R v Song (No 2)
[2017] ACTSC 148
•23 June 2017
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | R v Song (No 2) |
Citation: | [2017] ACTSC 148 |
Hearing Dates: | 14, 15, 16, 19 and 20 June 2017 |
DecisionDate: | 23 June 2017 |
Before: | Mossop J |
Decision: | See [119]-[120] |
Catchwords: | CRIMINAL LAW – JURISDICTION, PRACTICE AND PROCEDURE – Trial – trial by judge alone – trafficking in a controlled drug other than cannabis namely heroin – money laundering – alleged proceeds from crime – telephone intercepts and surveillance – covert surveillance – recorded conversations – turns on own facts |
Legislation Cited: | Crimes Act 1900 (ACT), ss 114A, 114B Criminal Code 2002 (ACT), ss 600, 602, 603(7), 604 Drugs of Dependence Act 1989 (ACT), s 164 Legislation Act 2001 (ACT), s 126(2) Supreme Court Act 1933 (ACT), s 68B Telecommunications (Interception and Access) Act 1979 (Cth), s 46A Criminal Code Regulation 2005 (ACT), sch 1 pt 1.2 item 86 |
Cases Cited: | Edwards v The Queen (1993) 178 CLR 193 Filippou v The Queen [2015] HCA 29; 256 CLR 47 R v Baden Clay [2016] HCA 35; 258 CLR 308 R v Connors (No 2) [2016] ACTSC 333 R v DM [2010] ACTSC 137 R v Hillier [2007] HCA 13; 228 CLR 618 R v Mulcahy [2010] ACTSC 98 R v Olbrich [1999] HCA 54; 199 CLR 270 |
Texts Cited: | Australian Law Reform Commission, Confiscation that Counts: A Review of the Proceeds of Crime Act 1987, Report No 87 (1999) Explanatory Memorandum, Proceeds of Crime Bill 1991 |
Parties: | The Queen (Crown) Chang-Kee Song (Defendant) |
Representation: | Counsel Ms K McCann (Crown) Mr J Stewart (Defendant) |
| Solicitors ACT Director of Public Prosecutions (Crown) Legal Aid ACT (Defendant) | |
File Numbers: | SCC 256 of 2016 SCC 257 of 2016 |
MOSSOP J:
Introduction
This is a trial by judge alone conducted pursuant to s 68B of the Supreme Court Act 1933 (ACT), after the defendant, Mr Chang-Kee Song, signed an election on 14 December 2016 to be tried by a judge alone. The defendant is charged with two offences.
Count 1 is a charge that between 31 May 2016 and 11 June 2016 he “trafficked in a controlled drug other than cannabis namely heroin”.
Count 2 (incorrectly identified as “third count” on the indictment) is that on 10 June 2016 he “dealt with money or other property and the money or other property was proceeds of crime and that he knew or was reckless about the fact that the money or other property was proceeds derived realised directly or indirectly from some form of unlawful activity”.
Upon arraignment the defendant pleaded not guilty to both offences. However he indicated that he was willing to plead guilty to supply of heroin. That is an offence under s 164 of the Drugs of Dependence Act 1989 (ACT). The Crown did not take up on that offer. On the third day of the hearing he pleaded guilty to count 1 as a result of a particular transaction involving the sale of heroin of which evidence had been given. The hearing in relation to count 1 then continued as a disputed facts hearing in relation to the extent to which he was engaged in trafficking.
In R v Mulcahy [2010] ACTSC 98 at [13]-[24], Nield AJ when conducting a judge alone trial gave himself directions about his role. The directions were adopted by Refshauge J in R v DM [2010] ACTSC 137 at [9]. Nield AJ set out the directions as follows:
13. A criminal trial is governed by rules. The fundamental rules are designed to ensure that
an accused person receives a fair trial according to law. The fundamental
rules which govern a criminal trial are these.
14. The Crown bears the onus, burden or obligation, to use three interchangeable words,
to prove the guilt of the accused. The Crown has asserted that the defendant has
committed a criminal offence, therefore the Crown must prove that the defendant
committed that offence. The accused does not have to prove that he did not
commit that offence.
15. The level or standard of proof required in a criminal trial is proof beyond reasonable
doubt. The defendant cannot be found to be guilty of the offence unless the evidence,
which I accept, satisfies me beyond reasonable doubt of his guilt.
16. The defendant is presumed by law to be innocent of the offence with which he stands
charged unless and until the evidence which I accept satisfies me beyond reasonable
doubt of his guilt. If the evidence which I accept satisfies me beyond reasonable doubt
of his guilt, then he loses the presumption of innocence and the appropriate verdict is
guilty. If, however, the evidence which I accept fails to satisfy me beyond reasonable
doubt of his guilt, then he remains presumed to be innocent and the appropriate
verdict is not guilty.
17. In addition to the fundamental rules which govern a criminal trial, the following rules
have been developed.
18. As I am the judge of the facts, as well as the judge of the law, I must bring an open and
unbiased mind to the evidentiary material. I must view that material coldly, clinically and
dispassionately, and I must not let emotion enter into the decision-making process,
because both the Crown and the accused are entitled to my verdict free of partiality or
prejudice, favour or ill will.
19. I must determine whether each of the witnesses is a reliable witness. That is, whether
the witness has an accurate memory of the event about which the witness has given
evidence.
20. I must determine the relevant facts according to the evidentiary material, considered
logically and rationally, without acting capriciously or irrationally.
21. I may use my common sense, my individual experience and wisdom, in assessing the
evidence given by the witnesses.
