R v LK; R v RK

[2009] HCATrans 310

[2009] HCATrans 310

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney   No S162 of 2009

B e t w e e n -

THE QUEEN

Appellant

and

LK

Respondent

Office of the Registry
  Sydney   No S163 of 2009

B e t w e e n -

THE QUEEN

Appellant

and

RK

Respondent

FRENCH CJ
GUMMOW J
HAYNE J
HEYDON J
CRENNAN J
KIEFEL J
BELL J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 1 DECEMBER 2009, AT 10.16 AM

Copyright in the High Court of Australia

__________________

MR T.A. GAME, SC:   If the Court please, I appear for the appellant with MR H.K. DHANJI in both appeals.  (instructed by Commonwealth Director of Public Prosecutions)

MR J.S. STRATTON, SC:   May it please the Court, I appear with MR P.G. HOGAN and MR A.M. WEBB in the matter of LK.  (instructed by Hanby & Associates)

MR T.E.F. HUGHES, QC:   May it please, your Honours, I appear with my learned friends, MR M.R. GRACIE and MR B.C. KASEP, for the respondent, RK.  (instructed by Mee Ling, Solicitors)

MR S.J. GAGELER, SC, (Solicitor‑General of the Commonwealth of Australia):   If the Court pleases, I appear with MR G.M. AITKEN and MS P. McDONALD for the Attorney‑General of the Commonwealth intervening in both appeals on ground 2 of the notice of contention.  (instructed by Australian Government Solicitor)

MR J.G. RENWICK:   May it please, your Honours, I appear with MS G.E. WRIGHT for the Attorney‑General for New South Wales, intervening on the same basis as the Commonwealth.  (instructed by Crown Solicitor (NSW))

FRENCH CJ:   Yes, Mr Game.

MR GAME:   If the Court pleases, the reprint which I will refer to principally is Reprint No 2.  If I could commence by taking your Honours to the offence charged and then I will give your Honours a brief history of what occurred in these proceedings before coming to the question of statutory interpretation involved.  First of all, if your Honours look at the reprint, section 400.3(2) is the offence which it was alleged that the two respondents conspired with each other and others to commit and it is (2)(b)(i), that is to say:

the money or property is proceeds of crime . . . 

(c)the person is reckless as to the fact that the money or property is proceeds of crime ‑

is the fault element for that particular physical element in terms of the Code, which I will explain in a little detail as events unfold.  Perhaps your Honours could also just notice, before leaving this provision, section 400.3(1) is the more serious offence.  It carries 25 years, whereas the other carries 12 years.  But it has as an element, a physical element, that the money or property is proceeds of crime and it has as the fault element for that physical element that the person believes it to be the proceeds of the crime.  That is not the offence charged in this case.

Now, just before leaving that, this is a fairly common structure in the Code to have offences in descending culpability, intention, recklessness, negligence, which we see in subsection (3) and there are strict liability offences.  Some very serious offences, for example, importing border prohibited substances or precursors, has recklessness attached as the fault element for the most serious offence.  That comes about as an amendment, introduction of some provisions, which I will come to by way of example a little later.  But that is a situation where conduct is divided between the importing of the thing and the circumstances to what the thing is. 

Now, if I may go back to section 11.5 at this point to see how the provisions marry up.  I will obviously have to go through this in a little more detail shortly, but for present purposes 11.5(1):

A person, who conspires with another person to commit an offence punishable by imprisonment for more than 12 months . . . is guilty of the offence of conspiracy to commit that offence and is punishable as if the offence to which the conspiracy relates had been committed.

Now, subsection (2) I will come to and examine in the course of my oral submissions.  For present purposes it could just be noted that it is our case that the offence‑making provision is 11.5(1) and the physical and fault elements are in 11.5(1).  Our opponents submit that they are all to be found in 11.5(2), and I will endeavour to explain in the course of the morning why that is not so.

Before examining further the statutory provisions and the structure of the Code insofar as is necessary, could I just provide your Honours with a very brief resume of what happened in this case.  The indictment is to be found at page 25 of the appeal book, and although you do not have the back of the indictment the charge is under section 11.5, picking up section 400.3(2), but one sees the language of the count, deliberately intending, shall one say, to pick up the language of section 400.3(2).  That is to say, the two respondents to this appeal “did conspire with each other”, with another person “and with divers other persons”, which is very old language in conspiracy, “to deal with the money”, which is the language of the conspiracy provision:

with money to the value of $1,000,000 or more being the proceeds of crime where those persons who were to deal with the money pursuant to the conspiracy were reckless as to the fact that the money was the proceeds of crime.

Now, that intends to pick up a contemplation – that is to say, a contemplation between the conspirators of the physical and mental elements which amount to the commission of the offence under section 400.3(2). The contemplation is a present contemplation.  It is a contemplation about things that will unfold, will happen.  Our case is that there is nothing wrong with pleading a conspiracy in those terms.

Your Honours may have appreciated this, but what distinguishes this case from Ansari, apart from the facts, is that in the language of the indictment where there is a reference there to “the persons were reckless”, the definition of “reckless” – I am sorry; I will start that sentence again.  In Ansari, “reckless” was sought to be proven by establishing awareness.  The definition of “reckless” in the Code says that knowledge or intention can satisfy recklessness.

The thing that distinguishes this case is that the reference to “reckless” there on the facts was accepted by the Crown to rise no further than the definition of “reckless” in the Code for fault elements – that is to say, awareness of the substantial risk that that circumstance existed and that it was not reasonable to take the risk in the circumstances.  Those are not the exact words, but I will come to them.  So that is, shall I say, the central thing that distinguishes this case from Ansari. 

Now, what happened in this case was this, that there was a demurrer we see at page 29, ie, it was alleged that the indictment was bad.  There is no need to go to the provisions but it could just be noted that sections 17 and 18 of the Criminal Procedure Act require that a demurrer be brought prior to the commencement of the actual hearing of the trial and this was done.

Just briefly, before I come to how the demurrer was dealt with you will see that the Crown provided overt acts which appear at – there are two sets but the correct set is at page 69. Again, just pausing there, “overt acts” is clearly a term of art.  It is clearly a term of art which takes one to the general law of conspiracy.

FRENCH CJ:   The provision of these overt acts rather follows older practice of treating them as particulars of facts from which agreement would be inferred.  Is that not right?

MR GAME:   That is correct, your Honour, but ‑ ‑ ‑

FRENCH CJ:   But, in this case, an overt act is necessary to establish guilt.

MR GAME:   That is correct.  It is not that curious but the curious thing is that one is looking for the agreement but one is entirely, in this particular case, inferring the existence of the agreement from the things that people did.  That is not unique but it is not always the case, your Honour, but there is a different ‑ ‑ ‑

FRENCH CJ:   There is a twin role for them then.  There is that inferential support for the existence of an agreement and there is the necessity of establishing at least one in order to establish guilt.

MR GAME:   Yes, your Honour, but in practice often, but not always, one would say overt acts of X, overt acts of Y, so that one can sort out what now in evidence terms is provisional relevance and then one can determine whether or not - all the facts come in to establish the agreement but then you fix liability on individuals, having looked at what they did and then you infer their involvement.

Before I go further, it may not matter for this case, but there are particulars of a different kind, which might be described as particulars of an agreement and particulars of an agreement would be X and Y agreed to defraud the Commonwealth by not paying tax on income from their dress shop, or something like that.  Then it would say what the people agreed to do, in that respect.  These are particulars from which you infer the agreement and the agreement is, in substance, that which we saw in the indictment.  But it is an agreement in people’s minds, that is to say it is a meeting of minds to commit an offence and that is at the heart of the idea of conspiracy.

Now, the ruling on the demurrer commences at page 93.  The Crown allegations are set out at page 95.  At 97 her Honour says that she must rule on it, purely on “the averments in the indictment itself”.  That is reference to Glynn.  At 99 her Honour said that:

Thus the indictment avers all the essential elements of the offence in accordance with the requirements of the offence creating provision.

Her Honour then deals with the issue at page 109 and she dismissed the demurrer.  Her Honour said that in effect with respect to [RK] there was sufficient evidence that [RK] “was aware there was a substantial risk the money was the proceeds of crime” and she held likewise in respect of [LK].  She referred to a case of Hann and that is referred to at page 109, line 20.

FRENCH CJ:   I am just wondering whether you should be referring to the names.

MR GAME:   I am sorry.  That is my mistake.  I will call them [RK] and [LK].

HEYDON J:   Why are they abbreviated?  Many of the papers in the file in the courts below have their full names.

MR GAME:   Your Honour, I have no idea, but I assume that the reason was because there was the prospect that they would be put back on trial if the Crown appeal succeeded.

GUMMOW J:   Was there any order made?

MR GAME:   I did not hear your Honour.

GUMMOW J:   Has there been any order?

MR GAME:   There has been no order.  I think there is a practice direction that until further order, if the proceedings were under a pseudonym in the court below, they will be called by a pseudonym until such time as ‑ ‑ ‑

GUMMOW J:   No, any order below.

MR GAME:   Sorry. There must have been, your Honour. Section 111 of the Crimes (Appeal and Review) Act prohibits the publication of the identity unless the court makes an order under subsection (1) or the court:

unless the publication is authorised by order of the Court of Criminal Appeal or of the court before which the acquitted person is being retried.

One would imagine that section 73 of the Constitution and section 37 of the Judiciary Act would mean that section 111(1) speaks to this Court and the Court could make such order as it thought fit, so that ‑ ‑ ‑

FRENCH CJ:   Perhaps for the time being we will simply direct that the transcript not use the names and if you can be careful to refer to the initials.

MR GAME:   I will, your Honour.  Now, at the close of the Crown case an application was made that on the evidence led there was no case to answer and the judgment on that commences at page 185.  Now, one sees in that at page 186, line 30:

The Crown has presented its case against the accused on the basis that they agreed to deal with money in [RK’s] account, which was in fact the proceeds of crime ‑

Now, what that is a reference to is that the Crown led evidence that there was a fraudulent directive to remove money from the JP Morgan account of a much larger sum but it included 25 million or so Swiss francs which went into [LK]’s account.  The fact that it was in fact proceeds is of significance to show in terms of the argument that what we are saying in terms of a conspiracy occurs in the real world in which such an event occurs; that is to say, people choose to take the risk in circumstances where they foresee the prospect within their conspiracy a physical element that the thing concerned is in fact proceeds of crime.

HAYNE J:   The “they” in that proposition is the person accused of being a dealer?

MR GAME:   That is correct.  At page 195 at line 32:

In my view the evidence the Crown relies on and to which it has referred in these submissions is overwhelmingly capable of proving that each accused entered the conspiracy alleged and was reckless as to the money in [RK’s] account being the proceeds of crime. 

Then at the bottom of page 196, line 42:

What I have to decide at this stage is whether there is sufficient evidence to prove beyond reasonable doubt the essential elements of conspiracy to deal with the proceeds of crime, and recklessness that the money was the proceeds of crime.  As noted above, in my view there is.

HAYNE J:   That is recklessness of the alleged conspirator, not recklessness of the alleged dealer?

MR GAME:   That is right.  Yes, your Honour.  In the agreement one has in contemplation, shall I say, a circumstance in which the money is proceeds of crime, and I will use this again, but even if it is proceeds of crime, we would take the risk that it is proceeds of crime.  So we have in contemplation a physical element, proceeds of crime; we have in contemplation our mental element, recklessness as to that.  Whether that proposition is correct lies at the heart of this appeal.  I am going to put arguments to attempt to persuade your Honours that that proposition is defensible.  As I see it, from our perspective that is the issue this case boils down to.

GUMMOW J:   Could you explain that again, Mr Game, in terms of the statute.

MR GAME:   Yes, your Honour.  In terms of the statute, an agreement to commit an offence – the agreement between the two persons contemplates within the scope of the agreement a circumstance in which the money dealt with is proceeds of crime and even if that is the case, we will deal with it taking the substantial risk that that is the case (even if we do not know for sure that that is the case), as it were.  That is the proposition that we say is defensible and does work in terms of the structure of the Code.

HAYNE J:   But that, to leap ahead, either falls within section 11.5(1) as a conspiracy to commit an offence or, if account is to be taken of 11.5(2)(b), it is intending that an offence would be committed.

MR GAME:   That is correct, your Honour.

HAYNE J:   Those are the two elements of 11.5 that must be construed to arrive, you say, at one result, your opponents say at the opposite result.

MR GAME:   That is correct, and it would be obvious from that which we say is that an attempt to make 11.5(2) into the elements of the offence breaks down on careful analysis.

FRENCH CJ:   How does it make a difference to the outcome?

MR GAME:   It does make a difference – our opponents – in terms of contrasting positions we part company with the Court of Criminal Appeal at a particular point but it is a point way down the line in terms of the approach taken.  The point at which we part company is this idea that you can without qualification incorporate into conspiracy the idea of “knows all the facts”, that one needs to dig deeper about that issue.  We accept that “conspiracy” is a term of art.  We accept that “overt acts” is a term of art and we accept that the writers of this provision did not intend to throw all of that out the window.

Our opponents on page 1, line 1 of their submissions, section 11.5(1), does not contain the elements of the offence.  Their submission is all of the elements are to be found in 11.5(2)(b), that is to say, they part company with the Court of Criminal Appeal in both cases at the outset.  The reason why they do that, and I was hoping to come to this a little bit later, is they want a situation in which they feed into 11.5(2)(b) an intention by person A and person B that at some future point all of the physical elements will exist and all of the mental elements will exist by which process a term - the physical elements fall into elements of intention because they are elements of intention with respect to physical elements and then they add another layer to it and they say you have to then intend all the mental elements of the offence and they have two people intending, perhaps.

Whether they have to argue that might be debateable but that is how they argue their case and they argue that case that way for a particular reason which, as I say, is to require intention by the accused, as I said, in respect of all the physical elements and all the mental elements, that is to say, an intention that those physical elements exist.

BELL J:   Before moving to that aspect, if we can come back for the present to an acceptance of your proposition consistently with the majority in the Court of Criminal Appeal in Ansari, accepted, as I would understand the court in LK and RK, namely, that the elements of the offence are contained in subsection (1).

MR GAME:   Yes.

BELL J:   I have some difficulty in understanding the basis of your argument upon that acceptance that it is not requisite in order to establish that persons agreed to commit an offence that the agreement must be taken to involve knowledge of the acts that make the relevant conduct unlawful, not perhaps the characterisation of it as unlawful but the facts that make it such.

MR GAME:   Yes, your Honour.  What one is construing here is an agreement and in an agreement one has contemplation of things that may or may not occur or things that may change.  The question is, what is in contemplation within the agreement?  Now, I am saying that one has in contemplation the existence of the physical element that the money is proceeds of crime.  That does not mean that one knows or believes that it is proceeds of crime, but one has in one’s contemplation that that is the case and one says, even if that is the case, maybe all the better, but even if, I will proceed and deal with that money. 

So that at point (a) one has – and I will explain how in a sense this goes to the heart of the case – but in point (a) two people hatch a plot and within their contemplation is the prospect in their minds now but about a future event that in respect of that future event the money they deal with will be proceeds of crime. They do not have to know or believe that it is proceeds of crime.  They have to have in their contemplation in order that they can intend an offence.  But once they have that in contemplation and that in contemplation they exercise a certain state of mind, that is to say, recklessness, then, in our submission, they have an intention to commit a crime. 

This may sound odd, but it is not, in my submission, and I will come to it in due course.  Glanville Williams was quite fascinated by this subject and wrote a good deal about it and explained in a number of texts why it was the case.  I will give the Court a couple of examples.  If one takes a case like Morgan where a man said to another man, “Have sexual intercourse with my wife” and I will just change it a little bit, “you won’t know whether she is consenting because of the way in which she will conduct herself”.  So the three people say to each other, they say, “All right, we will go ahead and have sexual intercourse with your wife”.  We have in contemplation a situation in which she does not consent but we do not know whether she consents or not.  We do not know that fact.  We do not believe that fact, but we have in contemplation that such a circumstance exists. 

So in Code terms that is a physical circumstance.  Then we go on and say, “Well, we will do it nonetheless”.  We now have an intention to carry out a plot and you get a ladder, we have now got an overt act.  So we have a conspiracy to commit the offence of rape even although we do not know or we do not have any belief, but we do know that we may not know.  We have in contemplation within the scope of the agreement a circumstance in which sexual intercourse takes place without consent and a willingness to proceed notwithstanding.  Now, that is actually fairly conventional reasoning in terms of attempted rape because in attempted rape – and we have referred to some of the cases – the idea of recklessness as to the circumstance, which is said to be absence of consent, is held to be sufficient. 

HAYNE J:   Be it so, can we come back to this case?

