Soong v Commonwealth Director of Public Prosecutions

[2009] NSWSC 422

CITATION:	Soong v Commonwealth Director of Public Prosecutions [2009] NSWSC 422
HEARING DATE(S):	12/03/08-13/03/08.
JUDGMENT DATE :	21 May 2009
JUDGMENT OF:	Hidden J
DECISION:	Leave to appeal refused
CATCHWORDS:	CRIMINAL LAW - appeal from interlocutory decision of magistrate - application for permanent stay of proceedings refused - issues of double jeopardy, delay and health - no error of law
LEGISLATION CITED:	Income Tax Assessment Act 1936 (Cth) Taxation Administration Act 1958 (Cth) Crimes (Appeal and Review) Act 2001 Crimes Act 1914 (Cth) Criminal Procedure Act 1986
CASES CITED:	The Queen v Carroll [2002] HCA 55, 213 CLR 635 Pearce v The Queen (1998) 194 CLR 610 Jago v District Court (NSW) 1989 168 CLR 23
PARTIES:	James Soong (plaintiff) Commonwealth Director of Public Prosecutions (defendant)
FILE NUMBER(S):	SC 2007/14675
COUNSEL:	J Mendel (plaintiff) M Bracks (defendant)
SOLICITORS:	V Cassimaty J Zaki (CDPP)
LOWER COURT JURISDICTION:	Local Court
LOWER COURT JUDICIAL OFFICER :	Bartley LCM
LOWER COURT DATE OF DECISION:	20 August 2007

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

HIDDEN J

21 May 2009

2007/14675 James Soong v
Commonwealth Director of
Public Prosecutions

JUDGMENT

1 HIS HONOUR: Proceedings are in train in the Local Court against the plaintiff, James Soong, who faces 34 summary charges under s221F(14) of the Income Tax Assessment Act 1936 and s8Y of the Taxation Administration Act 1958 that he was concerned in the management of two companies which failed to remit PAYE tax instalments to the Commissioner of Taxation. His application to that Court for a permanent stay of proceedings was refused by Magistrate Bartley. He seeks leave to appeal against that decision under s53(3)(b) of the Crimes (Appeal and Review) Act 2001. That provision empowers this Court to entertain an appeal by leave against an interlocutory order made by the Local Court, but only on a ground involving a question of law alone.

2 The offences are alleged to have been committed over a three year period between 1995 and 1998. At relevant times Mr Soong was a director of the two companies involved, Concrete Formwork Pty Ltd and Build-Form Pty Ltd. Those companies were part of the Fyna group of companies, of which the applicant was the managing director. The business of those companies was supplying formwork for construction. The total of the tax instalments involved is almost $7.5 million .

3 It is necessary to sketch the history of the proceedings. Between mid 1998 and early 1999, the Australian Taxation Office (ATO) conducted an audit of the Fyna group, during which company records were produced and meetings took place with Mr Soong and the group’s in-house accountant, Edward Pearce. The investigation uncovered evidence that money deducted from employees’ wages which should have been remitted to the ATO had been used for purposes relating to other corporate commitments of Mr Soong. On 23 February 1999 the Australian Federal Police executed a number of search warrants, seizing relevant records, and on the same day both Mr Soong and Mr Pearce were arrested.

4 Both men were charged with three counts of defrauding the Commonwealth, under s29D of the Crimes Act 1914. In August of that year, after an assessment of the sufficiency of the evidence against Mr Soong to support those charges, the Director of Public Prosecutions decided that they should be withdrawn because of a deficiency in the evidence which need not be examined for present purposes. On 25 August the Director was granted leave in the Local Court to withdraw the charges. Mr Soong, who was represented on that occasion, did not oppose that course. However, the prosecution of Mr Pearce for the three charges proceeded, and towards the end of 2000 he was found guilty of them and sentenced to a term of imprisonment.

5 Early in 2001 the Director commenced a review of the available evidence to determine whether there might be a basis to lay further charges against Mr Soong. Additional material was received from the Federal Police but, more significantly, on 2 May 2002 Mr Pearce contacted the police and offered to provide information to assist them in the investigation. On 24 November 2002 he took part in a lengthy recorded conversation with the case officer, federal agent Moerman. A transcript of that conversation was furnished to the Director in January 2003. In the light of the information provided by Mr Pearce, and after an examination of documents referred to by him, the case against Mr Soong was re-assessed.

