Spies v The Queen

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S263 of 1999

B e t w e e n -
PETER MANNERY SPIES
Appellant
and
THE QUEEN
Respondent

GAUDRON J
McHUGH J
GUMMOW J
HAYNE J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 11 APRIL 2000, AT 11.07 AM

MR P. MENZIES, QC: If your Honours please, I appear with my learned friend, MR C.J. BEVAN, for the appellant. (instructed by Clinch Neville Long)

MR P. ROBERTS, SC: If the Court pleases, I appear with my learned friend, MR M.A.WIGNEY, for the Crown. (instructed by the Director of Public Prosecutions)

GAUDRON J: Yes, Mr Menzies.

MR MENZIES: Your Honour, there was one formal matter which I must attend to before opening the appeal. At page 1099 which is in the fifth volume of the appeal book appears a proposed amended notice of appeal. At 1089 appears a notice of motion upon which we need to move. We move on the affidavit in support of that notice of motion of Peter Allan Rowlands Clinch which was sworn 7 March and that appears at page 1091.

GAUDRON J: Yes. Now, is the amendment opposed?

MR ROBERTS: Yes, it is, your Honours. We do not consent to the amended notice of appeal being filed, the reason being the amended notice of appeal or the grounds that appear, appear to be different from the original and the special ‑ ‑ ‑

GAUDRON J: Are they different?

MR ROBERTS: In so far as we understand them, yes, and the special leave point that was said to arise in this matter seems to have disappeared into nothingness and, for that reason, we oppose the grant of ‑ ‑ ‑

GUMMOW J: What was the special leave point?

MR ROBERTS: That is a very good question, your Honour.

GAUDRON J: There was a general grant of special leave, though, was there not?

GUMMOW J: There was no condition, was there?

MR ROBERTS: There were no conditions on it, no.

GAUDRON J: And you have had notice of this amendment for some time?

MR ROBERTS: That is so.

GAUDRON J: And do the points squarely arise on the judgment of the Court of Criminal Appeal?

MR ROBERTS: A lot of the matters that are said to arise do not, because they were not matters that were found by the Court of Criminal Appeal.

GAUDRON J: No, because the Court of Criminal Appeal made a particular order.

MR ROBERTS: Some of these grounds, as we understand them, are said to be findings or holdings that were made by the Court of Criminal Appeal, and they were not, in so far as we understand some of these grounds. It is very difficult to understand some of the matters that are raised, indeed, any of them.

GAUDRON J: Which grounds of appeal do you not understand?

MR ROBERTS: Your Honours, probably we could say that, in so far as we understand them, they do not seem to reflect matters that were or not held by the Court of Criminal Appeal. A good example is ground 3 in the new notice of appeal. I am sorry, we find it very difficult ‑ ‑ ‑

GAUDRON J: Now do you understand the ground of appeal?

MR ROBERTS: No.

GAUDRON J: Well, I do.

MR ROBERTS: Perhaps it is my fault, your Honour, that I do not understand it, but ‑ ‑ ‑

GUMMOW J: Well, yes, I think I follow it.

MR ROBERTS: Your Honour, it is probably my fault then. I do not understand it, your Honour. So perhaps ‑ ‑ ‑

GAUDRON J: Do you say you are prejudiced?

MR ROBERTS: No, not at all.

GAUDRON J: You are not prejudiced of this?

MR ROBERTS: No. I am not prejudiced at all, your Honour.

GAUDRON J: If you are not prejudiced, Mr Roberts, there seems to be no reason why the motion should not be allowed to proceed on the ‑ ‑ ‑

MR ROBERTS: If your Honours please.

GUMMOW J: Mr Menzies will make it all clear, Mr Roberts.

MR ROBERTS: I have no doubt, your Honour, no doubt at all.

GAUDRON J: - - - notice of appeal. It is at page 1093 and following, is it?

MR MENZIES: At 1099, it is.

GAUDRON J: Page 1099, yes. Your submissions should make it clear to Mr Roberts what is being put.

MR MENZIES: Hopefully, your Honour. The essential question for this Court on the appeal and, in our respectful submission, a relatively simple one, is when the jury found the appellant guilty of defrauding the creditors of Duty Free, must it have been satisfied of facts which prove the appellant guilty of the offence of making improper use of his position as a director to gain directly an advantage for himself by causing Duty Free to purchase shares in the other company which we have described as Holdings.

GAUDRON J: Does that raise a factual analysis or does it relate to the elements of the offence as such – that section?

MR MENZIES: Section 7(2) of the Criminal Appeal Act raises, for determination, what were the facts that were necessarily found by the jury.

GAUDRON J: Then you do not dissent from the proposition that that requires a factual analysis rather than a legal analysis of the elements of the offence.

MR MENZIES: That is right, your Honour. If the answer to the question is no, then, in our respectful submission, the inevitable result must be either a grant of a new trial or an order for an acquittal. That second question is for later determination but can be determined by your Honours, of course. Now, the trial judge directed the jury to consider the second charge only if it found the appellant not guilty of the first charge and it follows, from a finding of guilt on the first charge, that the facts comprising the second charge, in so far as they were not facts considered in the first charge, were simply not considered at all.

Now, a simply illustration of this is found when one compares the two charges. Leave aside for the moment the issues that there was a difference in the legal test which needed to be applied so far as whether it was a subjective or objective test, and leave aside the question of who it was who was being affected by the actions in each case and the fraud charge being an allegation of defeat of creditors whilst in the second charge, the one which the Court of Criminal Appeal found proved, the issue was acting improperly for the advantage of the director himself.

Leave those matters aside for the moment, and look at the two charges. The charge under section 229(4), which appears at page 1, alleges an:

improper use of his position to gain directly an advantage for himself by causing the Corporation to purchase his shares in Sterling Nicholas Holdings Pty Ltd for $500,000.00 which sum he caused to be credited to his loan account with the Corporation.

Now, that difference was taken up in the Court of Criminal Appeal at – I do not think I need to take your Honours to it at the moment – but it was taken up, the proposition being that the facts needed to be found in the second charge being different to that needed to be found in the first charge. That proposition was rejected upon the basis that that added sentence, or the last words, I should say, the last clauses, “which sum he caused to be credited to his loan account with the Corporation”, was not necessarily - not an element offence, but a particular mechanism by which the offence was committed. But the difference it does make is this: that if the jury, as its conduct indicated, did not turn to consider the 229(4) charge at all, then it did not consider whether the sum of $500,000 was caused to be credited to the loan account with the Corporation.

GAUDRON J: Could I just interrupt you for a moment?

MR MENZIES: Of course, your Honour.

GUMMOW J: I have a recollection of having acted, I think, for Sterling Nicholas Duty Free in some litigation 20 years or so ago, but I cannot remember it actually came to court. I just thought I should draw it the parties’ attention. I do not feel any embarrassment in sitting on this case.

MR MENZIES: It certainly does not embarrass us, your Honour.

GAUDRON J: Mr Roberts, do you wish to say anything?

MR ROBERTS: No, thank you, your Honours.

GAUDRON J: Yes, thank you, Mr Menzies.

MR MENZIES: The reference to where this matter was agitated in the Court of Criminal Appeal appears at page 1081. It is not contained in our written submissions. Chief Justice Spigelman dealt with it at lines 10 to 25. The point we seek to make about that matter is this, that if the jury simply did not consider what happened to the $500,000 in circumstances where it is common ground that there was no actual transfer of funds at that time because there were no funds in the company to acquire the shares, then all that one is left with is a reference to a purchase, but with no reference to the consideration for it, and particularly the consideration moving from Duty Free.

So that if that be so, there is no evidence upon which one could find, on the bare fact of a purchase for $500,000, that there was some benefit, direct or otherwise, to the director, Mr Spies. So that, with respect, illustrates the difficulty that arises when one is dealing with two charges where the factual matrix to prove one is simply not the same as the factual matrix to prove another. The section, and I confess we have not ‑ ‑ ‑

GAUDRON J: However, there was no issue but that the money was in fact credited to his loan account, or set off against other ‑ ‑ ‑

MR MENZIES: That is so, your Honour.

GAUDRON J: Yes. That is perhaps not your strongest point, is it?

MR MENZIES: Not of itself, but there was an issue as to the effect of it and we deal with that later inasmuch as there was evidence on the one hand that Mr Spies’ loan account was in debit, and that was what was relied upon by the Crown, and there was also evidence not dealt with by the trial judge at all, except in the most cursory way, that on a proper analysis his loan account was in fact in credit and if that was the case then, rather than changing his position from a net debtor of the company to a net credit, which is what the Crown asserts, all it did was improve his position as a creditor of the company. It had no practical effect, in the circumstances.

HAYNE J: Just before you leave this point, section 7(2) is engaged, on one reading of it, only where “on the finding of the jury it appears to the court that” certain things must follow.

MR MENZIES: Yes, your Honour.

HAYNE J: What, if any, connection do you draw between the discussion we have just had about this extra element of “cause to be credited” to the loan account and section 7(2)?

MR MENZIES: Well, there could not have been a finding of the jury which dealt with this part of the section 229(4) charge.

HAYNE J: Can section 7(2) have operation in relation to a matter of fact which was not in dispute at trial? Leave aside express concession of a fact, but if evidence was given and uncontradicted, for example that this transaction led to a credit to the loan account, what, if any, significance does that fact have in the operation of section 7(2).

MR MENZIES: If that fact was one which the jury must have found to have convicted on the other offence, then it operates but, if not, it does not.

HAYNE J: The consequence of that seeming to be that at least the chief operation of section 7(2) – I do not say the only operation – the chief operation of 7(2) is in relation to what might be called included offences.

MR MENZIES: Yes, your Honour.

GUMMOW J: Yes. Something that is narrower.