22. I am not required by any rule of law, logic or common sense to accept a witness wholly
or to reject a witness wholly. I can accept everything that a witness has said if I
consider all of it worthy of acceptance, or I can reject everything that a witness has said
if I consider none of it worthy of acceptance, or I can accept that part of what a witness
said that I consider worthy of acceptance and reject the rest of what that witness said
as I consider it unworthy of acceptance.
23. The accused gave evidence on oath. He was not required to do so; he could have
elected not to give evidence. By giving evidence he became a witness in his trial. His
evidence is not any better or any worse than the evidence of other witnesses in his trial
simply because he is the accused. His evidence falls to be considered in the same
way as the evidence of the other witnesses in his trial falls to be considered. However,
by giving evidence he did not assume any burden, onus or obligation to prove anything
in his trial.
24. In a criminal trial the Crown must prove the essential elements of the charge beyond
reasonable doubt. The Crown does not have to prove everything about which evidence
has been given beyond reasonable doubt.
See also R v Connors (No 2) [2016] ACTSC 333 at [6]-[8].
I adopt these directions in relation to my role in the present case.
Elements of offences
Count 1 alleges a contravention of s 603(7) of the Criminal Code 2002 (ACT):
603 Trafficking in controlled drug
...
(7) A person commits an offence if the person traffics in a controlled drug other than cannabis.
Maximum penalty: 1 000 penalty units, imprisonment for 10 years or both.
...
Trafficking is defined in s 602 of the Criminal Code:
602 Meaning of trafficking
For this chapter, a person traffics in a controlled drug if the Person –
(a) sells the drug; or
(b) prepares the drug for supply –
(i) with the intention of selling any of it; or
(ii) believing that someone else intends to sell any of it; or
(c) transports the drug –
(i) with the intention of selling any of it; or
(ii) believing that someone else intends to sell any of it; or
(d) guards or conceals the drug with the intention of –
(i) selling any of it; or
(ii) helping someone else to sell any of it; or
(e) possesses the drug with the intention of selling any of it.
Heroin is a “controlled drug”: s 600 of the Criminal Code; Criminal Code Regulation 2005 (ACT), sch 1 pt 1.2 item 86.
The elements of this offence relevant in this case are:
1.The defendant trafficked in a substance, by either selling, preparing, transporting, guarding or concealing, or possessing the substance;
2.The defendant intended to traffic in the substance;
3.The substance was a controlled drug;
4.The defendant was reckless as to whether the substance was a controlled drug;
5.When the defendant trafficked in the controlled drug, the defendant had the intention to sell some or all of the drug.
Count 2 alleges a contravention of s 114B of the Crimes Act 1900 (ACT):
114B Money laundering
A person commits an offence if –
(a) the person deals with money or other property; and
(b) the money or other property is proceeds of crime; and
(c) the person knows that, or is reckless about the fact that, the money or other property is
derived or realised, directly or indirectly, from some form of unlawful activity.Maximum penalty: 1 000 penalty units, imprisonment for 10 years or both.
Section 114A provides the relevant definitions as follows:
114A Definitions for div 6.2A
In this division:
deal, with money or other property, means –
(a) receiving, possessing, concealing or disposing of money or other property; or
(b) bringing into the ACT money or other property.
proceeds of crime means –
(a) any property derived or realised, directly or indirectly, by anyone from the commission
of an offence punishable by imprisonment for longer than 12 months; or(b) any property derived or realised, directly or indirectly, by anyone from acts or omissions
that –(i) happened outside the ACT; and
(ii) would, if they had happened in the ACT, have been an offence punishable by
imprisonment for longer than 12 months.
property includes property located in Australia outside the ACT or outside Australia.
unlawful activity means an act or omission that is an offence against the law of the Territory, the Commonwealth, a State, another Territory or a foreign country.
The elements of this offence are as follows:
1.The defendant dealt with money or property by either receiving, possessing, concealing or disposing of money or property;
2.The defendant did so intentionally;
3.The money or property was proceeds of crime, in that it was derived or realised, directly or indirectly by anyone from the commission of an offence punishable by imprisonment for longer than 12 months.
4.The defendant knew, or was reckless about the fact that the money or other property was derived or realised, directly or indirectly, from some form of unlawful activity, being an act or omission that is an offence under the law.
Counsel for the defendant submitted that there must be another element of the offence namely that the intention was to “launder” the money in the sense of converting it from “dirty” money to “clean” money. This was said to arise as a result of the terms of the heading to the section which is “Money laundering”. Counsel for the defendant provided extracts of the Australian Law Reform Commission, Confiscation that Counts: A Review of the Proceeds of Crime Act 1987,Report No 87 (1999), the presentation speeches for the Proceeds of Crime Bill 1991 (ACT) and for the Confiscation of Criminal Assets Bill 2002 (ACT), as well as the Explanatory Memorandum for the Proceeds of Crime Bill 1991. However he submitted that there was nothing in these materials which gave support to his submission and did not refer to any part of those materials.
I do not accept the submission. Section 114B was inserted into the Crimes Act after 1 January 2000 and hence the heading to the section forms part of the Act: Legislation Act 2001 (ACT) s 126(2). However, the requirements of s 114B are carefully described in paragraphs (a) – (c) which in turn incorporate the defined terms set out in s 114A. I do not consider that the existence of the heading which refers to “laundering” impliedly incorporates an additional element relating to the intention of the offender into the offence. This means that, because of the breadth of the term “deal”, the scope of s 114B(a) is quite broad and extends to merely possessing such money or property. That may fall short of what, in some colloquial sense, might be considered to be “laundering” of money or property. However having regard to the text of the body of the section it is not, in my view, open to read into it an additional element which is not expressed in that text.
