R v Petroulias (No. 9)

[2007] NSWSC 84

CITATION:	R (Cth) v Petroulias (No. 9) [2007] NSWSC 84
HEARING DATE(S):	30 January 2007, 31 January 2007, 5 February 2007, 6 February 2007, 7 February 2007, 8 February 2007
JUDGMENT DATE :	15 February 2007
JUDGMENT OF:	Johnson J at 1
DECISION:	The application to exclude the evidence of Richard Llewellyn Morgan under s.138 Evidence Act 1995 is refused.
CATCHWORDS:	CRIMINAL LAW - application under s.138 Evidence Act 1995 to exclude entirety of evidence of Crown witness - Accused contends that evidence improperly obtained - contention that police investigators acted improperly in circumstances where witness gives induced statement and receives use derivative use undertaking under s.9(6) Director of Public Prosecutions Act 1983 (Cth) - no impropriety established - application refused
LEGISLATION CITED:	Evidence Act 1995 Director of Public Prosecutions Act 1983 (Cth)
CASES CITED:	R v Petroulias (No. 6) [2006] NSWSC 1422 R v Petroulias (No. 8) [2007] NSWSC 82 R v Petroulias (No. 1) [2006] NSWSC 788 Robinson v Woolworths Limited (2005) 64 NSWLR 612 Ridgeway v The Queen (1995) 184 CLR 19 Director of Public Prosecutions (Cth) v Ho (1998) 102 A Crim R 37 Rozenes v Beljajev [1995] 1 VR 53 Rozenes v His Honour Judge Kelly [1996] 1 VR 320 Ganin v NSW Crime Commission (1993) 32 NSWLR 423 Registrar, Court of Appeal v Craven (1994) 77 A Crim R 410 Rogan v Hyde (1995) 84 A Crim R 519 Bunning v Cross (1979) 141 CLR 54
PARTIES:	Regina (Commonwealth) (Crown) Nikytas Nicholas Petroulias (Accused)
FILE NUMBER(S):	SC 2002/93
COUNSEL:	Mr P Hastings QC; Mr C Hoy (Crown) Mr R Sutherland SC; Mr G Walsh (Accused)
SOLICITORS:	Commonwealth Director of Public Prosecutions (Crown) Coadys (Accused)
LOWER COURT DATE OF DECISION:	---
LOWER COURT MEDIUM NEUTRAL CITATION:	---

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
CRIMINAL LIST

Johnson J

15 February 2007

2002/93 Regina v Nikytas Nicholas Petroulias (No. 9)

JUDGMENT (objection under s.138 Evidence Act 1995 upon the ground that evidence to be given by Richard Llewellyn Morgan was improperly obtained)

1 JOHNSON J: The Accused, Nikytas Nicholas Petroulias, objects to the entirety of the evidence to be given by a Crown witness, Richard Llewellyn Morgan, upon the ground that his evidence was improperly obtained within the meaning of s.138 Evidence Act 1995.

Application for Voir Dire

2 The Accused sought a voir dire with respect to this objection. The Crown did not contend that this was an inappropriate matter for a voir dire. Submissions were made with respect to the nature and form of evidence to be received on the voir dire, given that a voir dire had been conducted, in aid of a similar objection, before Sully J in March 2005 in advance of the first trial. A number of witnesses were called on that voir dire in 2005 including Federal Agents Wills and Dametto and Mr Morgan himself. Mr Sutherland SC, for the Accused, submitted that the appropriate course was for the Court to receive the transcript of that earlier evidence and to allow further limited cross-examination of those witnesses. I acceded to this application: R v Petroulias (No. 6) [2006] NSWSC 1422.

3 In addition to the evidence of these witnesses on the voir dire before Sully J and again before me, further documentary evidence was adduced by the parties which bears upon the present objection. There is some overlap with evidence admitted with respect to a separate objection under s.138 Evidence Act 1995 to the admissibility of evidence obtained pursuant to listening device and search warrants. This objection is addressed in a separate judgment to be delivered today: R v Petroulias (No. 8) [2007] NSWSC 82. The scope of evidence to be adduced on the voir dire with respect to that objection was also considered in R v Petroulias (No. 6).

Ruling of Sully J on 29 March 2005

4 As mentioned earlier, the Accused made a similar objection under s.138 before Sully J with respect to the admissibility of the evidence of Mr Morgan.

