Rukaj v Director of Public Prosecutions
[2024] VCC 1757
•8 November 2024
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMON LAW DIVISION | Revised Unrestricted Suitable for Publication |
| CONFISCATION LIST |
Case No. CI-19-04749
| IN THE MATTER OF the Confiscation Act 1997 |
| and |
| IN THE MATTER OF the offender SOKOL RUKAJ |
| and |
| IN THE MATTER OF an application by SOKOL RUKAJ for an exclusion order pursuant to s16 Confiscation Act 1997 |
BETWEEN:
| SOKOL RUKAJ | Applicant |
| and | |
| THE DIRECTOR OF PUBLIC PROSECUTIONS | Respondent |
---
JUDGE: | HER HONOUR JUDGE HINCHEY | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 28 May and 21 August 2024 | |
DATE OF JUDGMENT: | 8 November 2024 | |
CASE MAY BE CITED AS: | Rukaj v DPP | |
MEDIUM NEUTRAL CITATION: | [2024] VCC 1757 | |
REASONS FOR JUDGMENT
---
Subject:PROCEEDS OF CRIME
Catchwords: Procedure – confiscation of proceeds of crime – application for restraining order – application for exclusion from restraint – persistent failure to comply with timetable for filing supporting affidavits – self-executing order setting out timetable – failure to comply with terms of self-executing order – power of Court to extend time under order – automatic forfeiture – effect of automatic forfeiture on Court’s powers
Legislation Cited: Confiscation Act 1997 (Vic), s35, s51; County Court Act 1958 (Vic), s49
Cases Cited: Lawstrane Pty Ltd and Victorian WorkCover Authority v Aurica Ruttmar (2013) 37 VR 320; Jorgensen v Slater & Gordon Pty Ltd [2008] VSCA 110; Mitrov Homes Pty Ltd v Mustafa (No 2) [2023] VSC 386; Dinh & Ors v DPP (Unreported, VCC, 11 November 2022); La Macchia v Minister for Primary Industries and Energy (1992) 110 ALR 201; Valentine v Eid (1992) 27 NSWLR 615; Director of Public Prosecutions v Nguyen; Director of Public Prosecutions v Duncan (2009) 23 VR 66; P Aker Flowerbulbs Ltd v Coulter (2009) 140 FCR 410
Judgment: Application granted.
---
APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr J Connolly | Sarah Tricarico Lawyers Pty Ltd |
| For the Respondent | Mr E Fryar | Solicitor for Office of Public Prosecutions |
HER HONOUR:
Introduction
1On 12 December 2018, Mr Sokol Rukaj (“the applicant”), was charged a number of serious offences, including trafficking a drug of dependence, possessing a drug of dependence, possessing a prohibited weapon and dealing with property suspected to be proceeds of crime.
2On 8 October 2019, the Director of Public Prosecutions (“the Director” or “the respondent”) made an ex parte application pursuant to s16(2) of the Confiscation Act1997 (Vic) (‘the Act”), for an order restraining three real properties and a sum of cash belonging to the applicant (“the RO”).
3On 15 October 2019, Judge Murphy made the RO in the terms sought by the Director. The purpose for which the RO was made, as set out in that Order, included to satisfy any forfeiture order, to satisfy automatic forfeiture of property and to satisfy any pecuniary penalty order that might be made.
4On 8 November 2019, the applicant filed an application pursuant to s20 of the Act, for orders excluding the property which had been restrained from the operation of the RO (“the exclusion application”). The exclusion application was stayed pending the final determination or withdrawal of the charges brought against the applicant.
5On 14 February 2022, the applicant was convicted and sentenced on a plea of guilty in the Sunshine Magistrates’ Court to, amongst other things, trafficking 197.9 grams of cocaine contrary to s71AC of the Drugs, Poisons and Controlled Substances Act1981 (Vic), a Schedule 2 offence under the Act. At the same time, a forfeiture order was made by consent in respect of the sum of cash referred to in paragraph 2 above.
6On 17 November 2022, the stay on the exclusion application was lifted.
