Regina v Ronen

[2004] NSWSC 1295

CITATION:	Regina v Ronen & Ors [2004] NSWSC 1295
HEARING DATE(S):
JUDGMENT DATE:	12 August 2004
JUDGMENT OF:	Whealy J at 1
DECISION:	The oral evidence will go before the jury not in a limited way but as evidence of the truth of the admissions made. Again, the scope and weight of those admissions will be a matter for the jury.
CATCHWORDS:	Evidence - Crown's entitlement to lead evidence as to the course of the uinvestigation - - Scope of evidence - accused offered opportunity to participate in interview - - Right to silence - - s 87(1)(b) admkissions within scope of authority
LEGISLATION CITED:	Evidence Act Telecommunications (Interception) Act 179
CASES CITED:	R v Reeves (1992) 29 NSWLR 109 Petty v The Queen (1991) 173 CLR 95
PARTIES :	Regina v Ida Ronen Regina v Nitzan Ronen Regina v Izhar Ronen
FILE NUMBER(S):	SC 70222/03; 70032/03; 70223/03
COUNSEL:	Mr T. Game SC; Ms S. McNaughton - Crown Mr R. Richter QC; Mr N. Rosenbaum - Accused Ida Ronen Mr I. Hall QC; Mr E. Power - Accused Nitzan Ronen Mr R. Van de Wiel QC; Mr P. Jones - Accused Izhar Ronen
SOLICITORS:	Ms P. Musgrave - Cth DPP Watsons Solicitors - Accused

LOWER COURTJURISDICTION:	Local Court
LOWER COURT FILE NUMBER(S):
LOWER COURT JUDICIAL OFFICER :

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

WHEALY J

THURSDAY 12 August 2004

70222/03 - REGINA v Ida RONEN
70032/03 - REGINA v Nitzan RONEN
70223/03 - REGINA v Izhar RONEN

JUDGMENT - See page 3600 of Transcript

1 HIS HONOUR: The point from which I start is Exhibit “B” in this application. I do not propose to refer to the material contained in any detail. It sets out however many illustrations of the forceful cross-examination and indeed the general approach adopted by the defence in relation to the Crown case. I do not suggest any criticism of the defence but it is clear that involved in this case is a very substantial attack on the method of investigation carried out by the Crown. It has been put in argument that the defence will go to the jury on the basis that the Crown case has been, in effect, blinkered and myopic; and that the investigation did not examine and analyse areas which would have thrown a different light on important matters.

2 It seems to me, and indeed it is not I think in any real sense disputed by any of senior counsel for the defence, that in this trial the Crown is entitled to lead evidence related to the nature of the investigation. It is entitled to demonstrate what the investigators did and what motivated them to look at certain matters. Perhaps equally as importantly, the Crown is entitled to show what motivated the investigators in relation to their decision not to look at other specific matters.

3 A good example of that may be inherent in the suggestion made throughout the cross-examination that the investigators did not go on with an audit of the Dolina companies. But there are many, many aspects to it. So it is against the background of that very important and critical feature of the case that I turn to look at the various arguments that have been advanced in relation to individual matters of evidence which are now sought to be led.

4 First there are the interviews conducted with Mrs Ronen, Nitzan Ronen and Izhar Ronen. In my view the Crown is entitled to lead evidence of the conversations that relate to the participation, if any, in the interviews sought with the accused and evidence as to what they said about those invitations, where they occurred.

5 In the decision of the Court of Criminal Appeal in R v Reeves 29 NSWLR (1992) 109 the Court had before it an argument related to a situation where evidence had been given that disclosed that an accused had exercised his right of silence. The question was whether, and in what circumstances, the usual direction should be given to the jury, that is the direction which is often known as the Petty direction, (taken from Petty v The Queen (1991) 173 CLR 95). In the course of the decision of Hunt CJ at CL his Honour said at page 115:

“A necessary consequence of an accused's right of silence is that the Crown often has no knowledge of the issues which are going to be raised by him at the trial. The Crown must lead all of its evidence upon every issue which it ought reasonably have foreseen may arise.”