MR GAME:   Yes, your Honour.  I was just about to give an example from this case, if I could do that, or from this statutory framework.  Now, if we have a situation in which we – sorry, just one point of reference.  In a conspiracy people may not desire the criminal outcome at all but it may be within the scope of the agreement, and that is a point made strongly in Peters.  You might never intend that the investors lose their money but you have it within your scope of contemplation that such a circumstance will exist if the scheme does not come good, or whatever else.  It is the same with proceeds of crime.  So you have an agreement and an agreement is to deal, shall I say, with the money that sits in the bank account, the 25 million.  The attempt to get the money out of the bank account is, in fact, what is involved in this case.  That is the conspiracy alleged, to get the money out of the Swiss bank account. 

Now, a physical element of the crime is that the money is proceeds.  A mental element of the crime is recklessness as to that prospect.  If the two people have in their contemplation that they will commit the crime in circumstances in which they are aware that the money will be proceeds, then they have an agreement to intentionally commit the crime and that much is not controversial.  So if we take the situation in which you say, “We will agree to deal with this money, we do not know whether it is proceeds, but I will tell you, I will tell you the day before whether or not it is proceeds”, and you say, “Well, fine I am happy to proceed in those circumstances”, we have an intention to commit a crime in which our mental state will, in those circumstances, be one of intention.

If we change those facts a little bit and we have a situation in which we – we contemplate a prospect in which the money that sits in the account is the proceeds of crime and we say even if the money is proceeds of crime, we will deal with it even if we do not know; that is to say, “I might tell you or I might not tell you the day before or I might not know”, and you say, “Well, I’m prepared to go ahead nonetheless”, we now have in contemplation a situation in which these people have in their contemplation that in the real actual world they will deal with money which is proceeds of crime even if they do not know it, just as in the rape case, even if they do not know of the absence of consent.  That, in terms of framing an agreement, in our submission, is defensible in terms of the structure of the Code and it is defensible in terms of all of the elements sitting in 11.5(1).

BELL J:   The agreement is an agreement to deal with money, there being a substantial and unjustifiable risk that it is proceeds of crime.

MR GAME:   Yes.

BELL J:   At the point of the entry into agreement and the commission of an overt act by one of them, the offence is complete.  What is the requirement to establish the fact that it is proceeds of crime?

MR GAME:   There is no requirement in an agreement to establish that something is in fact proceeds.  In an agreement the only requirement is that in the contemplation of the individuals is a commission of a crime.  In our submission, in contemplation of the individuals in a crime is the contemplation of a circumstance in which it is proceeds and they will proceed nonetheless.

HAYNE J:   The crime that you thus identify is a crime shorn of one of the elements identified in 400.3, is it not?  It is shorn of the element in 400.3(2)(b) for you say that there is an agreement to commit a crime, regardless of whether it is in fact proceeds, though the crime that is to be committed is a 400.3(2) crime, is it not?

MR GAME:   Yes, your Honour, but ‑ ‑ ‑

HAYNE J:   You ignore the requirement of (2)(b).  How can that be?

MR GAME:   No, your Honour, I am not ignoring the requirement of (2)(b) because what I am saying is that inside the agreement – that is to say, within the scope of the agreement – is a contemplation that we will deal with this money even if in the real world this money is proceeds of crime.  That is the problem that Glanville Williams tackled in these articles that I will come to in a little time.

HAYNE J:   That may be, but do you accept that whether conspiracy is wholly defined in 11.5(1) or account must be taken of 11.5(2), the subject matter of the conspiracy must be commission of a crime, commission of an offence?

MR GAME:   Absolutely.  No question about that, your Honour.

HAYNE J:   Thus it is necessary in identifying whether the conspirator, or the alleged conspirator, has committed an offence under 11.5, whether 11.5(1) is the sole source or 11.5(1) plus 11.5(2) is the source, that the conspiracy is to commit an offence.  Is that right?

MR GAME:   Yes, your Honour.

HAYNE J:   The offence in issue here is the offence identified in 400.3(2), is that right?

MR GAME:   Yes.

HAYNE J:   Of which an element is that identified in (2)(b)(i) that the money is, in fact, proceeds.

MR GAME:   Yes, your Honour, but ‑ ‑ ‑

HAYNE J:   The conspiracy must be a conspiracy to commit an offence, an element of which is that in fact the money is proceeds, is that right?

MR GAME:   Yes, your Honour, but it is all in their heads.

HAYNE J:   That is a wonderful answer, Mr Game, which I am sure needs further explanation.

FRENCH CJ:   The money is not in their heads, it is in the bank.

MR GAME:   No, no.

FRENCH CJ:   That is reflected in the indictment, is it not?

MR GAME:   That is fine, your Honour, but that is the problem.  You do not actually have to prove – you actually do not have to prove to prove this offence that the money is proceed – the way this indictment was drawn they accepted the onus of establishing it.  It elucidates the problem because one can see that it really was proceeds of crime, although one can get lost on the question of statutory construction.

FRENCH CJ:   Was not the subject matter of the agreement, as asserted in the indictment at 25, “money to the value of $1,000,000 or more being the proceeds of crime”?

MR GAME:   Yes, your Honour, but ‑ ‑ ‑

FRENCH CJ:   It was an agreement about real money, was it not, not just money in their heads?

HAYNE J:   Real money being the proceeds of crime.

MR GAME:   Yes, your Honour.  That is actually fine, in my submission, because you are saying these people have in contemplation a physical circumstance in which the money is proceeds of crime, that is to say, we will do it if it is or if it is not.  We will do it if she consents or if she does not consent.  The problem is not – I know that Justice Hayne would probably prefer I do not take you to a different example but may I just give a different example.  For some reason the drafters of the Code have now created border prohibited imports and border prohibited precursors, and you have to pick one or the other. 

It is in a later reprint but there is no necessity to go – I have provided the Court with it – but the point about it is this, that you might not know or believe what it is.  It might be a prohibited import, it might be a precursor or it might be farm machinery, but because in your contemplation – it might turn out to be farm machinery but because in your contemplation is a circumstance in which it comes in in which it is a border prohibited import or it is a border prohibited precursor, then in our submission you have a state of mind in which you contemplate the physical circumstance that it is that thing.  Having contemplated that you are reckless about it, you have conspired to commit the offence, even although you have no knowledge as to whether or not it is or is not in fact that thing because you have contemplated it within the scope of your agreement.  In our submission, that is conventional uncontroversial thinking.

BELL J:   Did I understand you a few moments ago to say that it was not necessary for the Crown to have framed an indictment with the averment that the money was the proceeds of crime for the purposes of this offence?

MR GAME:   For the purposes of this offence, yes, but for the purposes of this – as I say, one can get confused in this case because it really was proceeds of crime.  But you could have a conspiracy to commit this offence where there was no proceeds, where there never would be any proceeds, because you are having in contemplation – this case is different because the agreement is inferred from the things that these people do and because the Crown could prove that back further in the process there was a fraudulent transaction from J.P. Morgan which took the money out of their account.

One would still need to assert that their agreement contemplated the thing would be proceeds of crime.  One would still need to aver that, so you could be more precise about it by saying to deal with money being (physical element contemplated) proceeds of crime and, in our submission, you would have the offence. 

CRENNAN J:   Did the Crown accept in the running of this matter that the alleged conspirators had no knowledge of what was happening in relation to the J.P. Morgan bank and the Commonwealth Superannuation Scheme?

MR GAME:   The Crown could not prove that they knew how the money came to leave the J.P. Morgan account.  The Crown could prove all the things that [RK] and [LK] did in respect of it and their attempts to get it out of the account in what they did.  So they could prove that it was proceeds.  They could prove, in our submission, that shall I say recognising that what they were dealing with was proceeds, even though they did not know it, they would take the risk that it was and satisfy recklessness.

I was actually just finishing off at page 197.  If I just finish off that and then come back to the Code.  At 197 we see at the top of the page what it was:

The Crown case against these accused is that they conspired to deal with the money by getting it out of the account, which is notionally the next step –

Then at the bottom of the page:

Rather, the indictment alleges the accused intentionally agreed to commit an offence, the mental element of which was recklessness.

Now, we then see an examination of Ansari and at page 199, line 40 an acceptance of – well there could be nothing but an acceptance – but an application of that which Justice Howie said in Ansari.  It refers to:

he cannot have that intention if he does not know all the facts that would make the intended conduct an offence.

GUMMOW J:   Can you have the relevant intention at (2)(b) if the fact…..that the offence would be impossible of commission?

MR GAME:   Yes, your Honour, if the offence would be impossible, yes.

GUMMOW J:   So why do we keep looking forward to what could or could not be the case here?

MR GAME:   Well, just because, your Honour ‑ ‑ ‑

GUMMOW J:   I know we are looking at the terms of the averment, but I am trying to construe ‑ ‑ ‑

MR GAME:   Yes, your Honour, I understand that.

GUMMOW J:   There must be many gangsters who have conspired to kill someone who has already been bumped off.

MR GAME:   There are many people who agree to commit crimes in which they have an agreement, but they do not know or believe that the circumstance exists per se, but they have in their contemplation a circumstance where, if it exists and whether or not they know it they will do it.  Whether or not they know that fact they will do the thing.

GUMMOW J:   I am not necessarily disagreeing with you; I am just trying to tease out the meaning of the words and in particular in 11.5:

who conspires with another person to commit an offence –

Now, who is going to commit it?  Both conspirators, one conspirator?  Does it matter?

MR GAME:   It can be anybody.

GUMMOW J:   Exactly.

MR GAME:   It can be anybody who commits the offence, that is correct, but it is also – the very array of possibilities that is in contemplation in an agreement shows, in our submission, the flaw in saying that to conspire to commit an offence you must in fact know a particular circumstance, positively speaking.

FRENCH CJ:   Does the indictment, incidentally, assume that all the parties to the agreement agreed to deal with the money contrary to the provisions of section 400?

MR GAME:   Yes.  Getting the money out of account in the definition was dealing in the money.

FRENCH CJ:   Where those persons who were to deal with the money et cetera, is that a reference to everybody who is a party to the conspiracy?  It just seems to me that if the indictment assumes that everybody who is a party to the conspiracy is to deal with the money, then the second limb of the indictment must refer to everybody who is a party to the conspiracy.

MR GAME:   I hope I am not criticising anybody too close at hand, but it is not good pleading to say whether those persons, ie, all of them, because you are only concerned with essential conspirators.  So Mr Michael may or may not be an essential conspirator.  On my understanding of this case, he is not an essential conspirator although he is a named one.  But for the purposes of satisfying the offence, it would mean, must be that [RK] and [LK] were mutually in agreement that they would be reckless about that fact.  That sits in the mutuality.  The agreement is the conspiracy to commit an offence.

Now, I appreciate that this may all seem odd but just the same analysis would apply to a crime of negligence and the same analysis would apply to a crime of strict liability, that is to say, in a crime of, say, strict liability you have a duty to maintain a defence of honest and reasonable mistake of fact.  You could conspire to commit that offence not knowing that there would be a positive failure to maintain, that there would be a failure to maintain, but contemplating a circumstance in which there was a failure to maintain and in which you had no honest and reasonable mistake of fact, that is to say, you were happy to take, shall I say, cheap reports about the protocols that your particular factory operated under. 

So this particular analysis, in our submission, can apply, if applied correctly, uncontroversially to crimes across the spectrum.  The same would apply with respect to conspiracy to do something negligently.  You do not know that the person will be negligent who does the act, but you contemplate in circumstances in which the person negligently does the act, you are willing.  You are willing for yourself to be a party to that event, that is to say, say, you have a driver who drives without spectacles, you contemplate that your driver will drive without a set of spectacles.  You do not contemplate, necessarily, that they would drive negligently but it is within your contemplation that if that occurs you will, shall I say, live with the prospect.  You will be negligent about the prospect. 

The really curious thing about all of this is that this legislation has divided conspiracies into fault and physical elements where it is strange language and credibility to do so, but that is the way in which the Code is framed and I will endeavour to show how the working provisions feed into this.  At page 199 her Honour, applying Justice Howie in Ansari, said he did “not know all the facts”.  Then her Honour at page 201, line 41, in Ansari:

In my view the Court did not hold that a person can be charged with conspiring to commit an offence the mental element of which is recklessness, simpliciter.  The Court held that that may be so when the Crown relies on intention or knowledge to prove the element of recklessness or where a third party is to commit the offence –

In our submission, the third party committing the offence makes no difference and, in our submission, it also makes no difference that you can prove recklessness by proving knowledge.  Then at page 202 her Honour ruled that the indictment was “bad at law or unknown to law.”  That is at line 20.  Internally that is not correct.  Internally what her Honour is saying is that the indictment is not bad at law but that there was no case to answer because the Crown did not prove knowledge or intention as to that element that involved recklessness.  For the purpose of the present argument, nothing particularly turns on that mistake that appears there.

GUMMOW:   Mr Game, how does the notion of intention in 11.5(2)(b) work, looking at 5.2 where (a) and (b) make an agreement to the effect that (b) is going to commit the offence?  What is the relevant intention of (a), looking at 5.2?  Section 5.2(1) does not seem to work.

MR GAME:   What 11.5(1) does is it says “conspires with another person to commit an offence” means an agreement to carry into effect a criminal agreement to commit an offence in which the physical circumstance is the making of an agreement to commit an offence.  That is how it was held in Ansari and we submit that is correct.  When one comes to 11.5(2)(b), we submit that what was said in Ansari about ‑ ‑ ‑

GUMMOW J:   Just a minute. What is the physical element and what is the fault element in making the agreement?

MR GAME:   In 11.5(1)?

GUMMOW J:   Yes.

MR GAME:   The physical element is the existence of an agreement to commit an offence.  That is all it is, and that is conduct.  That may seem strange, but things can be described as conduct looked at from one perspective or conduct or circumstance or result from another.

FRENCH CJ:   Why does one not just call it the making of the agreement?

MR GAME:   That is fine; that works.  But it has to be the making of the agreement to commit an offence.  Then the mental element is the intention of the person to participate in the agreement, and that is it.  Once you have got to that point, there is no further need to refer to that part of the Code which creates liability for an offence because you now have the physical and mental elements of the offence.  If you look then at 11.5(2) ‑ ‑ ‑

GUMMOW J:   You are right then – when one is looking at 11.5(2) and one bumps up against the word “intention”, one does not go back to 5(2).

MR GAME:   That is correct.  One does not go back to 5(2) because all the work has been done.

GUMMOW J:   That is why it is important to know whether 11.5(1) is, as it were, the sufficient statement of the offence.

MR GAME:   Yes, your Honour.

FRENCH CJ:   You read, incidentally, 11.5(2) in thinking about whether or not that defines elements of the offence in the light of 3.2, do you not, what is necessary to establish guilt in respect of offences?

MR GAME:   Yes, your Honour.

FRENCH CJ:   So it would hang together a little more readily if one views (2) as setting out elements of the offence.

MR GAME:   If you look at ‑ ‑ ‑

FRENCH CJ:   Not necessarily exhaustively because it may be that there are other elements to be inferred from (1).

MR GAME:   In our submission, you will not get elements from 11.5(2), and I will endeavour to explain why, but the critical thing you will not get is mutuality in respect of the commission of an offence.  All you will get is recklessness that the other person is committing an offence – that is to say, the thing falls down at the very point in which you seek to identify the criminal agreement.  I have not answered your Honour Justice Gummow’s question, but if I could perhaps just go back and try and deal with your Honour’s question in the context of unfolding how the Code works.  May I just before going into Part 2.2 ‑ ‑ ‑

GUMMOW J:   Just before you do that, though, this legislative pattern of stating an offence and then going on to say for a person to be guilty and then listing other matters appears throughout Part 2.4, does it not?

MR GAME:   Yes, your Honour, but ‑ ‑ ‑

GUMMOW J:   Which is headed “Extensions of criminal responsibility”.

MR GAME:   Yes, your Honour.

GUMMOW J:   Whereas later in the Act the pattern seems to be, for example – or it is all over the place – a person is guilty of an offence if (a), (b), (c) and then penalty. 

MR GAME:   Yes, your Honour, but ‑ ‑ ‑

GUMMOW J:   There is some special thinking at work here, I think, in framing Part 2.4.

HAYNE J:   And is the special thinking that the provisions for the person to be guilty, et cetera, to be understood as epexegetical of some of the elements that are found in (1).

MR GAME:   Exactly, your Honour, that is what it is.

HAYNE J:   So that when you say a person conspires with another person, meaning is given to that by (a) plus (c) of (2).

MR GAME:   Yes.

HAYNE J:   When you say to commit an offence, conspire to commit an offence, meaning is given to that by 2(b).