Further in relation to count 2, counsel for the defendant submitted that having regard to the manner in which the case had been opened it was necessary for the Crown to establish that the whole of the amount opened upon, namely $398,370, was the proceeds of crime, and that if the Crown failed to prove beyond reasonable doubt that any part of the amount referred to in opening was not the proceeds of crime, then the Crown case would fail. I do not accept that submission. I accept the submissions of the Crown that the amount that constitutes the proceeds of crime is not an element of the offence. Rather it is a matter of the particulars of the charge. I do not consider that there is any relevant unfairness which in the circumstances of this case would preclude the Crown from succeeding if it proved some lesser amount was the proceedings of crime. As a consequence, although the Crown case, consistently with the manner in which was opened, was based upon the whole of the amount being the proceeds of crime, the charge would be made out if the elements of the offence were established beyond reasonable doubt in relation to any part of the particularised amount.
The Crown case
The Crown case had four principal evidentiary components:
(a)evidence from telephone intercepts during the period 1 to 6 June 2016 of conversations which were said to relate to the sale by the defendant of heroin to identified or unidentified persons;
(b)evidence of surveillance of the activities of the defendant on 6 and 7 June 2016;
(c)evidence obtained during the search of the residence of the defendant on 10 June 2016;
(d)evidence of a drug user, who I will refer to as CD, of purchasing heroin from the accused.
Amongst the property seized during the search was an amount of heroin totalling 4.355 g and $398,370 in cash, including $377,905 in cash hidden among the foundations of the building.
The Crown case was therefore that the telephone intercepts demonstrated that the defendant was selling heroin to the other persons involved in the calls. It asserted that the money found on the person of defendant, found on the kitchen table at his home, and in a safe under his home, was all money obtained directly or indirectly through selling heroin.
The defence case
The defendant gave evidence. He admitted many matters consistent with the Crown case. He admitted that at the time of his arrest he was a heavy user of heroin. He admitted supplying heroin to other people. However, he said that the activity that he engaged in was not trafficking because it did not involve the sale of heroin, save in the one instance to CD which he admitted. He gave evidence that he was part of a buyers’ syndicate that purchased heroin by pooling the resources of its members. As a consequence the transactions which the Crown characterised as sales were not sales but were instead supply pursuant to the pooling agreement. In relation to count 2, the defendant gave evidence that a portion of the money found was money that he had saved from his earnings over the period 2002 to 2016 and that the balance represented winnings from gambling at the Star City Casino in Sydney or the Crown Casino in Melbourne.
Principal issues
In the light of the manner in which the case was conducted the critical issues are:
(a)In relation to count 1, has the Crown proved beyond reasonable doubt that the defendant trafficked in heroin by selling it or if, his trafficking involved activities other than sale, did he intend to sell it?
(b)In relation to count 2 has the Crown proved beyond reasonable doubt that the money found within his residence was the proceeds of crime, in that it was derived or realised, directly or indirectly, by anyone from the commission of an offence punishable by imprisonment for longer than 12 months?
Evidence
Telephone intercepts and surveillance
The telephone communications of the defendant were intercepted pursuant to a warrant in the period 1 to 6 June 2017 obtained under s 46A of the Telecommunications (Interception and Access) Act 1979 (Cth). A selection of those calls and text messages were admitted into evidence. There was no evidence disclosing how many of the calls intercepted were put into evidence.
In some of the calls the other party was identified by police and this identification was not the subject of any challenge. In other conversations the other party was not identified. There was no evidence linking the calls to any particular contacts on the mobile telephone of the accused. Except in the case of one person who gave evidence in the proceedings, the witness CD, there was no evidence of any relationship between the defendant and the persons on the call that would provide any context for what was said on the call.
Detective Senior Constable Christopher Watson gave unchallenged evidence about some of the terms used during the calls and their association with the illicit sale, supply and use of heroin. This included the expression “eight ball”, which is an eighth of an ounce of heroin, namely 3.5 g, a “half ball” which is 1.75 g, or a “quarter ball” which is approximately 0.875 g. He also identified that money is routinely referred to as “paper” in drug related conversations.
The telephone calls are consistent with the defendant engaging in the sale of heroin to the other persons involved in the calls. Many of the calls refer to the other person having paper, that is, money consistent with the exchange being a sale of heroin for money. Some of the calls involve references to the defendant giving loans or supplying heroin on “tick” to the persons. That is consistent with him being a dealer prepared to extend some credit to the purchaser with the expectation that it would be repaid at the point of further supply.
Consistently with the surveillance evidence, many of the calls involved arrangements to meet in public places, such as in car parks or near public toilets, or other locations identified by name known to the parties. That is consistent, at least, with the transactions involving illicit activity and consistent with the sale of heroin taking place at these locations.
The intercepted calls are sufficient to provide strong evidence of the defendant selling heroin to the other participants in the calls and text messages. They are more consistent with a request being made for a particular amount and that amount being exchanged for cash at the time, rather than the placing of an order with the supply of cash to be later delivered once it was obtained.
However there were some features of the telephone conversations consistent with the defendant’s case that he was involved in a buying syndicate. Although a number of the participants were not identified by name, they were given identifiers in the transcript (which was marked for identification but not admitted into evidence) which indicated that there were only a total of seven persons involved in these transactions:
(a)the witness CD;
(b)another named female;
(c)an unnamed female identified as Female One (who gave her name in the conversation on 8 June at 6:12.47am);
(d)Two different named males;
(e)an unnamed male identified as Male One; and
(f)an unnamed male identified as Male Two (who gave names in the conversations on 1 June 2016 4:18.33pm and on 6 June 2016 at 11:33.24am).