6 In the result, approval was given on 30 July 2003 to launch the prosecution of Mr Soong for one offence under s29D of the Crimes Act, alleging his defrauding the Commonwealth by concealing PAYE deductions of employees of another company of the Fyna group, Noxequin Pty Ltd, and for the 34 charges the subject of these proceedings. Those summary charges arose from the conduct giving rise to the earlier charges under s29D which had been withdrawn. Court attendance notices in respect of all these charges were served upon Mr Soong on 26 August 2003. It is the Director’s case that the evidence available from Mr Pearce was an important factor in the decision to bring these new charges.

7 The brief relating to the charges was served in mid October 2003. At the end of July 2004 Mr Soong was committed for trial in respect of the s29D offence. The summary charges were placed on a certificate under s166 of the Criminal Procedure Act 1986 as related offences, to be dealt with by the trial judge at the end of the trial. The trial took place over several weeks between April and May 2005, but the jury was unable to reach a unanimous verdict.

8 There then ensued negotiations about the disposition of the outstanding matters. Initially, Mr Soong offered to plead guilty to a charge of imposition on the Commonwealth under s29B of the Crimes Act for the Noxequin matter, in place of the s29D charge, if the summary charges were withdrawn. The Director was prepared to accept the plea to a s29B charge but not to withdraw the summary charges. Mr Soong was not prepared to enter pleas to the summary charges until the indictable matter was resolved. In the event, the plea of guilty to the s29B charge proceeded in the District Court, but the Director obtained an order that the summary matters be remitted to the Local Court.

9 The charge under s29B was an attempt to impose upon the Commonwealth by an untrue representation that there was no company other than Build-Form Pty Ltd in the Fyna group that should be remitting PAYE tax. The focus of the charge was the concealment of the fact that PAYE tax instalments amounting a little over $475,000 had been deducted from the wages of Noxequin employees but not remitted to the ATO. The plea was entered before Tupman DCJ, and her Honour sentenced Mr Soong to a term of imprisonment for 9 months which was suspended under s20(1)(b) of the Crimes Act. It will be necessary to examine these sentence proceedings further, because they lie at the heart of some of the grounds of the present application.

10 In December 2006 the summary matters were listed for hearing in the Local Court for five days, commencing on 14 May 2007. In the event, those days were occupied by the application for a permanent stay. Magistrate Bartley’s judgment refusing that application was delivered on 20 August 2007. This outline of the proceedings omits a number of intermediate steps, including adjournments, set out in detailed chronologies provided to his Honour by both parties.

The application

11 The application in the Local Court was founded upon a considerable body of evidence, and it is apparent from his Honour’s reasons that there was extensive reference to authority. Before me also the evidence was canvassed in some detail and a number of authorities were relied upon. In the event, while acknowledging the thoroughness of the submissions of counsel for Mr Soong, the matter can be dealt with relatively briefly.

12 In the Local Court the application had been founded upon the following propositions:

(a) Mr Soong had been placed in double jeopardy;
(b) he had been harassed by multiple prosecutions;
(c) the delay in proceedings was oppressive and prejudicial to him; and
(d) the state of his health was such that the prosecution should not proceed.

13 The application in this Court asserts that his Honour erred in law in his approach to the matter generally and failed to give adequate reasons for his decision. An amended summons sets out 11 specific grounds of the application, one of them particularising 16 complaints about his Honour’s reasoning. It is unnecessary to set out all these grounds. In effect, they are themselves particulars of broader complaints about the manner in which his Honour dealt with the four bases of the application. It is in that way that I approach the matter. Put shortly, what was argued on Mr Soong’s behalf was that it was not open to his Honour to have rejected each of those bases as he did.

Double jeopardy / multiple prosecutions

14 These aspects of the application are related and can be dealt with together. This is not the occasion to examine the notion of double jeopardy, including the different senses in which that expression might be used, in modern Australian law. Those issues were canvassed in The Queen v Carroll [2002] HCA 55, 213 CLR 635. Relevantly for present purposes, Gleeson CJ and Hayne J at [9] cited a passage in the joint judgment in Pearce v The Queen (1998) 194 CLR 610, also at [9], in which their Honours referred to the use of the expression to “encompass what is said to be a wider principle that no one should be ‘punished again for the same matter’…”. Similarly, in Carroll, Gaudron and Gummow JJ at [86], translating a familiar Latin maxim, referred to “the interest of the individual in not being twice vexed for one and the same cause.”