5 I am not bound by the decision of Sully J concerning that objection in advance of the first trial. In determining the objection, I will consider the evidence and submissions and make my own independent assessment for the purpose of ruling on the application. I will, however, have regard to the decisions of Sully J in my own process of decision making: R v Petroulias (No. 1) [2006] NSWSC 788 at [51]-[54].

Section 138 Evidence Act 1995

6 Section 138 Evidence Act 1995 is in the following terms:

“ Exclusion of improperly or illegally obtained evidence

(1) Evidence that was obtained:


(a) improperly or in contravention of an Australian law, or

(b) in consequence of an impropriety or of a contravention of an Australian law,
is not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting evidence that has been obtained in the way in which the evidence was obtained.

(2) Without limiting subsection (1), evidence of an admission that was made during or in consequence of questioning, and evidence obtained in consequence of the admission, is taken to have been obtained improperly if the person conducting the questioning:


(a) did, or omitted to do, an act in the course of the questioning even though he or she knew or ought reasonably to have known that the act or omission was likely to impair substantially the ability of the person being questioned to respond rationally to the questioning, or

(b) made a false statement in the course of the questioning even though he or she knew or ought reasonably to have known that the statement was false and that making the false statement was likely to cause the person who was being questioned to make an admission.

(3) Without limiting the matters that the court may take into account under subsection (1), it is to take into account:


(a) the probative value of the evidence, and

(b) the importance of the evidence in the proceeding, and

(c) the nature of the relevant offence, cause of action or defence and the nature of the subject-matter of the proceeding, and

(d) the gravity of the impropriety or contravention, and

(e) whether the impropriety or contravention was deliberate or reckless, and

(f) whether the impropriety or contravention was contrary to or inconsistent with a right of a person recognised by the International Covenant on Civil and Political Rights, and

(g) whether any other proceeding (whether or not in a court) has been or is likely to be taken in relation to the impropriety or contravention, and

(h) the difficulty (if any) of obtaining the evidence without impropriety or contravention of an Australian law.”

7 The present objection contends that evidence obtained from Mr Morgan was obtained improperly, or in consequence of an impropriety, for the purposes of s.138(1)(a) or (b) of the Act. The Accused does not contend that evidence was illegally obtained for the purpose of that section.

8 It is clear that the Accused bears the onus of establishing impropriety on an objection under s.138: Robinson v Woolworths Limited (2005) 64 NSWLR 612 at 621 [33], 632 [106].

9 The Evidence Act 1995 does not define the concept of “impropriety”. The principles collected in Ridgeway v The Queen (1995) 184 CLR 19 remain pertinent and those principles ought to be applied when considering whether conduct constitutes “impropriety” in a particular case: Robinson v Woolworths Limited at 618-619 [22]-[24], 622-623 [36]-[37], 631-632 [102]. In Robinson v Woolworths Limited, Basten JA (Barr J agreeing) said at 618-619 [23]:

“It follows that the identification of impropriety requires attention to the following propositions. First, it is necessary to identify what, in a particular context, may be viewed as ‘the minimum standards which a society such as ours should expect and require of those entrusted with powers of law enforcement’. Secondly, the conduct in question must not merely blur or contravene those standards in some minor respect; it must be ‘quite inconsistent with’ or ‘clearly inconsistent with’ those standards. Thirdly, the concepts of ‘harassment’ and ‘manipulation’ suggest some level of encouragement, persuasion or importunity in relation to the commission of an offence: thus, in describing the first category of cases (at 39) the joint judgment in Ridgeway referred to offences being procured or induced.”

10 Basten JA (Barr J agreeing) made the following observations at 622-623 [36]-[37] concerning the minimum standards test:

“In circumstances where there is no unlawfulness on the part of any law enforcement officer, mere doubts about the desirability or appropriateness of particular conduct will not be sufficient to demonstrate impropriety.