If the designations of the identity of the persons in the transcript are ignored (as, strictly, they must be) then it is only possible to say that the voices and what is said in the conversations indicate that there are a relatively confined, if uncertain, number of people talking to the defendant. Given the uncertainties about the identities of the people with whom the conversations occur, it cannot be said that the evidence is clearly inconsistent with the defendant’s description of his dealings with the members of a syndicate.
The conversations appear to be between people who are known to each other. There appears to be a degree of familiarity and trust between them. There are no conversations involving people who are unfamiliar as would be the case if the defendant was dealing with the public at large and fielding inquiries from potential new customers. None of these matters are necessarily inconsistent with the Crown case but they are consistent with the defence case.
The surveillance records provide evidence of the defendant travelling to various places in Canberra, driving and getting in and out of his car, playing with his dog, and talking to people. The photographic and video evidence obtained during the surveillance and stored on a disc was not significant enough for it to be shown or played in Court. The photos and videos of meetings and conversations with people do not show money or drugs changing hands. The evidence would be consistent with both the Crown and defence cases. Little, if any, reference was made to it in submissions.
The search
At about 8:10pm on 10 June 2016 police officers Turkich, Gough, Pumphrey, and Biziak attended the residence of the defendant in Hallen Close, Phillip and executed a search warrant. Officer Hawke attended later and assisted with the search. The officers who attended when entry was first made to the premises were unable to open the door using force and as a consequence broke a window next to the door so as to be able to open it. Officers Gough and Turkich saw a figure come to the door and then run away. Upon entry, officer Gough saw the defendant going up the stairs. He followed him and arrested him in the kitchen. He noticed that the water was running in the sink and turned it off. The house was a mess. It was covered in accretions of rubbish and had obviously not been cleaned or tidied for a very long time. On the person of the defendant officers found $1,035. On a kitchen table they found $19,430 Australian dollars. There were 4.355 g of what turned out to be heroin on the kitchen table. It was mainly present as two balls of heroin and three smaller amounts of heroin wrapped up in plastic in a small metal tin.
Heroin found during the search
The ACT Government Analytical Laboratory (ACTGAL) certificates tendered as Exhibit 5 show that 4.355 g of heroin was found during the search as follows:
(a)0.465 g in a piece of black plastic secured with a rubber band;
(b)0.004 g on a set of electronic scales;
(c)0.890 g in a piece of clear plastic secured with a rubber band and a piece of black plastic secured with a rubber band;
(d)2.508 g contained in a heatsealed piece of clear plastic and a snap lock plastic bag containing a heatsealed piece of plastic; and
(e)0.488 g contained in three heatsealed pieces of clear plastic within a metal box.
(Counsel for the Crown opened the case on the basis that 4.362 g of heroin were found but nothing turns on this difference.)
There was also an amount of heroin in a liquid in a plastic spoon which was not weighed and liquid taken from the S bend of the kitchen sink which also contained heroin.
The significant point is that, although there was a substantial amount of heroin found, it fell below the five gram threshold which would have made it a trafficable quantity and hence, given rise to the presumption that it was intended to be trafficked in the statutory sense: see Criminal Code s 604.
Evidence of the defendant’s use found during the search
There was clear evidence that the defendant was using heroin at a significant level. That is clear from the evidence of use found during the search (needles, drugs, scales, and a spoon with heroin in it). That evidence was consistent with his evidence that he was using at least two to three grams of heroin per day.
Cash found during the search
During the search the following amounts of cash were found:
(a)$1,035 was found on the person of the defendant;
(b)$19,430 was found on his kitchen table; and
(c)$377,905 was found in a safe underneath the house behind a door at the back of the garage.
The amounts of cash found in each of these places would be consistent with the Crown case that the defendant was involved in the sale of heroin. However they would not be inconsistent with the case run by the defendant which would, if accepted, explain each of the three amounts.
Taped record of conversation during search
During the course of the search First Constable Pumphrey recorded his conversation with the defendant. That conversation was admitted into evidence as Exhibit 4; a transcript of which became MFI B.
The defendant was cautioned (Q 15).
He disclosed that he was renting the premises for $400 per week and that he had worked at a delicatessen at the Fyshwick Markets for six or seven years (Q 62).
He disclosed that he earned up to $900 a week after tax and that he was paid with cash (Q 67-69).
He said he was not under the influence of drugs but that he was just about to have a shot of heroin (Q 122-125), indicating to officers that he had last used heroin after work at about 2:30pm - 3:00pm (Q 132).
When asked about whether there were items named on the warrant on the premises he disclosed there was heroin, marijuana, needles, a set of scales, and a “bong”. He described the bags of heroin that were found upon his person, saying that he was going to use it (Q164). He said:
it’s unfortunate but with the habit I’ve got I sort of have to use throughout the day to get through work … Like I’ve been speaking to the doctor and he’s been increasing my Methadone so I can try and cut back, but you know, yeah, I’m pretty stuck thick into it.
He said it was using three or four grams a day (Q 168), and when asked how long he had been using that quantity he said that it had just recently “blown out” when a month ago he had “slipped into a depression” and increased his usage (Q 169).
He said that he had been using heroin for 21 years on and off. When asked about the scales he said he used them to check what he buys because “it’s a bit of a dodgy business” (Q 191).
He was asked to describe what happened when the police came to the door and he said that he was mixing up a shot of heroin and he tipped it down the sink (Q 202).
He disclosed that he had a prescription for Methadone which he collected from Develin’s Chemist in Garema Place, Civic (Q 221).
He was asked about a small silver box, a bag of heroin and another smaller bag of heroin. He identified that there were three street deals in the box (Q 248) and that they were in white plastic with the ends melted (Q 253). The bigger bag of heroin was half an “eight ball” (1.75 g) and the smaller one was similar except that he had used some of the heroin from it and resealed it (Q 261).
