R v Faiello - [2018] SADC 82

DISTRICT COURT OF SOUTH AUSTRALIA
(Criminal)
R v FAIELLO
[2018] SADC 82
Reasons for Ruling of Her Honour Judge McIntyre
30 July 2018
CRIMINAL LAW - PARTICULAR OFFENCES - DRUG OFFENCES - PROCEDURE
Disputed facts hearing. Defendant contends that his plea of guilty was entered on the basis that he was transporting the drugs that are the subject of the charge rather than selling the drugs himself. The prosecution does not accept that assertion.
Held: Defendant has not established on the balance of probabilities that he was merely transporting the methylamphetamine. The prosecution has proven beyond reasonable doubt that he possessed the drugs with the intention of selling those himself.
Controlled Substances Act 1984 (SA) s4;s32; Listening & Surveillance Devices Act 1972 (SA) ; Evidence Act 1929 s34P; Controlled Substances (Controlled Drugs, Precursors and Plants) Regulations 2014 Schedule 1, referred to.
R v Olbridge (1999) CLR 270; R v Kreutzer [2013] SASCFC 130; R v Tran [2017] SASCFC 99, considered.

R v FAIELLO
[2018] SADC 82
Introduction

The defendant Daniel Rocco Faiello was committed to the District Court on a charge of trafficking in a controlled drug, methylamphetamine, contrary to s.32 (3) of the Controlled Substances Act 1984 (S.A.).
On his first arraignment in the District Court on 19 January 2018 Mr Faiello entered a plea of guilty to that charge. The matter was listed for submissions on 21 March 2018. On the day of submissions a report from a psychologist Ms Darmenia dated 24 February 2018 was provided to the Director for Public Prosecutions and to the Court. It was apparent from the history taken by Ms Darmenia that there was a dispute as to the factual basis for the plea. Ultimately it was necessary to proceed by way of a disputed facts hearing.
Mr Faiello contends that his plea of guilty was entered on the basis that he was transporting the drugs that are the subject of the charge rather than selling the drugs himself. The prosecution does not accept that assertion. The prosecution says that Mr Faiello was in possession of the drugs with the intention to sell them himself.
The Facts
At about 4.45 pm on 1 March 2016 the police stopped a black Mercedes Benz, SA Registration 12633 on Walkerville Terrace at Walkerville (“the Mercedes”). Mr Faiello was the driver of this vehicle. The vehicle was registered to Chrelik Pty Ltd, a business owned and operated by Christopher Khoury an associate of Mr Faiello. Police searched the vehicle. Hidden behind the air-conditioning panel in the front console police found a plastic resealable bag containing a white crystalline substance. The contents of that bag weighed a total of 22.4 grams and contained 17.9 grams of pure methylamphetamine. The bag was swabbed and tested for DNA. There is extremely strong support (greater than one hundred billion) for the hypothesis that Mr Faiello is a contributor to the mixed DNA profile obtained.
The police also located a shoulder bag or satchel which contained a set of electronic scales with white residue subsequently determined to contain methylamphetamine, $1,500 cash in $50 notes, a Blackberry and an I-phone 4. Three further mobile devices were found; a Blackberry found during a search of Mr Faiello, an I-phone 6 located in the centre console of the car and an android mobile phone located in the right hand driver’s side pouch of the car. Finally, police found a plastic bag in the boot of the vehicle which held a plastic drink bottle with a hidden cavity containing a number of new empty plastic resealable bags.
Between the 25^th February 2016 and 1 March 2016 Mr Faiello was apparently living at 42 Overland Road, Croydon Park. Those premises were under surveillance as part of a wider police investigation. Listening and surveillance devices had been installed inside and outside the premises under the terms of a warrant under the Listening and Surveillance Devices Act 1972 (SA) issued on 18 January 2016 (‘the warrant’).
A camera installed outside the premises records Mr Faiello coming and going from the Croydon Park premises in the Mercedes between 25 February 2016 and 1 March 2016. A camera and listening device installed in the kitchen area recorded a number of conversations involving Mr Faiello and a number of activities that he undertook between 25 February and 28 February 2018. The recordings formed a major part of the evidence in the disputed facts hearing.