MR MENZIES: Yes, and the ‑ ‑ ‑

GUMMOW J: Wholly contained – relevantly contained within.

MR MENZIES: Yes, your Honour. So that, for example, a person may have been convicted of assault occasioning bodily harm and there was evidence of assault but not evidence of actual bodily harm being occasioned, then it would seem that that is where section 7(2) would then operate, the lesser clearly included in the greater and section 7(2) would then operate. This is not such a case, in our respectful submission. It is not a case of a large box with a smaller box inside but two entirely different sorts of categories.

GUMMOW J: Well, maybe they overlap; maybe they have some elements in common but that would not be enough you say.

MR MENZIES: Yes, your Honour. Yes, perhaps intersecting circles rather than one circle contained in another.

GAUDRON J: Is not the major difficulty of this case that it not having been left to the jury to – or the jury not having been instructed to make findings on the question whether the least would be set aside or perhaps – although that was the way it was termed – would be the subject of a declaration that it was held in trust. One really cannot be sure what findings – well, one cannot be sure to what extent its findings are infected with that error.

MR MENZIES: That is so, your Honour, and that reflects, with respect, the comments of the Chief Justice in the decision which we brought to the attention of Chief Justice Spigelman and that was in a circumstance such as this and, indeed, the one that he was dealing with ‑ ‑ ‑

GUMMOW J: This is Chief Justice Gleeson’s decision?

MR MENZIES: Chief Justice Gleeson’s decision in McQueeny 39 A Crim R. His proposition is really echoed by your Honour Justice Gaudron. It might be useful if I took your Honours to it at 60. Chief Justice Gleeson then obviously sitting as the Chief Justice of New South Wales said at about point 5:

It was submitted to us on behalf of the Crown that this was an appropriate case in which to apply the provision of s 7(2).....There is some force in that submission. However, I would be very reluctant to exercise the power granted by s 7(2) in a case where a jury was given instructions that were so incomplete that it is difficult for an appellate court to be sure what facts they must have regarded as being established beyond reasonable doubt.

That is, with respect, one limb of our complaint; the other being, even leaving aside the inadequacy of the directions, we are dealing with two concepts with respect to the two crimes, which are intersecting circles rather than one within the other.

The Court of Criminal Appeal recognised the difference between the subjective intention, which must be found to prove fraud, and the objective intention, which must be found to prove section 229(4), improper dealings by a director, but appeared to fail to recognise that the fraud charge involved intention to defraud the creditors of the corporation, whilst the improper use of position charge involved a director obtaining a direct advantage to himself. In our respectful submission, it does not follow that the one results in the other. It may do, and in some circumstances it will, but it is not an inevitable consequence. The error which the Court of Criminal Appeal fell into appears at page 1080 at about line 30. Chief Justice Spigelman dealt with the differences - in the preceding pages dealt with the concepts clarified by Chew and Byrnes, then when on to deal with the essence of the offence of 229(4), so far as its mental element was concerned. That appears between lines 15 and 20. It then goes on to say, just after line 30:

If it could be said that the jury’s finding meant that the accused believed that the intended result would be advantageous to him, then it follows that both the mental element in the s 229(4) charge and the improper use of position element in the s 229(4) charge would be satisfied.

Our respectful submission is the proper test is if it can only be said that the jury’s finding, or if it must be said, or if it cannot be expressed in another way, but the way that Chief Justice Spigelman expressed it, if it could be said, does not get over the barrier because he is postulating nothing more than, “This is a circumstance where 229(4) might apply”, but it has to be better than that, in our respectful submission.

GAUDRON J: On one view of this matter you might find that albeit that it was to his disadvantage, he nonetheless still intended to defraud the creditors.

MR MENZIES: Yes, your Honour. We certainly do not submit that, but that is certainly a view that could be taken.

GAUDRON J: Yes, on one view the facts could permit the inference that the appellant put himself in a worse position but he did that so as to advantage the company and defraud the creditors.

MR MENZIES: Yes. That is certainly open, in our submission, on the facts, your Honour.

GUMMOW J: Now, is that the crucial passage in the Court of Criminal Appeal’s treatment of how they get into section 7(2) as it were? Is there any other treatment of the construction of 7(2)? I know it is referred to at 1081.

MR MENZIES: It is referred to, your Honour.

HAYNE J: At lines 46 and following on 1080 his Honour the Chief Justice puts it in terms of finding “must have encompassed a finding”.

MR MENZIES: Yes.

GUMMOW J: You challenge that?

MR MENZIES: Yes, your Honour.

McHUGH J: The difficulty is that the jury could not possibly have made the finding which is set out at line 50 on that page because they had no occasion to consider it. So what it comes to is that the Court of Criminal Appeal itself is making that finding based on what it assumes are facts underlying the conviction on the other charge.

MR MENZIES: That is so, your Honour, rather than simply determining what it was the jury found.

HAYNE J: Does that invite attention to what factual findings the jury must have made?

MR MENZIES: Yes, your Honour.

HAYNE J: I can imagine a case where a set of findings of fact might wear a different legal complexion. The relevant inquiry is what are the findings of fact that they made? What do you say they were on this first charge where they returned the verdict?

MR MENZIES: Obviously, he was a company director and those formal matters would have been found and one takes no issue with that. One then gets into difficulty ‑ ‑ ‑

McHUGH J: Having regard to the summing up and the way the case was put, the jury must have been satisfied beyond reasonable doubt of these matters, must it not, that the transaction was not entered into in good faith, that there was an obligation on the part of the appellant to renew the lease in the name of Sterling Nicholas Duty Free, that the shares in Sterling Nicholas Holdings were valueless and that Sterling Nicholas Duty Free received nothing in return. The question is, it seems to me, as a matter of law, do those facts constitute a 229(4) charge? It seems almost in a different area of discourse.

MR MENZIES: Entirely different area of discourse, your Honour. The other problem that arises with those findings is that they were made – query whether they were entitled to make those findings on the charge because the – the evidence went in at the trial, there was no issue taken with it but the charge was seen to be about one thing, that is, sale of shares, and the whole of the opening.

McHUGH J: Well, that is another part of the problem. I put those things to you because that seemed to be the accused case but it may well be the fact that the jury simply formed the view beyond reasonable doubt that shares were - or the arrangement was entered into for no reason other than to delay or hinder the creditors.

MR MENZIES: Yes, your Honour.

McHUGH J: Which was sufficient to make out the charge on the first count but it tells you nothing at all about the matters in respect of credit in the loan account et cetera, et cetera.

MR MENZIES: Exactly, your Honour.

HAYNE J: And may lead to the further question of what you do with the finding of fact that the transaction was not in good faith when the hypothesis for its consideration is that the jury received insufficient guidance in deciding that kind of issue.

McHUGH J: On the 229 charge, yes.

MR MENZIES: Yes. Of course that was the matter that the Court of Criminal Appeal was astute to recognise very early on so far as the fraud charge was concerned.

McHUGH J: The general view of 7(2) has always been, has it not, that the facts that you determine that the jury has found constitute as a matter of law all the elements of the offence for which you substitute the conviction?

MR MENZIES: Yes, your Honour.

McHUGH J: There is no value judgment on the part of the Court of Criminal Appeal. It says, “Well, the jury found these facts and those facts constitute this offence”.

MR MENZIES: Yes. It is, as I opened it, really, a very simple proposition. If those are the facts and there was another crime which fitted those facts then the appellant could be, I suppose, fitted with that crime but not otherwise. So the exercise the Court of Criminal Appeal is carrying out is making a determination of what were the facts that were found.

McHUGH J: It is strange that the accused was not prosecuted on a separate charge in respect of the lease transaction. It seems to have been used as evidentiary of the intention to defraud.

MR MENZIES: Well, our submission about the lease transaction is that when one looks at it carefully there was nothing wrong with it. There was not a ‑ ‑ ‑

McHUGH J: I do not think that is a submission that a jury would find very appealing, Mr Menzies.

MR MENZIES: Maybe so, your Honour. But on an analysis of the facts, and applying the law to the facts, there is an argument that can be made that supports that proposition. That, of course, leads us to the next proposition, that is, assume in our favour, that the answer is no. Then what does one do with it? Does the matter go back? Do your Honours allow the appeal and order a new trial, or do your Honours enter a verdict for an acquittal? It is our submission that your Honours do the latter. And the basis for that is that when one examines – we deal with it in our written submissions at length – but when one examines, first of all, the lease transaction what appears to have happened is that, in 1986, there was an agreement which was clearly binding upon Duty Free, apparently in exercise of an option. That agreement was never acted upon. Ultimately an agreement, orally, was entered into between the Duty Free and the landlord. That agreement was never reduced to writing. It was reduced to writing, eventually. It was never signed by the appellant, or by a corporation with which the appellant was involved, in our respectful submission, not giving rise to any binding right in Duty Free. What Duty Free had, as the tenant of the premises, was a common law right to continue Holding over on an expired lease on a month‑to‑month lease, but that was the extent of it. And that there was no - contrary to the Crown’s submissions that there was a legal right, our submission is the legal right in Duty Free to obtain a new five year or seven year lease. Our submission is that that ‑ ‑ ‑

GAUDRON J: But where does this take you? On any view there was a fiduciary duty on the part of the director.

MR MENZIES: That is true.

GAUDRON J: Yes, on any view.

MR MENZIES: And what we can say about that is this, your Honour, that so far as Duty Free and Holdings, the other company, was concerned, the transactions that were entered to, ultimately, for Holdings, rather than for Duty Free, was one entered into with the consent of all the directors and all the shareholders.

GAUDRON J: Of?

MR MENZIES: Both companies.

McHUGH J: One director was deceased. Did he give evidence to the trial? Was there full disclosure? It is the Meinhard v Salmon‑type point, is it not? It is not quite itself a partnership, but it is close enough to it, or a joint venture. Your client is there. He is the director of a company which is entitled to renew a lease. Surely his obligation is to obtain that lease for them.