In relation to the cash from his pockets he said that it came from his savings (Q 282). He said: “I went through a saving stage when I was, you know, I got down to using once [a] day and I was trying to put, um, yeah and I blew most of that when I – the last month I’ve been doing it crazy.” (Q 284).
In relation to the three street deals, he told police that had bought five and said he wanted to buy a block amount but couldn’t find any (Q 294).
He said that half an eight ball was worth about $500. He identified that he had bought $1400 worth of heroin the day before (Q 300, Q 307). He declined to tell police who he had bought it from suggesting that to do so might be at the “expense of my health” (Q 310). He said it was a transaction done in his car (Q 313).
When asked about his mobile phone, which he had registered a couple of weeks before when he lost his usual phone, he said the sim card was that of Mark Lee, a friend, because he had given him the sim card (Q 380).
He was then told that the police had been monitoring his phone and that they knew that he had been meeting with people and supplying them with drugs (Q 416).
Q 417. What can you tell me about that?
A. Um, yeah I do a lot of favours for people.
Q 418. Yep.
A.Um I have to, you know I mean to get the prices I do, um, yeah, like, um, sometimes like we chuck in together, we get on together so we meet up and we get on, um, that’s it.
Q 419. And how long have you sold Heroin for?
A. Ah, well I don’t really sell it so much as buy it with people, alright, and you know if one of our friends you know there’s a group of us that chuck in together, right if one of them run out you know I might throw some his way and then throw some back.
Q 420. Yeah. Do you take cash payments for it?
A. No, no, we just you know he just gives me back gear.
Q 421. Okay. Well to your benefit we’ve also have surveillance watching you.
A. Yeah.
The expression to “get on” refers to purchasing heroin. He declined to identify who those friends with whom he might “chuck in” with were.
He was asked about a particular person with whom he has had conversations. He identified him as a good friend. He declined to say whether or not that person had supplied him with heroin before (Q 464).
He said that on a bad day he ends up having “eight shots” of heroin (Q 468).
He said that he tried to use with someone and they would pool their money to make a purchase (Q 470) and that whoever had the contact on that day was then responsible for picking up that purchase (Q 471).
He said he knew three people who supply heroin but has met a lot more as just
“one-offs” (Q 475).
He disclosed that he had a bank account with the St George Bank (Q 479).
He declined to answer a question about whether he ever paid the good friend (referred to at [57]) money (Q 482). He denied that giving $2600 to his friend was for the purchase of heroin (Q498).
When it is suggested to him that he might also go by the name “Mark”, he also declined to answer the question (Q 504).
He denied that the friends that he said he shared heroin with owed him money (Q 515) or that he kept accounts when he supplied heroin to other people (Q 516).
When in the kitchen area he laughed when he saw that he had thrown the bag (in which the heroin had been) down the sink but forgot to dispose of the spoon in which the heroin was sitting (Q 530).
When shown the money on the table he said that it was money that he had saved and estimated it at about $10,000. He said that it came from his pay packets (Q 545).
He was asked questions about the fact that he earned about $900 a week, paid $400 in rent, and had a heroin habit which cost him $1800 every four or five days (Q 549-560). He said that his heroin use has been at that level just “for the last month” and that he had a lot more money previously on the table but he was now using his savings. He said: “I’ve got a mother overseas, right I’ve got to look after and that, so I’m not always this fucked up, sometimes I get my shit together all right.” (Q 567).
He pointed out the envelopes on the table and said that he was “pretty confident” that they will correlate with the money (Q 570). He also said that “I’ve depleted a lot of my savings … I’m just trying to tell you what I’ve got left so I can see how much or how soon I have to dry out” (Q 573-574).
When referring to the bags that can be seen he said “when I buy a bulk I get it in one big bag, not like those” (Q 592).
He gave information about his failure to lodge tax returns (Q 592-598) and identified his current bank accounts being with St George (Q 601).
He was then asked how much cash he thought there was in the house and answered “around the 10 [thousand dollar] mark”. He said he had $42 000 saved up in about seven or eight years (Q 613) but that he had been “chopping in like crazy” and that he was using “eight times a day” (Q 614). The police officers put to him that he had been obtaining money from drug dealing or supplementing his income dealing in heroin. He denied that and said “I’m depleting my savings on heroin”. The transcript of the conversation says:
Q 645. You’re not dealing in heroin?
A. No, I help people.
Q 646. You help people?
A. Like chuck in and get on with them.
Q 647. Yeah, do [you] charge people?
A. No.
Q 648. Yeah.
A. We chuck in together.
Q 649.But we heard and read conversations and seen you, and seen exchanges of money?
A. Well you know at one point we’ve got to chuck the money in.
The officers asked about the amount of money that they found on him and the number of different weights of heroin. He repeated his answer that “he couldn’t get onto his dealer” so he just bought what he could (Q 657).
He was asked about $42,000 that he said he had saved and explained that when Caloola Farm (one of the businesses by which he had been employed) shut down he got paid out and had also been saving money over his working life in Canberra (Q 666).
He was asked what he did after he finished work that day and said that he went and had a couple of shots in his car and then “met up with a few people” who he declined to name (Q 690-694). He said that when he met up with those people they were discussing “what we were going to chuck in, what we were going to get, how much we all had, and then when we were going to meet up to divvy it up” (Q 698).
He was asked what kind of weights of heroin he buys and said that he would buy an ounce, or if he could not get that much, half an ounce. He said that half an ounce would cost $3500 to $4000 and last him eight to 10 days.