Statutory Context
The charge of trafficking in amphetamine is brought under s.32(3) of the Controlled Substances Act (1984) (SA) (“CSA”). This section provides that “a person who traffics in a controlled drug is guilty of an offence”.
Trafficking is defined in s.4 of the CSA as either selling, having possession intending to sell or taking part in the process of sale of a controlled drug.
Section 32(5) of the CSA provides for a reverse onus in relation to the question of an accused’s intention or belief. That sub-section provides as follows:
(5)If, in any proceedings for an offence against subsection (1), (2), (2a) or (3) it is proved that the defendant had possession of a trafficable quantity of a controlled drug, it is presumed, in the absence of proof to the contrary—
(a)in a case where it is alleged that the defendant was taking part in the process of sale of the drug, that the defendant—
(i)was acting for the purpose of sale of the drug; and
(ii)had the relevant belief concerning the sale of the drug necessary to constitute the offence; or
(b)in any other case—that the defendant had the relevant intention concerning the sale of the drug necessary to constitute the offence.
Mr Faiello admits possession of 22.4 grams of material which contained 17.9 grams of pure methylamphetamine. The trafficable quantity of methylamphetamine is a mixed weight of 2 grams.[1] It is agreed by both prosecution and defence that ss32(5) has no application in the present circumstances because Mr Faiello has admitted that he had the necessary state of mind by his plea and that the difference between the parties is the factual basis upon which he is to be sentenced.
[1] Schedule 1 Controlled Substances (Controlled Drugs, Precursors and Plants) Regulations 2014.
Defence counsel contends that Mr Faiello was taking part in “the process of sale”. Section 4(5) of the CSA expands upon the concept of “the process of sale” as follows:
For the purposes of this Act, a step in the process of sale of a controlled drug includes, without limitation, any of the following when done for the purpose of sale of the drug:
(a)     storing the drug;
(b)     carrying, transporting, loading or unloading the drug;
(c)     packaging the drug, separating the drug into discrete units or otherwise         preparing the drug;
(d)     guarding or concealing the drug;
(e)     providing or arranging finance (including finance for the acquisition of the     drug);
(f)      providing or allowing the use of premises or jointly occupying premises.
Counsel for the defence identified s.4(5)(b) as the basis upon which Mr Faiello ought to be sentenced. Specifically it is said that Mr Faiello was transporting the methylamphetamine for another for limited financial reward.
The prosecution, on the other hand, contends that Mr Faiello was in possession of the methylamphetamine located in the car intending to sell it. That is, he was not taking “a step in the process of sale” rather he was selling it himself.
The Hearing
Circumstances of aggravation must be established beyond reasonable doubt whereas the burden of establishing mitigatory factors lies on the defendant on the balance of probabilities.[2]
[2] R. v Olbridge (1999) 199 CLR 270 and R. v Kreutzer (2013) SASCFC 130
Mr Faiello did not give evidence. Accordingly, the only information I have concerning his version of events is from counsel’s submissions and the material contained in the report of Ms Darmenia. I have no evidence whatsoever as to what he alleges was his involvement with the drugs. Specifically I do not know what arrangements are alleged, who the parties to the arrangements are said to be, what understanding Mr Faiello had about the drugs, the precise nature and extent of Mr Faiello’s alleged involvement in the transportation nor the payment that he was to receive if any. Accordingly he has not discharged the burden of establishing the mitigatory factor for which he contends. That is, he has not established that I ought to sentence him on the basis that he was merely transporting the drugs for limited financial gain. This does not necessarily, as the Honourable the Chief Justice noted in R v Kreutzer[3], prove the converse. It remains for the prosecution to prove beyond reasonable doubt that Mr Faiello had possession of the drugs intending to sell them.
[3] Op. Cit. at [36].