MR MENZIES: Your Honour, there is no doubt concerning that matter that there was an obligation with respect to the renewal of the lease. What we say about it, though, and the circumstances were all the shareholders and all the directors of both companies consented, so that ‑ ‑ ‑

GAUDRON J: Where does that take you? I take it you are putting this on the basis that there should be no order for a retrial, and only on that basis.

MR MENZIES: Yes, your Honour, only on that basis.

GAUDRON J: Mere consent would be nothing, absent full disclosure, would it, absent evidence of full disclosure?

MR MENZIES: Yes, your Honour.

McHUGH J: But it hardly answers the question in relation to the first charge. You seem to want to have your cake and eat it.

MR MENZIES: If we can.

HAYNE J: That is what counsel are paid to do.

McHUGH J: Your arguments are very keen to point out that the lease transaction did not form part of the first charge and now you want to somehow or other rely on that to say, well, you should not stand trial on the first charge, but even if your argument was right about the lease, why was not there enough evidence against your client even on the narrow view you take of the relevant evidence, that is to say, the lease does not come into the first charge at all? Even on that basis, surely, there is a case to go to the jury that he intended to hinder creditors by making himself a creditor rather than a debtor.

MR MENZIES: Our response to that is contained in our written submissions and I do not seek to delay further upon it. Could I take your Honours to simply some – would your Honours just excuse me for a moment.

McHUGH J: I thought you were going to sit down. I thought you had finished your case.

MR MENZIES: I am just about to, your Honour. I just want to draw attention to some errors in the written submissions simply with some reference numbers, and there are about half a dozen of them which I need to draw your Honours’ attention to. The reason for it is this, we accepted the Court’s invitation to bring this matter on at fairly short notice. The result

was that the preparation of the written submissions took place before the appeal books had been completed so that ‑ ‑ ‑

GUMMOW J: There is no need to apologise for anything, I do not think, Mr Menzies. Just tell us what we need to know.

MR MENZIES: Your Honour, in light of experience I felt perhaps I did. What I need to draw your Honours’ attention to are these: at page 2 of our written submissions, paragraph 6, the third last line of paragraph 6, the reference should be 1079.6. Then would your Honours please add on page 8 at paragraph 32 two further references, pages 458 and 456. At page 10, paragraph 39, the second-last reference should be 567 and not 479. Four lines up from the bottom of 39, the first reference, AB468 should be 480. At paragraph 41, the second-last line, the first reference should be 567, not 468. There is an additional reference at paragraph 43 on page 11. After the reference which first appears, that is AB486 in line 3, would your Honours please add 639. Finally, at paragraph 47, would your Honours delete the reference in the last line, 446. Those are our submissions, if your Honours please.

GAUDRON J: Yes, thank you, Mr Menzies. Yes, Mr Roberts.

MR ROBERTS: Your Honours, in paragraph 30 of our written submissions what we have endeavoured to do is to not only find what the jury must have found in order to have convicted the appellant of the fraud charge, but to identify the minimum requirements for a conviction under the section 229(4) charge. So, rather than approaching the matter as to what matters ‑ ‑ ‑

GAUDRON J: But you misstate it, do you not, on the third dot point?

MR ROBERTS: Well, can I go through them one by one?

GAUDRON J: Because, I mean, they could have found that his purpose was to disadvantage himself, but to advantage the company, vis-a-vis the creditors?

MR ROBERTS: No, they could not have, your Honour. Can I go through each ‑ ‑ ‑

GAUDRON J: To find him guilty they could have.

MR ROBERTS: Well, your Honour, can I just go through them one by one? The first matter that he was a director was not at issue, it was part of the element of the first offence and was found. The second matter, that the appellant caused SNDF to purchase from himself all of the shares in Holdings for $500,000, was part of the element of the first charge, was found, was not at issue, was part of the factual matrix, they must have found it. The third matter, which apparently is a matter of some dispute, going in reverse order, firstly the Court of Criminal Appeal at page 1080 of the appeal book in the passage that we have already looked at in the lines that your Honour Justice Hayne drew attention to, at 45 through to 53, was a finding by the court, the other members agreeing with Chief Justice Spigelman that:

the jury on the fraud charge must have encompassed a finding that there was an improper use of position in this sense and that the entire objective of the transaction as to benefit the accused, the now Appellant.

GAUDRON J: Yes, I know that is what the Court of Appeal said ‑ ‑ ‑

MR ROBERTS: I am going in reverse order.

GAUDRON J: ‑ ‑ ‑ but that does not necessarily follow from the jury’s finding, does it?

MR ROBERTS: Can I then go to the summing up, because I am going backwards. The summing up ‑ ‑ ‑

GUMMOW J: Reverse engineering.

MR ROBERTS: Possibly. Hopefully, construction as opposed to deconstruction. But if your Honours look then at the summing up where the fraud matter was put to the jury in these terms, commencing with appeal book volume 2, at page 317 at line 31. This is the direction that the jury was given on the fraud charge:

As to this element of the offence, the Crown invites you to draw an inference from all the surrounding circumstances that the purpose of the sale of the accused’s shares in Sterling Nicholas Holdings to Sterling Nicholas Duty Free was for no reason other than to delay or hinder creditors by making the accused, himself, a creditor rather than a debtor; and I should add not only a creditor but a secured creditor at a time when the accused well knew that the company was about to go into liquidation.

GAUDRON J: Yes, but it does not follow, Mr Roberts, that it was to his advantage to be a secured creditor to the company as distinct from simply selling the Holdings company or his shares in the Holdings company to somebody else, as subsequently happened. He may well have wished to on the jury’s findings and even on that summing up – may well have wished to disadvantage the creditors but it does not necessarily follow that it was to his advantage, notwithstanding that he became a secured creditor. One may well rather have cash in hand than the status of a secured creditor.

MR ROBERTS: But your Honour is not looking, with respect, to the matter at issue which is the sale of the shares, not what happened in the – that is not an element of the charge.

GAUDRON J: Exactly. He could have sold them – that is right. You are assuming that the only person to whom they could be sold was Duty Free.

MR ROBERTS: No, I am not assuming it, your Honour. What I am endeavouring to show is that the third dot point must have been found and encompassed by the jury’s verdict, particularly when one looks at the various passages that I was taking your Honours to ‑ ‑ ‑

GAUDRON J: Well, I do not see it in that passage at 317.

HAYNE J: And how does it sit in any event with the Court of Appeal’s view of the charge reflected at 1078, line 5? The Court of Appeal understood the charge as leaving it open to the jury to convict if:

satisfied as a fact that the shares were not worth anything,

Now, if that is the basis on which the jury may have proceeded, how can you get the third dot point out of the charge?

MR ROBERTS: Well, because the matter that was identified as the error by the Court of Criminal Appeal is irrelevant to the third dot point, which is the minimum requirement for a conviction under section 229(4). It is simply a different matter entirely. It has nothing to do with it.

HAYNE J: Yes, and that seems to me to defeat the argument you advance entirely, the very fact that it is different. How do you get out of the jury’s verdict a finding of fact reflected in the third dot point if the verdict is to be understood in light of the charge that was given?

MR ROBERTS: Your Honours, in the factual matrix of this case where, in effect, there was no issue as to the advantage that would flow and the purpose of the appellant entering into this transaction, the real question was, was it fraudulent or no. It is very difficult to see any other reason for the acquiring of the Holdings’ shares by Duty Free when it is about to go into liquidation.

McHUGH J: But improper use of his position as a director to gain directly an advantage for himself required a judgment on the part of the jury.

MR ROBERTS: Yes, your Honours.

McHUGH J: Now, if the summing up on fraud is defective because the jury were led to believe that the accused could be guilty of that charged, even if he believed there was real value in the shares, how can you say, as a matter of law, that he made an improper use of his position?

MR ROBERTS: Because the value of the shares is not one of the minimum requirements that are ‑ ‑ ‑

McHUGH J: But it may be relevant. His belief may be relevant as to whether he made improper use of his position.

MR ROBERTS: In the circumstances of this case, it was the judgment of the Court of Criminal Appeal that it was not. It is our submission that it was not. Clearly, the jury did not accept that point in any event as to the worth of these shares. They must have found that they were, for all intents and purposes, worthless. The only matter that was advanced by the appellant in this case as being a reason that Duty Free would have entered into this transaction at all is somehow or other to acquire this lease, because there was no purpose in it other than that at all.

If we take away that matter, then clearly those shares are worthless and that is what the jury has found. But we do not need to go into that area to find out the minimum requirements of this charge which is purely the matter of advantaging the appellant by entering this transaction at all.

GAUDRON J: It is an objective test as to improper conduct, is it not?

MR ROBERTS: Improper use of position.

GAUDRON J: Improper use of position.

MR ROBERTS: Yes, your Honour.

GAUDRON J: But is there some intention in to advantage themselves?

MR ROBERTS: That must be the purpose.

GAUDRON J: It must be a subjective purpose or belief. I think it was said to be a belief. It must be done with the belief.

MR ROBERTS: That it would advantage, not that it was advantaged.

GAUDRON J: No, but there must be, at least, a belief that it would be advantaged by that.

MR ROBERTS: Yes, but really in a way, this is the starting point for the whole case. This is the only reason that was ever advanced by anybody that this would advantage him in relation to how the money was to be paid because there was no money there, by changing his position, vis‑a‑vis, the books, making him a creditor instead of a debtor of a company that is about to go into liquidation. It almost beggars belief to think that this transaction could possibly be for anything other than to advantage the appellant and, indeed, no other explanation was ever put or offered and, indeed, has been offered to date other than that ‑ ‑ ‑

GAUDRON J: Well, I can think of its purpose being to delay the creditors without at the same time advantaging the appellant.