MR GAME:   Yes, but it sits inside the mutuality to commit an offence in 11.5(1).  Can I just show your Honours another example where this occurs that highlights this.  If you go to section 135.4, your Honours may recall that there was always a general conspiracy provision in the Crimes Act (Cth) very similar to 11.5(1).  It sat in a section called section 86.  Then, after a time, conspiracy to defraud came in and it was separately dealt with.  Now we see in section 135.4 conspiracy to defraud.  Now, we have different types of conspiracy to defraud, to obtain a gain, to cause a loss, and we get to subsection (9) and we see not elements but things that explain that which is required:

(a)the person must have entered into an agreement with one or more other persons; and

(b)the person and at least one other party to the agreement must have intended to do the thing ‑ ‑ ‑

FRENCH CJ:   The explanation of these separations in 11.5(2) in the Model Code Officers Committee commentary is that they call it 405.1 and then dot points one and two were redrafted to more clearly separate the agreement component of the conspiracy from the intent to commit an offence pursuant to that agreement, which rather suggests, does it not, that they provide content to the elements of the offence that are to be inferred from subsection (1)?

MR GAME:   We have no complaint about the idea that they provide content.

FRENCH CJ:   So I just wonder what conceptual utility there is in saying that they are not elements of the offence.

MR GAME:   Well, your Honour, the reason is that we are, shall I say, defensively meeting an argument that all of the elements are in 11.5(2) and that all section 11.5(1) tells you is that the crime has to be a crime of more than 12 months.  That is the position taken by LK explicitly, Ansari and, it would seem, also RK.

HAYNE J:   But the notion of epexegesis can be seen in 11.4, incitement.  Section 11.4(1):

A person who urges ‑

What sort of urging is at stake:  It is urging where you intend that something be done.  It is not simply uttering words, “Go ahead and do it”.  It is urging where you intend that it should be done.

MR GAME:   Yes, your Honour, but when you give the jury the direction what is meant by “intent to urge” in subsection (1), you will clearly be mindful of subsection (2) and you will make the direction in such a way that you make it clear that the person in urging must intend that an offence incited be committed.  We do not have a problem with that approach, but in our submission the whole thing falls apart if you actually call the 11.5(2) provisions the elements of the offence.

FRENCH CJ:   Exhaustively.

MR GAME:   Yes.

FRENCH CJ:   If you do it non‑ exhaustively and say they are to be read with (1) as defining the elements of the offence you do not have a problem, do you?

MR GAME:   But the elements are in (1), yes.  It does make a difference because if you make the subsection (2) things into elements and just the elements, then you have lost the agreement and you have set up something which I can explain right away now, which is you have set up something that is a very strange beast and it does not look like a conspiracy to commit an offence.

BELL J:   But that is not what the Chief Justice is putting to you.  He is putting to you ‑ ‑ ‑

MR GAME:   I accept that.  I am sorry.  I am fighting on two fronts.  Your Honour, I understand that, but at some point I want to explain why the elements of the offence do not sit in 11.5(2); why they sit in section 11.5(1).  But we do not question the content.  When you look at what is meant by “conspire”, that means that there is an actual meeting of minds.  That means that there is an actual meeting of minds by real conspirators who intend to commit an offence.  We got that from (2)(a) and (b) if we did not already have it in (1).  For the person who is guilty they must also commit an overt act.  An overt act is not an element of the offence – I will explain.  It is something that has to be proven but it is not an element in the sense of physical and fault elements that go to make up an offence.  It does not have any fault element attached to it.

BELL J:   But it would have a default element pursuant to the scheme if it were an element ‑ ‑ ‑

MR GAME:   That is exactly right.

BELL J:   ‑ ‑ ‑ and it might be thought to be an element because it is essential to guilt, not to the conviction of a person for an offence but to guilt.

FRENCH CJ:   That is what distinguishes it from the US Model Code.  The US Penal Code takes the overt act as a necessary condition of conviction as distinct from agreement and intention which are necessary to a finding of guilt.  Here they brought the overt act in as what is required for a finding of guilt.

MR GAME:   Yes, but, your Honour, in our submission it is not an element, and I will explain why.

You can withdraw from a conspiracy under subsection (5) if you withdraw and take all the reasonable steps to prevent the commission of the offence.  Now, if an overt act is an element, then if you are a party to the agreement and then before the overt act is committed you say, “Goodbye, I’m off”, you cannot be guilty of the offence if subsection 11.5(2) is the element of the offence, even although you have not taken any steps at all to prevent the commission of the offence.  If an overt act is an element, then it is a circumstance or it could be conduct.  If it is conduct, it requires intention.  If it is a circumstance, then you now have a question about whether or not that overt act has attached to it recklessness.  If it is conduct you now have a question about whether or not an overt act as it sits there attaches the mental element of intention or recklessness.

But the problems go deeper.  If the elements are in subsection (2)(a), then the first thing is you have (2)(a), an agreement.  If those are the elements – you could have a trivial agreement of the kind that we referred to in our submissions in reply such as agreeing to leave a door open.  When subsection (2)(a) is given the sense it should be given, which is to give sense to that which appears in 11.5(1), what we are giving sense to is the actual meeting of minds in the criminal agreement.  It is not a trivial agreement.  Then section (2)(b), a fault element must be for a physical element under the Code.  In (2)(b), you would have:

the person and at least one other party to the agreement must have intended that an offence would be committed –

I will come to the content of that in a moment.  That is not a fault element for any physical element.  That, in fact, is ultimately conceded in Ansari’s submissions in reply.  It is said, well, it is not a fault element for a physical element, it accompanies a physical element of agreement.  If you say it accompanies, then you are out of the discourse.  The discourse about identifying fault and physical elements has gone.  As I say, our opponents rely on the elements here very heavily because they want “intended” there to do work in terms of Part 2.2, but that definition only applies when intention is a fault element for a physical element and not otherwise.  They want to say “intended” means intend all physical and fault elements. 

Then they also want to say that this other person intend all physical and all fault elements.  Now we have created something new, which is the existence of a state of mind in another person in respect of all physical and fault elements divorced from the idea of mutuality.  We have now created a circumstance which is this other person’s state of mind.  So now we have got a fault element of recklessness with respect to another person’s state of mind.

Now we have lost the agreement because one thing the case has made perfectly clear, and we have referred to Chief Justice Gleeson’s judgment in Trudgeon on this, that a coincidence of intentions in no sense goes to establish a conspiracy.  That is at the heart of the law of conspiracy.  All that can be referred to by our opponents in this analysis is the coincidence of two intentions and a foresight of the possibility or the substantial risk that the other person holds that state of mind and then the third element is an overt act to which it is now said, that is a circumstance or conduct to which a fault element applies.  If that is the analysis then you have actually lost the thing that you came to find which was the existence of a conspiracy.

BELL J:   Can we just go back to an analysis that accepts that an element of the offence is that contained in subsection (1) and then seeks to address subsection (2)?  You have put a number of submissions supportive of the reasoning of the majority in Ansari and in LK and RK.  But, it does leave consideration of what it is the matters in subsection (2) are in light of the scheme of the Act, including 3.2.  How does one know what are physical elements under the law creating the offence relevant to establishing guilt if the matters set out in subsection (2) do not answer that description?

MR GAME:   Well, your Honour, one can only look at the language of subsection (1) and ask oneself does this create the offence?  Does this create the offence?  We say the answer is yes, it is a fairly uncontroversial way of creating offences and in Kingswell just such language was found to create an offence and a series of different offences.  We say look at history.  Section 86 used to be in exactly the same terms but with add‑ons.

BELL J:   Section 86 predates this scheme but the issue is – we can all accept the history but what, in light of this scheme, are we to make of the requirements of subsection (2) for the person to be guilty, certain things are to occur or must be present.

MR GAME:   Yes, your Honour, but your question was a more direct one to start with which was, how do you that subsection (1) creates the elements of the offence? 

BELL J:   Well, it is, how do you know in light of section 3.2 of this Code?

MR GAME:   How do you know?  Well, you know because there is an acceptance by the very fact that it sits here that there must be physical and fault elements in conspiracy.  One can find, though, if one looks for those elements, the heart of it sits in the idea of a conspiracy which is not expounded in subsection (2), that is to say, the mutuality on the committing of a crime.  So you must find it in subsection (1) or, as I say, you have lost the agreement, the criminal agreement.  You still have to work out what you do with subsection (2), but I endeavoured to show – again showing examples has all its own difficulties – that in a similar context 135.4 you had something that manifestly was not elements and was never intended to be the elements for those various offences. 

BELL J:   How do subsections (7A) and (2A) fit in with this analysis because (2A) directs attention to subsection (2)?

MR GAME:   Your Honour may be aware that although subsection (7A) was brought in, in a number of different places at the same time and its history was a little different, but a special liability provision is a provision which says that if absolute liability or an offence provides that you do not have to prove a thing – and that does not mean strict liability, that means a section such as you do not have to prove that a person knew someone was a Commonwealth officer, such as you see in 135.4.  Now, it has limited work to do, but it was brought in to deal with the situation in which you cannot show how much, I will say, in drug terms, the people agreed to bring in.  But you can see in the real world or in the agreement of other parties how much was the subject of the agreement.  But it does not take you away from the notion that you are looking at the subject, the content of the agreement.  So subsection (7A) has a little work to do but, in our submission, it neither detracts from or assists in the ultimate resolution of the question at stake in this case. 

Now, the submission dealt with – and I may just deal with this in passing by LK in particular – was that subsection (7A) picks up strict liability provisions as well.  If it did, then one would run the risk of losing the whole crime.  For example, anybody would be guilty of conspiracy to commit an offence of strict liability by having no mental state about the circumstances at all.

The words in the special liability provision which say “not necessary to prove” – they are terms of art and they do not refer to strict liability and if they did then so would negligence, so would recklessness.  May I in order to – and I apologise for the way in which things have unfolded back to front in my argument, but may I come back to Part 2.2 and say something about that.  In Part 2.2 elements of offences, subsection 3.1:

(1)An offence consists of physical elements and fault elements.

So that once you have the physical elements and the fault elements for the offence then, as we say, you do not refer – Part 2.2 is gone and you have no further use for it.  To be found guilty you have to establish the physical elements necessary to establish guilt and the fault elements in respect of the physical elements and once you have established those two then you have all that you need.  Now, section 4.1 is a riddle but section 4.1(1) divides physical elements into:

(a)      conduct; or

(b)      a result of conduct; or

(c)      a circumstance –

Whether something is conduct or a circumstance can be quite arbitrary, actually.  For example, in He Kaw Teh which is not anybody’s list, Justice Brennan thought that importing a prohibited substance was conduct and that knowledge and intention applied to it.  Your Honour Justice Bell held similarly, applying He Kaw Teh in Saegasi‑Or before the Code was amended, but the fact that the substance is a prohibited import can also be described as a circumstance and that is how it was described in the amendments so that recklessness became a mental element for it.

The relevance of that for this discussion is that there is nothing antithetical about describing the making of an agreement to commit a crime as conduct.  You might conceivably be able to break it up into other things but there is nothing wrong with calling it conduct for the purposes of section 4.1(1).  One then moves to “Fault elements” and we see:

A fault element for a particular physical element may be intention, knowledge, recklessness –

Now, “intention” there is defined, “intention with respect to conduct” or, “intention with respect to a circumstance” or “intention with respect to a result”.  Intention in that definition has no meaning unless it applies to conduct, circumstance or result.  There is no further place for it.  You may have noticed, and I should have perhaps referred to it is that back in 3.1 we spoke about physical elements, fault elements for physical elements, fault elements for which a fault element is required.

FRENCH CJ:   Physical elements for which a fault element is required.

MR GAME:   Yes, your Honour.  A fault element is for a physical element.  The reason I am focusing on that is (2)(b) is not a fault element for any physical element.  Now, just before passing over it, in section 5.2(3) we see:

A person has intention with respect to a result if he or she means to bring it about or is aware that it will occur in the ordinary course of events.

Now, those words “will occur in the ordinary course of events” are – that very idea is in the conspiracy cases as not being sufficient to establish mutuality.  Just because you foresee that something will occur or that somebody else may have that intention does not mean that there is an agreement.  The case we have referred to in our submissions on that is Chief Justice Gleeson’s judgment in Trudgeon when he was Chief Justice of New South Wales. 

Now we come to recklessness.  In section 5.4(4) we see that recklessness can be established by establishing – if recklessness is a fault element for a physical element, and in section 400.3(2) it is, proof of intention, knowledge or recklessness will satisfy that fault element.  It was said in Ansari that that was the thing that saved the indictment – would save the conviction because recklessness could be established by establishing intention or knowledge.  That may be so, but ‑ ‑ ‑

FRENCH CJ:   The Crown relied upon that in Ansari, did they not?

MR GAME:   Yes, they did.  But they did not in LK and RK.  They relied on subsections (1) and (2), that is to say, a person is reckless with respect to a circumstance and that is what one was talking about here, namely, the money in question was proceeds of crime.  If:

(a)he or she is aware of a substantial risk that the circumstance exists or will exist; and

(b)having regard to the circumstances known to him or her, it is unjustifiable to take the risk.

Now, you could, in our submission, have a current intention in respect of your own or another person’s state of mind which contemplated your awareness of a substantial risk and contemplates that having regard to the circumstances it is unjustifiable, that is to say, you took the chance but you knew that it was bad to do so, that is to say, that it was unjustified to do so.

BELL J:   Accepting the truth of that proposition, how does that marry up with a requirement that your intention is to enter into an agreement to commit an offence, the offence being an offence involving proof of the proceeds of crime?

MR GAME:   The intention is that the intention that the events will occur in which the circumstances – I do not use that as a term of art – exist in which the crime is committed.  Whether or not you believe those circumstances exist in fact is not the critical thing.  What is critical is your contemplation that in such circumstances existing you – that is to say, in such circumstances existing you will take the risk that those circumstances do exist whether or not you know it and you there, poised to commit the offence, you are possessed of all of the mental and physical elements of the offence.

BELL J:   Can I come at it another way.  Accepting for present purposes your analysis that the offence is to be found in subsection (1) and your acceptance that subsection (1) is to be understood in light of the conspiracy having an established meaning at the time of the enactment of the Code, does your argument involve the acceptance that the Code in the creation of the offence in subsection (1) departs from Giorgianni?

MR GAME:   Giorgianni is an aiding and abetting case.  All that was said about conspiracy was obiter, but ‑ ‑ ‑

BELL J:   Yes.  My question remains as put, Mr Game.

MR GAME:   No, understood, but, your Honour, the big problem is, what does it mean when you say “knows all the facts”?  Aiding and abetting has an imminence about it with respect to the actual commission of the offence.  When you have a conceptualised agreement, it is not black or white.  It is not either knowing all the facts or knowing none of the facts.  You can commit an offence recognising circumstances in which facts will exist, might exist, do exist and a willingness to do things.  That is by its very nature what lies within a conspiracy. 

If you have in contemplation a circumstance in which that circumstance exists and you take the risk, then you know enough of the circumstances in the terms of the agreement.  Perhaps an answer to this could be found by a very brief reference to the decision which was referred to, R v Churchill [1967] 2 AC 225 and the passage I wanted to go to is at page 237. At 237 we see that Viscount Dilhorne in his speech says:

In answer to the question posed by the Court of Criminal Appeal in this case, I would say that mens rea is only an essential ingredient in conspiracy in so far as there must be an intention to be a party to an agreement to do an unlawful act; that knowledge of the law on the part of the accused is immaterial and that knowledge of the facts is only material in so far as such knowledge throws a light on what was agreed.

Your Honour, you do not have to know facts, particularly you do not have to know circumstances, positively speaking, before you bring them within the contemplation of your agreement.  No light is thrown on that in Giorgianni.  But also, your Honour, it is not correct to say, in our submission, that there are two, shall I say, extremes – one is knowing all the facts and one is knowing none of the facts.

Let me give an example.  Say you have an offence of strict liability in a context of a provision which creates a duty to maintain a client or something of that kind.  Now, because it saves costs for other providers in this particular industry, you agree to lower your standards but you do not agree on a failure to maintain necessarily, but you contemplate a circumstance in which, if the physical element is a failure to maintain, the protocols and reports that you get will not provide you with a defence of honest and reasonable mistake of fact.

You could apply that to Churchill itself – that is to say, if you had a situation in which you could not distinguish between the cheap fuel and the expensive fuel but you proceeded regardless.  You do not know all the facts, but you make yourselves a party to an agreement that amounts to a commission of the offence.

May I pause also here just to refer your Honours very briefly to a short passage in Peters on the subject - Peters 192 CLR 493. The passage I wanted to refer to is at paragraph 26, page 507, in the joint judgment of Justices Toohey and Gaudron. I will not read it out, but if your Honours could read paragraph 26. So you have within your contemplation as an object of the conspiracy in terms of the necessary legal requirements of the commission of the offence, but you do not necessarily have any foresight or knowledge that those circumstances will or do exist. But you accept that in the circumstances that do exist – namely, that the investors lose all their money – you will proceed regardless. You do not intend that the investors lose all their money for the purposes of conspiracy to defraud. That is why I say all you are doing is construing an agreement.

