Stribrny v The State of Western Australia
[2015] WASC 396
•22 OCTOBER 2015
STRIBRNY -v- THE STATE OF WESTERN AUSTRALIA [2015] WASC 396
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2015] WASC 396 | |
| Case No: | CPCA:23/2012 | 24 AUGUST 2015 | |
| Coram: | TOTTLE J | 22/10/15 | |
| 21 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | KAMIL STRIBRNY ROMANA STRIBRNA THE STATE OF WESTERN AUSTRALIA |
Catchwords: | Criminal Property Confiscation Act Objection to application for confiscation of property Application to have Freezing Notice set aside Property was crime-used Whether the second plaintiff can rely on hardship provision to set Freezing Notice aside The second plaintiff is not an innocent party The second plaintiff would not suffer undue hardship if the property is confiscated It is not practicable to make adequate provision for the second plaintiff Whether the second plaintiff is entitled to a proportionate share of the proceeds of sale of the property The property is not effectively controlled by the first plaintiff The second plaintiff does not have an equitable interest in the property |
Legislation: | Criminal Property Confiscation Act 2000 (WA), s 34(2), s 81, s 82(3), s 82(5), s 107, s 141, s 146(1)(a), s 146(1)(c), s 153(1), s 153(2), s 156(1) Misuse of Drugs Act 1981 (WA), s 7(1)(a), s 34(2)(b) |
Case References: | Allen v Snyder (1977) 2 NSWLR 685 Baumgartner v Baumgartner (1987) 164 CLR 137 BJF v The State of Western Australia [2011] WASC 163 Green v Green (1989) 17 NSWLR 343 Hong Yen Le v Director of Public Prosecutions [2007] VSCA 72; (2007) 171 A Crim R 196 Lloyd v Tedesco (2002) 25 WAR 360 Muschinski v Dodds (1985) 160 CLR 583 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
Freezing Notice Numbered WAPFN120049 issued pursuant to section 34 of the Criminal Property Confiscation Act 2000
- First plaintiff
ROMANA STRIBRNA
Second Plaintiff
AND
THE STATE OF WESTERN AUSTRALIA
Defendant
Catchwords:
Criminal Property Confiscation Act - Objection to application for confiscation of property - Application to have Freezing Notice set aside - Property was crime-used - Whether the second plaintiff can rely on hardship provision to set Freezing Notice aside - The second plaintiff is not an innocent party - The second plaintiff would not suffer undue hardship if the property is confiscated - It is not practicable to make adequate provision for the second plaintiff - Whether the second plaintiff is entitled to a proportionate share of the proceeds of sale of the property - The property is not effectively controlled by the first plaintiff - The second plaintiff does not have an equitable interest in the property
Legislation:
Criminal Property Confiscation Act 2000 (WA), s 34(2), s 81, s 82(3), s 82(5), s 107, s 141, s 146(1)(a), s 146(1)(c), s 153(1), s 153(2), s 156(1)
Misuse of Drugs Act 1981 (WA), s 7(1)(a), s 34(2)(b)
Result:
Application dismissed
Category: B
Representation:
Counsel:
First plaintiff : In person
Second Plaintiff : In person
Defendant : Mr M Seaman
Solicitors:
First plaintiff : In person
Second Plaintiff : In person
Defendant : Director of Public Prosecutions (WA)
Case(s) referred to in judgment(s):
Allen v Snyder (1977) 2 NSWLR 685
Baumgartner v Baumgartner (1987) 164 CLR 137
BJF v The State of Western Australia [2011] WASC 163
Green v Green (1989) 17 NSWLR 343
Hong Yen Le v Director of Public Prosecutions [2007] VSCA 72; (2007) 171 A Crim R 196
Lloyd v Tedesco (2002) 25 WAR 360
Muschinski v Dodds (1985) 160 CLR 583
- TOTTLE J:
Introduction
1 On 29 February 2012 police officers conducted a search of 14 Lower Keys Drive, Clarkson (Lot 645 on Deposited Plan 38124 in Certificate of Title Vol 2558 Folio 63) (the Property). They found 14 mature cannabis plants being grown in two rooms at the rear of the house constructed on the Property. The plants were being grown with the aid of a sophisticated hydroponic cultivation system.
2 The Property was, and is, the family home of the plaintiffs, who are Mr Kamil Stribrny and Ms Romana Stribrna, and their three children.
3 On 4 April 2012 a Justice of the Peace issued a freezing notice numbered WAPFN120049 (the Freezing Notice) in respect of the Property. The Freezing Notice was issued pursuant to s 34(2) of the Criminal Property Confiscation Act 2000 (WA) (CPCA) on the basis that there were reasonable grounds for suspecting that the Property was 'crime-used'.
4 On 26 April 2012 Mr Stribrny filed an objection to the application for confiscation of the Property. On the same day Mr Stribrny filed an originating summons seeking to have the Freezing Notice set aside.
5 On 5 October 2012 Ms Stribrna filed an objection to the confiscation of the property and on 7 December 2012 she was joined as a plaintiff in the proceedings.
6 On 13 March 2013 Mr Stribrny was convicted, in the Magistrates Court of Western Australia, of cultivating cannabis with intent to sell or supply, contrary to s 7(1)(a) of the Misuse of Drugs Act 1981 (WA) (the Offence).
7 At the hearing of these proceedings the plaintiffs represented themselves, though they had been represented by two different firms of solicitors at earlier stages in the proceedings.
8 In overview, the issues in the proceedings were as follows:
(a) Was Ms Stribrna able to satisfy the criteria set out in s 82(3) of the CPCA, the hardship provision, thus enabling the Court to set the Freezing Notice aside?