MR ROBERTS: But surely they are one of the same thing.

GAUDRON J: No, not at all. Not at all. That seems to me to be the error in all this reasoning. One can set about defrauding people without any belief or intention in advantaging yourself. You could do it to advantage a third party.

MR ROBERTS: That is so, but clearly the only person that was advantaged here, he holding 9,999 shares out of the 10,000 of Holdings, was the appellant, and how that was ‑ ‑ ‑

GAUDRON J: Well, perhaps not, because what he has parted with are shares in a company which had an asset which was subsequently sold for very close to this $500,000 which, on one view, might have produced cash in the hand as it subsequently did.

MR ROBERTS: Your Honour, on 17 October 1989 when Duty Free resolved to buy these shares Holdings was a worthless company that had an excess of liabilities over assets. There was no logical reason whatsoever ‑ ‑ ‑

GAUDRON J: Unless you took into account the lease that was coming into the ‑ ‑ ‑

MR ROBERTS: One could not take into account the lease at that stage, there was no lease on 17 October. The only person who could have been advantaged ‑ ‑ ‑

GUMMOW J: No, it said that there was a prospect of getting it, though, which is a real prospect.

MR ROBERTS: There was a real prospect of getting a lease but it was purely at the option, later on, of the appellant that he decided to put it in the name of Holdings and not Duty Free. This is what was put forward as being the value and the interest that Duty Free had in going into this at all. Clearly, that was rejected by the jury, as it must have been. There could be no possible benefit to the company or advantage. The only person who could have been advantaged by this transaction, and indeed was advantaged by it, was the appellant because it changed his position from that of a debtor to a creditor so that when the company went into liquidation, if those transactions were not set aside, he would be free of recourse from the liquidator. Indeed, the provisional liquidator did take action to seek to set these transaction aside, but because they ran out of money they had to abandon that course. But, your Honour, the real point is there could have been no other reason in this case ‑ ‑ ‑

McHUGH J: But that is your argument, is it not? That what you say is that the jury must have found, given the summing up at page 317 that his only reason for causing the company to purchase the shares for $500,000 was to delay or hinder the creditors, and as a matter of law that constituted an improper use of his position as a director.

MR ROBERTS: Yes, and the concomitant is an advantage to himself, it must have been. That is the short issue, and that is the only matter really in dispute in this. If the Court of Criminal Appeal, if it was open to them to come to that view, and we submit it was, then the appeal must fail. That is the only matter at issue in our submission. If you look carefully at the minimum requirements ‑ ‑ ‑

GAUDRON J: But then, do you not face this further difficulty? Once you say that, it all hinges on the purpose of delaying or hindering creditors and it was the absence of a direction with respect to that very finding that led the Court of Criminal Appeal to set aside the conviction on the first count.

MR ROBERTS: No, the error that they have identified is the failure to direct the jury that if they found that the appellant believed, never mind about what the jury believed, but if they found that the appellant believed that the shares may have been of value, then this was a matter which went to the question of fraud and, in the circumstances of the fraud charge, and the defence, in effect, being, “These shares were value, I thought they were or, at least, that is what is put”, simply did not give evidence ‑ ‑ ‑

GAUDRON J: But would that not carry through?

MR ROBERTS: No, it had nothing to do – sorry ‑ ‑ ‑

GAUDRON J: To the question of advantage.

MR ROBERTS: In our respectful submission, not at all. This is entirely an extraneous matter. It only went to the fraud charge. Well, your Honour shakes your Honour’s head.

GAUDRON J: I just do not understand why you say that. You must be working on the assumption that converting yourself from a debtor to a secured creditor in a company is an advantage regardless of all the other circumstances.

McHUGH J: No, I think that is not quite how you put it though, was it?

MR ROBERTS: No.

McHUGH J: The advantage is not changing from debtor to secured creditor. Your case is that the improper use of the position is to hinder or delay your creditors.

MR ROBERTS: And the key words, “at a time when the accused well knew that the company was about to go into liquidation” – those are the key words.

McHUGH J: Are they his creditors, or are they the company’s creditors? You have a contingent creditor in the background, namely, the bank guarantee, have you not?

MR ROBERTS: Well, they are all, I suppose, contingent creditors, in one sense. The employees, who lost out – all their various benefits ‑ ‑ ‑

McHUGH J: But the charge is he must gain an advantage for himself.

MR ROBERTS: Yes.

McHUGH J: Now, by delaying or hindering the creditors, per se, does not give him an advantage, does it? It gives the company an advantage.

MR ROBERTS: But in the factual position when he was a debtor, yes, it did. He was a debtor of the company.

McHUGH J: Yes. So in a liquidation the company would have an action against him.

MR ROBERTS: Absolutely.

McHUGH J: Yes.

MR ROBERTS: And that obviously must have been found by the jury and this is at the very heart of the conviction of a fraud charge. So what we say is that the third dot ‑ ‑ ‑

McHUGH J: Well, the summing up at 317 is a bit confused, is it not, when it talks about:

to delay or hinder creditors by making the accused, himself –

The only relevant creditor was the company, was it not?

MR ROBERTS: Well, he became a creditor of the company by changing his position in the loan account from that of a debtor to a creditor and then he became a secured creditor because of this equity charge.

McHUGH J: No, but at the time when he entered into this transaction he was a debtor.

MR ROBERTS: That is right.

McHUGH J: And his creditor was the company.

MR ROBERTS: Yes.

McHUGH J: The summing up may be defective at 317 in that it rather tends to throw the focus on the creditors of the company rather than the fact that relevantly the company was his creditor. It would be more accurate to say, would it not, that it was no for reason other than to delay or hinder the company from recovering its debt by making him a creditor rather than a debtor of the company?

MR ROBERTS: Well, it may be more accurate but what we are looking at is not so much a defect in the summing up but what was said and what the jury must have found. Now, whether it was well expressed or ‑ ‑ ‑

McHUGH J: Well, this is what troubles me, Mr Roberts. The jury may have rejected that defence at 317 on the basis that he was hindering the creditors of the company rather than hindering his own creditors – his only creditor.

MR ROBERTS: Well, I suppose to be accurate there are, in fact, two creditors involved in this. One was the bank because it guaranteed the overdraft.

McHUGH J: He did, yes.

MR ROBERTS: Yes, personally.

McHUGH J: So he was a contingent debtor.

MR ROBERTS: To the bank.

McHUGH J: Yes.

MR ROBERTS: And he was a debtor to the company and the purchase of this – what we are going back to is the reason behind the purchase for the shares and the effect of the purchase of the shares, of course, was to change him at least in the company’s books from being a debtor to a creditor. The company owed him money.

McHUGH J: I understand that, but your case really stands or falls on the proposition that the jury accepted what was put at 317. What I am putting to you is that it seems to me so unsatisfactory a direction in respect of those matters that ‑ ‑ ‑

GUMMOW J: It is just more complicated than it appears at 317, as Justice McHugh has been explaining to you. Where do we find all that explanation at 317? That is the problem it seems to me.

MR ROBERTS: What we were looking at was ‑ ‑ ‑

GUMMOW J: We do not, do we?

MR ROBERTS: We were looking to see if the third dot point ‑ ‑ ‑

GUMMOW J: We are lawyers. These jurors were not lawyers.

MR ROBERTS: Well, your Honours, perhaps it was much easier for them to decide that obviously ‑ ‑ ‑

GUMMOW J: Well…..to go wrong and be confused.

McHUGH J: But it has thrown a completely different focus on it. If you are talking about the company being the creditor that he is seeking to hinder or delay, then there are questions of what the liquidator can do, preferences, there is a whole different thrust of investigation. It just seems to me that this jury would have had the impression that if the company’s creditors were being hindered or delayed, that was sufficient.

MR ROBERTS: We are not arguing ‑ ‑ ‑

McHUGH J: If you think it out clearly and analyse it in terms that should have been put by the judge, the question is: did he do this, so that he could hinder or delay the company recovering its money? Did he do this to delay the bank in getting its money? It just sets up a whole train of investigation and argument which seems to me almost going in the opposite direction to the thrust of the summing up at 317, which is looking from the company’s point of view and its creditors. The passage at 317, seems to me, ought to be understood by the jury to mean that you would have had to look at the relationship between the company and its creditors.

HAYNE J: And especially as that is so in light of the terms of the first count, is it not? The first count is “defrauded persons being the creditors” of the company. So the jury has its eyes fixed firmly on the position of creditors of the company. How can you spell out of their finding in that regard any conclusion about whether this director gained an advantage or not?

MR ROBERTS: Because we submit that in the factual matrix of this case, it was inevitable and it must have been a finding that the share purchase was to advantage him in the way which it did by changing him from being a debtor to a creditor.

HAYNE J: That argument assumes perfect correlation between disadvantage to creditors and advantage to director. And that may be there in some cases, but how can you spell it out of the findings, out of the verdict of the jury that they must have found it to be so here.

MR ROBERTS: But, your Honours, it is not a question of “it may be so in some cases”. What we are looking at are the facts in this case, and in this case the facts were such that there was no possible reason for that transaction to have taken place other than to advantage the appellant, and none was offered. All that was offered was, “I am entitled to do it”. Now, in those circumstances – and that is all that was ever being said, he was entitled to do it, and that there was an advantage that flowed because eventually Holdings held a lease. Now, in those circumstances where the jury had found fraud and given the directions that they received – were they good, bad or indifferent – the jury’s verdict must have, in our submission, encompassed the finding that the share transaction was to advantage ‑ ‑ ‑

GAUDRON J: Why can you jump from good, bad or indifferent simply to the findings? I mean, that seems to me to be one of the great problems in section 7(2). If there was something that casts doubt on any aspect of the factual findings in a case of this nature, it seems to me you cannot really be satisfied as to where the effect of that matter begins and ends in the jury’s deliberations.