He agreed that his addiction was costing him around $3000 per week (Q 723) but again he reiterated that his use had only “blown up” in the last month or so (Q 728).
Following the last part of the taped recorded conversation, police discovered a safe which was located amongst the foundations of the building through a door at the back of the garage. Police obtained the code for the safe from the defendant and discovered within it a large amount of cash. The cash was bagged up and subsequently counted at the Winchester Police Centre. The total from the safe was $377,905.
The notebook found during the search
Among the material found during the course of the search was a notebook which the defendant admitted that he owned. This was tendered as Exhibit 14. The first three pages of that notebook contained the defendant’s handwriting. The notes made on those pages related to rental properties and described their address, the rent payable, and in some cases provided contact details and inspection times. They are consistent with notes made by the defendant when searching for new rental accommodation. The remaining 15 pages contained writing which the defendant also admitted was his. The pages consisted of a number of ruled columns with figures in those columns. At the top of each column was a letter. Those letters varied, but, for example, page number four of Exhibit 14 has the initials:
T D Tt I+? QB
Page six has the letters:
T I P D Q J.
The totals written on the right hand side of the lettered columns are either exactly or close to the figure of $6800 which, according to the evidence of Detective Senior Constable Watson was the within the range of $6500-6800 for which an ounce heroin was being sold in 2016 .
The evidence of the defendant was that while the handwriting on this document was his and did relate to heroin, he prepared it at the direction of his dealer “Mark” who had stayed with him for some months, and that although he wrote the entries, he did not understand what those entries meant. This explanation was unbelievable. The document also contains annotations, corrections, and calculations which are inconsistent with the defendant being a mere amanuensis. The defendant was not being truthful when he denied knowledge of its meaning. However notwithstanding my rejection of the evidence of the defendant in the absence of some explanation, it is not possible on the basis of the document alone to make it clear findings about its meaning.
The contents of the document appear to be consistent with keeping tally of either sales of drugs to particular people or, consistently with the defendant’s case, the contributions of different persons to a joint purchasing scheme.
Evidence of CD
The witness who I refer to as CD had known the defendant for approximately nine years. She was a heroin user. She had obtained heroin from the defendant. She started using heroin four and a half years ago and first obtained it from the defendant two or two and a half years ago. On some occasions she paid him for the heroin, on other occasions she cleaned his house in exchange for heroin. Having regard to the catastrophic untidiness of the residence of the defendant at the time of the execution of the search warrant, this evidence based upon the need for significant house cleaning was credible.
She gave evidence that she had purchased heroin from him on five occasions paying either in cash or through the provision of cleaning services. She thought that the last time that she had purchased heroin from him was two or three months prior to the police coming to her house. She estimated that it was April or maybe in early May 2016.
One of the intercepted conversations was on 1 June 2016 where CD asks where he is and she says that she will see him in 15 minutes. Before the conversation is cut off the defendant says “Just one”. The second conversation involving CD was on 9 June 2016 which recorded that the defendant was to meet her outside the toilets at an unidentified location. On that occasion the defendant asks “Just one? Just one?” And she answers “Two”.
In her evidence, CD said that the first conversation related to having lunch and maybe “getting some pot” but that the other conversation was in relation to the supply of heroin. In cross examination she identified that two shots of heroin would be $80 each and hence a transaction involving two would involve $160. She denied ever being told by him how much the drugs cost him.
She said the defendant said he was making money to assist his mother. This evidence was challenged in cross-examination and submissions were made that CD should not be believed in relation to it. It was agreed between the parties that CD had not disclosed any material about the defendant’s reasons for selling heroin or any conversation about his mother in a statement made to police or in proofing by the Director of Public Prosecutions. Notwithstanding these matters I accept the evidence. It is consistent with what the defendant told police (see [67] above) and, even if not true, is a plausible excuse that a dealer might give when challenged.
Financial records
Tax records obtained by the police from the Australian Taxation Office showed salary and wage details for the defendant for the financial years 2009 until 2015. During that period the records showed a variable annual income which averaged over the period approximately $35,000 per year. The total income during the period was $244,487. Since 2011 the defendant has been employed by the entity operating the delicatessen at the Fyshwick Market’s and since 2012 that has been his only employer. There is no evidence of his income in the financial years 2002 to 2008.
Bank records were put into evidence relating to three accounts held with the St George Bank, two opened in 2012 and one in 2013. The records show debits relating to modest retail purchases and credits by cash deposits just sufficient to fund the debits. The records were consistent with both the Crown and defence cases. There were no bank records for the period 2002 to 2011 put into evidence.
Oral evidence of the defendant
The defendant gave oral evidence and was cross-examined. He was clearly a person of some intelligence. He gave evidence in an apparently frank manner. Many of the facts asserted by the Crown were admitted. It was really only in relation to the nature of the heroin transactions and the source of the funds that were found in his possession where the Crown case differed from his evidence. Some aspects of his evidence were unsatisfactory and I refer to those below.
He gave evidence that he had started using heroin at the age of 20 and that he was now 43 years old. The extent of his heroin use at the time of his arrest was demonstrated by the fact that he was taking 100 millilitres a day of Methadone when he first went into custody following his arrest.
He was been born in South Korea but his family left when he was six months old to live in Iran. At the age of four years his family moved from Iran to Australia due to the Iranian revolution. He attended school in Sydney, including a selective public high school, before doing two years of a civil engineering degree at the University of Newcastle.