BELL J:   An agreement to commit an offence?

MR GAME:   Yes, your Honour, that is obvious.

BELL J:   You say obviously.  If two persons agree to deal with money in a bank account in circumstances in which there exists a substantial and unjustifiable risk that the money is the proceeds of crime and one or more of them commits one overt act in pursuance of that agreement, then that is, on your analysis, an offence?

MR GAME:   So long as there is an acceptance by them that in the circumstance that that money they are dealing with is in fact proceeds of crime they will proceed, then there is an offence.  So, it is not a knowledge that it is proceeds, but an acceptance that they will do the crime, it being proceeds of crime.  Whether or not they want it to be, whether or not they would like it to be, whether or not they believe it to be, they will do it.  That is the physical element of the crime under section 400.3(2).

BELL J:   And that is the significance of the factual averment that the money was proceeds of crime?

MR GAME:   That is correct.  But that is why I say ‑ ‑ ‑

BELL J:   So what was the Crown going to prove in that regard in this case?

MR GAME:   The Crown would rely on the very same conduct of the individuals, that is to say, the way in which they dealt with it demonstrated an acceptance by them that it being proceeds of crime they would take the risk.  Now, ironically, your Honour – I say ironically because section 5.4 is an awareness of recklessness because it is at such a high level, that is to say, an awareness that having regard to the circumstances it was unjustifiable to take the risk.  I say ironically because that brings you very close to the idea of an acceptance of a circumstance in which it is proceeds of crime, but there is nothing about that which is exceptional.  I say there is nothing about that which is exceptional, although I will give your Honours and example. 

In attempted rape – attempted rape being an offence of purpose – there is nothing objectionable in attempted rape about recklessness as to the circumstance of absence of consent, that is to say, even if you do not know or believe that the person is not consenting.  Giorgianni did not grapple with that particular issue because it was not confronted with it and Giorgianni did not grapple with the issue which is exposed in the academic discussion of this problem which I will take your Honours to shortly.

GUMMOW J:   Have you got Justice McHugh’s judgment in Peters on your list?

MR GAME:   Yes, your Honour.

GUMMOW J:   A lot of the problems we have been talking about for the last hour flow from 3.1 of the Code, divides offences into two categories and assumes there always are two categories.  In Peters 192 CLR 493 at 515, paragraph 54 and following, Justice McHugh refers to Churchill, amongst other things.  It explains there is a real difficulty in treating conspiracy in terms of actus reus and mens rea.

MR GAME:   Yes, your Honour, it is a fundamental problem.

GUMMOW J:   And upon that difficulty, this straitjacket seems to have been imposed by 3.1, we are somehow struggling with the consequences of that.  Unless we see what went wrong with the legislation, to speak provocatively, we are not going to be able to grapple very much with it.  I wonder if these people had ever read Peters v The Queen when they were preparing this.

FRENCH CJ:   They thought they were substituting physical and fault elements for mens rea and actus reus, or the other way around.

MR GAME:   That is what they thought, yes.

GUMMOW J:   On assumption that that was always a useful division.

MR GAME:   Yes, your Honour, and in the footnotes they referred to this good article and ‑ ‑ ‑

GUMMOW J:   I am not worried about articles, I am worried about what one of my colleagues said.  That is a very detailed and learned judgment.

MR GAME:   I am sorry, your Honour.  I only mentioned the good article because it mentioned they were aware of the problems.  But yes, your Honour, this is a case of ‑ ‑ ‑

GUMMOW J:   They did not have to read articles to be aware of the problem, they just had to read the Commonwealth Law Reports.

MR GAME:   It is a very bad case of trying to fit a square peg into a round hole and then jumping on it over and over again.  Now, I was still in the subsection (5) point.  I went through 5, 3 and 4.  So 5.6, “Offences that do not specify fault elements”, and that explains how you end up with default fault elements for physical elements.  But you do not need default fault elements and you do not need fault elements at all unless they are for a physical element and once you have one you do not need two or three. 

Now, if I could say something briefly about the extensions of criminal liability provisions and one can see something from the structure, and the something that one can see from the structure, if I could just refer your Honours to, section 11.1, one sees “Attempt”.  Now, in “Attempt”, and this is taking Giorgianni on board, so to speak, 11.1(3):

For the offence of attempting to commit an offence, intention and knowledge are fault elements in relation to each physical element of the offence attempted.

Now, it is said against us that where the word “intention” appears in 11.5(2), that means intention in respect of all the physical elements and all the fault elements of the offence and by two people, the accused and one other.  So one can see there that those who drafted this legislation were able to be very specific if they intended to bring about the result which is urged against us.  Now, in complicity, which is aiding and abetting, we see in subsection (3):

For the person to be guilty, the person must have intended that:

(a)his or her conduct would aid, abet, counsel or procure the commission of any offence –

One sees there “any offence (including its fault elements), so, again, in the aiding and abetting example, a specific referral to the fault elements of the offence.  Again, speaking specifically on the subject, subsection (3)(b) creates a form of common purpose, but there is no need to refer to that.  Your Honour Justice Hayne I think earlier this morning took me to section 11.4(2) and I will not dwell on that further.  The answer to your Honour Justice Bell’s question, as unsatisfactory as it may be, is that in 11.5(1) you do find a physical element, a physical element being the making of a criminal agreement, that is to say, an agreement ‑ ‑ ‑

BELL J:   Indeed, that is the analysis of the majority in Ansari and accepted as correct by the court in LK and RK.

MR GAME:   Yes.

BELL J:   It seems to me in some of the submissions that you latterly addressed were directed to the contentions raised in the submissions of the respondents, but it still leaves you with the reasoning of the court in LK and RK and Ansari to deal with.

MR GAME:   Yes, I was not going to duck that completely, your Honour.  In fact, now is as good a time as any for me to take you to that.  Could I take the Court to LK and RK. It is in the appeal books at page 350 but more conveniently it is reported at (2008) 73 NSWLR 80 and following. In LK and RK, if I could just refer your Honours there to paragraph 21, one sees a picking up of that which Justice Howie had said at paragraph 76 of Ansari.  There is no need to go back to Ansari at this point, but one sees there the picking up of the idea:

The person does not have to know that the act is unlawful but needs to know all the facts that make the act unlawful.

As I said before, when one talks about the scope of an agreement one is talking about a different animal than necessarily knowing all the facts.  One is talking about in having contemplation circumstances that may or may not exist in the future.

KIEFEL J:   If you say the inquiry under 11.5(1) is upon the content of the agreement, which is to commit an offence, and in this particular case you then look to see whether the terms of that agreement show that an offence was in contemplation of the offence here, would you say that the conspiracy was established ‑ ‑ ‑

MR GAME:   Yes, your Honour.

KIEFEL J:   ‑ ‑ ‑ where there is an agreement to deal with money and they are prepared to take the risk that the money is proceeds of crime and that is an unjustifiable risk in the circumstance.  I am interested to ask you whether that is sufficient because I am a little confused about what you say needs to be thrown into the agreement about the proceeds of crime.

MR GAME:   Yes.  The add‑on is that in circumstances where the money is proceeds of crime, even if we do not positively know that fact.

KIEFEL J:   Could I put it this way.  If you are talking about the terms of the agreement is it sufficient, do you say, that they are agreeing to deal with money and will take the risk that it is proceeds of crime and put to one side whether it is in fact proceeds of crime; they take their inquiry no further and they will take that risk ‑ ‑ ‑

MR GAME:   No, your Honour.

KIEFEL J:   Is then proof of the fact that it is proceeds of crime simply a matter which the Crown has to satisfy but it does not form part of the agreement itself; that what has to be within the agreement is sufficient to show a preparedness to take a risk that it is proceeds of crime?

MR GAME:   A preparedness to take the risk that it is proceeds of crime in circumstances where it is proceeds of crime.

KIEFEL J:   Yes, but that has not formed part of their agreement.  The rider that you have attached is a matter which the Crown would have to prove separately in evidence; otherwise you have them in a position of knowing that it is proceeds of crime, have you not, at the time of the agreement?

MR GAME:   No, your Honour.  Whether or not it is proceeds of crime in the real world is something that the Crown accepted it must prove and it proved.  But when one is looking inside the agreements ‑ ‑ ‑

KIEFEL J:   That is what I am interested to find out.

MR GAME:   The scope of the agreement has to have in its contemplation the commission of a crime but the fact that this thing in the future is proceeds of crime is a physical element.  It is a physical element to which a mental element of recklessness attaches.

KIEFEL J:   That is why I am saying in terms of the agreement are you concerned only with the mental element?

MR GAME:   No, your Honour; you are concerned with the physical element to the extent that they have in contemplation that in circumstances in which that physical element, even if it exists they will ‑ ‑ ‑

KIEFEL J:   But if the physical element is the making of the agreement, is not the mental element the recklessness with which they are prepared to view the money?

MR GAME:   Yes, your Honour, that is correct, but the physical element of the offence is the making of the agreement to commit a crime.  There may be in fact many crimes in contemplation but they have to contemplate – for example, in my example about bringing in prohibited drugs, precursors or contraband of another description they may not be aware that it is going to be any of those three things but they have contemplation of the prospect of all three and they will take it regardless.  In our submission, they are guilty of conspiracy to commit all three offences so that whether or not they know the fact is not to the point.  The fact is that they have in contemplation in that circumstance they will take it.  So, even in that circumstance they will take it or, as I said before, all the better.

KIEFEL J:   I am sorry to labour this, but what do you say that the agreement has to contemplate with respect to the moneys being proceeds of crime?

MR GAME:   The agreement has to contemplate that there is a circumstance which will occur in which the money is proceeds and in that circumstance, even if we do not know it at that moment, we will take the risk that it is and we are aware that it would be unjustified for us to take that risk.  As I said before, ironically, almost all that you need comes out of that second part of recklessness.  I say ironically because we are breaking things into physical and fault elements where it does not make a lot of sense in the real world. 

I say ironically because once you have established an awareness of recklessness – an awareness that you will or the person who commits the crime will be reckless – I am sorry, that you will be reckless, you the criminal will be reckless, you have to be aware of the prospect of a circumstance within your agreement that you will be reckless, that is to say, you will take the risk and it is unjustified.  As I said, ironically, in truth that really picks up the physical element because the idea of it being unjustified and you being aware of that lack of justification necessarily brings in contemplation that it is proceeds of crime.  What has happened is that the physical element is brought into play by a satisfaction in truth of the mental element of the offence.

HAYNE J:   I am not sure whether the criticism is open or not, Mr Game, but a possible criticism of the submissions you have just been making is that they are submissions that do not distinguish between the state of mind of the conspirator and the state of mind of the dealer.  It may be that to make the points that you seek to make it is necessary to consider the case where you have alleged conspirators, A, B and C, agreeing that either C or, if you want to further elaborate it, a fourth party, D will commit the section 400, et cetera, offence.

MR GAME:   Yes, I understand the distinction but, your Honour, that elucidates a great deal, but the reason why I have not focused on that is that it elucidates a great deal but at a point you are going to have to prove the state of mind of the accused in respect of the future commission of this crime.

HAYNE J:   The conspirators.

MR GAME:   That is right.

HAYNE J:   That is the context in which we are examining the question?

MR GAME:   Yes.

HAYNE J:   The relevant fault element is intention to make an agreement having particular characteristics.  Do you go that far, at least?

MR GAME:   Yes, absolutely.

HAYNE J:   The agreement that you say must be intentionally made between conspirators A, B, C in my example is an agreement for commission of a crime?

MR GAME:   Yes.

HAYNE J:   You say, do you, that the agreement which A, B, C must make is an agreement that accepts that if the money, the subject of the proposed dealing, is in fact proceeds of crime, they will go ahead?

MR GAME:   Yes.

HAYNE J:   And you say, do you, that it is not necessary for the Crown to establish that A, B and C made any agreement beyond an agreement that contemplated the possibility that it would be proceeds and agreed we will go ahead, is that right?

MR GAME:   That is correct.  If that submission is wrong, then as far as I am aware I will lose the case.

HAYNE J:   Now, at some point – and this I think may be something that you will need to write down if you are going to be able to convey it, at least to me, Mr Game – can you take that submission and could you be good enough please to relate it to the particular words in the statutory chain that we are dealing with.  Now, by all means answer me immediately if you feel able to, but I well understand that it may be a task that is better undertaken going away, writing it down and getting it completely accurate first time, but you take whatever course you think is going to be of best advantage.

MR GAME:   Well, I may still be going at lunchtime, but I may also wish to write something down and give it to your Honour overnight, but I will be finished well before then, but yes, I will do that. 

FRENCH CJ:   So I can understand this in relation to our earlier discussions about this objective reality of the money and its character, on one reading of the indictment what the Crown has to do in the light of the requirements of 11.5 is to demonstrate the existence of an agreement which has terms which are intention, the first term being we are going to deal with money to the value of $1,000,000 which is the proceeds of crime, and that reflects the reality that the conspiracy has to be a conspiracy to commit an offence, the first element of that offence being that the relevant money is the proceeds of crime.  Then the second term of the agreement is that the people who are to deal with this money will be “reckless as to the fact that the money was the proceeds of crime”.  The tension is because you are bringing both these things in as terms of an agreement, they have a difficulty in standing together.

MR GAME:   The point is that in the mind, in the agreement, in the scope of the agreement, is a situation in which a physical element – that is to say, the thing is proceeds of crime exists – and a mental element – that is to say, recklessness as to that fact – that state of affairs exists within the scope of the agreement.

FRENCH CJ:   Yes.  I suppose the way I am trying to put the question is if I were asking what are the terms of this agreement, what would be your answer?  Forget about physical elements and other things and circumstances, just tell me what are the terms of the agreement you are alleging?

MR GAME:   The agreement we are alleging is that these people say to each other “We will deal with this money even if it is proceeds of crime and in those circumstances even if we do not know it, we are prepared to take a risk that that is the case”.  So that one has encapsulated both the physical ‑ ‑ ‑

FRENCH CJ:   So it is not a term of the agreement that they will deal with money which is the proceeds of crime?

MR GAME:   It is a term of the agreement that if it is proceeds of crime they will deal with it.

KIEFEL J:   There is a hypothetical non‑assumption, almost.  It is a factor that may exist, but it forms no part of the terms.  That is where I was confused with you before.

MR GAME:   That is right.  It may exist or it may not.  If it exists we will do this, whether or not we positively know it exists.

KIEFEL J:   And proof of the offence itself if it is established as a fact that they are proceeds of crime, their recklessness attaches to that.

MR GAME:   Their recklessness, yes, your Honour.

KIEFEL J:   The physical element necessary for the agreement does not have to be present within the terms of the agreement itself.

MR GAME:   The physical element of the ‑ ‑ ‑

KIEFEL J:   But it has to be something to which it may attach.

MR GAME:   It is something contemplated as a prospect within the wider terms of the agreement.

FRENCH CJ:   You accept that if the terms of the agreement to make out a conspiracy must be as I put to you that that is an agreement whose terms do not stand together, are inconsistent?

MR GAME:   Well, the clumsy drafting was clearly there with an intention to allege that they had an agreement, but ‑ ‑ ‑

FRENCH CJ:   It is trying to link together the conspiracy provision with a substantive offence provision by picking up each element of the substantive offence.

MR GAME:   That is right.  It had an agreement that confronted itself with a physical and a mental element and it said we can confront an awareness by these people within their agreement, such a contemplation.

FRENCH CJ:   The problem is it brings into conjunction what looked very much like two inconsistent states of mind.

MR GAME:   Yes, it does, but it just has to be remembered that the only reason why this is being done is because the Act has forced bifurcation of fault and physical, and it has forced a bifurcation in the agreement and in the substantive offence. 

GUMMOW J:   But the result of the forcing of the bifurcation is to take this offence beyond the common law, is it not?  It is not an agreement to do an unlawful act.  That is what was, I think, puzzling Justice Kiefel, as well as myself.  It is an agreement to do something that may or may not be an unlawful act and taking the risk that it turns to be the latter and that would go beyond the common law and why should we construe the Act this way?

MR GAME:   Your Honour, that is a proposition that we contest and I will take your Honours to some text about that quite shortly.  It would be convenient if I just left that until I have dealt with LK and RK.  But I was at paragraph 21 and then one comes – I am sorry to go back, but one thing that has just occurred to me is that the structure of the legislation with breaking things up in these terms with intention, recklessness, negligence, strict liability invites this very clumsy discourse.

GUMMOW J:   Well, dangerous discourse, I suspect.

HAYNE J:   And the bottom line is that you end up committing conspiracy, careless of whether there is an offence, reckless as to whether there is an offence and it is a very tendentious way of putting it, but that is the bottom line that you are ultimately going to have to confront, Mr Game, that you are ending up creating an offence of, in effect, careless as to result.