6 I will omit detailed reference to decided cases. Hunt CJ at CL continued:

“Without wishing to appear as cynical as did Avory J in R v Liddle...I think that it may safely be said that it ought reasonably to be foreseen that the fairness of the conduct of the investigating police officers may be criticised and in a way of which the Crown will not necessarily be forewarned.
It seems to me, then, that the fact that such questions were asked of the accused is therefore usually admissible in order to meet (at least in part) such anticipated criticism, and in my view that fact was admissible in the present case. Once the fact of the questions were asked is found to be admissible, the nature of the answers given must necessarily also be admissible - even if it discloses that the accused exercised his right to silence - for otherwise a very misleading impression may be conveyed, and one which would usually be detrimental to the accused.”

7 His Honour then went on to consider the directions that should be given in relation to the exercise by the accused of the right to silence.

8 In the present matter, it seems to be common ground that Mrs Ronen was not directly asked to participate in an interview. But, of course, she was already speaking to the officers who were conducting the search and indeed certain answers were made by her to which reference has been made in earlier rulings.

9 The situation of Nitzan and Izhar Ronen is slightly different in each case. But I think it may be safely said that, in one way or other, they were each offered an interview and, as it turned out, it appears that they did not in the end partake in such an interview.

10 Again, it seems to me the Crown is entitled to have the offer of the interview made to each of the two men placed before the jury and, as Hunt CJ at CL said, that carries with it the necessity as well to also place before the jury whatever response was made. It will be necessary, of course, if that evidence is led, that I should give a direction to the jury in accordance with Petty's case and I propose to do that.

11 The next issue relates to certain comments made by Nitzan Ronen in the telephone conversation BB306. I should say in dealing with this matter and in other matters which follow that the Crown wishes to place before the jury the range of matters which Mr McVeigh took into account, firstly, in issuing or recommending the issue of tax assessments back in 2001 and secondly in relation to the views that may have influenced him in his dual role as a seconded investigator.

12 In opposition, Mr Richter has said that by reading paragraph 20 of his statement, one can see that in reality he took essentially one mathematical comparison into account and virtually nothing else. But I agree with the Crown submission that a fair reading of his whole statement does not necessarily lead one to that conclusion by any means.

13 I think the Crown is entitled to place before the jury, in the light of the nature of the attack on the Crown case in relation to the method of investigation, including the issue of assessments, just what Mr McVeigh did take into account. That should be done, I think, in a way that does not result in a situation where the danger of unfair prejudice outweighs the probative value of the evidence. See s 137 of the Evidence Act.

14 So far as this present material is concerned, that is the statements by Nitzan Ronen in the telephone call BB306, the issue has to be approached with some delicacy because of the position of Mrs Ronen. I refer here to the fact that the call was the subject of an agreement between the parties – an agreement made months ago – that it should not be admitted against Mrs Ronen. In my view, however Nitzan Ronen's comments are admissible as an admission against him; and if they were matters that had some influence on Mr McVeigh, well then, they will have a secondary probative value as well. But, in relation to the first issue, I think that they should be admitted. Moreover I consider that the context of Nitzan Ronen’s remarks, which the Crown has indicated in its reply submissions it relies on, should also be fairly placed before the jury. I do not see, in that context, any unfair prejudice to Nitzan Ronen, although I think some direction might need to be given about Mrs Ronen as well, and the Crown can perhaps address me about that on Monday, and also in relation to Izhar Ronen as well. It seems to me the call would not be admissible against Izhar Ronen, even though the word "we" is used. So I think that some care will have to be taken about the directions that should be given and I would ask the Crown to give some thought to that.

15 As to what the context is and what the expression used by Nitzan Ronen means, I take on board all of the arguments that have been advanced but have come to the conclusion that the material is admissible as an admission against Nitzan Ronen. It is plainly relevant in these proceedings but the exact content of that admission and the weight to be given to it I think are matters for the jury after it has been admitted.

16 I turn next to the “dot points”, if I can call them that, in the various audit reports of Mr McVeigh. The Crown does not propose at this stage to tender the statement of facts of Mr Moulds, even though it is referred to as the basis of many matters that Mr McVeigh took into account in his audit reports. All this material, I should say, is contained in Exhibit “A” before me on this application.