Background to this application
7On 29 November 2022, orders were made that on or before 3 February 2023, the applicant file and serve any affidavit on which he intended to rely in support of the exclusion application.
8A directions hearing which had been scheduled for 21 February 2023 was adjourned by consent to a date to be fixed.
9On 17 August 2023, further timetabling orders were made by consent. The orders included an order that the applicant file and serve any affidavit material on which he intended to rely by 4.00pm on 19 October 2023. The matter was adjourned to a directions hearing on 14 November 2023.
10On 10 November 2023, the time for the applicant to file and serve his affidavit material was again extended by consent to 30 November 2023. The matter was adjourned to a directions hearing on 30 January 2024.
11On 29 January 2024, orders were made by consent adjourning the matter to a directions hearing on 13 February 2024.
12On 12 February 2024, orders were again made by consent adjourning the matter to a directions hearing on 19 March 2024.
13On 14 March 2024, a self-executing order was made by consent, which (relevantly) provided:
“1.Unless by 4.00pm on 22 May 2024 the Applicant files and serves any affidavit upon which he intends to rely, the Applicant’s exclusion [application] filed on 8 November 2019 is struck out.”
(“the self-executing order”)
14On 22 May 2024, the applicant affirmed an affidavit (“the applicant’s affidavit”). It is common ground that the applicant’s solicitor’s filed and served the applicant’s affidavit at 4.04pm on 22 May 2024.
15In an email dated 23 May 2024, the Director wrote to the Court concerning the fact that the self-executing order had not been complied with and asserting that as a result, the RO had, by operation of that order, been struck out. In those circumstances, it was submitted that the restrained property had automatically been forfeited to the Minister by operation of s35(2)(b) of the Act. The Director further submitted that unless the applicant could show compliance with the self-executing order, Order 1 had been enlivened, meaning that the Court is now functus officio. The email concluded with the Director seeking “the court’s view on whether the court will accept the filing of the Affidavit”.
16On 23 May 2024, the parties were advised that the matter would be listed for a directions hearing on 28 May 2024. The parties were requested to provide written submissions addressing the issues and setting out the relevant case law.
17On 27 May 2024, the parties filed written submissions as requested.
18At a hearing on 28 May 2024, it was conceded by the applicant that the applicant’s affidavit had been filed at 4.04pm on 22 May 2024. Thus, the only issue before the Court was whether it has any power to extend the time for compliance with the self-executing order. The parties were questioned about why the Court did not have the power to extend the time for compliance with the self-executing order, nunc pro tunc, to a time after 4.04pm on 22 May 2024.
19At the same hearing, it was noted that the applicant had not yet made any formal application for orders extending time for compliance with the self-executing order. In light of the narrowing of the issues, it was agreed that the best course would be for a timetable to be set, providing for the filing and service of:
(a)a formal application setting out the orders sought by the applicant; and
(b)further written submissions, and a court book containing the authorities that would be relied upon by each party in relation to the matter.
20Orders to that effect were made by the Court on 29 May 2024. The matter was set down for further hearing on 21 August 2024. That hearing addressed the issues which arise for determination.
Orders sought
21In his application filed pursuant to the Orders made on 29 May 2024, the applicant seeks the following orders:
1(a)That the self-executing order be set aside;
1(b)Alternatively, that the self-executing order be stayed nunc pro tunc; and
2That the time by which the applicant was to file and serve the applicant’s affidavit be extended nunc pro tunc to 5.00pm on 22 May 2024.
The parties’ submissions
The applicant
22The applicant submitted that the Court has the power to make the orders sought by virtue of the Court’s incidental powers and the broader jurisdiction conferred upon it by s49 of the County Court Act1958 (Vic).