Before leaving these broad principles, it is necessary to note the indeterminacy of the test identified by reference to inconsistency with ‘the minimum standards which a society such as ours should expect and require of those entrusted with powers of law enforcement’: Ridgeway at 36. Such a test invites assertion and counter-assertion, with no objective touchstone to assist in deciding which to accept and which to reject. It is at least doubtful whether a majority of the Australian community would have shared the High Court’s view of the ‘entrapment’ of Mr Ridgeway: see for example, the comments of McHugh J at 85. The answer is not necessarily to eschew the task, but to establish, in advance, standards of conduct against which a claim of impropriety can be assessed. Where no relevant pre-existing standard has been breached, it should be a rare case in which impropriety would lead to exclusion. (Of course, standards may themselves require scrutiny, but no relevant standard was identified in the present case.) And the test of such a case must involve judicial appraisal of all potentially relevant public policy considerations, being the task actually undertaken in Ridgeway . Appeals to ‘community standards’ will tend to substitute subjective reactions for careful analysis, albeit of ill-defined concepts.”

11 Hall J reached a similar conclusion in a separate judgment in Robinson v Woolworths Limited.

12 As will be seen, the Accused contends that Australian Federal Police (“AFP”) investigators acted in a deliberately and intentional improper fashion in this case. The s.138 objection is not based upon a claim of technical or inadvertent impropriety. In these circumstances, I approach the question of onus and standard of proof in the manner identified in R v Petroulias (No. 8) at [14] to [18].

13 The Accused contends that the evidence of a witness may be excluded under s.138 where there has been improper conduct by police officers in a course of conduct leading to a suspect providing an induced interview, as part of an application for an undertaking under s.9 Director of Public Prosecutions Act 1983 (Cth). Reliance is placed upon the decision of Ireland J in Director of Public Prosecutions (Cth) v Ho (1998) 102 A Crim R 37 at 42-43 where evidence of a witness was excluded under s.138 as being improperly obtained where the Crown proposed to call the witness at the trial of a third person where the witness had agreed to give evidence against two other accused persons only, and not the third. The Accused submits that AFP investigators acted improperly with respect to Mr Morgan so that s.138 is engaged leading to the exclusion of his evidence.

14 The present application does not seek the exclusion of the evidence of Mr Morgan upon the basis that I should conclude that his evidence is unreliable. The difficulties confronting such an application have been recognised: Rozenes v Beljajev [1995] 1 VR 53; Rozenes v His Honour Judge Kelly [1996] 1 VR 320. The weight to be given to Mr Morgan’s evidence is a matter for a jury. However, as I have said, such an application is not made in the present case.

Factual Background to the Present Application

15 Although further oral evidence was adduced from Federal Agents Wills and Dametto and Mr Morgan on the voir dire before me, Mr Sutherland SC was content to rely upon written submissions of Mr Clelland SC and Mr Livermore, who appeared for the Accused before Sully J in February and March 2005, in support of the present application. No additional oral submissions were made.

16 In these circumstances, I will set out part of the judgment of Sully J given on 29 March 2005 in which his Honour identified the argument advanced for the Accused, relevant factual matters and recorded certain findings. His Honour said (pages 1-7):

“The nature of the alleged impropriety is that from first to last the relevant AFP officers carried out a pre-planned ruse, the design of which was in part to intimidate, and in part to induce by favourable and favoured treatment, the co-operation of Mr Morgan in the obtaining from him of evidence incriminating the present applicant in the offences for which he will presently stand trial in this Court.

It is convenient to commence the relevant narrative by canvassing some events of 24 March 2000.

On that day, three AFP agents attended premises at 91 Anglesey Avenue, Saint George, in South Australia. One of them was Agent Stephen Dametto, who had earlier travelled to South Australia from Sydney. He was armed with a search warrant that had been issued, pursuant to s 3E of the Commonwealth Crimes Act 1914, on 23 March 2000 in Sydney.
The warrant authorised the searching of the premises at 127 Kensington Road, Norwood, South Australia, which premises were described as the residence of Mr Morgan, although the premises were the residence of his parents with whom, as I infer, he stayed from time to time.

What actually transpired at Anglesey Road, and later Kensington Road, was tape recorded as it took place. The transcript of what was thus recorded is behind Tab 2 in exhibit D1 on the present application [part of Exhibit VR4 on the 2007 application] .

Mr Dametto and his colleagues identified themselves to Mr Morgan, and he invited them inside. Mr Dametto then explained to Mr Morgan why the police were calling upon him. He did so in these terms:
‘We are here in regards to the allegation that yourself with Nick Petroulias and others were involved in the fraudulent issuance of taxation documents being advanced opinions and private binding rulings, and which led to loss of revenue to the Commonwealth government, and therefore against section twenty-nine (d) which is to defraud the Commonwealth.’