MR GAME:   Your Honour, what I say about that is that you are aware of a circumstance which, shall I say, but you do not know that circumstance – you are aware of a circumstance and in that circumstance you are prepared to be negligent about the topic, so that, shall I say, in the cost cutting part manufacturers they think, “We will cut our costs.  We know that” – say, the strict liability, “we know that the protocols won’t be good enough.  We are not suggesting that the equipment will break down or any of those things, but we mutually agree to participate in those circumstances which will amount to the commission of the offence”.

Going back to LK and RK, one sees at paragraph 23 of the Chief Justice’s judgment a reliance on that which Justice Howie said at paragraph [78].  This harks back to something that your Honour Justice Bell raised with me before is this language of knowing “all the facts that would make the intended conduct an offence”.  Just pausing there, it is a very tendentious proposition in respect of an offence that has circumstances and results to which no mental element may attach necessarily to say “know all the facts”.  It depends what you mean by knowing all the facts, as I have tried to demonstrate by reference to negligence and strict liability offences.  In the situation we are discussing here, you may know all the facts in the relevant sense by knowing that you will do it if it is proceeds even if at the moment you do it you are not positively satisfied or aware of that fact.  Then the next sentence:

It is not enough that he intends that conduct will be carried out that it so happens and by reason of facts of which he is unaware is criminal.

This is a kind of a binary approach to the problem because we have got on the one hand knowing all the facts and we have got on the other hand unaware of the facts altogether.  The facts that one is aware of – and this harks back to that which Viscount Dilhorne said, which is one is only concerned with knowledge of the facts to the extent that we are working out what falls within the terms of the agreement.  So this knowing all the facts in fact itself becomes a way in which the real problem – maybe “buried” is too strong, but the real problem is lost.  Our submission is that we agree with everything in the analysis to that point and it is at that point that we part company with the analysis in Ansari and in LK.

BELL J:   You depart at paragraph 23 from the analysis, is that right?

MR GAME:   Yes, your Honour, that is right.

BELL J:   That is because you do not accept in relation to the Code offence of conspiracy the proposition that the accused must know all the facts that make the intended conduct an offence?

MR GAME:   That is too broad a statement, and it needs to be confined by identifying what are the terms of the agreement.  That is to say, knowing all the facts, those words seem to take insufficient regard of the fact that participants of a conspiracy may have, in contemplation, many different circumstances, some of which may exist, some of which may not.

BELL J:   One of the difficulties that I am having with your argument is that frequently you speak in terms of the scope of the agreement, at times, so it seems to me, moving from the requirement that the parties enter into an agreement to commit an offence.  Now it is unexceptional that they need not know the legal character of the conduct to which they agree is an offence, but the proposition at paragraph 23 is they need to know the facts that make it an offence, albeit not its legal characterisation.

MR GAME:   Again, I do not really question that proposition.

BELL J:   Yes.

MR GAME:   But the scope of the agreement is a much bigger thing than the thing that sits within it, which is the agreement to commit an offence.  The scope of the agreement may have much wider ramifications than it – in the example I gave you before of “Is it a prohibited import, is it precursor, is it contraband?” the scope of the agreement is a big thing.  It has within it more than one crime that fits within 11.5(1).  On my analysis, it has three crimes sitting within it, even if they do not know or believe any particular circumstance.  So that is how we would put it.

Your Honours, if one proceeds with a consideration of the Chief Justice’s judgment:  his Honour then considers the common law position at paragraph 42 and then says at paragraph 53:

I agree with Howie J in Ansari . . . that it is possible at common law for persons to conspire to commit a crime of which the mental element is recklessness.  I also agree that there is no reason why that cannot be true under the Criminal Code (Cth). Such an offence will, however, be rare.

Now, there he does not appear to be limiting himself, his Honour, to the fourth subsection in the recklessness provision.  That is the one that picks up knowledge or intention.  He does not appear to be confining him there.  He is talking about recklessness in the common law sense anyway, so it is not knowledge or intention.  Then his Honour cites Gillies in The Law of Criminal Conspiracy, paragraph 54.  We see, in our submission, in the last sentence an acceptance of something very similar to the propositions we have been putting to your Honours:

As a minimum these persons should not be incriminated unless they agree to commit, and thus have the intent to commit the conduct creating the risk of harm, with the same degree of knowledge of risk as would be required of the perpetrator of it by the mens rea element of the substantive crime of recklessness represented by it, as a basis for incriminating the latter in the substantive crime.

It is not clear where his Honour accepts that and that is, in our submission, very close to the position – bearing in mind this is pre‑Code, but that is very similar to the position we are advancing.  And yet, then he says under the Code, the Code picks up the common law and then, really, there is ‑ ‑ ‑

FRENCH CJ:   He is not addressing a situation that we have here where you have a substantive offence with two components, one of which is the objective fact that the money is the proceeds of crime, the second that they are going to deal with it recklessly as to whether it is.

MR GAME:   Yes, your Honour.  It is a slightly different situation but they are saying ‑ ‑ ‑

FRENCH CJ:   It is the interface of those two things with the content of the agreement that amounts to the conspiracy that gives rise to the problem.

MR GAME:   Yes, your Honour, but my submission is that to the extent that one looks back to the common law, and we say that one can, one sees that although the common law does not use this language of fault and physical elements, it contemplated conspiratorial agreements of the kind that one has in mind here.

BELL J:   It is a little unclear quite what Professor Gillies is saying in this passage.  He speaks just a little below the middle part of the passage of persons agreeing:

to commit an act which is criminal and is of a risk‑producing character –

It is the former that raises a question mark about what is being said there.

MR GAME:   Quite, your Honour, but the point is that the conduct there is not conduct of “I intend that this is proceeds of crime”.  It is, “I intend” shall I say, “to deal” – let us say “to contain returns in my tax return which may or may not be accurate but which may in may imperil the commission”.  An agreement to do that is a conspiracy to imperil at common law and under conspiracy to defraud.  So the “commit the conduct” does not – if you translate it – mean intend that it is proceeds.

If you are putting a statement in your tax return which may or may not be right, you do not know it is false.  You do not intend it to be false, but if it is false you are happy to have the Commissioner return your tax on that basis and if you and your accountant both agree on this course of conduct you have conspired to defraud the Commonwealth simply because you put a statement in your tax return which you knew may be untrue even if you were not positively satisfied of that fact.  Imperilment is a good example but once you get into the actual discourse of conspiracy the situation is far more complex than saying that you have to intend the physical conduct that goes to make up the substantive offence.

That is all I wanted to say about that.  So his Honour then basically said the position under the Code is the same because of 11.5(1) and 11.5(2)(b), that appears in paragraph 60, and then that is pretty much the judgment.  Paragraph 72 his Honour says:

I have set out (at 86 [24] supra) par [85] of the judgment of Howie J which states that the charge would not itself be bad merely because it alleges a conspiracy to commit an offence that could be committed recklessly.  Indeed, in the present case there is nothing on the face of the indictment that states that it was the accused who were reckless –

I am not sure about that, but the point is understood that it is recklessness not in the extended sense that we saw in Ansari and that is the reasoning in the judgment.  As I say, we support it and we support the reasons given for saying that the common law applies, and that was to be found in the judgment, if I can just refer to that briefly before leaving it, at – I am just looking for one paragraph before I part from this judgment.  I just cannot find the paragraph, but his Honour gives the reasons and his Honour also cites – there it is, at paragraph 61. 

His Honour is talking about common law and his Honour has reinforced that the common law applies by virtue of that which appears in the MCCOC Report.  The MCCOC Report has been debated extensively between the parties and it is not conclusive, but we do support the proposition that it was intended by the use of the language of conspiracy and overt acts that it was intended to bring into play the common law relating to that which is meant by a conspiracy.  Now, your Honours, I wanted now to take the Court away from the Code and to refer ‑ ‑ ‑

HAYNE J:   Just before you do that, Mr Game, can I see if your argument thus far is accurately captured as the proposition that A and B commit the offence of conspiracy under 11.5 if they intentionally agree that one or other of them or a third party, C, will do acts where A and B take an unjustifiable risk that the acts, if performed, will be criminal?

MR GAME:   Accepting that they will do so even if, in the circumstances, they are criminal; yes, that is our argument.  Now, where I wanted to take the Court ‑ ‑ ‑

GUMMOW J:   That formulation is not limited to circumstances where the criminal act we are talking about is one which has an element of recklessness.

MR GAME:   That is correct, your Honour.  It is attractive ‑ ‑ ‑

GUMMOW J:   That might be a slip or a jump.

MR GAME:   It is attractive because “recklessness” has a purposiveness about it, but the argument does not depend on that purposiveness.  I wanted to take the Court shortly to some texts and articles.  First, I wanted to refer to Chapter 15 of Glanville Williams’ Criminal Law The General Part, Second Edition, 1961, starting at page 663.  We see at page 663, under paragraph 212, the consideration of what the term “conspiracy” means, and we see at about point 3 on that page, a point at which the Code now departs.  At common law:

There need be no overt act beyond the making of the agreement.

BELL J:   I am sorry, what page?

MR GAME:   Page 663, your Honour, and if one imagined it was point 3, “There need be no overt act”.  So we see discussing what “conspiracy” is, then “There need be no overt act”.  Then at page 667, about point 2:

It must not be understood to mean that the mere fact –

This is referable to a case called Murphy:

that two persons independently pursue the same end is enough to convict them of conspiracy . . . A conspiracy is not merely a concurrence of wills but a concurrence resulting from agreement.

Towards the bottom of the page:

“The parties must put their heads together to do it.”

Then we see at page 669, paragraph – sorry, there is also a passage at 668, point 6, which is worth noting:

Mere knowledge of and mental consent to a crime . . . does not make a man a conspirator.

Page 669, “two or more parties”.  Now, if we go then through to 677:

Conspiracy generally requires an intention to commit the ulterior crime.  Hence if a person purports to take part in a plot but is in reality an informer, he is not guilty of conspiracy.

That is the point, we say, reinforced by subsection 11.5(2)(b) of the Act.

Whether recklessness is sufficient for conspiracy probably varies with the result that is in view.  Where an act when done would be criminally reckless, an agreement to do that act is probably a criminal conspiracy.  Thus in an indictment for conspiracy to pervert the course of justice, by producing a false certificate in court, it was held to be sufficient to show that the defendants agreed to certify the fact as true without knowing it to be so; they need not have known it to be false.

The courts incline to say that there may be –

I will not read the rest of it out, but that is Glanville Williams who seems to have thought about this subject for about 30 years.  Now, if I could then take your Honours to two articles by Glanville Williams.  The first is about attempt, The Problem of Reckless Attempts [1983] Crim LR and one sees at 368 at point 7 that that is – I will not read it out but it is the paragraph that begins, “To turn the abduction problem”.

FRENCH CJ:   A very personal piece of polemic.

MR GAME:   Yes.  He seems to write with a good deal of humour which comes through.  Now, that is a challenge, in our submission, to accepting there is an all encompassing proposition that which appears in Giorgianni on the subject.  One cannot be as black and white about the subject. 

One sees the attempted rape by recklessness discussed at page 372.  I will not read it out, but that discussion – the whole of that discussion, in our submission, supports the idea that knowing all the circumstances is not necessarily an adequate description of attempt, particularly the last paragraph on page 372 and the reference to Pigg.  This was all in terms of a polemic about what the attempts committee had or had not recommended on the subject.

Now, if I can go then to an article.  The English amended their legislation after the case of Gardner and the legislation can be seen in the article by Glanville Williams in the New Law Journal article, December 1, 1977, page 1164.  One sees at 1165 the first relevant provision.  It is in the first column at the top, such “a course of conduct shall be pursued which will necessarily” and we would say much more specific language.  Just pausing there, Saik, a case that our opponents rely on, is a consideration after 20 years of this legislation as to what it all meant.  Then one sees at page 1166, again at the top of the first column, a specific dealing with the type of problem that arises in this case.

FRENCH CJ:   Are you referring to recklessness as the consequence?

MR GAME:   Yes, your Honour.  It just says:

Where liability for any offence may be incurred without knowledge on the part of the person committing it of any particular fact or circumstance –

Then without going into all of the limits it says:

unless he and at least one other party to the agreement intend or know that that fact or circumstance shall or will exist –

What I am saying is, here one has a very specific provision trying to deal with the problem in a different statutory context but making a specific provision about it.  Then if your Honours look at ‑ ‑ ‑

FRENCH CJ:   That is a quotation, by the way.

MR GAME:   That is just the section.

FRENCH CJ:   I see.

MR GAME:   That is just the section.  It is not an argument.  This is all about what do you make of the section.  If your Honours then look at the next column, in the middle of the column:

Liability for conspiracy is fixed at the time when the conspiracy is entered into, and does not depend upon what happens afterwards –

and so forth, and we make that point.  Then we have No (4):

Recklessness as to circumstances that are in fact present.  It seems probable that at common law recklessness as to circumstances is sufficient to found liability for conspiracy where it is enough for the substantive crime.  An example is where D1 and D2 agree to make a statement that, for all they know, may or may not be true, in order to get money.  If the statement is untrue they will, if they get the money on the strength of it, be guilty of obtaining property by deception.  At common law their agreement to make the statement would be a conspiracy.

At the top of the next column, “A fortiori”, what Glanville Williams is saying is that under the statute that is not possible.  So that is that article.  Then the next article I wanted to refer to is ‑ ‑ ‑

FRENCH CJ:   Incidentally, just before you go on, the analogue to this case would be, would it not, throwing up the difficulty that I put to you before, that there is an agreement – it is reflecting the situation – you have an agreement to make a false statement, reckless as to whether it is true or false.

MR GAME:   Even if it is false, yes.

FRENCH CJ:   Well, that is the dichotomy.  That is the tension.  You have to have a mental disorder to enter into an agreement like that.

MR GAME:   Well, your Honour, if you consider the conspiracy – at the instant before the offence is committed, one presumably has a joint mental state that is very similar to that which when one commits the offence; mental state that is very similar.  Curiously, in this particular case, [RK and LK], events unfolded so that in effect you are inferring the agreement from things that are happening and people are doing.  That is not unusual, obviously.  Now, the next article that I wanted to refer to is ‑ ‑ ‑

FRENCH CJ:   Perhaps before you take us to the next article we might break for lunch.

MR GAME:   Certainly, your Honour.

FRENCH CJ:   We will adjourn to 2.15.

AT 12.46 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.16 PM:

FRENCH CJ:   Yes, Mr Game.

MR GAME:   Before I part company with the article that I was just taking the Court to by Glanville Williams, that passage at page 1166, where it says:

An example is where D1 and D2 agree to make a statement that, for all they know, may or may not be true, in order to get the money.  If the statement is untrue they will, if they get the money on the strength of it, be guilty of obtaining property by deception.  At common law their agreement to make the statement would be a conspiracy.

That is to say, the facts they know are that the statement may or may not be untrue, although the substantive offence, shall we say the obtaining, depends upon the untruth of the statement which need not be established for the purposes of the conspiracy.  That is to say, it forms no part of the proof of the conspiracy to prove that the statement is in fact untrue and they knew it.

HAYNE J:   Professor Williams’ description of the operation of section 1(2) at the last three lines in the middle column carrying on over the next column encompasses the essence of the argument you advance.

MR GAME:   Yes, your Honour.  Then he concludes by saying under subsection (2) clearly you need more.  Now, Professor Ormerod, who is the author of Smith and Hogan, has written an article in 2006, Current Legal Problems, page 116, and he has written an articled called Making Sense of Mens Rea in Statutory Conspiracies.  I do not know whether your Honours have that article yet but you will see in footnote 1 that a number of English academics have written about this subject and the content of this article shows that Professor Ormerod has thought quite deeply about it.

I wanted to take your Honours to a point in the consideration at page 220 and following where Professor Ormerod speaks of “Rethinking Intention”.  He considers a number of different situations.  I will not go through the first paragraphs but he has “We Will do ‘x’ if ‘y’” and all the examples he gives are about money laundering, so it is quite useful.  The first one is:

If D1 and D2 declare ‘we will transfer the money if it is clean money’ –

and then he goes on to consider that.  In the following paragraph – I can really only skate over this and it does require some consideration, but I will take your Honours to the parts that seem to be important.  Towards the bottom of the page:

If the statement is ‘we will transfer money if it is criminal’, clearly this is a sufficient intention to constitute a conspiracy to launder money.  The other eventuality, what they would do if the money is legitimate, is neither here nor there.  D1 and D2 have declared an intention to pursue a course of conduct which if carried out in accordance with their intentions, which here must be taken to mean including those circumstances that they anticipate and accept, will necessarily involve a criminal offence.  There will be few such cases.

