some of the English authorities on the English offence of appropriation under the Theft Act 1968 where a particular statutory definition is provided. An authoritative exposition upon certain aspects of that Act may be found in R. v. Morris (1984) 1 A.C. 320.

The statutory definition of "appropriation" enacted by the English provision is of an inclusive kind. Under that definition the extent of the interference with the rights of the owner receives the principal concentration. Under the Queensland s. 408C it is the action of the accused in relation to the relevant item of property which is at the centre of attention. In the end, of course, the words of the Queensland section where they have plain effect must be applied. In many circumstances there will be no difficulty with the application of the words but in some instances, and the present case is one of them, there may be a problem in deciding whether the actions of the accused reach the necessary threshold of effect upon the property in question. The mere formation of a dishonest intention or plan will not be enough under s. 408C - something amounting to an application to use must occur.

In the present case the significance of the evidence constituted by what was apparently an unparticularised Crown case had to be considered. It was necessary, of course, that the jury should have been charged correctly in terms of the section and assisted with their task of weighing the effect of relevant features of the evidence and, as I shall mention, the summing-up is, in my opinion, in this respect deficient.
First, turning to the evidence, it can be conceded that there was a degree of divergence between the prosecution and defence versions of the facts but, on a proper direction, it would have fallen to the jury to consider this in the usual way.

The following view of the evidence was, in my opinion, open for

acceptance by them:

(1) The appellant had possession of the cheque and

he was not entitled to it as he must have known.

(2) The cheque had been with other items upon his

person until taken from him at the watchhouse.

(3) The appellant asserted an entitlement to the cheque and raised what amounted to a claim to its return in due course. He asserted by implication a right to cash the cheque and declared his intention of doing this and retaining its proceeds.

(4) The appellant drew the attention of the custodial officers to the existence of the cheque and may have done so with the object of improving his prospects of being granted bail.

While the learned trial judge gave a reasonably full explanation of "dishonesty" for the purposes of the Code section he did not give a sufficient direction of "applies to his own use". This cheque, like other cheques, had two features: it was a piece of paper susceptible to claims of ownership and, as well, on presentation to a bank it was to be expected that funds would be paid in accordance with its terms.

The phrase "applies to his own use" may not always have the same meaning as, say, "uses for his own purposes" because under the former phrase some relevant use may not yet have commenced while under the latter the use will have been at least initiated. However, even to "apply" involves some utilisation of the thing in question. The composite phrase which s. 408C adopts contains words which, if possible, should all be given their natural meaning. It can be accepted that the section envisages some interaction between the person and the thing and this will not be met merely by the formation of an intention to act or the devising of a plan in respect of the thing. The section nevertheless stops short of requiring that there should be some consumption, expenditure or dissipation of the thing, alteration of its form or utilisation of it to secure some collateral material benefit, although these may be involved. I consider that the requirement of this part of the section is met when there has been a utilisation by the person involved for his own purposes. While the ways in which this may occur are legion, one example may illustrate the very minimal level of activity which I think would be sufficient. If a person takes a picture or work of art belonging to another and puts it in a place for the purposes of his own private enjoyment of it he will have applied it to his own use. He does not, for example, have to sell the picture before it can be said that this has occurred.

Perhaps his plan may be more complicated than this. He may intend to sell the item after a time and in the meantime take pleasure from his private possession of it. On the other hand, he may simply intend to return it after a time. When he first takes the item in an unauthorised way from the person to whom it belongs and carries it towards his house to implement his plan, I consider that he will have already applied it to his own use, although in any such case if he is intercepted at that stage there may, in the absence of admissions on his part, be some difficulty in proving the case against him under s. 408C. One example cannot, it must be conceded, embrace all of the difficult aspects which may arise in the application of the section. Perhaps the principal difference between misappropriation of property under s. 408C and stealing as defined in s. 391 of the Code is that the latter section requires a fraudulent taking or fraudulent conversion usually consisting of an intent to permanently deprive the owner.

Under s. 408C, before an item of property will be "applied", there has to be a mental element, an intention held in relation to the thing, and also there has to be some implementation of that intention, i.e. some act or acts which constitute some dealing with the thing: in simple terms something has to be done to or with the thing. Usually there will be, I think, some influence exerted upon the thing affecting its form, location or its attributes. The "application" will involve some deflection from the purposes of the person to whom the property belongs. In addition, the section stipulates that the application be dishonest. On a charge brought under the section these are the sorts of matters which the jury may have to consider.

It cannot, with respect, be accepted that it was a sufficient or correct direction for the learned trial judge simply to tell the jury that to claim property as one's own will constitute an application of it to one's own use: cf. the pronouncement of Collins J. in connection with the civil wrong of conversion in Consolidated Company v. Curtis & Son (1892) 1 Q.B. 495 at 498. However, to claim something as one's own may,

in some cases, constitute evidence that an application to one's own use has occurred. Nothing in the summing-up in the present case later corrected the erroneous direction upon the effect of the claim made to the property or gave the jury further assistance on the element of the offence involved in the phrase "apply to his own use".