As I have indicated above, the police found a number of items in Mr Faiello’s possession in addition to the methylamphetamine. These included a large amount of cash in $50 notes, a set of scales with traces of methylamphetamine and two mobile telephones in Mr Faiello’s satchel. A number of plastic bags suitable for packaging and repackaging drugs were located hidden in a secret compartment of a drink bottle found in the boot of the car. In addition to the two mobile devices found in Mr Faiello’s bag he had on his person and within the car, three further mobile devices. All of these items are consistent with someone who is actively involved in selling drugs as opposed to someone who is merely transporting them. I further note that the methylamphetamine had a significant value in the order of $11,200 to $22,400 if sold in points[4].
[4] Declaration of Benjamin Ward dated 15 February 2018
I consider that the prosecution has established that Mr Faiello had possession of the drugs with the intention of selling them because he also had possession of all of the tools of the trade of a person who intended to sell drugs present in the Mercedes and, in my view, there is no reasonable hypothesis consistent with innocence available on the evidence. In those circumstances it is not strictly necessary to go further and consider the effect of the surveillance evidence. However, in deference to the submissions put forward I will do so.
The evidence relied upon by the prosecution comprised the surveillance material obtained by the police under the terms of the warrant, uncontentious declarations relating to the search of the vehicle and the investigation generally, and the forensic science declarations relating to that material. A number of items were tendered as exhibits; Exhibit P1 is a USB stick which contained the audio-visual material from the recording device installed in the kitchen of the Croydon Park premises; Exhibit P2 is a disc of the surveillance material from the external camera and Exhibit P3 is a bundle of 20 photographs comprising screen shots from the internal surveillance. Relevant aspects of the surveillance material were played in court.
Surveillance Evidence
On 25 February 2016 the surveillance device installed at the front of the Croydon Park premises captured Mr Faiello attending that address with Carli Murdock and Christopher Khoury at 2.17pm. The surveillance footage from inside the premises on the same day and time records a conversation between the trio from which it can be inferred that Mr Khoury is showing Mr Faiello and Ms Murdock around the premises with a view to one or both of them occupying the house.
From 25 February 2016 until 1 March 2016 Mr Faiello can be seen driving the Mercedes to and from the Croydon Park premises.[5] Whilst Mr Faiello is not the only person using the Mercedes he appears to be the main driver of that vehicle during that period. Mr Faiello can also be observed accessing the Mercedes without driving it on a number of occasions; namely on 25, 26 and 28 February and on 1 March 2016.
[5] Exhibit P2; Declaration of Mark Andrew Nelson dated 20 July 2017 and attached spreadsheet.
On Saturday 27 February 2016 the surveillance device inside the Croydon Park premises records the movements of Mr Faiello, his interactions and conversations with Mr Khoury and Ms Murdock in the kitchen lounge area of the premises. Portions of this surveillance material were played in court and the parties made submissions about what can be seen and heard in that material. Having carefully considered the material and the submissions I make the following observations and findings:[6]
[6] Numbers in brackets are references to time stamps on the surveillance material
·On a number of occasions throughout the course of that day Mr Faiello can be seen with a satchel or shoulder bag. It appears to be his method of transporting his personal items such as keys. The bag is sufficiently similar in appearance to the satchel or shoulder bag located in the Mercedes on 1 March 2018[7] for me to conclude that it is the same bag.
[7] See photographs annexed to the declaration of David Philip Pedder dated 27 April 2016
·In conversation with Mr Khoury, Mr Faiello discusses manufacturing a product that given the content and context of the discussion I conclude was an illicit drug. Mr Faiello says that he “used to cook it bro” and explains how the product is dried using Pyrex dishes. In the context of that discussion Mr Faiello tells Mr Khoury that he has “gotta go pick up three ounces now”. I conclude from the context of the discussion, and from what can be observed subsequently, that Mr Faiello is referring to three ounces of an illicit drug. (at 13.02 – 13.05).
·Later that afternoon Mr Faiello has a conversation with Ms Murdock in which he asks her “What do you want, you want half a…..?” There is some background noise as Ms Murdock is unpacking groceries but she can be clearly heard to reply “A gram”. Mr Faiello makes a partly inaudible reply in which he mentions “scales”. He then leaves the kitchen briefly and returns with a white object (at about 17.54).