That is a useful cautionary note because there will be a few such cases in which people actually know that the money is proceeds of crime, but they have within their contemplation that if it is proceeds of crime they will proceed to deal with it.  Now then is:

We Will do ‘x’ only if ‘y’:  Campbell calls these ‘comprehensive conditional intentions’.  They differ significantly from the previous category because D1 and D2 have declared intentions as to their course of conduct in both eventualities:  where y materializes and where it does not.

So if they say “if the money is clean, if it is not we will not transfer it”, there is no conspiracy.  Alternatively, if they say “we will transfer the money only if the money is criminal”, then obviously an intention to money launder.  Professor Ormerod goes on to say:

These will be rare, in the money laundering context at least.  It may be that they are more frequent in other examples such as the paedophile who might say ‘I will touch the girl sexually only if she is under the age of 13’; or the thief, ‘I will steal only if there is something worth stealing’.

Then at the top of page 224 and most pertinently for the current case and the current argument:

To do ‘x’ even if ‘y’:  Campbell calls these unconditional intentions.  They are generally regarded as a form of direct intention.  Taking the money laundering duo as an example, let us imagine that D1 and D2 say ‘we know that the monies involved in our business might be criminal, we do not know for sure that they will be, but our business is transferring money and we agree that we will pursue such conduct even though some of the monies we transfer are criminal’.  Their agreement could be reconstructed as one which includes a confirmed intention:  ‘we intend to pursue a course of conduct (transferring money) which is not criminal money and if certain circumstances transpire (the money is criminal), we intend nevertheless to pursue a course of conduct (transferring money)’.  The agreement will, if completed in accordance with one of their intentions, necessarily involve the commission of a crime.

Then there is an analysis of that in the context of agreeing to touch a person under 13.  Then the second example:

D1 and D2 agree to pursue a course of conduct, damaging property; they foresee that the property might not belong to D1.  They agree to continue even if that may be the case.  Their agreements include one intentionally to damage property if it belongs to another.

That thinking, in our submission, is pertinent to the statutory context that we are considering here.  At page 225 – this is in a consideration of whether or not these are “states of mere recklessness” and then the “even if” example is considered but again not in the context of our statutory framework.  I will not read that long paragraph, but that long paragraph is a development of the argument which we have been putting.  So that is the Professor Ormerod article.  We submit that a similar process of thought is appropriate in respect of sections 400.3 and 11.5 in its application to it.

I wanted to now briefly say something further about intention in what might be described in the ordinary sense.  In section 11.5(1) we have conspiracy to do an act.  We are talking about the intention that lies within a conspiracy to commit an offence.  There is no statutory use of the word “intention” relevant to that except that there is an intention to agree, which is the fault element for conspiracy.  The conspiracy to commit an offence – there is buried in that an idea of an intention to commit an offence.  “Intention” as it appears in section 11.5(2)(b) in our submission is manifestly not defined by that which appears in Part 2.2.

Now, in this context I just wanted to make reference to passages from two cases, one back to Peters and Justice McHugh’s judgment at paragraphs 68 and 69.  Again, it is similar to that which I read out at paragraph 26 and Justice Gummow raised a number of other earlier passages in Justice McHugh’s judgment.  I will not read it, but I just wanted to draw your Honours’ attention to paragraph 68 and the idea of intention that lies in conspiracy.  We submit that those ideas are inherent in the idea of conspiracy, namely, we are not talking about intention in terms of an inclination to achieve a particular result or a desire.  We are talking about intention in a different way in terms of framing what I have called the scope of conspiracy and whether a conspiracy within 11.5(1) falls within that broader scope.

I wanted to take the Court to one further case about intention and that is the decision of this Court in Kural (1987) 162 CLR 502. The curious thing about this case was that the trial was heard after He Kaw Teh was argued but before the decision was delivered.  This is a case about intention.  One sees at the bottom of page 505 – I will not read it to the Court, but your Honours no doubt will recall that it is said at the end that the foregoing comments were not designed as a direction to give juries and for the next 20 years they were read out as directions to juries.  At the bottom of page 504 through to 505 is an examination of what the idea of intention means.  I will not read it out, but I would ask your Honours to do so.

So the point about that is that when one speaks of “intended” in 11.5(2), one is speaking purposively but one is not speaking intention in the same words precisely as the Code and one is not speaking intention in the sense of a precise awareness of particular circumstances.  In my submission, that reasoning applies when one looks to a conspiracy to commit an offence, as it does when one looks to whether or not there is an intention that an offence would be committed.

GUMMOW J:   Pages 504 and 505 are emphasising the importance of inference, I think.

MR GAME:   Of inference, yes, your Honour.  There is a short passage at 507 as well, which I will not read, but there is a passage at the top of 507 which is illustrative of the fact that there is nothing odd or peculiar about the way in which I have been putting the argument and you see in the direction given:

I should take the consequences, if that something turns out to be a prohibited import -

ie, I do not have to know that it is a prohibited import.  I would take the consequences if it turns out to be so.

CRENNAN J:   So you need awareness of the likelihood.

MR GAME:   In effect, yes.  So the last case I wanted to refer to was Trudgeon which was a decision of the New South Wales Court of Criminal Appeal which was reported in the Australian Criminal Reports only. I will not read them out again, but two passages – it is at 39 A Crim R 252, passage is at the middle of 255, starting “That a conspiracy to supply”, those two paragraphs – and then a long paragraph on the following page starting at “The mental element” and I will just pause there. We submit that if you do as the respondents do, which is find all the elements in 11.5(2), you have lost the thing which is at the heart of the conspiracy.

I have said all I really wanted to say in‑chief.  I have not yet produced the document that I promised your Honour Justice Hayne.  I will do so overnight and would be grateful if I could provide it tomorrow.  Just before I resume my seat, first of all, if there are any questions, but RK raises a question about costs.  My instructions on that are that we will meet RK’s costs of our appeal in any event, whether we lose or win, but we resist costs and costs should not be ordered in respect of the notice of contention.  In our submission, this is a criminal matter and there is no reason why costs should flow in the notice of contention.  As I say, win or lose, we are prepared to meet our case costs – reasonable costs of our appeal.

Subject to any questions from the Bench, those are the submissions in‑chief that I wish to make. The question of section 107 and section 80 all arise on the notice of contention, so my submissions on that will have to await the submissions of our opponents on that subject.

FRENCH CJ:   Yes, thank you, Mr Game.

MR GAME:   If the Court pleases.

FRENCH CJ:   Yes, Mr Stratton.

MR STRATTON:   Your Honours, the position for the respondent LK is that section 11.5(2)(b) of the Code states that for a person to be found guilty of conspiracy to commit an offence it must be proved that that person and at least one other party to the agreement “must have intended that an offence would be committed pursuant to the agreement”.  It is, in effect, the case for the respondent LK that it follows from that that the fault element for the substantive offence, as it were, must in each case be intention.  From the point of view of the respondent LK, it is submitted that if that point is accepted it should put an end to the appeal.

HEYDON J:   So your argument is the physical element is the making of the agreement and the fault element associated with it is the intention.

MR STRATTON:   Yes.

HEYDON J:   And intention excludes recklessness.

MR STRATTON:   Because of section 11.5(2)(b) it is submitted it follows that the prosecution must prove that the accused has intention in relation to each element of the substantive offence because it is submitted that to have an intention that an offence be committed necessarily means, as it were, distributively, that there be that intention in relation to each element of the substantive offence.

KIEFEL J:   But the intention there referred to is an intention that the offence be committed pursuant to the agreement.  It is meant to link it to the agreement.

MR STRATTON:   Yes.

KIEFEL J:   You are taking it much further than that.

MR STRATTON:   Yes.  In my submission, if there is an intention to commit an offence it necessarily follows that in relation to that offence that intention must apply to each and every element of it, depending on whether it be a circumstance, conduct or the result of a conduct.

FRENCH CJ:   That proposition does not depend upon characterisation of the intention in 11.5(2)(b) as a fault element.

MR STRATTON:   No.

FRENCH CJ:   It is just a logical proposition that the requirement for that intention means that it cannot stand with anything other than fault elements which are in the nature of intention.  Is that the position?

MR STRATTON:   Yes.

FRENCH CJ:   It is a logic argument.

MR STRATTON:   Yes.  Your Honours, in relation to the question of the categorisation of the elements of the offence of conspiracy, to some extent we say it is academic from the point of view of the respondent LK because we say that the same result will flow regardless of whether the elements are regarded as residing in section 11.5(1) or in section 11.5(2).  Nevertheless, we have a view about it which I would seek briefly to express.

FRENCH CJ:   The further option is that they may reside in both, read together.

MR STRATTON:   Yes.  Indeed, clearly, in my submission, I think I would have to concede that at least one element of conspiracy under the Code must reside, in effect, in subsection (1) and that relates to the nature of the substantive offence, that is, only certain types of substantive offence can be the subject of a conspiracy count under the Code.  We say in relation to section 11.5(2) if the matters set out in paragraphs (a), (b) and (c) are not elements of the offence, then what are they?  We say that, although it is not defined in the Code, necessarily that the elements of the offence are those irreducible factual matters that must be established by the prosecution in order to obtain a conviction and it is clear from the wording of section 11.5(2) that those three matters, the matters set out in paragraphs (a), (b) and (c), are matters that must be proved in order to sustain a conviction.  So it is again submitted as a matter of logic that at least those matters must be elements of the offence.

FRENCH CJ:   Here you are using elements in the generic perhaps previous Code sense encompassing but not limited to physical and fault elements as defined in the Code?

MR STRATTON:   Yes, I concede that.  Your Honours, the appellants attempt to otherwise categorise section 11.5(2).  The appellant describes the matters in paragraphs (a) and (b) as matters giving meaning to conspiracy and refers to paragraph (c) the requirement that there be an overt act as an additional precondition to liability.  In our submission, if a matter is a precondition to liability, unless it is a procedural matter, it necessarily must be an element of the offence. 

The appellant has argued in his reply that if section 11.5(2) was so construed, then the element of mutuality is lost.  It is submitted on behalf of the respondent LK that the effect of section 11.5(2) really is the same whether it is categorised as an element or otherwise and that mutuality is not lost.  It is submitted that a difficulty for the appellant’s argument in relation to section 11.5(2)(c), that is, the requirement that there be an overt act, is that if it is not an element, then there is no fault element.  So it is submitted that it would be, in effect, a physical element to which no fault element attaches.

KIEFEL J:   What do you say, though, to the proposition that (a) and (b) give content to and explain what a conspiracy is for the purposes of subsection (1)?

MR STRATTON:   Well, it is submitted that they do more than that.  It is submitted that they actually are what is required to be approved by the prosecution in order to establish the offence of conspiracy and that the words that open section 11.5(2), that is, “For the person to be guilty”, et cetera, it is submitted that it necessarily follows that those are constituent elements of the offence.

BELL J:   I am sorry, Mr Stratton, I just missed the submission that you made concerning subsection (2)(c).  Did you say that there was no fault element?

MR STRATTON:   If the appellant’s submission is correct, then if it is not an element to the offence, then there is no operation of the requirement that each physical element has a fault element.  So it is, as it were, left without a fault element and presumably it would follow ‑ ‑ ‑

BELL J:   But that does not do torture to the ‑ ‑ ‑

MR STRATTON:   No, but it would mean presumably that an act can constitute an overt act even if it was accidental, presumably, but that is as against the requirement ‑ ‑ ‑

BELL J:   It is an overt act pursuant to the agreement.

MR STRATTON:   Well, it is submitted that that of itself indicates that it must have been intended as a physical element with a fault element attached.  The appellant has argued that logical consequence of the construction urged by the appellants is that a conspiracy to commit an offence of recklessness is bad at law, and that appears in the appellant’s reply at paragraph 7.  But, in fact, our position is very much the position which the Court of Criminal Appeal reached in Ansari which, in my submission, is to this effect, that a count of conspiracy to commit an offence of recklessness is not bad at law, but the prosecution will fail to establish such an offence unless it is able to prove intention as distinct from recklessness.  I would refer to the reliance both of Justice Simpson and Justice Howie on the fact that recklessness under the Code can be established by proof of intention.

FRENCH CJ:   Intention or knowledge?

MR STRATTON:   I am sorry, your Honour?

FRENCH CJ:   Is the prosecution to conspiracy to commit an offence of which recklessness is an element, as upheld in Ansari, limited to cases in which the extended definition of “recklessness” by reference to either intention or knowledge is concerned, because you just spoke of it in terms of intention only.

MR STRATTON:   Yes, I take your Honour’s point.  In a sense, intention in three different senses in which it is used in the Code, that is, intention in relation to conduct, circumstance or result.

Your Honours, it is submitted that in effect the offence of conspiracy is created by section 11.5(1) in that that provision establishes a sanction for the offence but the elements, possibly not all of them, are set out in 11.5(2).  That structure of a statute is a familiar one.  For example, it is the same structure that is used in the Crimes Act (NSW) in relation to murder where the sanction or penalty is established in section 19A but the elements of the offence of murder are found in section 18. For that matter there was a similar structure in relation to the Customs Act.

In the present case, the respondent LK was charged with conspiring to commit the substantive offence of dealing money which was the proceeds of crime reckless as to the fact that it was the proceeds of crime.  The matters which had to be proved in relation to the substantive offence included recklessness as to the fact that the money was the proceeds of crime.  Importantly in this case this was not the sort of case to which the appellant referred of matters not presently in existence but matters being considered of happening or not happening in future because importantly – and this is referred to at appeal book 369 by the Chief Justice.  This is part of the judgment of the Court of Criminal Appeal.  At paragraph 65 the Chief Justice said:

It is of significance that in Ansari the Court was concerned with the second of the two kinds of money laundering offences ie whether there was “a risk that money or property will become an instrument of crime”, to which I have referred at [13] above as an offence B.  The present case involves an offence A:  namely that the money or property is proceeds of crime.

That was considered to be an important distinction between the present case and Ansari, the other important distinction of course being that in Ansari the Crown case was actually that they could prove intention although conspiracy to commit recklessness was charged.  It is submitted that the ‑ ‑ ‑

HAYNE J:   Can I just interrupt you and take you back, I think you said – correct me if I am wrong – that there could not be a conspiracy to commit an offence where the relevant fault element was recklessness.  Is that right?

MR STRATTON:   No.  My submission is that, in effect, the ratio decidendi of Ansari is that the Crown is entitled to charge the offence of conspiring to commit an offence of recklessness.

HAYNE J:   Yes.

MR STRATTON:   So the learned trial judge was right to reject the demurrer but that unless the Crown can prove actual intention in the way that that expression is used in the Code the Crown case will fail.

HAYNE J:   Can I put this hypothetical to you which may make the point:  A and B agree together that they will have money laundered.  A and B know and intend that the money will be laundered and, for that purpose, they propose to employ C, a bank officer who is under their sway and who will not ask any awkward questions.  C may be the person who is the actual money launderer, the dealer in proceeds of crime.  C may be acting recklessly but A and B could conspire, could they not, to commit the offence.

MR STRATTON:   My submission is, yes, and that is the particular example which was referred to by the Chief Justice of New South Wales in reaching the conclusion that he did in the present case and, similarly, that was one of the two matters that Justice Howie relied upon in giving the majority judgment in Ansari.

HAYNE J:   And you are not submitting to the contrary?

MR STRATTON:   No.

FRENCH CJ:   The three circumstances in which you can support an indictment for conspiracy to commit an offence of which recklessness is an element, (1) where you are relying upon and you prove intention, (2) where you are relying upon and prove knowledge, and (3) where the conduct concerned is that of a third party?

MR STRATTON:   Yes.  In effect, your Honour is quite correct to point out that I have simply been referring to intention, but I have been intending to refer to it in the Code sense where intention, depending on the type of element, is either intention to commit an act on one hand or knowledge ‑ ‑ ‑

FRENCH CJ:   Well, it is in the definition of recklessness.

MR STRATTON:   Precisely, yes.  If I could take your Honours to that in relation to section 5.2 as to what intention means, because the fact that the money was the proceeds of crime is a circumstance, relevantly intention in that context is defined in section 5.2(2), that is:

A person has intention with respect to a circumstance if he or she believes that it exists or will exist. 

Now, your Honours, although I have got quite a bit more to say, in effect we say that that really determines this appeal, that because the section which establishes conspiracy requires that there be intention because of the relevant physical element in the substantive offence is one of circumstance, in my submission, applying the Code to that factual situation the prosecution was required to prove that the defendants believed that that circumstance exists on the facts of this case; that it exists, not that it will exist.

BELL J:   That is taking the analysis a step further than the Court of Criminal Appeal found it necessary to do in this case or in Ansari.  Since in each of those decisions the court approached the matter upon the basis that the requisite intention was the intention to enter the agreement to do the unlawful act, one was no longer troubled beyond that point with the Code Part 2.2 analysis of the elements of the offence that was the object of the conspiracy simply with the capacity of the Crown to establish that as part of proof of the intention to enter an agreement to commit a given offence, one knew the things that made doing those acts an offence.