Mr Morgan was asked whether he understood the allegation, and he replied that he did. Mr Dametto thereupon told Mr Morgan he and his colleagues were there ‘namely, [sic] but I should think mainly, to hear what you have to say’. He told Mr Morgan that the applicant and ‘other promoters’ were being interviewed in either Sydney or Melbourne.

At Mr Morgan's request, Mr Dametto repeated in broad outline the allegations against Mr Morgan. Mr Dametto then formally cautioned Mr Morgan, and also advised him of his right to have the assistance of a lawyer.

In my view, a fair reading of the transcript to this point does not suggest that Mr Morgan was being overborne, or that he himself thought otherwise. Plainly, he understood what had been put to him, because he responded by saying that although he had nothing to hide, he was in unfamiliar territory, and felt that it would be prudent to obtain legal advice. He proceeded to arrange an appointment to do so; and the upshot was that he took no further part in any formal interview pending his receipt of that advice.

The search warrant was formally read to Mr Morgan. He was given a copy of it; and in due course he went with the police to the Kensington Avenue premises, where the search warrant was duly executed.

As seems to be inevitable with tape recorded encounters of the kind described, the transcript itself is less than ideal, in that it records people talking at and over, as well as to, each other or one another. It is, even so, possible to get from the transcript a reasonably reliable picture of how things actually fell out as the encounter progressed.

That picture does not seem to me to be one of police intimidation or trickery, either deliberate or inadvertent. Nor does it seem to me to be a picture of a citizen so completely off-balance as to be incapable of understanding what was being put to him; or the gravity of the stated allegations; or the need to proceed with prudence and with the assistance of appropriate professional advice and assistance.

In due course, and on 6 April 2000, Mr Dametto in company with Mr Wills, an AFP colleague, formally interviewed Mr Morgan. The interview was tape recorded, it being necessary to change the tape from time to time. That entailed that the interview comprised a number of discrete segments as follows: 2.25 pm to 3.07 pm; 3.20 pm to 4.01 pm; 4.10 pm to 4.52 pm; and 5 pm to 5.37 pm. Transcripts of all four segments appear at Tab 3 of exhibit D1 [part of Exhibit VR4 on the 2007 application] .

Each segment began with a reading on to the record by Mr Morgan of a written formula given to him for that purpose by the police, and reading:

‘I am making this statement as a consequence of an assurance given to me by F/A Stephen Dametto that the contents of this statement and the information which results from it will be used to form the basis of an application for indemnity from prosecution to the Director of Public Prosecutions for the Commonwealth of Australia. I understand that as a consequence of this assurance, this statement cannot be used to prosecute me for any offence except an offence arising from any falsity in the making of this statement. If I am granted an indemnity from prosecution, I am prepared to give evidence as a witness for the Director of Public Prosecutions for the Commonwealth of Australia against any person as required. This statement made by me accurately sets out the evidence which I will be prepared if necessary to give in full as a witness. The statement is true to the best of my knowledge and belief and I make it knowing that if it is tendered in evidence I shall be liable for prosecution if I have wilfully stated in it anything which I know to be false or do not believe to be true.’


A reading of the transcripts indicates the following things:

1. That at some time prior to 6 April 2000 there had been some consideration given by the police, by Mr Morgan and his advisers, or by all of them, to the possibility of an ‘indemnity from prosecution’ being sought from the Commonwealth Director of Public Prosecutions.

2. That the focus of the interview was very much upon the present applicant rather than upon the person who was actually being interviewed in the wake of conversation during which he had been told that he was the subject of allegations of having committed serious criminal offences.

3. That the method employed by the interviewing police displayed a regrettable predilection for asking leading questions; and a no less regrettable willingness to carry on the interviewing of Mr Morgan during the tape-change breaks. I observe, but not in a merely captious way, that had those blemishes not been present, a deal of the time spent on the present application could have been saved by a reduction in the number of points available to be made upon the basis of the transcripts.

4. There is nothing to suggest that Mr Morgan did not understand what he was being asked; or what he was saying; or that he saw himself as being brow-beaten by his interviewers.