23In support of this submission, the applicant placed reliance upon Lawstrane Pty Ltd and Victorian WorkCover Authority v Aurica Ruttmar (“Lawstrane”),[1] where the Court said:
“11… both parties’ arguments proceeded upon the false assumption that the County Court has no implied powers to stay its own judgment or the execution of that judgment nunc pro tunc. The appellant maintained that in the absence of an express provision or rule, the County Court had no power to make such an order. That argument must be rejected. …
…
16Weinberg J (as he then was) also referred to s 49 in the context of implied powers …, stating that it conferred jurisdiction upon the court in civil matters in the broadest of terms. Section 49 of the County Court Act gives the County Court the power to make any order in civil proceedings that can be made by the Supreme Court in a like case. As the Supreme Court undoubtedly has the power to stay the operation of a judgment or order in the exercise of its powers, s 49 operates to confer that same power on the County Court.
… .”
[1] (2013) 37 VR 320 at paragraphs [11] and [16], per Redlich JA and Davies AJA
24The applicant also placed reliance upon the decision of the Court of Appeal in Jorgensen v Slater & Gordon Pty Ltd[2] (“Jorgensen”), which establishes the following relevant principles:
[2] [2008] VSCA 110 at paragraphs [9]-[12]
(a)the Court has a wide discretion to relieve a party of the consequences of non-compliance with a self-executing order;
(b)the governing consideration, as in every aspect of practice and procedure, is what justice requires;
(c)the power must be exercised with care;
(d)the court should have regard at least to the following matters:
(i) the circumstances in which the self-executing order was made;
(ii) the reasons for non-compliance with it;
(iii) the prejudice to the defaulting party if relief were not granted; and
(iv) the prejudice to the innocent party if relief were granted;
(e)as to the reasons for non-compliance, it is important to ascertain whether the failure to comply was wilful, that is, was reflective of deliberate disregard for, or indifference to, the court’s order.
25It was noted that the decision in Jorgensen had recently been cited with approval by Connock J in Mitrov Homes Pty Ltd v Mustafa (No 2).[3]
[3] [2023] VSC 386 at paragraphs [88]-[89]
26The applicant highlighted the Court’s observations in Jorgensen, viz:
“On an application such as this, for relief from the operation of a self-executing order, we think it proper to ask (as Parker LJ put it in Re Jokhai Tea Holdings Ltd) whether ‘the punishment fits the crime’.[4] Given the view we take of the circumstances of the non-compliance, we have concluded that the loss of Mr Jorgensen’s right of appeal would be a disproportionate punishment.”[5]
[4] [1993] 1 All ER 630 at 641
[5] Jorgensen (supra) at paragraph [33]
27As to this, the applicant submitted:
(a)if the Court declines to provide the relief sought, the prejudice to the applicant will be “extreme, as it would result in the dismissal of his application and the forfeiture of his assets, of substantial value”;
(b)conversely, the prejudice to the respondent is “minimal, as, but for litigating the present issue, the non-compliance did not cause any delay or adverse consequence. Insofar as any prejudice has resulted from litigating the non-compliance, the applicant submits that this was caused by the respondent’s insistence on adherence to the…self-executing order, in circumstances where consenting to a four-minute extension of time would have ended the issue”;
(c)the fact that the breach was only of four minutes’ duration demonstrates a “bona fide attempt to comply with the … self-executing order, as opposed to a wilful or deliberate disregard, or indifference, to the order”; and
(d)given that the non-compliance was of only four minutes’ duration, striking out the applicant’s exclusion application “is disproportionate to the non-compliance. It is a punishment that simply does not fit the crime.”
The respondent
28The respondent submitted that the Court does not have the jurisdiction, legal authority or power to make the orders sought by the applicant.
29The respondent relied upon the arguments which had been articulated in the submission filed on 27 May 2024, namely that by operation of the self-executing order, with effect from 4.00.01pm on 22 May 2024:
(a)the applicant’s application pursuant to s20 of the Act, was automatically struck out;
(b)by reason of this fact, pursuant to s35(2)(b) of the Act, the property the subject of the RO, was automatically forfeited to the Minister;
(c)in those circumstances:
(i)there is no longer any RO in operation in respect of the property;
(ii)the property has automatically vested in the Minister;
(iii)the only procedure now available in respect of the property is to seek exclusion from forfeiture under s51(1) of the Act. However, this relief is not available to the respondent, who was the accused in respect of the property restrained by the RO;
(iv)no order can be made by the Court pursuant to s20 of the Act, as there is no RO in existence; and
(v)“there could be no occasion to exercise the power”[6] either to extend the time fixed for compliance with the self-executing order, or otherwise set aside the self-executing order, to enable the applicant to file his affidavit material.