MR STRATTON:   I agree that the approach that I have put to your Honours is different from that in the court below, but my submission is, in effect, to summarise what I hoped to be putting to your Honours briefly this afternoon, is that no matter what route you take you come to the same conclusion, that is, whether you look strictly without paying too much attention to the common law at the Code or whether you take into account, as the Court of Criminal Appeal did, the context of the common law in relation to the interpretation of conspiracy, you arrive at the same result.  Importantly, as a sign of that, although the contention that I urge about the nature of the elements of the offence of conspiracy under the Code is different to that reached by Justice Howie in Ansari who came to the same conclusion as did the Court of Criminal Appeal come to the same conclusion in this very case.

BELL J:   As I read Justice Simpson, her reasons were consistent, though, on this point with the reasons of the majority, that is of Justice Howie, with whom Justice Hislop agreed in Ansari, is that – I am simply raising with you, Mr Stratton, that there seems to have been uniformity in approach in the Court of Criminal Appeal.

MR STRATTON:   Yes.

BELL J:   All right.

MR STRATTON:   Your Honours, we say that section 11.5(7A) is very significant in the interpretation of section 11.5 as a whole.  Section 11.5(7A) states that:

Any special liability provisions that apply to an offence apply also to the offence of conspiracy to commit that offence.

Clearly, a special liability provision includes an absolute liability provision.  In the written submissions I express the view, which I now concede may be wrong, that that also applied in relation to strict liability provisions but my submission is whether strict liability provisions are included or not subsection (7A) still poses enormous problems for the appellant’s interpretation of section 11.5 as a whole.

My submission is, if, as the Crown argues, that the fault element for the substantive offence is also the fault element for the offence of conspiring to commit that offence, why was it necessary to so specify in relation to absolute liability offences?  If it was so necessary, why did the legislature specify that for absolute liability provisions that that would be the fault element even if conspiracy was charged?  Why not include negligence, recklessness and so on?

The Crown puts to the Court that the reason for subsection (7A) is for provisions such as section 307.1 of the Code, that is the offence of importing the commercial quantity of border controlled drugs and if I could take your Honours to it.  Your Honours will see in section 307.1 it contains both an element of recklessness - that is 307.1(1)(b) - being that:

the substance is a border controlled drug –

and also an absolute liability offence.

FRENCH CJ:   Section 307 is not in the second reprint, is it?  It appears in the most recent reprint, I think, Reprint 12.

MR STRATTON:   Do your Honours have the small reprint?

GUMMOW J:   We have got reprint No 4 on the Bench file.

FRENCH CJ:   Not the complete reprint.

HEYDON J:   Section 307.1?

MR STRATTON:   Yes, 307.1.

GUMMOW J:   This is to throw some light on 11.5(7A), is it?

MR STRATTON:   Yes.

GUMMOW J:   Which preceded it.

MR STRATTON:   Your Honour, the Crown argues at paragraph 12 of the reply that it is to deal with provisions such as this.

FRENCH CJ:   But this comes in after it was enacted?

MR STRATTON:   Yes.  Your Honours will see in relation to 307.1 that there is both an element of recklessness, that is, that the substance was a border controlled drug, and an element of absolute liability that the quantity imported or exported is a commercial quantity.  For the Crown to say it is for a provision such as this that we have subsection 7A undermines the Crown’s argument, which is that you would take the elements for conspiracy to commit offence from the elements for the substantive offence in any event.  In other words, in my submission, if the Crown’s contention was correct, then subsection 7A would have no work to do.

Your Honours, briefly in relation to taking section 11.5 in the Code as a whole, in my submission, the scheme of the Code is that in relation to the inchoate offences that intention is required, and that is certainly the case in relation to attempt, section 11.1(3), and also in relation to incitement.  Your Honours, in relation to the secondary material in the written submissions, at page 8 I have taken your Honours to what is said in the report of the Criminal Law Officers Committee on the Model Criminal Code.  That is at page 8 of the written submissions.  I have also supplied your Honours with a copy of the relevant sections of the report.  At paragraph 42 of the written submissions I have quoted what the authors of that report say, which is:

The Committee agreed that intention was required and that recklessness would not suffice.

There is a footnote which has been a matter of some contention between the parties, but your Honours will see that there is a reference in the footnote supporting that to an article by Gillies which I have extracted over the page, at page 9, which indicates, in my submission, that the committee meant to say what their words say, that is, the intention of the legislature was that intention only and not recklessness should not suffice.

I have taken your Honours to some other secondary authorities, which is consistent with the interpretation which I am urging upon your Honours, which is that what is required is intention to commit an offence.  Your Honours, I wanted to then take your Honours to the common law position in relation to conspiracy to be reckless and I think I can deal with these much more quickly than I had anticipated.  I have taken your Honours to the decision of Churchill v Walton and, in particular, I have extracted from the speech of Viscount Dilhorne where he said:

On this point the law is, in my opinion, the same for conspiracy as for aiding and abetting, as to which Lord Goddard C.J. said in Johnson v Youden:

“Before a person can be convicted of aiding and abetting the commission of an offence he must at least know the essential matters which constitute that offence.

Then I have taken your Honours to the decision of the House of Lords in Kamara v DPP.  That, of course, was a case of an appeal against a conviction of conspiracy to trespass.  But in the course of dealing with the appeal Lord Hailsham summed up some of the essential principles in relation to conspiracy and I have extracted a passage from his speech at page 119, where he said:

Before I seek to answer these questions I will enumerate one or two propositions about which there is no doubt –

and then to take you to the second of those propositions:

(2)      In spite of this, mens rea is an essential ingredient in the crime of conspiracy.  This mens rea consists in the intention to execute the illegal elements in the conduct contemplated by the agreement, in the knowledge of those facts which render the conduct illegal -

and there is a reference back to R v Churchill.  Now, your Honours, in my submission Giorgianni v The Queen in this context is very significant because the nature of the physical element in dispute in this case is a circumstance and, in my submission, that is a very important factor in determining this case.

Giorgianni was a case, of course, where on the Crown case Giorgianni procured culpable driving by another man by sending him in a road with defective brakes.  So, importantly again in Giorgianni they were dealing with a circumstance and I have extracted a passage from the joint judgment.  If I could just take your Honours to the underlined section at the bottom of page 12 of the written submissions:

There are, however, offences in which it is not possible to speak of recklessness as constituting a sufficient intent.  Attempt is one and conspiracy is another.  And we think the offences of aiding and abetting and counselling and procuring are others.

Similarly over the page in another underlined section their Honours say:

It is not sufficient if his knowledge or belief extends only to the possibility or even probability that the acts which he is assisting or encouraging are such, whether he realizes it or not, as to constitute the factual ingredients of a crime.

My submission is that the facts in Giorgianni really are very much on all fours with the examples given by the appellant.  For example, your Honours will recall my learned friend, Mr Game, referred to the example of someone sending out someone driving who may have not been wearing his spectacles, negligence in relation to maintaining a factory.  They are matters which go to a circumstance and, in my submission, the authorities are clear that when the element is a circumstance, that actual intention or knowledge is needed. 

Now, true it is the appellant has referred to the passage of Justice Mason in Giorgianni who said that in relation to some of the elements of intent, it was not necessary to show actual knowledge, and that is the passage at 495 of Giorgianni.  It is clear that what Justice Mason was considering then was not the circumstance.  His Honour was considering the other type of element, that is, a result of conduct.  Again, if I could take your Honours to section 5.2, in my submission, the Code, in effect, reflects the expression of opinion of this Court in Giorgianni about the different levels of knowledge which are required for a circumstance on the one hand and on the other hand something which is the result of conduct, that is, in section 5.2 in relation to a circumstance we go to subsection (2):

A person has intention with respect to a circumstance if he or she believes that it exists –

and we say that is relevant for our purposes because it is a circumstance which “exists or will exist”.  But in relation to a result of conduct such as a collision from negligent driving or from injury sustained from that collision, then:

A person has intention with respect to a result if he or she means to bring it about or is aware that it will occur in the ordinary course of events. 

That echoes, in my submission, what Justice Mason said at page 495 of Giorgianni.  Similarly, in relation to the example that the counsel for the appellant took your Honours to in relation to the passage from Gillies, again that is knowledge in relation to a result where the result being death in relation to a murder.  Again, if I could take your Honours to a passage to which the counsel for the appellant took you at the end of his oral submissions, page 522 of Peters 192 CLR 493. Mr Game took your Honours to the passage at page 522 starting virtually at the top of the page:

But a person may intend to do something even though it is the last thing he or she wishes to bring about.  Intention in this context is broader than a person’s inclination to act to achieve a result that he or she believes is desirable.  If a person does something that is virtually certain to result in another event occurring and knows that that event is certain or virtually certain to occur, for legal purposes at least he or she intends it to occur.

That is the passage to which Mr Game took you, but, again, that is a reference to a result of conduct and that is, in my submission, by no means different to what the Code says in relation to result of conduct and intention to bring it about or where it will occur in the ordinary course of events.

Your Honours, in relation to the English authorities, your Honours have been taken to a number of articles but, in my submission, a surer guide to the state of authorities in England is the decision in Saik which is very similar to the facts of the present case and true it is their Honours were giving their decision in terms of English legislation, but their Honours made it very clear in Saik that they regarded the statute as not having modified the common law position but of having codified it.  At paragraph 62 of the written submissions, I take your Honours to those passages.  If it would assist your Honours, I will take your Honours to those passages in the actual report, but only if your Honours wish me to do so.  I will take silence as a wish to move on, if I may.

FRENCH CJ:   Yes.

MR STRATTON:   Your Honours, my submission is that the common law authorities are very clear that what is required in a situation where the relevant element is, in effect, a circumstance that what is required is actual knowledge.  My submission is, in effect, that we get to the same result no matter by which route, whether by the Court of Criminal Appeal’s route of taking into account the common law authorities or by the other route, a simple statutory interpretation exercise in isolation.  In my submission, we end up with the same route, which is that it was necessary for the Crown on the facts of this case to establish actual knowledge.

GUMMOW J:   Was the House of Lords case referred to in the Court of Criminal Appeal?

MR STRATTON:   It was certainly referred to in Ansari.  Your Honour, it does not appear to have been referred to in the court below, but my memory is that it was referred to by Justice Howie in Ansari.  That case, of course, was relied upon in the decision of the Court of Criminal Appeal below.

Your Honours will recall, in brief, that the facts of Saik were very similar to these.  Saik actually pleaded to a count of laundering money with the proviso, as it were, that he suspected but did not know that the money was the proceeds of crime.  After he was convicted and sentenced he appealed against his conviction and the sentence and the conviction was quashed.

FRENCH CJ:   Yes, Saik does not appear to be cited in Ansari.

MR STRATTON:   No.

GUMMOW:   What do you get out of Saik?

MR STRATTON:   In my submission, really it confirms the common law position that in relation to circumstances that there must be actual proof of knowledge in relation to the conspiracy count.  The Crown has addressed your Honours at some length in relation to cases of sexual assault.  In relation to those, in my submission, it is important to bear in mind, as this Court as I recall observed in Banditt v The Queen, that the concept of recklessness appears in a number of different concepts in the criminal law and it does not always carry the same meaning and, in my submission, to attempt to apply recklessness as referred to in the context of sexual assault to the law of conspiracy generally is not profitable.

Your Honours, in the written submissions I take issue with a number of matters argued by the appellant as matters which would cause difficulty if the interpretation of conspiracy accepted by the Court of Criminal Appeal was adopted.  In the written submissions I have attempted to deal with them in some detail, but in oral submissions, if I may, I would simply seek to deal with them globally.  The offence of conspiracy has always been regarded as, as it were, a different creature to substantive offences and it has been rightly regarded as a species of charging an accused person which bears with it real procedural advantages for the prosecution.

This Court has always, particularly in cases such as Hoar, expressed the importance of limiting the use of conspiracy, but importantly of its very nature conspiracy, unlike substantive charges, involves, as the Crown has stressed to you in written submissions, the idea of mutuality.  So in relation to some of the, as it were, problem questions which the Crown gives as examples, it is no surprise that when two parties are charged and one of

them has a different state of mind to the other that although they might be guilty of different substantive offences they are not guilty of a conspiracy to commit a single offence.

In summary, your Honours, in my submission having regard to the nature of section 11.5 itself to the structure of the Act to the common law authorities, in my submission your Honours would not accept the appellant’s contention that the Court of Criminal Appeal was in error in saying that for a circumstance charged in relation to a conspiracy offence that the prosecution must establish intention or knowledge.  Your Honours, subject to any matters your Honours wish to put to me, that is all I wanted to say in relation to the Code element, as it were, of the appeal.

In relation to the constitutional element, as your Honours are aware, I have adopted the written submissions of my learned friend, Mr Hughes, and I did not propose to add anything further to them.  So unless there is a particular matter your Honours wish me to address, those are the submissions.

FRENCH CJ:   Thank you.  Yes, Mr Hughes.

MR HUGHES:   Your Honours, on the construction of section 11.5(1) we have prepared some short speaking notes which expand somewhat, but not very greatly, upon the content of our written outline.  May I have the Court’s indulgence to hand those up.

FRENCH CJ:   Yes, thank you, Mr Hughes.

MR HUGHES:   Your Honour, the essence of our argument on the construction of section 11.5(1) and associated provisions is contained in our written outline to which we adhere.  I should say at the outset that there is nothing in the submissions that have been made to the Court by my learned friend, Mr Stratton, this afternoon from which we would wish in any way to diverge.

May I go to the written outline, page 3, where we attempt to deal with the construction of 11.5(2) of the Code.  We say that paragraphs (a) and (c) of that provision – that is, subsection (2) – contain the physical elements of conduct and in the absence, as is the case here, of any specified fault element, section 5.6(1) provides intention as the fault element for conduct.  So to establish guilt it was incumbent, we say, upon the prosecution to prove that RK intended to engage in conduct which included the physical elements specified in paragraphs (a) and (c) of 11.5(2).

We go on to say that for RK to be guilty of the offence charged, it was also necessary for the prosecution to prove the fault element of intention as specified in paragraph (b) – see, if we may ask the Court, section 5.2.  As held by their Honours in the Court of Criminal Appeal, the circumstance was that the money, the subject of the proposed dealing in breach of section 400.3(2), was proceeds of crime as defined in section 400.1 of the Code.  To prove the requisite intention specifically prescribed by section 11.5(2)(b), it was incumbent upon the prosecution to establish belief by RK that the circumstance as to the tainted status of the money existed when he made the agreement charged – see section 5.2(2).  We submit that the Chief Justice in the Court of Criminal Appeal held correctly at paragraph 8, appeal book 352, line 52:

The relevant physical element in this case is a “circumstance” ie “the money is proceeds of crime”.

Paragraph (b) of section 11.5(2) specifies a fault element of intention.  If intention was not the specified fault element, section 5.6(2), your Honours, which relates to “circumstance” would have made recklessness the fault element.  There is, however, we would venture to submit, no possible scope for the operation of 5.6(2) where the fault element has been specified as intention in respect of a circumstance.  Therefore, we say, matters which have to be proved before a person can be guilty of conspiracy under section 11.5(1) involve intention in relation to each of the three fault elements set out in subparagraphs (a), (b) and (c) of section 11.5(2).

We say that there appears to be, your Honours, no dispute about the matters referred to above in relation to paragraphs (a) and (c) of 11.5(2).  The dispute in this case concerns paragraph (b) which, unlike the other two paragraphs (a) and (c), has circumstances as the relevant physical element but it still has “intention” as defined in respect of a circumstance as the applicable fault element.  Now, I appreciate that what I have endeavoured to put to the Court up to this point proceeds on the basis or is based on the proposition that paragraphs (a), (b) and (c) do define fault elements in respect of the conspiracy to commit an offence, that is, the conspiracy at which section 11.5(1) directs itself.

It matters not, in our submission, your Honours, that the three matters referred to in paragraphs (a), (b) and (c) are not the exclusive fault elements.  Our argument accommodates itself, if I may say so, perfectly easily to the proposition that there is a fault element or fault elements contained in section 11.5(1).  The important factor in the evaluation of the meaning of section 11.5 read in the context of section 400 is that paragraphs (a), (b) and (c) of section 11.5 prescribe preconditions to the establishment of criminal liability for the offence described or defined – not exclusively defined – in section 11.5(1).

As I say, it is not necessary for our argument to contend that paragraphs (a), (b) and (c) in 11.5(2) are exclusively the only fault elements we can accommodate to finding other fault elements in subsection (1).  But where you have, as we have here, your Honours, prescriptions in the nature of the expression of preconditions to the establishment of criminal liability it is, in our respectful submission, difficult to see why those prescriptions in the three paragraphs of section 11.5(2) are not fault elements upon which the definitions of “intention” to which we have – the statutory definitions of “intention”, as we have endeavoured to describe them in our outline, attach.