Following the interview of 6 April, the police set about preparing a witness statement in the conventional form. After several drafts had been prepared and corrected, a final statement dated 29 April 2000 was settled and Mr Morgan signed it. This is the statement upon the basis of which the Crown proposes, as I understand the fact, to lead Mr Morgan's evidence at trial.”

17 The Commonwealth Director of Public Prosecutions, by a document dated 22 August 2001, has given Mr Morgan an undertaking in these terms (Exhibit VR2, Tab 8):

“Commonwealth of Australia
Director of Public Prosecutions Act 1983 Section 9(6)

‘TO: RICHARD LLEWELLYN MORGAN

I, Damian John Bugg QC, the Director of Public Prosecutions of the Commonwealth of Australia, HEREBY UNDERTAKE pursuant to s9(6) of the Director of Public Prosecutions Act 1983 that:

(a) any answer you give, or any statement or disclosure you make, in the course of giving evidence in the proceedings specified in the Schedule hereto;

(b) the fact that you disclose or produce a document or other thing in the said proceedings; or

(c) any information, document or other thing that is obtained as a direct or indirect consequence of an answer you give, a statement or disclosure you make, or a document or other thing you disclose or produce in the said proceedings;

will not be used in evidence against you other than in proceedings in respect of the falsity of any evidence you may give.

SCHEDULE


Proceedings against Nikytas Nicholas PETROULIAS (also known as Nick Petroulias) for alleged offences against:

* Section 29D Crimes Act 1914 - Defraud the Commonwealth

* Section 73 Crimes Act 1914 - Corruption and Bribery of Commonwealth Officers

* Section 70 Crimes Act 1914 - Disclosure of Information by Commonwealth Officers

* Section 30 Crimes Act 1914 - Taking Property out of Commonwealth Custody’.”

18 Although the term “indemnity” was used, at times, in evidence and submissions, to describe the instrument issued by the Commonwealth Director of Public Prosecutions on 22 August 2001 with respect to Mr Morgan, the document is in fact an undertaking pursuant to s.9(6) Director of Public Prosecutions Act 1983 (Cth). The document is a “use derivative use” undertaking (under s.9(6)) and not an undertaking not to prosecute which operates as a transactional indemnity (s.9(6D)): Ganin v NSW Crime Commission (1993) 32 NSWLR 423 at 433; Registrar, Court of Appeal v Craven (1994) 77 A Crim R 410 at 430; Rogan v Hyde (1995) 84 A Crim R 519 at 524.

Submissions of Accused Concerning Suggested Evidence of Impropriety

19 It was submitted for the Accused that Mr Morgan was included in the search warrant of 24 March 2000 with the intention that this could be used to place pressure on him and other potential witnesses who were obviously not the principal suspects. Investigators had identified Mr Morgan because of matters personal to him and because of information they had obtained about him as a person who may co-operate and become a witness.

20 It was submitted that Mr Morgan was a susceptible witness and that it was intended to treat Mr Morgan as a suspect in the hope that this pressure would result in him deciding or agreeing to be a witness.

21 It was submitted for the Accused that AFP investigators put into effect a plan on 24 March 2000 to execute a warrant, but not to arrest Mr Morgan. Nevertheless, it was submitted that the police used language of arrest and charge in circumstances where there was no such intention. The police emphasised the seriousness of the allegations and then conveyed to the witness that what they were really seeking was his assistance in his investigations.

22 The Accused submits that, by 6 April 2000, no fact had come to light which would have justified Mr Morgan being regarded no longer as a suspect, but as a witness. By then, negotiations between the police and Mr Morgan’s solicitor had taken place for him to become a witness. Part of those negotiations involved the making of an induced statement which would be purportedly used in an application for an indemnity.

23 It was submitted for the Accused that the conduct of the 6 April 2000 interview with Mr Morgan involved the following:

(a) a document used by Mr Morgan and referred to in the transcript (Exhibit VR4, Tape 1, page 1) was later destroyed;

(b) there are references in the transcript to previous discussions of tape;

(c) the interview contained leading questions asked by AFP investigators which, the Accused contends, were of an improper kind, particularly for a witness who was apparently seeking an indemnity;

(d) conversations took place between the four tapes, which should not have occurred.

24 A principal submission for the Accused was that, during the break between the second and third tapes, conversation took place in which Mr Morgan recalled for the first time that he made payments to the Accused (Exhibit VR4, Tape 3, pages 1-2).