MR ROBERTS: Indeed, in the judgment of the Court of Criminal Appeal the defect that they found did not affect the factual requirements and it is a matter of judgment under section 7(2).

GAUDRON J: Let us look at what is said at page 317.

MR ROBERTS: Yes, your Honours.

GAUDRON J: That seems to have at least the defects that Justice McHugh has raised with you.

MR ROBERTS: But it really does not matter for this purpose whether there are defects or no. If they were instructed ‑ ‑ ‑

GAUDRON J: You keep saying that, but why does it not matter?

MR ROBERTS: Because the purpose of our analysis here is not to see whether the charge to the jury was good or bad in relation to the fraud charge, but what the jury must have found in convicting him of the fraud charge, whether it was right, wrong or indifferent, and then to ‑ ‑ ‑

GAUDRON J: So, in your submission, section 7(2) operates regardless of errors that may have affected the findings made by the jury.

MR ROBERTS: No, of course it does not, and the Court of Criminal Appeal said that and it said in its judgment the defect which was identified, the chance that the appellant lost of acquittal, did not affect the factual findings that must have been made and, in those circumstances, it was open to it to substitute a verdict. We submit it really does not matter if some of your Honours would say, “Well, I do not think, in my judgment, I would do it”. As long as it was open to the Court of Criminal Appeal to have done it then ‑ ‑ ‑

GUMMOW J: How does this section work, actually? How does this section work? The word “Where” in section 7(2) means “if”, I suppose, and that is some sort of condition, is it, to the exercise of a power or is it a duty?

MR ROBERTS: It is a power. If they find that ‑ ‑ ‑

GUMMOW J: What then conditions the exercise of the power other than the satisfaction of the condition?

MR ROBERTS: There must be a finding of guilt, obviously, as a prerequisite.

GUMMOW J: No. Everything in the first five lines is satisfied.

MR ROBERTS: Yes.

GUMMOW J: What remains by way of discretion? I just do not know. Is that analysed in any of these multitude of decisions on this section?

MR ROBERTS: I am not sure there were that many decisions under this provision, but it confers ‑ ‑ ‑

GAUDRON J: Certainly, it is a discretion. Ordinarily, one would think it was a discretion made.

MR ROBERTS: Yes.

GUMMOW J: What condition should ‑ ‑ ‑

GAUDRON J: But, surely, in the exercise of that discretion, one would have regard to the summing up and whether or not it provided a proper basis for the jury to find anything.

HAYNE J: And you look to the summing up to identify what are the facts that the jury must have been satisfied of.

MR ROBERTS: Well, you would look to the charge, you would look to the evidence and you would look to the summing up, yes. You could have regard to all of those matters in coming to the conclusion what the jury must have found. The starting point for the operation of the exercise of discretion obviously is that there has been some flaw or error in the conviction. Otherwise, it would not be there to start off with. So this provision can only operate where there has been an error and obviously the legislature has given this power to accord in circumstances where it appears to it that a verdict can be substituted. Obviously it is an economical way of proceeding.

So the question, really, for this Court is whether it was open to the Court of Criminal Appeal to have made the finding that it did. I think there is no dispute in relation to that. We say it was open and whether your Honours individually or collectively were to necessarily come to the same view is irrelevant. As long as it was open to the court and they have not, in exercising ‑ ‑ ‑

GUMMOW J: That is why I keep asking you, Mr Roberts.

MR ROBERTS: I am sorry, your Honour?

GUMMOW J: That is why I keep asking you what I have been asking you.

MR ROBERTS: What must be found, the ‑ ‑ ‑

GUMMOW J: Look, the first five lines of section 7(2), are they, if you like, a jurisdictional fact? They either exist or they do not exist. They may involve some evaluation, but they either exist or they do not exist. Only if they exist may the court proceed. Now, what are you saying happened here? You are saying, “Oh, they may have existed because the court thought they did”.

MR ROBERTS: No, the court said they ‑ ‑ ‑

GUMMOW J: There is no element of discretion, it seems to me.

MR ROBERTS: The court said that it found that those facts must have been proved and, in those circumstances ‑ I am agreeing with your Honour. Of course, it is a jurisdictional fact, as such, but in coming to that conclusion ‑ ‑ ‑

GUMMOW J: If they were wrong about that, House v The King has nothing to do with anything.

MR ROBERTS: But in coming to that conclusion, obviously matters of judgment must come to bear.

GUMMOW J: Yes.

GAUDRON J: Well, I do not understand that. What, because it appears, bring in a matter of judgment?

MR ROBERTS: Well, I suppose finding out what a jury must have found always, to some extent, must involve some element of judgment.

GAUDRON J: Yes, but you see, there is, I think, a difference between second guessing the jury and ascertaining what was necessarily found in the particular case. You see, for example, in a murder case the only issue is, let us say, murder or manslaughter. It can be determined from the facts that that is the only issue, from the way the case was conducted. The trial judge declines to leave provocation to the jury. You can say, “Well, provocation should have been left, and had it been left, then the jury must have been satisfied that it was at least manslaughter, if not murder”.

MR ROBERTS: Because they were convicted of murder and that is why we were there in the first place, yes.

GAUDRON J: Yes, so one can see that situation where you are not second‑guessing so much as you can say those matters are not in dispute or they were definitely proved.

MR ROBERTS: Yes, but that is what I have endeavoured to do. There were three matters and I have submitted that each of those matters was proved and that is what the Court of Criminal Appeal said. They must have been found.

McHUGH J: Your case has to rest on this proposition, must it not? You have made out the first two dot points. I do not think there can be much dispute about that. Then you have to read the passage at 317 as involving findings, first, that his only reason for the sale transaction was to “hinder creditors” of the company; secondly, by making himself a secured “creditor rather than a debtor” and thirdly, when he knew that “the company was about to go into liquidation”. The question then is, is, as a matter of law, that an improper use of his position to gain directly an advantage for himself?

MR ROBERTS: Quite so.

McHUGH J: Yes.

MR ROBERTS: And can I also - your Honour, footnote 29 at page 10 of our submissions, there are two other passages which were referred to in the summing up. Page 354 – it may not add a great deal, 354 line 36. It is very repetitive, perhaps, but it is again put to the jury at 354 line 36.

McHUGH J: That very specifically puts “the creditors of the body corporate”. Yes, that is where it is first shown.

MR ROBERTS: Yes, and 355 at line 10 – at lines 6 to 9 possibly, or 6 to 10.

HAYNE J: Well, it is instructive also to go on to lines 12 and following for that outlines the way in which the Crown put its case in the second charge which is all to do with the lease and you now seek to support the conviction on the second charge on a basis which seems, if I may say so, to bear little resemblance to the nature of the case made at trial.

MR ROBERTS: Two points. Firstly, your Honours, for the purpose of the present exercise, the directions that were given in relation to 229(4) are irrelevant because there was no verdict and in so far as it is suggested that the Crown case in relation to the lease is different in some way, with respect, that is clearly not so. Can I just point to a couple of passages in the summing up? There is a complete misconception in the appellant’s arguments and submissions in relation to the relevance of the lease. Could I just point to page 11 of the appeal book volume 1. There are no addresses so the opening is the only matter in which the Crown case is put. Can I point to line 25 and read that paragraph:

In late ’80 and early 1990, the accused, knowing the position that Sterling Nicholas Duty Free was in and knowing the risk that he personally was in, came up with an idea, which resulted in the transaction which is the subject matter of these charges. The idea was basically to sell the shares that he owned in this other company, the one that didn’t trade, Sterling Nicholas Holdings, which had an excess of liabilities over assets, so it basically was a worthless entity. What he decided to do was to sell his shares in Sterling Nicholas Holdings to Sterling Nicholas Duty Free for the sum of half a million dollars. Sterling Nicholas Duty Free, of course, didn’t have any money to pay for the shares but what happened was, and what could happen was, that the shares could be paid for by way of credit and that could have an effect on his position in a number of ways.

Which were then referred to. And can I also refer your Honours to, just by way of example, page 13 of the opening, at line 5:

If somebody enters into an arrangement such as this –

this is the sale of the shares –

you might think it’s not going to last very long because the liquidators would look at all this and say, “What’s going on?” and they won’t take a great deal of notice of such a transaction, probably set it aside and the accused will be back where he started from. Clearly, it would be a blatant thing to do to enter into a transaction like this; there was more needed. How can you possibly sell shares in a worthless company for half a million dollars and say they’re worth half a million dollars because someone is going to say later on, “Hang on, what’s going on?” This is where –

I will use the words of the jury –

the wrinkle comes in.

The least transaction was what was put forward as putting value into this transaction. That was how it came on. It is the defence, in effect of this, was the least transaction.

McHUGH J: But my problem is this: I have found your argument about the effect of the findings at 317 quite persuasive as constituting as a matter of law a 229(4) charge. But section 7(2) only operates where the jury could, on the indictment, have found the appellant guilty of some other offence.

MR ROBERTS: Yes, your Honour.

McHUGH J: In relation to that other offence, it seems to me that the offence that you now want to convict him on, set out at page 317, bears almost no relationship to what is put to the jury as to the Crown case at page 355. You would be hard pressed apart from the sentence at line 25 to see any connection between the two passages.

MR ROBERTS: What was said in the summing up? I am sorry, what I said ‑ ‑ ‑

McHUGH J: At page 355, in the summing up:

As to the second charge, the Crown case is that the accused clearly made improper use of his position to gain an advantage for himself because the shares in Sterling Nicholas Holdings were worthless and the effect of the transaction was to deprive Sterling Nicholas Holdings of a lease which should have been granted to it and to require that company to pay half a million dollars for something it should have had in the first place. The effect of this being to make the accused a creditor, not a debtor, and to make him immune from any claim by the liquidator.