·There was a dispute about what can be observed on the surveillance video after this. The prosecutor contended that Mr Faiello can be seen at the breakfast bar with a plastic bag of white powder and a set of scales and that he is then engaged in repackaging a portion of the white powder. Defence counsel contended that it is far from clear that the item seen on the counter was a set of scales and that it is also not clear what, if anything, Mr Faiello is doing. My observation was that Mr Faiello had a plastic bag containing white powder and that he repackaged a portion of it into a smaller bag. He can be seen (at 17.57.43) either giving that smaller bag to Ms Murdock or placing it on the kitchen counter in front of her. Whilst it is possible that Mr Faiello had a set of scales on the breakfast bar the vision is not sufficiently clear for me to be certain of that. I therefore proceed on the basis that he did not.
·During the course of the afternoon and evening Mr Faiello can be seen handling the plastic bag containing white powder on a number of occasions. He variously has the bag in his hands and places it on the kitchen counter, the breakfast bar and in his shoulder bag. On two occasions he can be seen removing white powder from the bag and placing it in a pipe. He then lights and apparently smokes the pipe in a manner commonly adopted by people smoking methylamphetamine or ice.
·On the basis of the abovementioned material I accept beyond reasonable doubt that the white powder is an illicit drug specifically methylamphetamine.
·Just prior to midnight (at 23.30) Mr Faiello can be heard on a mobile telephone making an arrangement to meet someone at McDonalds on the corner of Torrens Road and South Road. I have considered the recording[8] and the transcript prepared by the police[9]. In general terms I agree with the transcription but there are some subtle differences between my view of the conversation and that of Officer Golder. It is my view that in the course of that conversation Mr Faiello can be heard to say “Yeah, yeah, yeah just meet me at the McDonalds. What does your mate want? The same hey? Yeah alright I’ll do it now. Ciao.”
·Immediately following this telephone conversation Mr Faiello can be seen in the kitchen changing the mobile telephone for another in his shoulder bag. He then commences a call on the second mobile. During the next 15 – 20 minutes Mr Faiello moves in and out of the kitchen area, engages in a number of telephone conversations and conducts a lengthy argument with Ms Murdock.
·Clearly visible on the kitchen counter throughout this time, amongst other items, is Mr Faiello’s shoulder bag and the plastic bag of white powder.
·Ms Murdock can be seen in the kitchen apparently making some food. During the course of this she can be seen moving the plastic bag of methylamphetamine around the counter for no apparent reason. (At about 23.44)
·Mr Faiello then repackages a quantity of white powder by decanting some from the plastic bag into a smaller plastic bag. Again it is not clear whether he is using scales in that process. (Commencing at about 23.49.36) As Mr Faiello is doing this he makes a call to someone who informs him that he is at McDonalds. Mr Faiello replies “Give me five minutes and I’ll be there. I’ll come and bring the car alright.” Mr Faiello then speaks in Italian but concludes by saying, in English, “I’ll be there in, give me ten, I’m gonna do it now alright. Ciao”. Mr Faiello can then be seen finishing the repackaging and then placing a number of items from the kitchen counter in his shoulder bag. He also picks up the large plastic bag of white powder and then leaves the kitchen (about 23.54).
·Mr Faiello can be seen in the surveillance material from the external camera leaving the Croydon Park premises on foot at about 23.53.50 and returning at about 23.59.01. He is carrying his shoulder bag in both portions of video.
·The prosecutor contends that the telephone conversation at 23.30 and Mr Faiello’s subsequent actions were indicative of Mr Faiello arranging and attending a drug transaction. I am satisfied that this is the case.
·During the course of Mr Faiello’s argument with Ms Murdock in the latter stages of the evening he can be heard accusing her of stealing “gear” from him (23.49). I accept that this is a reference to the methylamphetamine because at the time he makes the accusation Mr Faiello is handling the bag of white powder and further adds “Just ask man and I would have gave you a pipe.” The prosecutor further contends, and I accept, that this together with the previous surveillance material demonstrates Mr Faiello was treating the methylamphetamine as his own.
