R v Evans & Doyle - [1999] VSC 488

SUPREME COURT OF VICTORIA

CAUSES JURISDICTION

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Not Restricted

Plaintiff

ALAN BARTLE EVANS and

GREGORY JAMES DOYLE

Defendants

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JUDGE:	McDonald J
WHERE HELD:	Melbourne
DATE OF HEARING:	In the course of trial which commenced on 5 October 1999
DATE OF RULING:	15 November 1999
MEDIA NEUTRAL CITATION:	[1999] VSC 488

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Criminal Law – "no case" submission – "insider trading" – agreement to purchase securities – authorisation of broker to purchase shares not the entry into an agreement to purchase securities within s.1002G(2)(a) of Corporations Law - Corporations Law s.1002B(1),(2),(3): 1002G(1)(a),(b), 2(a).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr I.D. HILL QC with Mr G.T. Chettle	Director of Public Prosecutions (Commonwealth)
For the Defendant Evans	Mr M. Rozenes QC with Mr T. Thomas	Corrs, Chambers Westgarth
For the Defendant Doyle	Mr P.J. O'Callaghan QC with Mr P.D. Santamaria	Freehill Hollingdale & page

HIS HONOUR: The accused Evans and Doyle are presented before this court on their trial on an indictment signed by a duly authorized delegate on behalf of the Director of Public Prosecutions for the Commonwealth. The indictment was filed with the court on 13 August 1999. The accused are jointly charged on two counts on the indictment of the crime of "insider trading", it being alleged that as "insiders" (see s.1002G(1) of the Corporations Law) they jointly acted in breach of s.1002G2(a) of the Law which by s.1311(1) of the law constitutes the commission of an offence. Those particulars of the sections of the Law as constituting the crimes with which the accused are charged are endorsed on the indictment.

On each count the accused are jointly charged that on 20 November 1995 they entered into an agreement to purchase shares in Mt Kersey Mining NL at a time when they were in possession of information which was not generally available, but which if it had been so available would have been expected by a reasonable person materially to affect the price or value of shares in Mt Kersey Mining NL and that they knew or ought to have reasonably known that the information was not generally available and that if it had been so available that it might have a material effect on the price or value of those shares.

In respect of count 1, it is alleged that the accused entered into an agreement to purchase 30,000 shares in Mt Kersey Mining NL. On count 2 it is alleged that the accused entered into an agreement to purchase 136,000 shares in Mt Kersey Mining NL.

Previous to the indictment before the court which was filed on 13 August 1999 the accused were each charged on an indictment filed on 7 December 1998. That indictment contained 3 counts. Again, by that indictment, the accused were charged with crimes of "insider trading". It was alleged against each accused that at the relevant times they were each "insiders" as defined by s.1002G(1) of the law and that they had committed offences…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading R v Evans & Doyle

Details

AGLC: R v Evans & Doyle [1999] VSC 488
Case: [1999] VSC 488
Decision Date: 15 November 1999

CaseChat Overview and Summary

The appeal by the respondents, Evans and Doyle, against their conviction for insider trading was heard in the Court of Appeal. The respondents were found guilty of contravening section 1002G of the Corporations Law by agreeing to purchase securities and authorising a broker to purchase shares, based on information they possessed due to their positions within a company. The appeal centred on whether the authorisation of a broker to purchase shares constituted an agreement to purchase securities within the meaning of section 1002G(2)(a) of the Corporations Law.

The central legal issue was whether the authorisation of a broker to purchase shares, in the context of insider trading, constituted an agreement to purchase securities. The respondents contended that merely authorising a broker did not equate to entering into an agreement to purchase securities. The prosecution argued that the authorisation was an integral part of the agreement. The court had to determine whether the authorisation was sufficiently linked to the agreement to purchase securities to constitute a contravention of the law.

The Court of Appeal found that the authorisation of a broker to purchase shares did not in itself constitute an agreement to purchase securities. The court reasoned that the agreement to purchase securities was a distinct step that required explicit communication between the parties involved in the transaction. Authorising a broker was merely an operational step in the execution of a pre-existing agreement. Given this distinction, the court concluded that the prosecution failed to prove an essential element of the offence beyond reasonable doubt. Consequently, the convictions were quashed, and the appeal was allowed.

Orders