That bit does not bear much relationship to what is set out at page 317.

MR ROBERTS: It does not bear a great deal of relationship I suppose in what I put to the jury was our case to start off with it. But that is a defect in the summing up in relation to 229(4) and we say even if there was no summing up in relation to 229(4), that should not affect the position here because ‑ ‑ ‑

McHUGH J: Well, I will want a lot of convincing on that, that if the Crown runs one case in respect of the other offence, that you can then say, “Well, they never made out that case but, nevertheless, because of the findings in respect of the first or primary offence you can enter a conviction”.

MR ROBERTS: What his Honour was in fact saying was the share transaction obviously could have benefited nobody unless somehow it can be said that the shares were worth some money and then what he has done is then to go into that aspect. Now, that might be right, wrong or indifferent, but it really does not affect the way in which the case was put at all. The charge is there; the way it is opened is there and his Honour may have possibly confused two parts of it, I may add, without, so it seems, any objection on the part of the accused in relation to any of these matters.

But, your Honours, if we are discussing the lease, the case never ever changed. The lease was important because this was the only matter that was ever suggested gave some semblance of worth to these shares and, therefore, so it was said, was evidence that fraud was not occasioned. So it was a very important part of the case and, obviously, it being the real matter of dispute, I suppose, in the trial, it had obviously assumed an importance in terms of the summing up.

McHUGH J: I appreciate it is a strong Crown case, a very strong Crown case, but it is a question of whether the proper forms have been followed.

MR ROBERTS: But not in relation to the 229(4) – it does not matter if his Honour did not address ‑ ‑ ‑

McHUGH J: The 229(4) charge is put to the judge in a particular way. He says, “That is the case that you made. Now you want to convict the accused of that offence but not the offence particularised by the judge. You want to convict him of another offence which has never been particularised at any stage until you get to the Court of Criminal Appeal”. I mean, your paragraph 30, to a significant extent, rewrites the findings at 317. That does not mean that it is not a proper rewriting of them, but even your paragraph 30 seem to me to be a fair way removed from what appears at 355, Mr Roberts.

MR ROBERTS: Well, what we were endeavouring to do was not only look at the summing up, was to look at the facts; the indictment of which he was convicted - or the charge, I am sorry, of which he was convicted and the two charges in the indictment; and the summing up; all of those matters, and then to say what must the jury have been satisfied of when they convicted the accused of fraud, albeit that there was an error in the summing up in relation to the fraud charge. That is why the court was in the position of exercising a discretion under 7(2). All of those matters ‑ ‑ ‑

McHUGH J: No, but, look, let me put this. You see 7(2) only operates when the jury – when the jury could on the indictment have found the accused guilty of some other offence. Supposing this jury had come back and found the accused guilty of the 229(4) offence, brought in a special verdict and set out the matters at 317. The conviction would be set aside, would it not, because that was never the way it was put to the jury?

MR ROBERTS: Your Honour, that expression “where the jury could have found you guilty on the indictment” means that it must have been available, either as an alternative or charged. That is what, in our submission, it means.

McHUGH J: The formal charge is no doubt there on the indictment but it is a question of whether the jury could on the indictment have found him guilty of some other offence and when you see what you now particularise by reference to 317 and what the judge particularised by reference to 355 does not seem to me to be the same offence.

MR ROBERTS: But, your Honours, the wording of 7(2), the starting point is where he:

has been convicted of an offence –

and he has been –

and the jury could on the indictment have found the appellant guilty of some other offence –

The “some other offence” is 229(4).

McHUGH J: Well, that is the question: 229(4) as an abstract conception or as particularised?

MR ROBERTS: They could have found him guilty on the indictment because the charge was there. We have not got to the stage of the facts. This is barely a question of whether he could be found guilty on the indictment, that was it an available charge on the indictment?

HAYNE J: But that then invites attention to the ambit of 7(2). Can 7(2) operate except in respect of an offence, the factual elements of which are wholly included in the elements of the offence of which the accused was found guilty?

MR ROBERTS: Well, can I respectfully submit there are two questions. The first is we are looking at the phrase before the comma, what is meant by that, and then we move on to the second aspect, which is the matter that has been raised here:

and on the finding of the jury it appears to the court that –

that is a separate question. The first one is whether it was available to them to convict on the indictment some other offence. Sometimes it is available, whether it is charged or not, murder, manslaughter, sometimes because the indictment contains a separate count. Some prosecutorial authorities, such as the one here, in their wisdom or whatever decide to charge in the alternative because it is seen to be oppressive to have two counts. We would not have had this problem if we had not had the alternative no doubt. It would not have ‑ ‑ ‑

GAUDRON J: What you have here are not two true alternatives.

MR ROBERTS: No. That is right.

GAUDRON J: You have cases which are charged in the alternative because there would be double punishment to convict of those offences.

MR ROBERTS: The first question is ‑ ‑ ‑

GAUDRON J: Is that not right? I mean, this is ‑ ‑ ‑

MR ROBERTS: That is one area where it operates – where 7(2) can operate.

GAUDRON J: Well, that is a question, is it not? There is a question whether it operates for true alternatives.

MR ROBERTS: It is not the question that is raised in the submissions.

GAUDRON J: No, but it is a curious section.

MR ROBERTS: Yes, that is true.

GAUDRON J: And it defines the nature and extent of the powers that may be exercised by the Court of Criminal Appeal. It is, therefore, important to understand exactly what it is concerned with.

MR ROBERTS: Yes.

HAYNE J: And its bite here is that you have one charge which concerns the position of creditors – “defraud creditors”, and one charge that concerns the position of the accused – “advantage the accused”. Now, you can understand that there may be facts where advantage is obtained by a director because creditors are defrauded. But if the section is engaged only in the true included offence, only where the factual elements of one are wholly included in the elements of the offence of which the accused was found guilty, then 7(2) was not engaged in this case because of the differing aspects of the two offences.

MR ROBERTS: Your Honour is now looking at the second aspect. The first is, was it available to the jury, could they have found him guilty of some other offence on the indictment? And the answer to that is “Yes” because there were two charges there expressed in the alternative. That is the first thing. If not, the section cannot be engaged at all. That is the first inquiry. The clear answer must be, we submit, “Yes” either because on the indictment there are two offences or because there is an alternative verdict available as a matter of law as in murder and manslaughter. That is the first part. Then we move on, and on the finding of the jury – so we are looking at the conviction which is on appeal and obviously is to be set aside ‑ ‑ ‑

GUMMOW J: And of the constituents of the offence found provided.

MR ROBERTS: Yes.

CALLINAN J: Do you not have to, in order to hold that there should be a 7(2) conviction, do you not have to be satisfied that there is a precise identity between the two sets of particulars that would be required to convict on either and that, as to the 7(2) offence, some of them have to be able to be identified with precision as having been found by the jury in convicting on the first offence? There has to be a precise identification of particulars. You have to have at least some of the particulars of the offence of which the person has been convicted, you have to be satisfied that they must have been proved before a 7(2) offence can be recorded by an appeal court.

MR ROBERTS: What the Court must be satisfied of is what is provided in the section, and that is ‑ ‑ ‑

CALLINAN J: Yes, but the section is not in a vacuum, the section applies to facts and particulars. It applies to the particulars of the offence charged, surely.

MR ROBERTS: But what your Honour is saying, in a given situation, how do you find which facts must have been found? And matters which your Honours raise, of course, are so.

CALLINAN J: You cannot just look at the elements of the offence, you have to look at the elements of the offence in relation to the facts in issue.

MR ROBERTS: Absolutely.

CALLINAN J: But you have to be able to say that the jury must have regarded these particular facts as having been an issue and must have found these particular facts ‑ ‑ ‑

MR ROBERTS: Or not at issue, it must have found them anyway. Those are the three facts – that is what we have said, and that is what we have done. We have said ‑ ‑ ‑

McHUGH J: That is one of the things that troubles me about this case is why, or how, the judge could not take the jury’s verdict on the second count.

MR ROBERTS: Because we asked him not to because it was expressed ‑ ‑ ‑

McHUGH J: I know it is expressed as an alternative, but it is a pretty strange alternative. I mean, having regard to what is put at page 355, I cannot see the slightest reason why the accused could not have been convicted of both offences.

MR ROBERTS: No, there was not, but that is the way that it was expressed in the alternative, this case had some history before this trial and that is the way it was, and it was not changed, which was a pity, because we would not be here, no doubt, if there had been, because there would no doubt have been a conviction in relation to both. But, there was not and that is why we are here arguing the toss in relation to the second aspect.

GUMMOW J: Then you were going through section 7(2) and “on the finding of the jury” – and there has been some discussion with you about just what is involved with that – “it appears to the court”, the question is: to what standard of satisfaction should it appear to the Court of Criminal Appeal? This phrase “it appears” appears in lots of statutes, as you know.

MR ROBERTS: It does not make it any easier, your Honour.

GUMMOW J: No, we know when it is an administrative body it does not mean it appears subjectively. This is a different sort of body here.

MR ROBERTS: And the word “must” is there, yes. Well ‑ ‑ ‑

GUMMOW J: I do not think, myself, that what was said in McQueeny, really focuses on the point.

MR ROBERTS: No, no, it is a different aspect entirely.

GUMMOW J: But it was just McQueeny that was applied at 1081.

MR ROBERTS: No, McQueeny was said not – the court took cognisance of McQueeny and said, “We realise what was in McQueeny.”

GUMMOW J: I know, I know that, but no one seems to have assisted the court by explaining what they had to attain by way of satisfaction before something could appear to them. It was treated to some discretionary exercise, it seems to me from McQueeny.