In summary therefore I accept beyond reasonable doubt that the powder in the white plastic bag is methylamphetamine and that Mr Faiello treats this as his own. I further accept that Mr Faiello was involved in a drug transaction on the evening of 27 February 2016.
[8] Exhibit P1
[9] Appendix F to the declaration of James Golder 13 July 2016
Submissions
The prosecution contended that the surveillance and the items found during the search of the Mercedes establishes that these were not drugs that Mr Faiello was couriering from A to B for someone else. Rather it is said that this evidence leads to the inevitable conclusion that the drugs that were in Mr Faiello’s possession on 1 March were his drugs and that he had the intention to sell some or all of those drugs. The prosecution further contends that the plastic bag containing white powder that Mr Faiello can be seen dealing with on 27 February are the “three ounces” that he told Mr Khoury that he was going to collect and that it is the same plastic bag containing methylamphetamine that police later find in the centre console of the Mercedes.

The defence on the other hand say that there is nothing inconsistent between the evidence relied upon by the prosecution and Mr Faiello’s contention that he was transporting the drugs found in his possession on 1 March 2016. Counsel for Mr Faiello says that the surveillance material upon which the prosecution relies occurs mostly on Saturday 27 February 2016 and yet Mr Faiello was not stopped in the Mercedes until Tuesday 1 March 2016. It is further submitted that there is no evidence of a technical or forensic nature as to what was in the plastic bag seen on Saturday 27 February 2016. Whilst there is an inference that the white powder could have been a drug it is not possible to say what quantity or quality of drug was in that bag. It is further said the prosecution contention that the plastic bag shown on the Saturday surveillance bears a striking resemblance to the item seized by police on Tuesday is not sustainable.
I have found beyond reasonable doubt that the white powder in Mr Faiello’s possession on Saturday 27 February 2016 was methylamphetamine and that he was treating it as if it was his own. What is less certain is whether it is the same methylamphetamine and the same plastic bag as that located in the Mercedes on Tuesday 1 March 2016. There is a period of over 60 hours between the last surveillance and the police search. Whilst the two bags and their contents are undoubtedly similar in appearance, the courts often see drugs such as methylamphetamine packaged in precisely the same manner. There is nothing particularly distinctive about the method of packaging that would enable one to say that it was the same bag and the same substance. I consider it likely, even probable, that it is the same bag but could not exclude as a reasonable hypothesis that it is a different bag.
What is however not in dispute is that Mr Faiello was found in possession of a plastic bag containing white powder containing 22.4g of mixed methylamphetamine. It is not necessary in my view for the prosecution to prove that it was the same plastic bag as that seen in the footage of 27 February in order to establish beyond reasonable doubt that Mr Faiello had possession of that drug, intending to sell it. I have found that the items located in the car are of themselves sufficient to establish the offence beyond reasonable doubt for the reasons set out above. That view is reinforced by the surveillance evidence.
The surveillance evidence that I have referred to and my findings about that evidence indicate that Mr Faiello had a quantity of methylamphetamine and was prepared to enter into a drug transaction shortly in the days leading up to the search of the Mercedes. Defence argues that this evidence is evidence of discreditable conduct presumably a reference to section 34P of the Evidence Act (1929) (SA). Strictly speaking section 34P only applies in relation to “..the trial of a charge of an offence.” which is, of course, not the situation here. The offence is admitted; it is the factual basis for sentencing that is in contention. However, even at trial such evidence can be admitted as circumstantial evidence of a fact in issue in certain circumstances.[10] In my view it is proper to have regard to the surveillance material as showing a propensity or disposition on the part of Mr Faiello to deal with methylamphetamine in the manner that I have described only a few days before the search. It is strongly probative of an intention to sell the drugs in his possession.[11]
[10] Section 34P(2) & (3)
[11] R. v Tran [2017] SASFC 99
Conclusion
Mr Faiello has not established on the balance of probabilities that he was merely transporting the methylamphetamine as contended by him. The prosecution has proven beyond reasonable doubt that Mr Faiello possessed the drugs found in the black Mercedes with the intention of selling those himself. This is the basis upon which I will proceed to sentence.