His stepfather and mother moved to the United States of America in 2001 or 2002 and he moved to Canberra because his sister was there and he wished to get away from his drug use. He has worked at Caloola Farm, a job search and training company, and then at another company called Max Employment. He completed a Certificate IV in Workplace Training and Assessment. He gave evidence that he also worked weekends at a Shell service station and tried also to do what he described as night fill work (I assume at a supermarket), but on top of his day job, this was physically too much. He attempted to save for eight or nine years but after a deterioration in his health, left Max Employment and after a short period where he attempted to study, worked only one job. He said $100,000 to $150,000 of the amount found in the safe in his house was money saved from his various jobs over the 13 or 14 years since he had moved to Canberra.
He said that the balance of the money in the safe came from gambling winnings. He said that he was able to count cards in accordance with a card counting system that allowed him to be successful at playing blackjack in casinos. His evidence was that he gambled at the Star City Casino in Sydney and the Crown Casino in Melbourne. He said he was unable to use his card counting technique at the Canberra Casino because at that location the decks used for blackjack were continually shuffled and this made it impossible to use of the card counting technique. His evidence lacked precision as to when his gambling occurred during the period 2002 to 2016 or the amount that he earned during any part of that period. He said that he had ceased gambling because he had a bad losing streak and lost his confidence.
He gave generalised and rather unconvincing evidence about being “just a bit funny about banks” and hence not depositing his savings in a bank. He said “with the low interest rates and the high fees, you are basically paying them to use your money to make more money for themselves and I just don’t think that’s right”.
He gave evidence of being involved in a pooling scheme for the purchase of heroin. That involved a number of people each of whom had jobs. It involved the participants saying what they wanted in terms of heroin and providing the money for that amount. He said there were seven people in the pool although they did not all always participate. Which of the members of the group would do the heroin purchasing would depend on who had the best contact at the time. Purchased through that scheme, the two to three grams of heroin that he would use per day would cost between $500 and $850, whereas that amount of heroin would cost between $800 and $1200 if bought on the street.
He gave evidence that he had pulled out an amount of money from his safe and that before that he had $430,000 to $440,000 in the safe. He denied accumulating the money in the safe from selling heroin.
In relation to the evidence given by CD, he said that she was not part of the buying group but that he had sold her heroin on a handful of occasions based on what he had paid for the heroin himself. He denied having a conversation about dealing in order to assist his mother saying that his mother was comfortable, but not wealthy, and living in the United States.
He gave evidence about each of the telephone calls which the Crown relied upon as demonstrating that he had been involved in selling heroin to the person involved in the call. This evidence seemed to be significantly based upon a reconstruction rather than an actual recollection of the conversations in question. The evidence generally sought to characterise the transactions as involving not an immediate exchange of cash for heroin but instead the provision of money for the future supply of heroin. In relation to some of the transactions where it is clear that the other party was seeking the immediate supply of heroin, he explained them as occasions when he had given some heroin to the other person on the basis that it would be accounted for later. Similarly, he explained the references to the lending of money or obtaining it on “tick” as being occasions when he contributed an additional amount of money on behalf of that person to the group buying exercise. Some of this evidence was not convincing however, having regard to the very limited context available in relation to the conversations, I did not find it possible to reject this evidence beyond a reasonable doubt.
Characterisation of the alternative scenarios
The Crown case was that the defendant was simply dealing in heroin by purchasing it from another dealer and selling it to users. That was done by exchanging heroin for cash. In some cases, payment would be deferred, but that would be treated as a loan by the defendant to the purchaser. In all cases the heroin would be owned by the defendant and property would be transferred at the point where possession passed from defendant to purchaser.
Counsel for the defendant submitted that the position was as follows:
It was putting in of joint money. One person making a purchase and then distribution of the bulk purchase in terms of the shares that had put in money and we say that is not selling. So it is one person doing buying rather than one person doing lots of selling.
Thus the submission appeared to be that what was involved was a joint venture to buy heroin in bulk. The parties would pool their resources and a single individual who had contact with a suitable dealer at the time would make the purchase as agent for the joint venturers. The buyer would not own the heroin but would have possession of it only as agent for the other joint venture members. It would be owned in the proportions in which the members contributed to the fund. As a consequence, the supply by the buyer to the joint venture members did not involve a sale but simply a supply. The only sale was between the agent of the joint venture (the buyer) and the dealer.
Conclusion on contested facts hearing in relation to Count 1.
The defendant admitted his guilt on the basis of the evidence of CD that he sold her two shots of heroin worth a total of $160 on 9 June 2016. The Crown contended that the trafficking was more widespread than that. For the purposes of determining the basis upon which the defendant is to be sentenced as a result of his plea of guilty to count 1 it is necessary that the Crown prove the relevant facts beyond a reasonable doubt: R v Olbrich [1999] HCA 54; 199 CLR 270 at [27]; Filippou v The Queen [2015] HCA 29; 256 CLR 47 at [64].
The case is a circumstantial one insofar as there is, other than in relation to CD, no direct evidence of money changing hands in exchange for heroin. The Crown must establish that in the light of the all the circumstances established by the evidence considered as a whole, there is explanation other than guilt reasonably compatible with the circumstances: R v Hillier [2007] HCA 13; 228 CLR 618 at [46]. This requires the alternative explanation to rest upon something more than mere conjecture. A bare possibility is not enough: R v Baden Clay [2016] HCA 35; 258 CLR 308 at [47].
The telephone calls are more consistent with the transaction involving an immediate sale than with the arrangement described by the accused. All involve him as the supplier of heroin and many involve the provision of money, which is not expressly related to a future as opposed to immediate supply.
There was no attempt to match up calls to particular physical transactions demonstrated by the surveillance evidence so as to demonstrate that the circumstances were more consistent with a drug sale than either provision of money or supply of heroin as part of a group buying scheme.