MR ROBERTS: Well, they were satisfied that the jury must have been satisfied, which clearly does not mean some sort of reason beyond reasonable doubt that the Court of Criminal Appeal must engage in. They simply must look at all of the surrounding circumstances and reach a state of satisfaction themselves, “Well, we think the jury must have found this, this and this”. That is why I say there must be some element of discretion or judgment involved in that, because different people may come to different views in relation to those matters, and, ultimately ‑ ‑ ‑

GUMMOW J: But it is quite an important matter. They are exercising original jurisdiction here, in substance.

GAUDRON J: Yes, they are ‑ ‑ ‑

MR ROBERTS: That is ‑ ‑ ‑

GUMMOW J: And it affects the liberty of the citizen.

MR ROBERTS: Yes, your Honour, after a trial in which someone has been convicted.

McHUGH J: Oh, yes, but ‑ ‑ ‑

HAYNE J: He was about to be convicted of something else.

MR ROBERTS: No, as I say ‑ ‑ ‑

McHUGH J: It is the court that now convicts him, that is the point.

MR ROBERTS: That is so.

McHUGH J: Well, I would have thought that they had to be satisfied beyond reasonable doubt.

MR ROBERTS: But the jury was satisfied. The starting point is the jury, in finding someone guilty beyond reasonable doubt, must have found this. So we have the finding of reasonable doubt there, but what they are doing is looking at the jury’s verdict to see what they must have found, and you cannot apply it beyond reasonable - I am sorry?

McHUGH J: This is a very different case. It is a world of difference, it seems to me, between somebody being charged with burglary and because it took place before 9.00 pm at night, you cannot make out the case of burglary, so you enter house breaking or you enter larceny. There the jury have found the ultimate element in the charge, but here you asking us to go to the summing up, to look here, go to the opening address, and then say, Well, you are satisfied of facts which prove him guilty of offence. Now, surely, it must require a very high degree of satisfaction, I would have though, beyond reasonable doubt.

MR ROBERTS: But beyond reasonable doubt, that element is found in the jury having been satisfied beyond reasonable doubt.

McHUGH J: I know but the court must be – it must be satisfied beyond reasonable doubt that the jury must have been satisfied.

GUMMOW J: Otherwise someone has been convicted by a lesser standard.

GAUDRON J: Yes, and, although it does not appear in this case, the importance of it could probably be tested by reference to an offence under a Commonwealth law. You may well find that the effect of that in a Commonwealth offence is to deprive them of trial by jury, at least unless you assert that clear beyond doubt that it is unarguable that the jury must have found those things.

MR ROBERTS: But what your Honour is doing, with respect, is reading words into the provision which are not there.

GUMMOW J: No. She is trying to make it valid actually.

GAUDRON J: Would you like to consider those things over the luncheon adjournment, Mr Roberts?

MR ROBERTS: Certainly, your Honour.

GAUDRON J: Yes. The Court will adjourn until 2.15.

AT 12.46 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.17 PM:

GAUDRON J: Yes, Mr Roberts.

MR ROBERTS: Thank you, your Honour. If I could just make a few more points before I conclude. Your Honours, in relation to the suggestion that the court, in exercising its powers under section 7(2), must itself make findings of fact beyond reasonable doubt, we submit that that is not the position at all because there is no original fact finding done by the court. The original fact finding has been done and is taken to have been done by the jury.

GUMMOW J: I do not think anyone was suggesting that to you. The question is, what is the degree of satisfaction of the appearance?

McHUGH J: Can the court say, “We think it probable or not that the jury found these facts, therefore, we are going to convict this man of this offence”?

MR ROBERTS: No, the court would say, “We think the jury must have been satisfied of this and therefore it is open to us to exercise our powers”.

GUMMOW J: The question is – that only disguises it, though: “We think”, you see.

GAUDRON J: “It is clear beyond argument that the jury might” - for example, “it is clear” ‑ ‑ ‑

McHUGH J: “There must have been” itself, indicates, does it not, almost a degree of a certainty.

MR ROBERTS: Well, a sufficient degree of certitude or comfortably satisfied that that is what they did find. This is the sort of thing, in our submission, that the Court of Criminal Appeal has to do fairly often, though it is perhaps slightly different.

GUMMOW J: It might have to do it fairly often, but it should do it with a clear understanding of what the Act means.

MR ROBERTS: Yes.

GUMMOW J: All the more reason, actually.

McHUGH J: You see, until the enactment of provisions like section 7(2), it was probably safe to say that there was nobody serving a sentence of imprisonment for an indictable offence who had not been convicted by a jury. This section allows a court to convict a person.

MR ROBERTS: After he has been convicted by a jury.

McHUGH J: But the hypothesis is that the conviction has been set aside.

MR ROBERTS: It is substituted, that is so. But it is not as if ‑ ‑ ‑

McHUGH J: No, it is not substituting. It is finding him guilty of another offence.

MR ROBERTS: But it is not without trial by jury and a finding having been made.

McHUGH J: I know it is not, because the jury make the findings. But the question then is: if a Court of Appeal said “We are comfortably satisfied that the jury found those facts”, a person would be being sentenced upon the comfortable satisfaction of the Court of Criminal Appeal.

MR ROBERTS: I am not urging your Honours to substitute the language of the section.

McHUGH J: No.

MR ROBERTS: I am suggesting that the language of the section, itself, sets out the test and that putting a gloss on it ‑ ‑ ‑

GUMMOW J: How does it set out the test? It uses the words “it appears”.

MR ROBERTS: They are satisfied that the jury must – I am sorry – “it appears to the court that the jury must have been satisfied”. In section 8 the proviso, “all the circumstances”, “having regard to all the circumstances” there was no miscarriage of justice. If the Court engages in that sort of an activity – true it is your Honour may say it is not a perfect analogy because a conviction or a substitution does not take place but a conviction takes place because the Court is satisfied that miscarriage of justice occurred in section 8.

GAUDRON J: Yes, but that has been construed in a very precise manner in Mraz. It has been construed to mean it was not deprived of a chance of acquittal that was fairly open.

MR ROBERTS: The point I am making is that it is not suggested that they have to be satisfied beyond reasonable doubt that there was no miscarriage of justice. What I am suggesting is that it would be wrong to import into section 7(2) such a test when it is not there, and, indeed when one looks at the other powers in section 7 it would tend to suggest that it was not intended that any such test would be applied. They are all cases where verdicts can be adjusted in different respects, in different circumstances, and in none of those circumstances in the four subsections of section 7, we respectfully submit, do the words “beyond reasonable doubt” come into the arena of the ‑ ‑ ‑

GUMMOW J: The phrase “If it appears” appears in section 7(1). In section 7(3) it is “the court considers” and then “it appears to the court” again, is in section 7(4). The various subsections are informing different officers, are they not?

MR ROBERTS: Yes, in different sorts of situations but in none of those, we respectfully submit, is appropriate to put an extra layer of decision making or an additional test because it is not a question of the court finding facts for itself, originally, except perhaps, I suppose, the question of “mentally ill” in section 7(4) it might be but that would not be beyond reasonable doubt.

Could we submit this, your Honours, that it must be recalled that section 7, and particularly section 7(2), will often be of advantage to an accused person. It may often be that the Crown says, “If there is an error in the summing up, yes, we want a retrial on the greater offence”, and the court may think, “Well, in all the circumstances, clearly we find that 7(2) can apply and we do not propose to do that, we are going to substitute a verdict instead”. So it can operate and often will and, indeed, in this case it might well be said to have operated to this appellant’s advantage. Putting him up again on the fraud charge may well have been to his disadvantage with the opportunity of getting a longer sentence than he otherwise received because it was reduced on appeal because of the substituted verdict.

It was a real advantage, we would submit, and it was a practical matter for the court to engage in that exercise rather than putting up for what your Honour Justice McHugh has described as a strong Crown case, and indeed it was. So it was to this man’s advantage, we submit. It was a practical solution, but that is moving away. I am just suggesting that before we start ‑ ‑ ‑

GUMMOW J: That is focusing on “the court may”.

MR ROBERTS: Yes, but I am looking at how to interpret that word in a wider context.

McHUGH J: Yes, I know, but this section was derived from the English Court of Criminal Appeal Act 1907 and at that stage there was no power to order a new trial.

MR ROBERTS: No. Errors were found. They quashed the conviction.

McHUGH J: Yes. But this section enabled the court to substitute a verdict.

MR ROBERTS: That is so. I do not know the history. Section 8 was perhaps before ‑ ‑ ‑

McHUGH J: Yes, 7(1) certainly came from the English Court of Criminal Appeal Act 1907. My recollection is not clear about 7(2).

MR ROBERTS: The submission that I am making, perhaps in a roundabout way, is before we start to read very onerous types of tests into this which do not appear in the legislation, one must have regard to the overall effect of such a provision and its ameliorating effects in relation to accused people.

Usually we would submit it is to their advantage and it was to this man’s advantage in this case, we submit, not to put him up on another trial in relation to the fraud offence. Clear it was that this course was opposed in the Court of Criminal Appeal, the appellant at that stage having served, I think, 12 months of a 18‑month periodic detention sentence and may well have thought there is no way that anyone is going to put him up on anything again, but we would submit that what the court did – and they did it, I may add, at our instance ‑ was to, in effect, do something that was beneficial for him: not to put him up again on a fraud charge with the possibility that, after the trial, the same sentence would have been confirmed and he would have had to start again the sentence that he originally received and, your Honours, can I just ‑ ‑ ‑

GUMMOW J: Well, what do you say is required before something appears?

MR ROBERTS: Well, your Honours, my submission is you just cannot go beyond the words of the section ‑ ‑ ‑

GUMMOW J: Well, that will not help me, I am afraid.