[6]Director of Public Prosecutions v Nguyen; Director of Public Prosecutions v Duncan (2009) 23 VR 66 at 89 (“Nguyen and Duncan”)
30In a further submission dated 31 July 2024, it was submitted that the matters set out above –
“… go to the jurisdiction (and the lack thereof) of the Court and cannot be circumvented by s 49 of the CC Act. This is because the very subject matter of the proceeding has ceased to exist because there is no longer any property the subject of a restraining order as the property has been automatically forfeited to the Minister.”
(emphasis in original)
31The respondent relied upon the observations of the Court of Appeal in Nguyen and Duncan,[7] viz:
“… An exclusion order under s 22 is an order ‘excluding the applicant’s interest in the property from the operation of the restraining order’. Once property has been automatically forfeited under s 35(1), there is no longer any restraining order in operation in respect of the property. It follows that no exclusion order could be made under s 22 and, hence, there could be no occasion to exercise the power under s 20(1B) to extend the time for making application for such an order.
After forfeiture, the only procedure for seeking an exclusion order is that provided by s 51(1). That procedure is available only to a person other than the defendant. … .”
(emphasis added)
[7] Ibid, per Maxwell P, Weinberg JA and Kyrou AJA, at paragraphs [117]-[118]
32The respondent submitted that by reason of the automatic forfeiture of the restrained property under the Act, the Court has no jurisdiction to deal with the matter any further, whether by s49 or otherwise. That is because those powers only apply to matters “within [the Court’s] jurisdiction”.
33In oral submissions, counsel reiterated this argument and made the following additional submissions:
(a) one of the purposes of the Act, as set out in s1B, is to provide for automatic forfeiture of restrained property;
(b) restrained property may be forfeited under the Act in a number of ways, including if an application under s20 of the Act is struck out;
(c) once forfeited, the subject property vests in the Minister;
(d) pursuant to s47(1A) and s51 of the Act, automatic forfeiture of property can only be discharged if the conviction underpinning the forfeiture process is subsequently set aside, or if a person other than the accused, who claims to have an interest in the property, applies to the Court. It was common ground that neither of these circumstances has occurred;
(e) by operation of s133 of the Act, while proceedings under the Act are civil in nature, the rules regulating the practice and procedure of a civil court do not apply to proceedings under the Act;
(f) the incidental powers under s49 of the County Court Act1958 are not caught by the operation of s133; however, those powers exist only to give the County Court the power to operate within its statutory jurisdiction;
(g) the Second Reading Speech discussing the insertion of s35 and s35(2A) of the Act, is relevant to the issue which arises in this case. An extract from that document was provided to the Court, and relevantly provides:[8]
[8]See extract from Victoria, Parliamentary Debates (Hansard), Legislative Assembly, 30 October 2013, Justice Legislation Amendment (Miscellaneous) Bill 2013, 3674, Hon R W Clark, Attorney-General, Minister for Finance and Minister for Industrial Relations
“The act provides for the restraint and forfeiture of property in a range of circumstances, including automatic forfeiture of property following conviction for specified serious offences …
…
This is a complex process, and occurs subject to rules in the act which set out when a person may apply for an exclusion order; and when property finally vests in the minister and may be disposed of.
… .”
However, during submissions, it was acknowledged that the document also states:
“In many cases, property … may not be entirely attributable to the proceeds of crime. The act recognises this, and allows for exclusion orders that allow the court to rule on whether some or all of the property should be retained by the offender … These orders, when granted, may allow specified property to be excluded from restraint or … forfeiture … One of the rules in the act is that property may not be forfeited to the minister until any applications for exclusion orders are dealt with … .”