There was either no evidence that identified the other users or, where they were identified, to provide any context that would be consistent with the Crown case and inconsistent with the defendant’s case. This was notwithstanding that, consistently with the defendant’s evidence, the conversations recorded were between him and a limited number of people.
There was no exploration in cross-examination of the contents of the tally sheet in the notebook which he said he wrote which clearly deals with heroin supply, although not in a readily understandable manner. The defendant’s denial of knowledge of this other than as an amanuensis was implausible. However, there was no exploration of whether all markings and calculations on the document were his or how the dealer “Mark” was involved with the markings on the document. The evidence was not sufficient to demonstrate that “Mark”, the dealer, was a convenient figment of the defendant’s imagination.
There was no evidence beyond a limited period of telephone intercepts about the nature of his communications with the persons involved in those conversations. It is very hard, therefore, to reach a conclusion inconsistent with his evidence that they were persons known to him, who were in employment, and with the capacity to participate in a heroin buying syndicate.
There was no evidence beyond the evidence that the defendant gave of the extent of his use of heroin. Therefore, there was nothing inconsistent with assertions of defendant that he had only been using at the very high level that he was at the time of his arrest for a short period of time.
There was no evidence that would undermine his claims to have gambled money at casinos in Sydney or Melbourne and only limited cross-examination on that issue. Although it was suggested to him in cross-examination that the evidence was conveniently made up, there was no challenge to the underlying hypothesis that he was able to engage in card counting and hence had capacity to win money at blackjack. Further, there was no attempt to elicit details of the occasions or circumstances in which he won money which either might have undermined the plausibility of his story or permitted further investigation of his claims and the calling of a case in reply.
The presence of large sum of money is certainly consistent with the defendant profiting from the sale of heroin, the link between it and the conduct during the limited period the subject of the charge is not so close as to lend significant weight to the Crown case. There was no evidence that the amount contained in the safe was contributed to during the period when surveillance was taking place. It would only be by assuming that what was shown to have occurred in the limited period the subject of count 1 had also been occurring for a substantial period prior to that time that the conclusion could be reached that the money was the proceeds of heroin dealing. The defendant did lie to police when he gave false information about how much money would be found on the premises. That lie is suggestive that, although his evidence about having saved money may in some respects based on fact, is not the real explanation for such large sums of money in his possession.
The fact that the defendant made very significant admissions in the recorded conversation with police during the execution of the search warrant supports the plausibility of his evidence about the nature of the transactions in which he was involved. He described the scheme for purchasing heroin as part of a syndicate in circumstances that were inconsistent with a calculated decision to tell a false story. That was because in giving the explanation to police that he did he was confessing to the supply of heroin at a significant level and it is not a situation where he should be taken to have understood the significance of the difference between supply only and supply involving a sale. The statements made were therefore inculpatory rather than exculpatory and not obviously designed to achieve a forensic advantage. Those factors which make it more difficult to reject the evidence to the extent necessary that it not give rise to a reasonable doubt.
The conclusion that I reach taking into account all of the evidence is that although it is more likely than not that the defendant was selling heroin to the persons identified in the intercepted telephone calls rather than supplying it as part of a group buying scheme, I am not satisfied of that fact beyond reasonable doubt. Therefore the sentencing must proceed on the basis of the single transaction involving CD.
Conclusion in relation to Count 2
The amount of money found on the premises was a large amount. The bulk of it was hidden so as to avoid detection. The evidence of the defendant about his reasons for not putting it in a bank was not convincing. The existence of the safe full of money was not disclosed to police during the search and answers that the defendant gave about the amounts of money that the police would find on the premises were false. While I take the lie of the defendant as to the amount of money present on the premises into account as part of the body of evidence: Edwards v The Queen (1993) 178 CLR 193 at 210 and it does tend to undermine the credibility of the defendant’s explanation of the source of the money, it is only part of the evidence.
For the period during which the police obtained relevant records of the defendant’s income, there would only have been a limited capacity to save money. However the defendant did give evidence about the modest nature of his accommodation. He also gave evidence that in the period prior to obtaining his job at the delicatessen at the Fyshwick Markets he had worked multiple jobs and the evidence did not demonstrate that this was incorrect. Indeed, in the period 2009 to 2011, the records were consistent with him having worked at least two jobs. The defendant gave evidence of his reason for reducing his workload after the 2011 financial year, namely having fallen into a depression following the taking of medication for his liver. There are no records in evidence of his income in the period 2002 to 2009 and hence no basis upon which to say that the evidence that he gave about his income and employment during that period was incorrect.
As I have pointed out above (at [94]), although the evidence that he gave about winning money from gambling was given with a level of imprecision and lack of detail which reduced the weight that it might be given, the challenge to the gambling claim was not sufficient to demonstrate beyond reasonable doubt that it was not correct. As pointed out above (at [111]), there was no evidence to contradict the claim and the evidence given by the defendant was not demonstrated by cross-examination to evidence that should be rejected beyond a reasonable doubt.
While the explanation of the defendant is implausible and the collective circumstances strongly supportive of the Crown case, I am not satisfied beyond a reasonable doubt that the total amount particularised, namely $398,370, was the proceeds of crime within the meaning of s 114A of the Crimes Act. Further I am not satisfied beyond reasonable doubt that any lesser amount being part of that total amount was the proceeds of crime, even though there must be grave suspicions about its source. Therefore the defendant must be acquitted on this count.
Conclusion
So far as count one is concerned, I am only satisfied beyond reasonable doubt that the defendant trafficked (as opposed to supplied) heroin during the charged period when he sold two shots of heroin to the witness CD on 9 June 2016.
On count two the defendant is acquitted.
| I certify that the preceding one hundred and twenty [120] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Mossop. Associate: Date: 23 June 2017 |
5
9
7