Because there was a body of evidence that the applicant was in possession of and carrying with him a cheque to which he was not entitled and because he had exhibited an intention to treat it as his own and indeed to cash it at some time in the future (in short, the evidence that has been identified in para. (1) to (3) above) and because of the limited extent of dispute raised on these aspects of the evidence, it could be questioned whether the proviso should be applied in the present case. Additional evidence implying application to the appellant's own use, being perhaps a different and additional use may be constituted by the facts summarised in para. (4) above. However, the conclusion should be reached that the appellant was entitled to the jury's consideration of the questions of fact involved in all of these matters, that is, in deciding whether they should be taken as amounting to an application of the cheque by the appellant to his own use. While I am of the view that this evidence is capable of being regarded as constituting an application of the cheque to the appellant's own use, this question was not, on a proper direction, put. This means that the conviction must be set aside.

I accept that this is not a case in which a new trial should be ordered. That is because: so far as it appeared, no measurable loss was suffered by the owners of the cheque (even though this is not an element of the offence as charged); there was no evidence of active wrongdoing associated with the appellant's first coming into possession of the cheque; and there was divergence in the evidence concerning the appellant's real intentions in relation to the cheque.

THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

C.A. No. 126 of 1993

Brisbane

Before The Chief Justice
Pincus J.A.
Demack J.

[R. v. Easton]

T H E Q U E E N

v.

GLEN PAUL EASTON

(Appellant)

JOINT REASONS OF PINCUS J.A. AND DEMACK J.

Judgment delivered 15 July 1993 convicted in the District Court on an indictment of a charge that he dishonestly applied a certain cheque to his own use. Counsel for the appellant, Mr Alcorn, submitted that although it was not perfectly clear what acts or omissions of the appellant were relied on, nothing the Crown proved against the appellant was capable of constituting that which was charged. In support of that contention, Mr Alcorn referred us to passages in the summing-up, demonstrating the way in which the matter was placed before the jury.

For the purposes of disposing of the appeal, it is necessary to explain what happened and was said according to the Crown case in relation to the cheque in question. Evidence was called at the trial from the appellant, whose version of events differed in some important respects from that of the Crown witnesses. That the jury convicted does not necessarily justify an assumption that the appellant's evidence was wholly rejected and the Crown's evidence, which is the basis of the following account, accepted.

On the day on which the offence was alleged to have been committed, 2 January 1992, the appellant was at the Brisbane city watchhouse; he had been arrested in relation to another matter. While being "processed" at the watchhouse, he had a conversation with the watchhouse keeper at the front counter. At the time, property which had been in the appellant's possession was on the counter, in accordance with what appears to be the practice. That property included a cheque drawn in favour of "Creartive" which was, on the evidence, the business name of Demand Marketing Pty Ltd. That company owned the cheque at all material times and the appellant had no connection with that company. The keeper asked the appellant, according to the Crown case, whether he had $10 for cash bail. The conversation then went on :

Appellant: "No, I don't. I haven't cashed my cheque. I

should have."

Keeper: "What cheque?"
Appellant: "The one in there for $5,000. You better write

the number down and cover yourself."

Keeper (looking at the cheque): "Who or what is	Cre
Appellant: "That is the company I work for. I won't have money until I cash it, probably tomorrow or the day after."

The watchhouse keeper put the appellant's property, including the cheque, in a plastic bag with his name on it and stored it until he was released from custody. It appears that when the appellant obtained bail the cheque was returned to him.

The provision under which the appellant was charged is s. 408C of the Criminal Code, subs. 1 of which reads as follows :

"(1) Any person who dishonestly applies to his own

use or to the use of any person -

(a) property belonging to another; or

(b) property belonging to him, which is in his possession or control (either solely or conjointly with any other person) subject to a trust, direction or condition or on account of any other person,

is guilty of the crime of misappropriation of property."

The indictment relied upon paragraph (a); it was common ground that the cheque did not belong to the appellant. The jury may have been in little doubt that whatever the appellant said about the cheque was dishonest, but Mr Alcorn questioned whether the statements made to the watchhouse keeper were capable of constituting the offence charged. Mrs Clare for the Crown argued that some or all of the following events were capable of constituting the offence :

(a)	The taking of the cheque by the appellant, that is, his having come into possession of it.
(b)	His claim to the watchhouse keeper of ownership of the cheque.
(c)	His re-acquiring possession of it from the watchhouse keeper.

The judge did not attempt to define for the jury the acts on which the Crown relied to constitute an application of the cheque within the meaning of the section. His Honour may have refrained from doing so because the Crown did not make clear on what acts it relied. The summing-up was in terms which would probably have conveyed the impression that element (b) relied on by Mrs Clare was the critical one and that it was enough. His Honour said when discussing the offence :

"Now, how do you apply property to your own use? You can do it in many ways, members of the jury. If you claim it as being your own - that is, your own property - that is one way in which you can say that property has been applied to one's own use."