15 The argument for Mr Soong was that the pursuit of the summary charges was effectively to try him a second time for criminality substantially the same as that which had already been dealt with. Of course, as his Honour noted, no issue of that kind arose from the withdrawal of the original charges under s29D of the Crimes Act, and before me counsel for Mr Soong made no such submission. The focus of the argument was the sentence proceedings before Judge Tupman.

16 As I have said, the charge to which Mr Soong pleaded guilty before her Honour centred upon the concealment of Noxequin’s liability to remit PAYE deductions to the ATO. Nevertheless, an agreed statement of facts revealed that the charge arose from the wider ranging investigation which I have recounted and was said to be part of a more extensive pattern of offending. Her Honour was aware of Mr Soong’s arrest in February 1999, the charges which were then laid against him, and the subsequent history leading to the outstanding summary charges.

17 As I understand it, the argument was that her Honour had regard to the whole of the criminality exposed by the investigation in dealing with Mr Soong for the matter before her. This was said to be evident from her remarks on sentence and from some exchanges with counsel in hearing submissions on sentence. A fair reading of that material, however, does not support that proposition. It is clear that her Honour treated the evidence of the overall investigation and of the other charges laid merely as background material.

18 When that history was raised in the course of submissions on sentence, counsel for the Director drew a clear distinction between the charges initially laid and that with which her Honour was dealing, while acknowledging that they involved conduct of a similar kind. Nothing in her Honour’s exchanges with counsel then appearing for Mr Soong suggests that she was not mindful of that distinction. More importantly, her Honour’s remarks admit of no doubt that her focus was on the particular charge to which Mr Soong had pleaded guilty. Among other things, she said:

On 15 January 1999, during an audit meeting, when asked by ATO officers questions about the group tax liability of the FYNA Group, the offender falsely denied that there was any other company than Build Form Pty Limited within the Group which should be remitting PAYE tax. He knew that to be false because he was aware of the activities of Noxequin during the immediately preceding period.
That is the subject matter of the false representation and the subject of the charge before me.
…
So far as this matter is concerned, as actually brought before me, it is one count amounting to a representation made on one occasion almost eight years ago that there were no other companies liable to remit group tax. This representation had the effect of concealing the liability to remit almost half a million dollars in collected PAYE tax and the benefit sought by the offender was that he would have access to the funds for the purposes of his own businesses to allow them to continue.

19 I might add that the lenient sentence which her Honour imposed puts paid to any suggestion that she had regard to a wider pattern of criminality. One of the factors contributing to that leniency was the delay in the matter being finalised and, to some extent, that was the context in which her Honour referred to the history of the proceedings as a whole since Mr Soong’s arrest. The charges with which I am concerned, although of a nature broadly similar to the Noxequin charge, are clearly directed at distinct criminality relating to two other companies in the Fyna group.

20 In his judgment Magistrate Bartley correctly observed:

The thirty-four charges do not amount to litigation afresh of matters already judicially determined.
No issue of criminal liability arising in the thirty-four charges has already been disposed of. The accused is not being twice vexed in the same cause.
More broadly, in all the circumstances, the thirty-four charges are not unwarranted harassment of the accused by multiple prosecutions.

21 No error has been shown in his Honour’s approach to this aspect of the application.

Delay

22 I have dealt with the grounds of the application relating to double jeopardy and multiple prosecutions on their merits, even though it is questionable whether they raise a question of law. The remaining grounds of the application certainly do not. Under the guise of the assertion that certain findings of fact were not open to his Honour, they are really a critique of his assessment of the evidence and the inferences he drew from it.

23 On the issue of delay, the focus of the argument was the period between August 1999, when the original charges under s29D were withdrawn, and August 2003, when the prosecution was re-commenced with the fresh charge under s29D and the summary charges. The progress of the matter thereafter was protracted for reasons which are apparent from my sketch of its history, but it was otherwise unremarkable.

24 His Honour accepted that it was mainly the availability of the evidence of Mr Pearce which led to the revival of the prosecution and that the period preceding it, to adopt the expression used in written submissions for the Director, “was not characterised by investigative or prosecutorial neglect.” The Director had limited notice of the application in the Local Court for a stay and the basis of it, and relied upon the evidence of the solicitor then handling the matter, Ms Karen Wildermoth. She came into the matter late in 2004, and did not have carriage of it at the time the fresh charges were laid. Her evidence was based upon an analysis of the Director’s file, and his Honour found her to be an impressive witness.