25 It was submitted for the Accused that an unsatisfactory process occurred thereafter whereby Mr Morgan’s statement was prepared and settled.

26 The submissions of the Accused concluded with the contention that the handling and treatment of Mr Morgan by AFP investigators was “an orchestrated ruse from start to finish”.

Submissions of the Crown

Decision to Roll Over Morgan

27 The Crown submits that it is a common and accepted practice in prosecutions to decide to utilise a suspect as a witness, the so-called roll-over witness. The prospect of recruiting Mr Morgan had been recognised reasonably early in the investigation. At a meeting on 28 September 1999, as a result of intercepted telephone conversations, it was then decided that investigators would approach Mr Morgan for information (Exhibit VR2, Tab 2, pages 60-62).

28 It was clear by then, the Crown submits, that Mr Morgan was involved in the marketing of the schemes and, in particular, his company, Morgan HR Pty Limited, was one of the initial applicants for an advanced opinion and one of the last to get a public binding ruling.

29 The Crown submits that there was no impropriety involved in the decision to approach Mr Morgan to give evidence for the prosecution.

Independent Legal Advice

30 The Crown submits that, whatever might be said about the conversation between Federal Agent Dametto and Mr Morgan on 24 March 2000, the outcome was that Mr Morgan not only had the opportunity to consult with his solicitor during the meeting, but also was left to obtain advice before making any decision as to whether he would co-operate with the investigators.

31 The Crown submits that any suggestion to Mr Morgan that he may have been involved in a serious offence was correct. The documentation revealed Mr Morgan’s role with the promoters’ entities. In addition, telephone intercepts revealed his association with the Accused including payments of money. By the time the search of Mr Morgan’s premises had concluded, the Crown submits that further significant evidence had been obtained in the form of the client lists which, by their appearance, had clearly been improperly obtained from the Australian Taxation Office (“ATO”).

32 Although Mr Morgan may have considered that he was not doing anything illegal (PT784, 788, 2007), the Crown submits that it was the fact that he had been paying amounts of cash to an ATO officer who was supplying rulings and ATO documents to assist in selling schemes from which the officer was obtaining a share of the profits. Accordingly, any impression conveyed to Mr Morgan by AFP investigators that he was involved in a serious offence was correct.

33 The Crown emphasises that, at the conclusion of the discussions on 24 March 2000, Mr Morgan was left to obtain legal advice from his solicitor. Before the commencement of the interview on 6 April 2000, the solicitor had an opportunity to discuss the matter with the AFP investigators and to advise Mr Morgan.

34 Accordingly, the Crown submits Mr Morgan’s decision to co-operate was reached of his own free will and was not the product of improper pressure by investigators.

Recording of Conversation

35 The Crown submitted that the procedure of tape recording the conversation with Mr Morgan on 6 April 2000, for the purpose of having a record of his version of events from which to distil a statement, was proper. It was submitted that, in the vast majority of cases, police simply prepare an electronic version of a statement with no record of the initial account given by the witness. The Crown submits that, to the credit of Federal Agents Dametto and Wills, not only was the conversation recorded, but the tapes were also retained.

Methodology of Interview

36 The Crown submits that there was no impropriety in the method adopted to obtain from Mr Morgan his account of his dealings with the Accused. Most questions were relatively short and were followed by a lengthy answer by Mr Morgan in his own terms. The Crown submits that, on very rare occasions, Federal Agent Wills intervened to focus on a matter already mentioned in order to clarify the position.

37 According to the Crown, the fact that conversation occurred in the breaks during the recording process while tapes were being changed was neither remarkable nor improper. It should not be overlooked that this was not an interview of a suspect, but a conversation designed to elicit from a witness an initial account of the relevant events.

38 The Crown submitted that the procedure of having Mr Morgan repeat the conversation onto the tape upon resumption was an adequate means of capturing additional information he had provided during breaks, bearing in mind that the purpose of the interview was simply to create a record of Mr Morgan’s account from which a statement could be prepared.

39 The Crown submitted that no impropriety had been demonstrated for the purposes of s.138 Evidence Act 1995, let alone impropriety causally linked to the obtaining of Mr Morgan’s evidence. It was submitted that no basis had been demonstrated under s.138 for exclusion of Mr Morgan’s evidence.

