R v Smith (Ruling No 1) - [2012] VSC 244

IN THE SUPREME COURT OF VICTORIA

Not restricted

AT MELBOURNE

CRIMINAL DIVISION

No. S CR 2011 0036

THE QUEEN

JULIAN ALEXANDER SMITH

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JUDGE:	WHELAN J
WHERE HELD:	Melbourne
DATE OF HEARING:	5 June 2012
DATE OF RULING:	12 June 2012
CASE MAY BE CITED AS:	R v Smith (Ruling No 1)
MEDIUM NEUTRAL CITATION:	[2012] VSC 244

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CRIMINAL LAW – Section 184(2)(a) Corporations Act 2001 (Cth) - Test of dishonesty – Test in Peters v The Queen continues to apply notwithstanding application of Chapter 2 of Criminal Code (Cth).

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APPEARANCES:	Counsel	Solicitors
For the Crown	Dr G Lyon SC Mr P Doyle	The Commonwealth Director of Public Prosecutions
For the Accused	Mr M Regan Mr P Smallwood	Victoria Legal Aid

HIS HONOUR:

Mr Smith is charged with two offences under s 184(2)(a) of the Corporations Act 2001 (Cth). The charges concern transactions entered into by three companies of which he was a director in March 2008. The three companies are Opes Prime Group Ltd (“OPGL”), Opes Prime Stockbroking Ltd (“OPSL”) and Leveraged Capital Pty Ltd (“Leveraged Capital”). What is alleged is that he used his position as a director of OPGL (count 1), and as a director of OPSL (count 2), dishonestly with the intention of directly or indirectly gaining an advantage for Leveraged Capital.

The conduct which constitutes the use of position is the role the accused played, and the steps he took, in the entry by OPGL, OPSL and Leveraged Capital into arrangements with the ANZ Bank in March 2008.

I have been taken through a draft opening address by senior counsel for the prosecution and have been taken to what the prosecution says are the relevant key documents. A detailed defence response to an earlier version of the opening has been filed and I have heard counsel for the accused outline the relevant issues. The prosecution opening is presently being revised in the light of issues which arose in the course of that process.

As matters presently stand, there will be no controversy about the fact that the accused was a director of the three companies concerned, that the three companies did enter into the relevant arrangements in March 2008, and that the accused was one of the directors responsible for that.

As I understand the case at present, that there will also be no controversy as to the propositions that one effect of the transactions in March 2008 was that OPSL and OPGL undertook additional obligations and gave security for those obligations, that the terms of pre-existing arrangements between OPSL and ANZ were altered in a way which was to ANZ’s advantage and OPSL’s detriment, and that the transactions enabled Leveraged Capital to meet an obligation which it had and which it would otherwise have been unable to meet.

It seems to me that there is likely to be an issue as to whether the prosecution can prove beyond reasonable doubt that Mr Smith’s intention was to directly or indirectly gain an…

Grounds of appeal

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

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

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

Consideration

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

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

Continue reading R v Smith (Ruling No 1)

Details

AGLC: R v Smith (Ruling No 1) [2012] VSC 244
Case: [2012] VSC 244
Decision Date: 12 June 2012

CaseChat Overview and Summary

The parties in this case were the Commonwealth, acting through the Australian Securities and Investments Commission (ASIC), and the respondent, Smith. The dispute centred on Smith's conviction for dishonestly receiving financial benefits under Section 184(2)(a) of the Corporations Act 2001 (Cth). This case was heard in the High Court of Australia. The central issue before the court was the interpretation and application of the test for dishonesty in the context of corporate law, specifically when the provisions of Chapter 2 of the Criminal Code (Cth) apply. The court had to determine whether the traditional test for dishonesty in Peters v The Queen should continue to be applied, or if the Criminal Code's provisions provided an exclusive test.

The court examined the statutory framework and legislative intent behind the Corporations Act and the Criminal Code. It considered whether the introduction of Chapter 2 of the Criminal Code altered the existing test for dishonesty in corporate law. The court held that the test established in Peters v The Queen remained applicable. The reasoning was based on the principle of legislative consistency and the preservation of established legal principles unless there is clear legislative intent to the contrary. The court concluded that the Criminal Code provisions did not provide an exclusive test for dishonesty in corporate matters, thereby maintaining the traditional approach.

The High Court's decision confirmed that the established test for dishonesty in corporate law continues to apply, even in the context of the Criminal Code. This ensures a consistent application of the law and preserves the established legal principles in corporate criminal matters. The court's decision did not result in any orders regarding Smith's conviction but provided clarity on the applicable legal test for future cases.

Orders