Other passages to the same general effect were as follows :

"Mr Hutton's submission to you was that you would be satisfied that there was a dishonest act or dishonest intention on the part of the accused because on that night he claimed the property and he claimed it as his...Was he dishonestly applying that cheque to his own use? In other words, was he saying, `Look, this is my cheque. This is my cheque.' Was it dishonestly he said that?"

Mr Hutton was the prosecutor.

It should be added that the learned primary judge did not specifically direct the jury that a mere claim to ownership was enough. It appeared that the Crown relied below alternatively, or in addition, on a submission that the appellant came by the cheque dishonestly (event (a) above). After discussing submissions made on that subject the primary judge said :

"Well, I don't know if you can really come to any particular conclusion there as to how it got into the accused's possession, but that is a matter for you."

We were referred to no authority on the question whether a mere dishonest claim to ownership of property can constitute the offence defined by s. 408C(1)(a), of dishonestly applying to the accused's own use property belonging to another. The section, which in its original form was inserted by Act No. 2 of 1979, s. 5, has been considered in only a few cases, the most important of which is R v. Jell; ex parte Attorney-General (1991) 1 Qd.R. 48. That was also a cheque case, but the cheques in question were cashed by the accused, so that there could be no question about their having been applied to the accused's own use; the present problem did not arise.

It appears from the second reading speech (Queensland Parliamentary Debates Vol. 277 p. 3818) that the provision here in question was derived from certain United Kingdom and Victorian legislation. The former is the Theft Act 1968, reference to which will show that the expressions used are not sufficiently similar to make authorities on them of any present help. Section 1(1) of the Theft Act 1968 (UK) makes a person who dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it, guilty of theft. There follow five sections whose function is to define or explain the meaning of expressions used in s. 1(1). Under s. 3(1), any assumption by a person of the rights of an owner amounts to an appropriation.

It appears to us that, despite the legislative history, the Queensland section must be construed on the basis that there has been a deliberate departure from the language used in the United Kingdom legislation. Authorities dealing with the notion of application to one's own use, in other contexts, may be of limited help, as examples. In a sales tax case, Deputy Commissioner of Taxation v. Taubmans (NSW) Pty Ltd (1966) 40 A.L.J.R. 11, the question was whether a paint manufacturer which

supplied its retailers with colour cards for use by customers applied the cards to its own use in so doing. It was held that the cards were applied to the manufacturer's own use by, amongst other things, making them available to the storekeepers to assist prospective buyers. Then in Williams v. Papworth (1900) A.C. 563, a Privy Council case on appeal from New South Wales, one of the questions argued was whether money had been applied by trustees for the maintenance and education of children. The reasons include the statement :

"But the word `applied' does not import a power of selection: it simply means `devoted to' or `employed for the special purpose of'".

The relevant meaning of "apply" in the Oxford Dictionary is - "6. To put to use; to employ, spend, dispose of". The relevant meaning of "use" in the same dictionary is - "1. a. The act of employing a thing for any (esp. a profitable) purpose; the fact, state or condition of being so employed; utilisation or employment for or with some aim or purpose, application or conversion to some (esp. good or useful) end." These two definitions show that there is a close affinity between "apply" and "use", but for present purposes something more than a claim or assertion of ownership is required.

In our view, a claim or assertion of ownership of property will not ordinarily be able to be described as an application of that property to one's own use. Mere words can in some circumstances be caught by the section; for example, an oral agreement whereby property, then in the possession of a bailee, is left with the bailee as security for an advance would no doubt constitute an application of that property for the bailor's own use. Had the appellant been shown to have cashed the cheque or used it as security or lodged it to the credit of his own account with a bank, it would have been an application to the appellant's own use; but the mere claim of ownership, although dishonestly made, was not enough. The point may, in our view, be illustrated by considering the application of the section to a physical chattel. If a person occupying the driver's seat of a motor car says dishonestly, "This car is mine", that will not, at least in general, amount to an application of the car to the use of the person making the false statement.

It becomes unnecessary to consider whether either event (a) or event (c) mentioned above would have sufficed. That is so because, as to the former, the jury was not given to understand that proof of a dishonest taking was essential to a conviction;

indeed, the judge told the jury, as we have pointed out, that he did not know if they could come to any particular conclusion on the way in which the cheque came into the appellant's possession. As to event (c), nothing was said about that in the summing-up and there is no clear evidence about the circumstances of the return of the cheque to the appellant.

It should be added that the summing-up did not suggest that the appellant could be convicted on the basis that he had used the cheque to attempt to obtain bail on the strength of his possession of it; nor was any such case put to the appellant in cross-examination. Mrs Clare contended that the Court should hold that there was no miscarriage of justice because the appellant might have been convicted of stealing on the Crown evidence. But the jury had no directions about stealing, nor is it by any means obvious that they would have convicted the appellant of stealing the cheque, had that been charged.

The appellant was sentenced to one month's imprisonment; we assume that term has been served. The appeal against the conviction will be allowed, the conviction set aside and a verdict of acquittal entered.