LIMITED DISTRIBUTION
-
CATCHWORDS
CONTEMPT OF COURT - destruction o f documents t h e s u b j e c t o f an
| e x t a n t | undertaking t o t h e Court | by a person | n o t | p a r t y t o t h a t |
undertaklng but aware o f i t s existence - p e n a l t y t o be imposed.
RE PETER ARNOT: EX PARTE DEPUTY COMMISSIONER OF TAXATION & ANOR.
NG263 o f 1988
LOCKHART J.
SYDNEY
LIMITED DISTRIBUTION
| IN THE FEDERAL C | O | U | J | 1 |
| 1 |
| NEW SOUTH WALES DISTRICT REGI- | ) | No. NG 263 of 1988 |
| 1 |
| GENERAL DIVISION | 1 |
| EX PARTE: | W U T y | COMMISSIONER | OF |
TAXATION & ANOR.
| JUDGE MAKING ORDER: | LOCKHART J. |
| DATE ORDER MADE: | 3 NOVEMBER 1989 |
| WHERE ORDER MADE: | SYDNEY |
MINUTES OF ORDER
THE COURT ORDERS THAT:
1. Peter Arnot be adjudged guilty of contempt of Court on the charge set forth in the statement of charge.
2. Peter Arnot be fined four thousand dollars ($4,000).
3. Peter Arnot be allowed until 2 February 1990 -time to
| Pay |
| 4. Peter k n o t pay the costs of the Deputy Commissioner of Taxation of this proceeding including any reserved costs. |
NOTE: Settlement and entry of orders is dealt with in Order 36
of the Federal Court Rules.
LIMITED DISTRIBUTION
| THE FEDERAL COURT OF AUSTRALIA | ) ) |
| N W SOUTH WALES DISTRICT REGIST | RY | ) | No.NG 263 of 1988 |
| 1 |
| EENERAL DIVISION | 1 |
| EX PARTE: | DEPUTY | COMMISSIONER | 0 F |
3 November 1989
REASONS FOR JUDGMENT
LOCKHART J.:
| This is t h e hearing of a motion f o r contempt. | The |
moving par ty is t h e Deputy Commissioner of Taxation and t h e respondent is Peter Arnot. The statement of charge is t o t h e
| following | effect: | t h a t | M r Arnot | is | sa id | t o be | gu i l ty of |
contempt of t h i s Court in t ha t , knowing of t h e terms of an Undertaking given by each of t h e applicants , Ralph Sharp and Greenwoods and Freehi l l s Pty Limited t o t h e Court on 3 March
| 1988 and renewed by each of t h e applicants on 7, 9, 10 and 11 |
March, 1988 i n these proceedings, such Undertaking being, i n t e r a l ia , t h a t t h e appl icants would not, except with t h e
wri t ten consent of t h e Deputy Commissioner, p a r t with custody of o r destroy o r deface any documents held by M r Sharp o r Greenwoods and Freehi l l s o r e i t h e r of them o r on t h e i r behalf
on behalf of any person who is named i n a document described a s exh ib i t A a s having had a facsimile transmission sen t on h i s behalf t o an organisation known as EBC o r Acceptor En te rpr i ses Limited, t h a t M r Arnot on o r about Tuesday, 5
| Apri l 1988, i n breach of | t h a t Undertaking removed from t h e |
custody of Greenwoods and Freehi l l s a f i l e consis t ing of documents held by Greenwoods and Freeh i l l s on behalf of M r Arnot who was named i n exh ib i t A a s having had a fax sen t on h i s behalf t o E B C and Acceptor Enterpr ises Limited, by taking it from t h e desk of a M r Dennis Lear, a d i r ec to r of Greenwoods and Freeh i l l s a t t h e premises of Greenwoods and Freehil ls a t t h e MLC Centre, Martin Place, Sydney, and destroyed some o r a l l of t h e documents cons t i tu t ing t h e f i l e by tear ing them
| i n t o p ieces and f lushing t h e pieces down | a lavatory. |
The commissioner had not given any wri t ten consent t o M r
| Sharp o r Greenhills | and | Freehi l l s o r t o e i t h e r of | them | o r t o |
| M r Arnot | t o t h e e f f ec t t h a t M r Arnot | might | remove o r des t roy |
| t h e documents. | That is t h e statement of charge. | M r Arnot has |
| pleaded | gu i l t y t o t h e charge. |
| M r Arnot is not himself | a p a r t y t o t h e giving of | t h e |
undertaking t o which reference is made i n t h e charge, but he pleads gu i l t y on t h e basis t h a t he, knowing of t h e exis tence
| and currency of | t h e undertaking, | never theless engaged i n t h e |
conduct t o which t h e charge re fe r s . I t is of course w e l l es tabl i shed t h a t in those circumstances a person i n M r Arnot's position may be gu i l ty of contempt and t h a t is conceded by
| counsel on | h i s behalf, | and r i g h t l y so. |
M r Arnot has given evidence t h i s morning, and I am
| sa t i s f i ed | from | t h a t | evidence | t h a t | before | he | at tended | a t t h e |
premises of Greenwoods and Freehil ls , a t t h e MLC Centre on t h e occasion mentioned i n t h e statement of charge, namely 5 April l a s t year, t h a t he had given consideration t o t h e question
| whether | he would | remove | t h e f i l e from t h e custody of |
| Greenwoods | & | Freehi l l s | i f | he | was | not | voluntar i ly | given |
possession of it by t h a t company bu t I am sa t i s f i ed t h a t he did not reach a concluded view on t h a t quest ion a t t h a t s tage. I t was p r i o r t o h i s going t o t h a t meeting a
| poss ib i l i ty which | he contemplated. |
| It is a l so c l ea r t h a t he was | aware of | t h e exis tence and, |
i n substance, t h e terms of t h e undertaking before he went t o
| t h a t meeting. | H e formed t h e view | a t t h e meeting | when it was |
| plain | t h a t he could not obtain possession | of | t h e f i l e , t h a t he |
| should | t ake it. | H e then decided t o remove t h e f i l e and | he |
| took | it | i n t o h i s possession | and quickly l e f t t h e room | where |
| o the r people w e r e present | and | proceeded | t o a lavatory i n t h e |
same building and over a period of not less than some 30 minutes, proceeded t o t e a r up t h e contents and t o f lush them down t h e lavatory. The f i l e was one of some s i ze and it took him, a s he admitted i n evidence, qu i t e a long t i m e t o dispose of its contents.