(h) to make an order in this matter extending the time for compliance with the self-executing order nunc pro tunc, would be to disrupt the automatic forfeiture process, thereby frustrating the operation of the confiscation regimen and parliamentary intention embodied in the Act. That is because the effect of such an order would be to divest the Crown of a proprietary right which has already vested in it. There is no substantive remedy that the Court could order if the orders were stayed, set aside, or the time was extended or the application for exclusion from forfeiture was reinstated;
(i) the circumstances which underpinned the decision in Lawstrane,[9] effectively corrected a procedural irregularity. This case is not similar, because the remedy sought is not directed toward a matter of procedure or process. What is sought is to unwind automatic forfeiture in an impermissible manner;
(j) the Court must adopt a two-step process in considering this matter. First, the Court must be satisfied, contrary to the respondent’s submissions, that it does have jurisdiction to deal with the application. It is only if the question which underpins this first step is answered in the affirmative, that the Court would then proceed to consider the issues set out in Jorgensen.[10]
(k) as to those factors, in this matter, it was submitted that:
(i)the applicant did not act reasonably in prosecuting his case;
(ii)his conduct viewed as a whole, involved a total disregard of the Court’s previous timetabling orders;
(iii)the delay did not involve circumstances beyond the applicant’s control;
(iv)the applicant was represented by solicitors at the time that the self-executing orders were made by consent; and
(v)the applicant did not seek an extension of time prior to the day of the late filing of material.
[9] Supra
[10] Supra
34The respondent’s submission concluded by observing that the applicant’s submissions “overlooks the thrust of the Director’s argument, that is at 4.01 pm on 22 May 2024 the property previously restrained by a restraining order was irreversibly forfeited to the Minister. As a consequence there is no substantive remedy that the Court could order even if the Self-Executing Orders were set aside (or time for compliance was extended) and the Exclusion Application was re-instated.”
35The respondent also relied upon the decision in Dinh & Ors v DPP,[11] a decision of Judge Dyer of the County Court, where his Honour held:
“On that basis once automatic forfeiture has occurred and the property previously restrained forfeited to the Minister in accordance with s 35 of the Act, there can be no basis upon which the present application could be granted. Following forfeiture there is no longer a restraining order in existence. Even if the self-executing order relating to the exclusion application was retrospectively extended in time, it could be of no effect as the restraining order to which it had previously related had lapsed once the property had been forfeited in accordance with s 35 of the Act.”[12]
[11] Unreported, VCC, 11 November 2022, per Judge Dyer at paragraphs [28]-[34]
[12] Ibid at paragraph [32]
36It was submitted that while the doctrine of stare decisis does not compel the conclusion that a judge must always follow a decision of another judge of the same court, as a matter of judicial comity, such a decision should be followed unless it is considered to be clearly wrong.[13]
[13]La Macchia v Minister for Primary Industries and Energy (1992) 110 ALR 201 at 204; Valentine v Eid (1992) 27 NSWLR 615 at 621-622
Analysis
Does the Court have jurisdiction to extend the time for compliance with the self-executing order?
37Having considered all of the relevant written material including the applicable case law, and heard the oral arguments of both counsel, I am satisfied that by virtue of the operation of s49 of the County Court Act, the County Court has the power to make an order extending the time for compliance with the self-executing order nunc pro tunc.
38In reaching this conclusion, I have had regard to the observations of Redlich JA and Davies AJA in Lawstrane,[14] citing with approval the observations of Weinberg J (as he then was) in P Aker Flowerbulbs Ltd v Coulter,[15] where his Honour observed that s49 of the County Court Act “conferred jurisdiction upon the court in civil matters in the broadest of terms. Section 49 of the County Court Act gives the County Court the power to make any order in civil proceedings that can be made by the Supreme Court in a like case … .”[16]
[14] Supra
[15] (2005) 212 ALR 606 at paragraph [33]
[16] Lawstrane (supra) at paragraph [16]
39Extrapolating from the observations of his Honour in that decision, I am satisfied that as the Supreme Court undoubtedly has “a wide discretion to relieve a party of the consequences of non-compliance with a self-executing order”,[17] s49 operates to confer that same power on the County Court. It should also be noted that it is not in dispute that this Court had the power to make the self-executing order in question.[18] In light of the provisions of s49 and the powers of the Supreme Court, I am satisfied that I also have the power to deal with the self-executing order and the consequences of non-compliance with it.