17 If I may go turn the On Fovo audit report as an example: I turn to page 9, the second half of the page, and the top of page 10. There are a number of matters set out on those pages in dot point form. These are said to be matters under the heading of "Intercepted Communications" which are revealed by the statement of facts to which I have earlier made reference.

18 The Crown, in the course of the argument, pointed out that Mr McVeigh did in fact wear two hats and that there was, as a consequence, a need there for some subtlety and delicacy in relation to providing him with intercepted phone calls. In the end, the matter was handled by his taking into account the contents of those telephone calls as referred to in the statement of facts, rather than by having access to the calls themselves.

19 The relevant passage is in the following terms (page 9, and top of page 10):

“The statement of facts reveals that in April 2000 the NCA commenced intercepting communications connected to the residence of Ida Ronen pursuant to a warrant issued under the Telecommunications (Interception) Act 1979. Calls were intercepted in the Hebrew language between, amongst others, Ida Ronen, Nitzan Ronen and Izhar Ronen. They have been translated and transcribed and include words to the effect of:
Izhar makes between $12,000 to $17,750 each week in cash
Izhar was transferring money from Australia using the services of a chartered accountant (referred to in the statement as X). The amounts sent were between $100,000 to $200,000
Ida advising Izhar that his share of the 'July totals' would be $81,000
In 1998 Izhar's share was $1,235,909
Ida advising Izhar that he had $213,360 in cash in a safe at her residence and he has $600,000 in an overseas bank account.”

20 The material then continues:

“Further intercepted communication details include:
Nitzan stating to Ida during a conversation when search warrants were executed 'Will have problems in the beginning. We pay a big fine and...'
Calls between Nitzan, Ida and Daniella Lior (cousin of Nitzan and Izhar and a resident of Israel) indicate that moneys being 'skimmed' from the outlets which has been sent from Australia to Israel have been returned to Australia as a loan from Lior
X informing Nitzan that he can send their money to Israel.”

21 (The reference to “X” here is, in fact, a reference to Mr Agoston whose name has featured in the intercepted calls and in Mr Segal’s evidence).

22 Again, at this stage it is not intended to place in evidence before the jury the audit reports themselves but, as I understand it, the Crown wishes to ask Mr McVeigh what matters he took into account and expects that the jury will be told those matters under the various dot point headings were matters that were taken into account. The reports, depending on the scope of cross-examination of Mr McVeigh, may be tendered at a later stage.

23 The issue that has arisen in today's proceedings really relates to the second last and third last dot points I have set out above. I have already dealt with the third last one, that relating to the conversation where Nitzan Ronen spoke to Mrs Ronen on 7 February 2001, and I have made a ruling about that matter.

24 That leaves me then really only with the material under the second last dot point. I have been, in a sense, troubled about this matter. But I have come to the conclusion that the Crown is entitled to put that matter before the jury through Mr McVeigh, although, as I am presently minded, I would make an order directing that the evidence in relation to this particular dot point material be limited in the way suggested by the Crown. That is, it is limited as being relevant only to the bona fides of the investigation. Again, I look to the Crown for some assistance in relation to the form of such a direction next week.

25 As to the telephone calls themselves, again I think I would like to reflect upon that and perhaps that can be raised with me again on Monday morning, as to whether it is necessary that the actual calls go in. It may be that they do in due course, depending upon cross-examination, but I will leave that point unresolved at this moment.

26 The final matter then is this: There was a meeting at Krochmalik and Hurwitz Pty Ltd on 5 March 2001 and Mr McVeigh attended that meeting along with Mr Neville Moulds from the NCA. So far as I can ascertain from the material placed before me, it was a voluntary meeting. The firm of accountants was represented by Graham Hurwitz and Ian Geller. There is no doubt that Krochmalik and Hurwitz acted as the accountants for the individuals, the Ronens, the accused in this trial, and for the Dolina companies, if I may use that shorthand expression; and also for On Fovo which operated three of the retail shops and, of course, Mrs Ronen, as I have already said, who operated the fourth retail shop. They were also auditors for the Dolina companies.