25 Her review of the Director’s records supported the conclusion that the decision to re-launch the prosecution was substantially based upon the evidence available from Mr Pearce. There was a conflict between her evidence and that of federal agent Moerman, whose evidence called into question the value of Mr Pearce as a witness. For Mr Soong it was contended that the Director was preparing to recommence the proceedings by May 2002 before Mr Pearce came forward with an offer to assist. Mr Soong’s position was that the evidence of Ms Wildermoth should not have been preferred over that of the federal police officer who had been involved in the investigation, noting that the solicitor who had had carriage of the case at the relevant time, Ms Ann Gordon, had not been called.

26 It was for his Honour to assess this evidence. It was not reasonable to expect the Director to call any solicitor earlier involved in the matter, given the late notice of the application and the basis for it. His Honour found that federal agent Moerman had “vacillated about the value of Mr Pearce as a witness.” He concluded that, while the Director was “moving towards charging” Mr Soong with some further offences having regard to additional evidence other than that of Mr Pearce, it was ultimately Mr Pearce’s evidence which “was the most important of the fresh evidence that justified prosecuting and maintaining” the new charges. That was a conclusion open to his Honour.

27 Further, his Honour found that Mr Soong had not been prejudiced by the delay in conducting his defence of the summary charges. He had been on notice of the allegations since his arrest in 1999, and the evidence against him was primarily documentary. This finding also was clearly open.

28 No purpose would be served by a more detailed analysis of the arguments put on behalf of Mr Soong on this aspect of the application. It is sufficient to say that they amount to no more than criticisms of his Honour’s fact finding and reasoning, and raise no question of law.

Health

29 There was evidence before his Honour that Mr Soong had a history of heart disease, and had undergone a bypass operation in October 2000. He suffered from other conditions, including moderate hyperglycaemia. In late April 2007, not long before the hearing of the stay application in the Local Court, he attended upon his general practitioner, Dr Leung, complaining of intermittent chest pain and palpitation, together with loss of appetite, anxiety and depressive moods. His Honour had before him reports of Dr Leung, who also gave oral evidence, as well as reports of a cardiologist, Dr NC Patel, and a diabetic specialist, Professor Denis Yue. Of primary significance was Dr Leung’s observation that, while the cause of the chest pain and palpitation was unclear, he felt that the combination of the presenting symptoms was likely to be related, directly or indirectly, to the court proceedings. He reported that further psychological stress would “definitely increase the risk of a another cardiac event which may potentially be fatal.”

30 His Honour found no support for that proposition in the reports of Dr Patel, and concluded that Dr Leung had put Mr Soong’s medical case “at, and somewhat beyond, its highest.” The complaint in this Court is that there was no medical evidence contradicting that of Dr Leung. In particular, although earlier medical reports had put the Director on notice of Mr Soong’s medical problems, the Director did not seek to have him medically examined and did not tender any medical evidence. Again, given the short notice the Director had of the stay application, it was unreasonable to suggest that the prosecution should have done. In any event, the evidence of Dr Leung was that in earlier years Mr Soong’s condition had stabilised and, at least since 2003, had been managed by prescribed drugs. In all the circumstances, his Honour was not bound to accept Dr Leung’s evidence of the possible consequences of the continued court proceedings and, yet again, that conclusion was open to him.

31 This complaint also raises no question of law.

32 Generally, his Honour's task was to exercise a discretion through the balance of competing considerations (in which he expressly included the evidence of Mr Soong’s medical conditions). One of those considerations was the undoubted seriousness of the charges and the public interest in their prosecution. His judgment demonstrates a careful examination of the evidence in that process, and the ground that he failed to give adequate reasons for his decision is without substance. It is not to be forgotten that the power of a court to stay a criminal prosecution will be used only in most exceptional circumstances: Jago v District Court (NSW) 1989 168 CLR 23, per Mason CJ at 31. Put shortly, Mr Soong failed to persuade his Honour that there were such circumstances in this case.

33 No error of law has been established. Accordingly, leave to appeal is refused.

34 Before parting with the matter, I should record that it is tinged with sadness. There was a period after judgment was reserved in which further material was sent to me which, if necessary, might have been the subject of further submissions. I received that material but, in the event, did not find further submissions necessary. During that period counsel for Mr Soong, Julius Mendel, suffered a serious illness. I am pleased to learn that he has since recovered. Tragically, however, during the same period counsel for the Director, Matthew Bracks, died. I can do no more than express my appreciation of the assistance of both of them in this matter.

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