FRENCH CJ:   When you say “fault element”, do you mean physical or fault elements?

MR HUGHES:   Yes, I am sorry ‑ physical or fault elements.  I am obliged to your Honour for the correction.

BELL J:   Do you say the intention in (2)(b) ‑ ‑ ‑

MR HUGHES:   Yes – is belief.  I am sorry, I interrupted your Honour.

BELL J:   No, not at all.  I am just trying to understand how you marry up the intention to which (2)(b) refers with the fault element notion of intention in 5.2.

MR HUGHES:   It is done via section 5.2(2):

A person has intention with respect to a circumstance if he or she believes that it exists or will exist.

If the circumstance, as we contend, is that the moneys are proceeds of crime it is incumbent upon the prosecution to prove a belief on the part of the accused RK or, for that matter, the accused LK, that the money was of that character.

BELL J:   I understand that.  It is just not clear to me how you distil (2)(b) down to the circumstance that the money was proceeds of crime.  Subsection (2)(b) is directed towards the requirement that the person and one other party to the agreement had intended that an offence be committed pursuant to the agreement.

MR HUGHES:   If one transposes one’s attention, your Honour, to the substantive offence, which is in section 400.3, one fastens on paragraph (b)(i):

A person is guilty of an offence if:

(a)the person deals with money or other property; and

relevantly –

(b)either:–

(i)the money or property is proceeds of crime –

We contend, congruently and respectfully, with the finding on this point by the Court of Criminal Appeal that the money was proceeds of crime is a circumstance.  Proof of the relevant intention with respect to that circumstance is proof of a belief by the accused that the money possessed or had that tainted character.

FRENCH CJ:   The intention in 11.5(2)(b) is that an offence would be committed.  Transposed to the offence we are concerned with here in 400.3(2), that unpacks this way.  First of all, an intention that a person will deal with the money, and that is conduct, I suppose.

MR HUGHES:   That is conduct.

FRENCH CJ:   Secondly, an intention that the money or property will be the proceeds of crime.  Maybe that is a circumstance.

MR HUGHES:   That is a circumstance, we say.

FRENCH CJ:   Thirdly – and this is, I suppose, the key point, or an important point – an intention that the person dealing with the money will be reckless as to the fact that the money or property is proceeds of crime.

MR HUGHES:   Yes, your Honour.  The sticking point in the appellant’s argument arises at the point in subsection (2) of section 400.3, the money is the proceeds of crime.  Now, I want to go on and speak very briefly about what is in the speaking notes which I think I handed them up.

CRENNAN J:   Just to be clear, Mr Hughes, you are saying then, are you, that belief in that circumstance, that is that the money was the proceeds of crime, is a belief that has to exist at the time of the agreement?

MR HUGHES:   Yes, your Honour, we would say that.  That seems a fairly clear proposition in the light of the way section 400.3 is drafted.

CRENNAN J:   In 5.2(2).

MR HUGHES:   And in the light of 2.2.  Turning to the speaking notes we venture to submit, respectfully, that a basal error in the appellants’ argument is the treatment of section 11.5(1) as providing but a single physical element for the offence of conspiracy charged against RK.  The suggested consequence of the appellants’ argument is that none of the subparagraphs, (a), (b) and (c) of 11.5(2), is definitive of any physical or fault elements of the charged conspiracy.  That approach, if we may invite the Court’s attention to it, is exemplified by resort to the statement “11.5(2)(b) does no more than require mutuality”, which, as your Honours will see, is the heading to paragraph 26 of the appellant’s outline.

This proposition, we would say, disregards the principle that in interpreting the elementary principle, that in interpreting the meaning of a statutory provision creating an offence one should pay regard to the totality of the events prescribed by the statute as the elements of its commission.  Clearly, 11.5(2)(b) and its companion subparagraphs define preconditions to the occurrence of criminal liability.

Your Honours, the appellants’ outline lacks any reference to section 3.2 of the Code which commences, as your Honours will have observed, with substantially the same words or expressions as 11.5(2).  Section 3.2, your Honours will see provides:

In order for a person to be found guilty of committing an offence the following must be proved –

after which words there are references to what we have described as “physical elements” and “fault elements”.  By parity of expression section 11.5(2) commences with the expression, ‘For the person to be guilty” followed by a description of physical elements and fault elements in subparagraphs (a), (b) and (c).

This rather striking similarity, as we would venture to describe it, of expression makes it difficult to conclude that section 11.5(2) does not define physical and fault elements of an offence against section 11.5(1).  If such a conclusion is unjustified it must follow that by a combination of section 5.2(2) and section 11.5(2)(b), proof of the conspiracy charged required evidence that the accused RK believed that the money was proceeds of crime as defined in section 400.1.  The Crown, of course, as your Honours know, concedes that there is no such evidence. 

Now, your Honours, if one sets oneself the task of itemising the physical and fault elements of an offence against section 400.3(2)(b)(i) of the Code, there emerges a material distinction between the statutory ingredients of that offence, that is, the offence against section 400.3, and the statutory ingredients of an offence against section 11.5(1), of the Code.  Now, if I may take a moment of your Honours’ time to look at section 400.3(2)(b)(i), the first physical element is that the accused deals with money.  As to the meaning of that expression, one goes to section 400.2.  There is a definition of “dealing with money or other property”:

(1)      For the purposes of this Division, a person deals with money or other property if:

(a)the person does any of the following –

Receives is one element, possesses is another, conceals or disposes of money are others, but there is the definition of “dealing”.  Now, the fault element, we say, applicable to this physical element is intention as defined in section 5.2(1) because dealing is conduct and subsection (1) of section 5.2 says that:

A person has intention with respect to conduct if he or she . . . 

believes that it exists or will exist.

FRENCH CJ:   It says “if he or she means to engage in that conduct” – that is 5.2(1) you were reading.

MR HUGHES:   I am so sorry, I muddled the reference, “if he or she means to engage in that conduct”.  So the fault element of intention with respect to dealing is meaning to engage in dealing.  I am sorry, I was rushing my fences, your Honour, I apologise.  The second physical element is that the money is proceeds of crime as defined in section 400.1(1).  It is defined just below the middle of page 476 of the print of the Act.  Now, as I have ventured to suggest before, that physical element is a circumstance.  See, if I may ask your Honours, section 4.1(1): 

A physical element of an offence may be . . . 

(c)a circumstance in which conduct, or a result of conduct, occurs.

The fault element for that physical element is recklessness in the absence of a specific fault element.  That is, I think, sometimes described in the terminology of this part of the law as a default fault element.  Now, turning if I may to the offence against section 11.5(1), we suggest that the material distinction between an offence against section 400.3(2)(b)(i) and an offence against section 11.5(1) is that for the latter offence section 11.5(2)(b) specifically provides a fault element of intention, whereas the former offence, that is the offence against section 400.3(2)(b)(i), does not specify a fault element of intention.

Hence, one supposes, the Chief Justice in the Court of Criminal Appeal in paragraph 69 of his reasons said at page 93 of 73 NSWLR or appeal book page 370:

It is not the Crown case that either of the accused knew that the money was proceeds of crime.  As the Crown emphasised in its submissions in this Court the Crown case was that the appellants were reckless as to the fact whether the money was proceeds of crime.  That allegation may have supported a substantive offence under s 400.3(2).  It cannot support a charge of conspiracy where, in order to satisfy the test of intention with respect to entry into an agreement to commit an offence, the accused must know the facts that constitute the offence.

There is the critical distinction between the elements of the conspiracy offence under section 11.5 and the substantive offence under section 400.3 with which the Court is concerned in this case.  In essence, your Honours, what the appellant’s argument seeks to achieve in this case is that transposition of a fault element of recklessness in relation to the substantive offence under section 400.3 to the offence of conspiracy created by section 11.5(1) with its preconditions of liability set out in subsection (2), we submit, with respect to the argument of my learned friend Mr Game, that such a transposition is impermissible.  It is not authorised by the statute.

As regards Ansari, your Honours, it is, we say, a materially different case on its facts from the case against RK and, for that matter, against LK.  There was at least one difference – namely, in Ansari the charge was conspiracy to commit an offence against section 400.3.(2)(b)(ii). That offence involves proof of a particular risk. An offence against 400.3(b)(i) does not include risk in the statement of the offence, as noticed by his Honour the Chief Justice in the Court of Criminal Appeal – see, if I may ask your Honours, the report of that case in (2008) 73 NSWLR 80 at paragraphs 20, 65 and 69, to the last of which three paragraphs I have already made a reference in my argument to your Honours.

I should have added that in Ansari, the Chief Justice in the Court of Criminal Appeal referred to the passages in the judgment of Justice Howie in Ansari at page 110, paragraph 88; page 111, paragraph 89 and page 113, paragraph 93.  We do submit as regards Ansari that his Honour Justice Howie was, with respect, in error in propounding the proposition that there was only one fault element in an offence against section 11.5(1).  That proposition, we respectfully suggest, cannot stand compatibly with section 11.5(2)(a), (b) and (c).  That statement or proposition was enunciated by his Honour Justice Howie at paragraph 63 of his reasons in Ansari at page 105 of 70 NSWLR.

Of course, the other difference between this case and Ansari – it has already been pointed out so I shall be brief – in Ansari the Crown relied upon section 5.4(4) so as to be entitled to prove recklessness as a fault element for a particular physical element of an offence by proving intention or knowledge.  In other words, the judgment of the Court of Criminal Appeal in Ansari proceeded upon what I may respectfully describe as the common sense basis that the greater includes the lesser.  I should say something about the indictment in this case.  It is at page 25 of the appeal book.  It avers that the two accused between specified dates:

at Sydney in the State of New South Wales and elsewhere did conspire with each other, Ralph MICHAEL and with divers other persons to deal with money to the value of $1,000,000 or more being the proceeds of crime –

Stopping there, the indictment expresses the elements of the offence.  It needed to go no further.  It did go further because the Crown conceived that it had an entitlement to make the further averments to the effect that the persons who were to deal with the money pursuant to the conspiracy were reckless as to the fact that the money was the proceeds of crime.  Those were immaterial averments and the offence was sufficiently described or would have been sufficiently described by stopping at the expression “the proceeds of crime” in the third line of the text of the indictment.

HAYNE J:   If that had been done, would that have sufficiently identified the offence that it was alleged the parties had conspired to commit?

MR HUGHES:   Yes, your Honour.

HAYNE J:   Would it not have been necessary to identify whether the offence which they had conspired to commit was an offence against subsections (1), (2) or (3) of section 400.3?

MR HUGHES:   Your Honour, I accept the correction that it may have been necessary to go that extra distance, but I would put it as the better view, with great respect to your Honour, that it was sufficient merely to allege or aver dealing in the proceeds of crime simpliciter, but that step is not fundamental to my argument.

Perhaps I should criticise myself, which is probably sometimes a good idea, is that it could be conceived as something in the nature of a forensic flurry designed to criticise, as we have, the transposition from the definition of an offence against section 400.3(2)(b)(i) to very different offence of conspiracy to commit that offence.  Those are the reasons for which we submit that the learned trial judge and their Honours in the Court of Criminal Appeal were correct in holding that the information for the indictment failed to disclose matters constituting an offence known to the law.  That concludes my submission on that part of the case.  Would it be your Honours’ wish that I stop now for the time being?

FRENCH CJ:   You have a notice of contention raising issues under 107 and section 80 of the Constitution.

MR HUGHES:   Yes, I do and I can go straight to that, but it occurred to me that your Honours might wish to compartmentalise this part of the argument and hear a reply on the construction point, but I am in your Honours’ hands.

FRENCH CJ:   I think it might be more convenient, especially having regard to the fact that Mr Game is yet to give us a written formulation in response to Justice Haynes’ question earlier, if you were to proceed on the notice of contention, Mr Hughes.

MR HUGHES: If your Honour pleases. Your Honour, on the points raised in the notice of intention, there are two. We rely on the outline of argument, which your Honours have on both points. It may be convenient to deal with the section 80 argument first and for that we have prepared some brief speaking notes, which I can hand up to the Court, if your Honours will be good enough to receive them, and copies for my friend. We deal with the constitutional question, the section 80 question, in paragraphs 28 to 44 and from then on through to paragraph 57, which outline we have endeavoured to supplement by reference to our speaking notes.

A vitally important case is Cheatle v The Queen to which we made reference in paragraph 48 on page 11. The question here on this part of the case, your Honour, is whether section 80 operates to embed, with respect to the trial, an indictment of an offence against a law of the Commonwealth the conclusiveness of the jury’s verdict acquitting an accused person of such an offence in a case where the jury returned such a verdict by direction of the trial judge.

The relevant facts here are that the respondents were jointly indicted, and I have referred your Honours to the terms of the indictment.  That is set out at paragraph 29 of the outline.  On 25 June they were arraigned in the District Court before her Honour Judge Sweeney.  There was an unsuccessful application for a permanent stay and/or the dismissal of the charge pursuant to section 11.5(6) on the ground that it was not in the public interest to proceed.  That failed.  Each of the respondents, having pleaded not guilty, was put in charge of a jury and the trial proceeded until at the conclusion of the evidence adduced in the Crown case, each of the counsel for the respondents made a submission that there was no case for their respective clients to answer.  Your Honours will see that at pages 185 to 202 of the appeal book.

On the seventh day of the trial, which was 8 July 2008, the trial judge upheld the submissions and in consequence directed the jury to return a verdict of not guilty in favour of each of the respondents.  The jury complied with that direction and her Honour accordingly discharged each of the respondents.  See, if I may ask your Honours, appeal book page 209.  On 28 July 2008 – see appeal book 213 – the Director of Public Prosecutions for the Commonwealth of Australia filed a notice of appeal challenging the trial judge’s decision so to direct the verdict of acquittal in favour of each of the respondents. 

This appeal involves, your Honours, a question whether section 80 of the Commonwealth Constitution operates to invalidate so much of section 107 of the Crimes (Appeal and Review) Act 2001 – which we will refer to as the Act – as purports to enable the Attorney-General or the Director of Public Prosecutions to appeal to the Court of Criminal Appeal against acquittal by a jury at the direction of the trial judge of an accused person who has been tried on indictment for an offence against the law of the Commonwealth.

The section relevantly provides that there may be such an appeal to the Court of Criminal Appeal where the accused has been the beneficiary of a verdict of the jury by direction of the trial judge on a point of law alone. This directed verdict or the direction of the learned trial judge that the jury return that verdict was on a point of law alone. We say at paragraph 33 of our outline that on its true construction section 80 of the Constitution embodies and makes applicable to the trial of an indictable offence against a law of the Commonwealth the essential characteristics of such a trial as they existed according to the common law when the Constitution was enacted.

It is necessary to deal with historical background, if I may suggest it.  We do this in our outline as briefly as possible, bearing in mind – and the brevity of the treatment is assisted by the detailed judgment of this Court in Conway v The Queen 209 CLR 203 at paragraphs 1 to 21, a case to which we refer later in our outline. It would be tedious to read those paragraphs. Their import is clear. Prior to the enactment, your Honours, of the Criminal Appeal Act 1912 (NSW) an accused person convicted of an indictable offence had no statutory entitlement to appeal the conviction or any other legal entitlement except possibly a writ of error which was a very limited remedy confined in its scope to error appearing on the face of the record.

However, your Honours, in the 19th century a practice developed in New South Wales that where a trial judge was concerned about the validity or the possible invalidity of a conviction in the light of a question of law he might, as a matter of practice, in the exercise of his discretion reserve the case for the consideration of the Supreme Court sitting in banc.  Such a case was called a Crown Case Reserved.  If the Court, upon consideration of such a case, reached the conclusion that the conviction was wrong in law, it was powerless to set the conviction aside, but the practice was for the Executive on the recommendation of the Court to advise the Sovereign or the Sovereign’s representative in the colony to exercise the prerogative of mercy by pardoning the accused. 

This practice had achieved statutory force in England in 1848.  It achieved statutory force in New South Wales, your Honours, by a local Act 13 Vic No 8, an Act passed by the legislative Council of New South Wales.  In some of the material which has been provided for your Honours’ consideration headed “Articles, Extracts and Other Material to which reference may be made in the course of argument on behalf of Respondent RK”, that Act 13 Vic No 8 1849, nine years after the establishment of ‑ ‑ ‑

FRENCH CJ:   Mr Hughes, we might return to that material ‑ ‑ ‑

MR HUGHES:   Sorry, I am going over time.

FRENCH CJ:   We might return to that tomorrow.  The Court will adjourn until 10.15 tomorrow morning.

AT 4.19 PM THE MATTER WAS ADJOURNED
UNTIL WEDNESDAY, 2 DECEMBER 2009