Determination

40 As Sully J observed in his judgment of 29 March 2005 (page 8), the focus of the present application is not upon Mr Morgan, but upon, in particular, Federal Agents Dametto, Wills and Wildman. Sully J summarised the Accused’s challenge to this evidence in the following way (pages 8-9):

“It can be accepted readily, and I do accept, that Mr Morgan was at the time of his first encounter with Mr Dametto and his colleagues, a man with real problems. He had a gambling problem; a broken-down personal ‘relationship’; a conviction that sooner or later the police would come knocking on his door in order to speak to him about his relevant involvement with the present applicant; and a completely understandable fear of finding himself in prison. In all of those senses it is, I think, quite correct to describe him, as the applicant’s submissions do, as having been vulnerable to any improper police pressure.

The present application does not focus, however, upon that vulnerability insofar as its existence might diminish Mr Morgan's credibility in the eyes of a jury at trial. It focuses, rather, on a proposition that the relevant police officers saw Mr Morgan, from the time they first began to look seriously at his position in the relevant scheme of things, as somebody who was on the outer rim, so to speak, of the criminal enterprise that they were investigating, and who, because of that fact, coupled with his perceived personal fragility, might be willing, if handled properly, to become a Crown witness.
That proposition is then developed into a further proposition, namely, that the relevant police officers in effect deliberately manipulated and exploited the perceived vulnerability of Mr Morgan so as to set him up as an available, and very useful, Crown witness.”

41 In the course of his judgment, Sully J adverted to observations of Stephen and Aickin JJ in Bunning v Cross (1979) 141 CLR 54 at 75:

“There is no initial presumption that the State by its law enforcement agencies, will in the use of such measures of crime detection observe some given code of good sportsmanship or of chivalry. It is not fair play that is called in question in such cases but rather society's right to insist that those who enforce the law themselves respect it, so that a citizen's precious right to immunity from arbitrary and unlawful intrusion into the daily affairs of private life may remain unimpaired.”

42 Although the decision in R v Ho provides no assistance to the Accused on the present application, I note the understandable recognition of Ireland J, at 42, of the importance “from the community’s point of view of encouraging persons involved in criminal activity to afford assistance to authorities and to give evidence”.

43 Sully J expressed the following conclusions on the application (pages 10-13):

“1. The police were perfectly entitled to approach Mr Morgan and to endeavour to interview him.

2. Had Mr Morgan been not a potential Crown witness who was regarded as having been on the outer rim of the relevant enterprise, but a primary suspect who was very much at risk of becoming an accused, then the police would have been not any the less entitled on that account so to have approached him.

3. In so doing with Mr Morgan as such a primary suspect the police would have been constrained by various well-recognised rules. They are conveniently summarised in the Court judgment in R v Plevac (1995) 84, A Crim R 570 at 578-582. The first two principles thus summarised are in my view very much to the present point. They are, case references omitted, as follows:


‘1. Police may in the course of investigation interrogate a suspect who is willing to answer their questions and that interrogation may include, putting to the suspect the facts that the police know or believe or suspect of them to be, in order to ascertain what, if anything, the suspect will say about them.

2. Such questioning must be fair and must not amount to intimidation, persistent importunity, or undue insistence or pressure; but questioning is not to be regarded as unfair merely because it is persistent.’


4. It is complained that it was improper of Mr Dametto to have told Mr Morgan that he was the subject of allegations of involvement in the relevant tax minimisation schemes. I do not agree. The fact is that he was alleged to have been so involved, whatever might have been thought about the degree of that involvement.

5. It is complained that it was improper of Mr Dametto to have cautioned Mr Morgan, and to have drawn Mr Morgan's attention to the right to professional advice and assistance. I do not agree. I see no breach of relevant public policy merely in the giving of such warning and advice. I can imagine a case where, listening to the actual tape recording, one heard the words spoken in tones of unmistakable menace; but that is not the applicant's present case.

6. The questioning that in fact took place on 6 April 2000 has the blemishes of which I have earlier spoken [the use of leading questions and continued conversation during breaks between tapes] ; but I do not accept that even with those blemishes, the questioning infringed the principles noted at 3. above.

7. It is complained that the formatting of the statement of 29 April 2000 is suspect, especially in its use of direct speech. Were it proposed to tender at trial the actual document, then it would be necessary to explore in more detail than has thus far been done, how the statement was compiled, proof-read and formatted. No such tender is, however, in prospect.