| M r Arnot was | not aware of | t h e contents of | t h e f i l e , save |
| t h a t | he | thought | t h a t | it | contained, | amongst | o the r th ings , |
| letters from himself t o Greenwoods and Freehil ls . | I am |
| sa t i s f i ed | when | taking | t h e f i l e and | destroying it | on | 5 Apri l |
| 1988, t h e purpose of | M r Arnot | was | t o prevent | t h e f i l e , | its |
| con ten t s | and | i n | pa r t i cu la r , | t h e | names | of | h i s | c l i en t s | being |
| disclosed t o t h e Deputy | Commissioner | of | Taxation. | H e f r ank ly |
| conceded t h a t i n evidence. |
| H e | sa id | t h a t | he | took | t h e | f i l e because | of | h i s | sheer |
| apprehension | of | t h e s i ze of | t h e f i l e or , | a s he put | it, t h e |
| monster | crea ted | by | it. | H e sa id he | had | c l i en t s | and | t h a t h i s |
p r inc ip le concern was t o s top those c l i en t s being caught i n what h e described a s disadvantageous circumstances. M r Arnot's
| deal ings on t h e fu tu res exchange i n various commodities. | bus iness a t t h e t i m e and f o r some years before t h a t involved | M r Arnot has given evidence on being recal led by h i s |
counsel i n t o t h e witness box of t h e names of c l i en t s of h i s whose names may have been revealed by t h e contents of t h e f i l e which has been destroyed when he t o r e it i n t o pieces and f lushed them down t h e lavatory i n t h e MLC building. H e has
| a l so given evidence of | h i s f inancial position which could be |
summed up by saying he does not appear t o be in a highly l iquid posiiton bu t has reasonably subs t an t i a l a s s e t s and although most of them a r e mortgaged i n var ious amounts he
| never theless | r e t a in s | reasonable | equ i t i e s | i n t h e proper t ies . |
| M r Arnot has apologized f o r h i s contempt of | Court. In my |
| view | t h e contempt is not | a t r i v i a l one. | It is | a | ser ious |
| contempt | t o de l ibera te ly | and | knowingly | des t roy | documents |
| included | i n | a | f i l e | f o r | t h e | purpose | of | preventing | t h e |
| Commissioner | of | Taxation | from | carry ing | ou t | h i s | s t a tu to ry |
| dut ies . | However, | I | t ake i n t o account a l l t h e matters t o which |
| I | have | re fe r red | and | t h e o the r matters t h a t w e r e t h e subjec t of |
evidence and of t h e submissions. I do not t h ink a cus todia l sentence is cal led f o r though I must confess t o having given t h a t ser ious thought during t h e course of t h i s morning's proceedings.
| The Court f inds M r Arnot gu i l ty of contempt of Court on |
| t h e charge set | fo r th i n t h e statement of | charge and | o rders |
| t h a t M r Arnot be fined $4,000 on t h e charge. | The Court o rders |
| t h a t M r Arnot | pay t h e cos t s of | t h e Deputy | Commissioner of |
Taxation of t h i s proceeding including any reserved costs .
| I | c e r t i f y | t h a t | t h i s | and | t h e | preceding |
| four | ( 4 ) pages | a r e a t r u e copy of | t h e |
| reasons f o r judgment | herein of | t h e |
| Honourable | M r . | J u s t i c e Lockhart. |
| A'ssociate |
| Counsel f o r Commissioner of Tax | Mr. J.V. Agius |
| So l i c i tor f o r Commissioner of Tax | Australian Government
So l i c i tor |
| Counsel f o r P . | Arnot: | M r . | R . | Toner |
| So l i c i tor f o r P . | Arnot: | Michell S i l l a r | & | Brown |
| Date of Hearing: | 3 November 1989 |
| Date of Judgment: | 3 November 1989 |