[17] Jorgensen (supra) at paragraph [9]
[18] TT44-45
40It is not to the point that the order in question affects the subject-matter governed by the Act. I do not accept the submission advanced on behalf of the Director that to make such an order would involve an impermissible interference with the confiscation regimen, or proprietary rights which have vested in the Minister.
41As can be observed from a reading of the extract from the Second Reading Speech referred to by counsel for the respondent, the confiscation regimen as contemplated by the Parliament, involves ensuring not only that forfeiture of property including automatic forfeiture, takes place in appropriate cases, but also that such forfeiture does not occur until any properly brought applications for exclusion from forfeiture, are dealt with.
42Further, I am satisfied that extending the time for compliance with the self-executing order nunc pro tunc will not have the effect of interfering with property rights which have already vested in the Minister, because the effect of the order will be to extend the time for compliance with the order, as if that had been done from the outset. In those circumstances, the effect of the order is that the right to the property has not yet vested in the Minister.
43In all other respects, the confiscation regimen will take its course, with an outcome involving automatic forfeiture of the property being one of a number of possible outcomes of the proceeding.
44I have given careful consideration to the decision of Judge Dyer in Dinh & Ors.[19] In particular, I have analysed his Honour’s observations and conclusions in light of the matters set out above and have taken note of the differences in the submissions and case law that were relied upon in that case, compared with the way in which matters have been put before this Court.
[19] Supra
45I note that while his Honour’s decision is persuasive, I am not bound by it. In those circumstances, given the conclusions I have reached above, I must respectfully disagree with his Honour’s decision and I decline to follow it in this case.
Should the time for compliance with the self-executing order be extended in this case?
46Having concluded that the Court does have the power to extend the time for compliance with the self-executing order nunc pro tunc, the second question for consideration is whether the time for compliance with the self-executing order should be extended as proposed. In order to reach a conclusion in relation to this matter, I must consider each of the factors set out in Jorgensen,[20] which have been referred to above.
[20] Supra
47As to this, I have taken into account the submissions made by each party. I have taken into account the fact that the self-executing order arose out of the applicant’s continuing non-compliance with Court orders for the filing of material prior to that time. In all of the circumstances however, and noting that the governing consideration, as in every aspect of practice and procedure, is what justice requires, I prefer and accept each of the submissions made by the applicant in relation to this matter, viz:
(a) by reason of the operation of the Act, the prejudice to the applicant will be “extreme” if the time for compliance with the order is not extended, as it would result in the dismissal of his application and the forfeiture of his assets which are of substantial value;
(b) conversely, the prejudice to the respondent is “minimal”, especially where the non-compliance has not caused extensive delay or adverse consequence to the respondent. I note that no submission to the contrary was put by counsel for the respondent;
(c) the fact that the breach was only of four minutes’ duration demonstrates a “bona fide attempt to comply with the … self-executing order, as opposed to a wilful or deliberate disregard or indifference to the order”; and
(d) in those circumstances, to allow the applicant’s exclusion application to be struck out, “is disproportionate to the non-compliance” and is “a punishment that simply does not fit the crime”.
48In those circumstances, I have reached the conclusion that justice requires that relief be given in respect of the non-compliance with the self-executing order, in the form of an order extending the time for compliance with it nunc pro tunc, to 5.00pm on 22 May 2024.
Conclusion and Orders
49Given the conclusions set out above, I will make the following Orders:
1. The time by which the applicant is to file and serve affidavit material in support of his application for an exclusion order, as set out in the Orders of Judge Hinchey made on 14 March 2024, be extended nunc pro tunc, to 5.00pm on 22 May 2024.
50I will hear the parties on the question of costs.
- - -
0
7
0