8. Mr Morgan gave evidence on the voir dire, and there was every opportunity to test him as to any intimidation that is said to have been applied by the police. I am wholly unpersuaded by anything I heard from Mr Morgan that he has any such complaint. Such evidence as he gave on the point seems to me to tend to the contrary.
In sum, then, I am wholly unpersuaded that the applicant has established any proper basis for my preventing the Crown from presenting Mr Morgan, warts and all, before the jury at trial as a willing Crown witness; and from seeking to persuade the jury that, notwithstanding the close and vigorous cross-examination to which it can forecast that he will be subjected, the jury ought to accept his evidence as credible, in whole or in some relevant part or parts.”

44 Cross-examination of Mr Morgan and Federal Agents Wills and Dametto before me did not, in my view, provide the Accused with any assistance in support of this application. If anything, the evidence of Mr Morgan emphasised his ability to take independent and measured legal advice from his solicitor in the period between 24 March and 6 April 2000 which provided him with the opportunity to exercise his own free will, without pressure, concerning his decision whether to co-operate with the AFP investigators by providing an induced record of interview on 6 April 2000 (PT791-792, 2007).

45 I have incorporated substantial parts of the judgment of Sully J in this judgment. Given the manner in which the application was argued before me, this course seemed apt. Nevertheless, I have brought my own independent judgment to bear upon the evidence and arguments advanced in favour of and against the Accused’s objection under s.138 to the entirety of the evidence of Mr Morgan. Like Sully J, and for similar reasons, I am entirely unpersuaded that a foundation has been established for a finding of impropriety for the purposes of s.138 Evidence Act 1995.

46 The approach adopted by AFP investigators to Mr Morgan does not give rise to a finding of impropriety. AFP investigators believed, on reasonable grounds, that Mr Morgan had been involved criminally in activities involving the Accused. To the extent that the acts and words of AFP investigators led Mr Morgan to believe that his position was serious and that he may be in jeopardy, that was an accurate understanding of Mr Morgan’s position. No misrepresentation was made to Mr Morgan.

47 It is common, acceptable and expected practice that police investigators will, from time to time, speak to a suspect with a view to that suspect becoming a Crown witness. The process of taking an induced statement to be considered by relevant prosecuting authorities is not uncommon. It is for the Commonwealth Director of Public Prosecutions, and not police officers, to exercise the statutory power to determine whether an undertaking will be given under s.9 Director of Public Prosecutions Act 1983 (Cth). What occurred in this case, on the evidence, provides no foundation for a finding of impropriety on the part of AFP investigators.

48 I accept the submissions of the Crown that it was good practice to tape record the conversation which took place between AFP investigators and Mr Morgan on 6 April 2000. The tape recording has been retained and is available to the Crown and counsel for the Accused. This is desirable practice, but does not always occur.

49 The asking of a number of leading questions by investigators on 6 April 2000 has given rise to some controversy in this case. I do not detect any impropriety in the leading questions asked and observe that detailed responses were given by Mr Morgan. Generally speaking, it is preferable to avoid the use of leading questions in an interview with a potential witness, as opposed to a suspect. That said, the use of some leading questions in this case does not provide a foundation for a finding of impropriety under s.138 of the Act.

50 Insofar as complaint is made about continued conversation during breaks between the four tapes on 6 April 2000, it is appropriate to observe that AFP investigators, upon resumption of each tape, took steps to ensure that any matters raised during the break were placed on tape by Mr Morgan. Again, I detect no impropriety in the approach adopted by AFP investigators.

51 Other matters relied upon by the Accused, including the subsequent disposal by Mr Morgan of notes used by him during the 6 April 2000 interview (PT794, 2007), do not give rise to a finding of propriety. With respect to Mr Morgan’s notes, I observe that he appears to have utilised them directly and expressly in the early part of the interview (Exhibit VR4, Tab 1, page 1). It appears that Mr Morgan repeated the contents of his notes, at least in that part of the interview.

Conclusion

52 In my opinion, the evidence adduced on the present application falls far short of demonstrating impropriety on the part of AFP investigators in their dealings with Mr Morgan culminating in him becoming a Crown witness in these proceedings.

53 The application to exclude the evidence of Mr Morgan under s.138 Evidence Act 1995 is refused.

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