MR ROBERTS: Well, it might not be very helpful but if the jury “must have been satisfied” of that, the court thinks that the jury must have found that as a fact, then, provided the first part of the jurisdictional fact is there, that he could have been convicted on the indictment on that count, which he could here, then they were entitled to enter a substituted verdict.

HAYNE J: If then the expression is a single composite expression, which seems to me to be the way in which you are putting it, what strength do you give to “must have been satisfied”? What degree of satisfaction or persuasion is entailed by those words?

MR ROBERTS: Your Honour, I know your Honour is attempting to draw me but I suggest that paraphrasing “must have been satisfied” is not going to assist. “Must have been satisfied” is an expression which can be understood, is understandable, and if the court is – well, this must have occurred, they are satisfied that the jury found those facts, then that is the end of it. Trying to paraphrase it or put it into some other language is not helpful and particularly putting in a test that is not there at all.

McHUGH J: I think you may have heard too many criminal summings up in which judges have told juries that “beyond reasonable doubt” cannot be explained.

MR ROBERTS: Yes, it is true, your Honours, that “beyond reasonable doubt” means beyond reasonable doubt and “must be satisfied” means must have been satisfied. Your Honour Justice McHugh at some stage put to me that I was attempting to encourage this Court to look at all of the facts and circumstances and the summing up. That was the furthest thing from my mind because our submission is that that is the function of the Court of Criminal Appeal, and they fulfilled that function. In this Court, the question is different. The question is: was there an error in the exercise of discretion. It is not the same test ‑ ‑ ‑

GAUDRON J: No, no, that is not the question. The first question is, relevantly, was it apparent, whatever that means, that the jury must have been satisfied? The first question is did the Court of Criminal Appeal err in determining that the jury must have been satisfied?

MR ROBERTS: Yes.

GAUDRON J: I do not think that is a discretionary. I think on any view it has got to be read, albeit with some compression, perhaps, on the basis that the court determines that the jury must have found.

MR ROBERTS: Yes, what I was endeavouring ‑ ‑ ‑

GAUDRON J: And it is in a judicial context, and that must mean that it has determined it logically.

MR ROBERTS: Yes. But this Court’s function, in our respectful submission, is to say, “Was it open for the Court of Criminal Appeal” – and it is different; the exercise is not the same ‑ ‑ ‑

GAUDRON J: No, no, not, “was it open?”.

MR ROBERTS: Was it open or was there an exercise or a miscarriage in relation to the discretion?

GAUDRON J: No, the first question is: did the Court of Criminal Appeal err in determining that the jury must have been satisfied? If it did, end of the matter. If it did not, then the second question arises: what are the circumstances which govern whether - its discretion to substitute a verdict?

MR ROBERTS: Well, whether they erred or not depends upon whether it was open to them to find, so what your Honour is putting to me is a different way of putting what I am putting, except I am saying that when it goes on appeal to this Court, it is a slightly different exercise because the original ‑ ‑ ‑

GUMMOW J: No, no, this is the first appeal, really.

MR ROBERTS: Well, no, your Honour, the function of ‑ ‑ ‑

GUMMOW J: It is from the operation of 7(2).

MR ROBERTS: Well, it is because it is for the substitutive, but the process of substitution was the appellate process in the Court of Criminal Appeal and they have ‑ ‑ ‑

GUMMOW J: Yes, the question really is whether the Court of Criminal Appeal misconceived or misconstrued that which governed its exercise of the appellate process. That question is initially raised here. That has to be right, surely.

MR ROBERTS: Yes, and I do not disagree in relation to that. Then the question is, what does that entail in the circumstances of this case, and what we have put – and I will just repeat it once more, but not again – that the three facts that were necessary to be found to exercise this discretion must have been found by the jury. The Court of Criminal Appeal was correct in so finding. Therefore, they were able to substitute the verdict and therefore there has been no legal error on the part of the Court of Criminal Appeal.

McHUGH J: But you may be right in defending the substitution of the verdict, but can you defend what appears at page 1080 in the court’s judgment which indicates error on its part?

MR ROBERTS: Which part on page 1080?

McHUGH J: Page 1080 where the court said:

If it could be said…..then it follows.

Now, that proposition is not correct as a matter of law, is it?

MR ROBERTS: Yes, it is because they start off, “If it could be said that” and we go down to line 46, it is just postulating the question, and then they say:

In my opinion the finding of the jury on the fraud charge must have –

it was not as if they misconceived the nature of the charge. It was just an expression of language, how they were ‑ ‑ ‑

GAUDRON J: Should it not read, as a matter of logical sequence, “If it must be said”, or “If it could be said”, all that follows is that the jury may or may not have.

McHUGH J: Yes.

MR ROBERTS: But this is only infelicity of expression because the test is in line 46, that we have the word “must” used. It is not as if the court did not know that that was the test, “In my opinion the finding” – - -

McHUGH J: Well, the courts do know it, but counsel say this again and again, “Oh, this is an experienced trial judge, this is an experienced court. The fact that they did not state the principle does not indicate error.” To my mind that is never persuasive because one knows from one’s experience that it is only when you have the key concepts in mind and you have to apply those key concepts that will lead you to what you think is the correct result, because the human mind often operates and you think that this conclusion follows, and it really does not follow when you have to apply critically the key concepts.

MR ROBERTS: But, I am sorry, your Honour, the critical passage, we submit, is at line 46. This is the lead in to it. It is not as if the court did not know that that was the test of the “must”, it was just the lead in expression and could I submit this was an extempore judgment.

McHUGH J: I understand that and one must make allowance for that, but after all, that sentence that you rely on at line 46 records a conclusion. It does not explain how the court got there, and there is at least arguable error in the “If it could be said” sentence.

MR ROBERTS: Your Honours, we do submit that this is just the lead in to the test that is imposed and the court has not lost sight of it by not repeating it twice, in effect, in the space of a few lines. It cannot be said that they lost sight of what the test was when it is there. At the very worst it is an infelicity of one word and not of the test that was imposed. I am reminded that at line 10, just before we get to that line:

The issue before this Court is whether or not…..the findings of the jury with respect to the charge under s176A of the Crimes Act mean that “the jury must have been satisfied of facts –

so we have it twice on the one page and it can hardly be said that the court did not know or misapplied the test when we have it twice on the one page and they have just used an alternate word as a lead in to coming to the conclusion when they have already set out the test and they conclude on the test.

McHUGH J: Your argument really comes to this, does it not, that the words “If it could be said that” are superfluous.

MR ROBERTS: Yes.

McHUGH J: And that what the court is saying is, “If the jury’s finding meant that the accused believed.”?

MR ROBERTS: That is so, your Honour.

GUMMOW J: And this phrase, “In my opinion”, appears several times too. I am not sure what is meant to be involved in the formulation of that opinion.

MR ROBERTS: We submit that it appears to the Chief Justice.

GUMMOW J: You say it is an expression of comparable satisfaction?

MR ROBERTS: No, we say it is a synonym for “it appears to me that in my opinion”. What his Honour was doing was looking at exactly what the phraseology of the section requires and “if it appears that” – well, it appeared to his Honour that, it was his opinion that.

GUMMOW J: Part of the problem is, in fact, McQueeny which suggests all of this is some evaluative exercise or discretionary nature involved in the

exercise of a power when the real question is whether the power exists and the reliance upon McQueeny is made explicit at 1081.

MR ROBERTS: Whether the power exists in this case, your Honour?

GUMMOW J: Yes.

MR ROBERTS: Yes. Obviously, they must be satisfied of those three facts and we say they were and it is apparent that they were, there being only one dispute and I have referred your Honours to this finding at the bottom of page 1080 where the court was so satisfied of that third point. This is the area we discussed this morning.

Your Honours, I think I have probably said all that I can usefully say in relation to these matters. Your Honours will have observed that it is our submission that if your Honours were against us in relation to the ability of the Court of Criminal Appeal to substitute a verdict, then we submit that the proper and appropriate course is to order a retrial in relation to both offences. Those are the submissions that we put.

GAUDRON J: Yes, thank you, Mr Roberts.

MR ROBERTS: If your Honour pleases.

GAUDRON J: Anything in reply, Mr Menzies?

MR MENZIES: Just very briefly, your Honour. All that has passed between my learned friend and your Honours illustrates the proposition which I think Mr Justice Callinan advanced and that was that unless one has an identicality of particulars of the ‑ ‑ ‑

GUMMOW J: Identity, I think.

MR MENZIES: If that is a word, your Honour - an exact identification of particulars in the two charges, then one immediately runs into problems and the problems are illustrated by the inquiry, as it were, that passed between my learned friend and Bench. What the Court of Criminal Appeal had to come to a conclusion was that the jury made certain findings of facts and there can be no doubt about it.

GAUDRON J: You do not say anything as to the nature of the discretion, assuming the Court of Criminal Appeal was correct in finding what the jury must have found. You do not go further and say anything?

MR MENZIES: It would produce a curious result if the Court of Criminal Appeal was to effectively usurp the function of the jury. Its finding must

have been based upon a satisfaction beyond reasonable doubt or perhaps even something higher, that is, there was no other finding that could be made. For the balance, if your Honours please, we have already reduced our submissions in reply to writing which we rely upon. The only thing that I would add is in response to an inquiry by Mr Justice McHugh concerning the directors and whether they had all taken part in pointing out that Mr McPherson had died before the trial. At pages 474 and 480 appear minutes recording Mr McPherson’s presence at the various meetings of the two companies. Thank you, your Honours.

GAUDRON J: Yes, thank you. The Court will consider its decision in this matter and will adjourn until 10.15 am tomorrow morning.

AT 2.42 PM THE MATTER WAS ADJOURNED

[2000] HCATrans 143

Key Legal Topics

Areas of Law

Criminal Law

Evidence

Legal Concepts

Appeal

Charge

Sentencing