27 The evidence thus far in the trial has revealed that Mr Geller, in particular, carried out functions and duties in relation to that role and that his firm acted as tax agents generally and for the companies and individuals I have nominated. The evidence also shows that Mr Hurwitz had a role as well.

28 During the course of the meeting, according to the handwritten document filled out at the time by Mr McVeigh, certain questions had been prepared in typed form and were completed in handwriting as a consequence of the questioning involved at the meeting. The particular matter, Dolina Fashion Group's return for the year 30 June 1999, was the subject of questioning in relation to its gross sales. The questions were, "What is this comprised of?" The answers were, "Mostly TT transfers, Coles Myer, et cetera". A question was asked, "What source documentation/banking records were relied upon?" The answer that has been completed by Mr McVeigh is, "A bank rec only", meaning, as I understand it, bank reconciliation only. Then, more importantly, the next question:

“Q. Does this figure include sales made at the retail outlets, On Fovo, Warehouse, Fashion Bargains?
A. No.
Q. If not, where is the sales from these outlets recorded?
A. Only in RYF and On Fovo.”

29 It appears that on the following day, 6 March 2001, Mr McVeigh produced in typed form a fuller statement which set out the matters which had been discussed at the meeting the day before. They included the matters to which I have already made reference but, as I say, it is a more comprehensive document and it shows that, for example, the questions related not merely to Dolina Fashion Group but also Dolina Enterprises. But the documents may be described, as they have been in argument for convenience sake, as a one page handwritten document and a two page typed document.

30 Mr Game SC, the Crown Prosecutor, seeks to tender the three pieces of paper and does so on a number of bases. First of all, again consistently with what I have outlined earlier, as material that is relevant to the investigation and the thinking of Mr McVeigh in relation to the investigation and the issue of tax assessments. Secondly, the Crown seeks to tender the material under section 87(1)(b) of the Evidence Act which provides:

“ 87 Admissions made with authority
(1) For the purpose of determining whether a previous representation made by a person is also taken to be an admission by a party, the court is to admit the representation if it is reasonably open to find that:
(a) when the representation was made, the person had authority to make statements on behalf of the party in relation to the matter with respect to which the representation was made; or
(b) when the representation was made, the person was an employee of the party, or had authority otherwise to act for the party, and the representation related to a matter within the scope of the person's employment or authority; or
(c) the representation was made by the person in furtherance of a common purpose (whether lawful or not) that the person had with the party or one or more persons including the party.
(2) For the purposes of this section, the hearsay rule does not apply to a previous representation made by a person that tends to prove:
(a) that the person had authority to make statements on behalf of another person in relation to a matter; or
(b) that the person was an employee of another person or had authority otherwise to act for another person; or
(c) the scope of the person's employment or authority.”

31 In view of the need to give this decision quickly, I do not propose to say anything other than I am satisfied that it is reasonably open on the material that has been placed before me to find that, when the representation was made, Mr Geller and Mr Hurwitz each had authority to act for the relevant parties and I am satisfied that the representations related to matters within the scope of the authority of each of those persons.

32 Subsequently, I am satisfied that the material may go to the jury as an admission. That is, the answers may be taken to be admissions by each of the accused.

33 There is no strong argument, other than in terms of principle, to the findings I have made in favour of the Crown to the tender of the handwritten document and, at the moment, it seems to me that that certainly can be admitted. But I am also of the view that the two page document may be admitted as well.

34 It will be necessary to give a direction to the jury, to make it clear to them that the oral testimony of Mr McVeigh, as to the admissions by Mr Geller, is the basis of the admission and not the handwritten document itself. Again, I will ask the Crown to give me some assistance with the form of that direction on Monday.

35 The consequence will be that the oral evidence will go before the jury not in a limited way but as evidence of the truth of the admissions made. Again, the scope and weight of those admissions will be a matter for the jury.

36 I also take into account in coming to the decision I have that both Mr McVeigh and Mr Geller will be available for cross-examination.

37 I am also satisfied that there is no danger of unfair prejudice arising in relation to that material and I am satisfied for the reasons I have given that it possesses considerable probative value.

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Last Modified: 07/16/2007