(b) Was Ms Stribrna an owner of the Property, more specifically did she have an equitable interest in the Property, entitling her to a proportionate share of the net proceeds of sale of the Property, upon its sale after confiscation, under s 82(5) of the CPCA?
9 Subsumed in these broad issues is the question of whether Ms Stribrna is an 'innocent party' as that term is defined in the CPCA.
10 Mr Stribrny's application to set aside the Freezing Notice had as its basis the proposition that he did not commit the Offence. Following his conviction Mr Stribrny was left with no basis upon which he could argue that the Freezing Notice should be set aside.
The relevant statutory provisions
11 The cultivation of cannabis with intent to sell or supply is an offence punishable, if the sentence is imposed by a summary court, with a fine of $5,000 or imprisonment for a term not exceeding 4 years or both (s 34(2)(b) of the Misuse of Drugs Act 1981 (WA)).
12 By s 141 of the CPCA, a confiscation offence is an offence punishable by imprisonment of two years or more.
13 The Offence was, therefore, a confiscation offence.
14 Property is crime-used for the purposes of the CPCA if, amongst other things, the property was used in connection with the commission of a confiscation offence (s 146(1)(a) of the CPCA) or any act was done, omitted to be done or facilitated in or on the property in connection with the commission of a confiscation offence (s 146(1)(c) of the CPCA). In this case, there is no dispute that the Property was crime-used.
15 Property which is the subject of a freezing notice (frozen property) is confiscated if each objection is finally determined and the freezing notice is not cancelled or set aside (s 7(2) of the CPCA).
16 The plaintiffs' application invokes the court's power under s 81 of the CPCA to set aside the Freezing Notice. The grounds for doing so are set out in s 82 in the following terms:
82. Crime-used property, release of
(1) The court may set aside a freezing notice or freezing order for property that was frozen on the ground that it is crime-used if the objector establishes that it is more likely than not that the property is not crime-used.
(2) If the court finds that the property is crime-used, or is not required to decide whether the property is crime-used, the court may make an order under subsection (3) or (4).
(3) The court may set aside the freezing notice or freezing order for the property if the objector establishes that it is more likely than not that -
(a) the objector is the spouse, a de facto partner or a dependant of an owner of the property; and
(b) the objector is an innocent party, or is less than 18 years old; and
(c) the objector was usually resident on the property at the time the relevant confiscation offence was committed, or is most likely to have been committed; and
(d) the objector was usually resident on the property at the time the objection was filed; and
(e) the objector has no other residence at the time of hearing the objection; and
(f) the objector would suffer undue hardship if the property is confiscated; and
(g) it is not practicable to make adequate provision for the objector by some other means.
(4) The court may set aside the freezing notice or freezing order if the objector establishes that it is more likely than not that -
(a) the objector is the owner of the property, or is one of 2 or more owners of the property; and
(b) the property is not effectively controlled by a person who made criminal use of the property; and
(c) the objector is an innocent party in relation to the property; and
(d) each other owner (if there are more than one) is an innocent party in relation to the property.
(5) If the objector establishes the matters set out in subsection (4)(a), (b) and (c), but fails to establish the matter set out in subsection (4)(d), the court may order that, when the property is sold after confiscation, the objector is to be paid an amount equal to the amount that bears to the value of the property the same proportion as the objector's share of the property bears to the whole property.
(6) In an order under subsection (5), the court is to specify the proportion that it finds to be the objector's share of the property.
(7) On the application of the DPP or an owner of the property, the court may set aside the freezing notice or freezing order for the property if it also orders the objector to pay to the State an amount equal to the value of the property.
(8) Sections 22(6), 22(7), 23, 24, 25 and 26 apply in relation to making an order under subsection (7) and to the objector as if the order was a crime-used property substitution declaration and the objector was the respondent in relation to the declaration.
17 A person is an 'innocent party' in relation to crime-used property if the criteria set out in the definitions in s 153(1), (2), (3) or (4) are met. Section 153(1) and s 153(2) are relevant in this case and they are in the following terms:
153. Term used: innocent party
(1) A person is an innocent party in relation to crime-used property if the person -
(a) was not in any way involved in the commission of the relevant confiscation offence; and
(b) did not know, and had no reasonable grounds for suspecting, that the relevant confiscation offence was being or would be committed, or took all reasonable steps to prevent its commission.
(2) A person is an innocent party in relation to crime-used property if the person -
(a) did not know, and had no reasonable grounds for suspecting, that the property was being or would be used in or in connection with the commission of the relevant confiscation offence; or
(b) took all reasonable steps to prevent its use.
The evidence
19 Mr Stribrny swore an affidavit on 22 April 2015, which was read and relied upon at the hearing. Ms Stribrna has sworn two affidavits, one on 1 April 2015 and a second on 22 April 2015, and these affidavits were read and relied upon at the hearing. In her second affidavit Ms Stribrny repeats what is said in her first affidavit but adds some details. Mr Stribrny and Ms Stribrna were each cross-examined on their affidavits.
20 The defendant read and relied upon two affidavits sworn by Ms Hayley Speight, an employee of the Office of the Director of Public Prosecutions. Ms Speight swore her affidavits on 26 March and 21 August 2015. These affidavits attached:
(i) a copy of the transcript of the proceedings before the Magistrates Court which resulted in Mr Stribrny being convicted of the Offence;
(ii) a DVD recording of the search of the Property on 29 February 2012, which was tendered in evidence at Mr Stribrny's trial;
(iii) the Freezing Notice; and
(iv) a copy of the Certificate of Title of the Property recording that a memorial under the CPCA was lodged on 4 April 2012.
21 Section 107 of the CPCA permits me to have regard to the transcript of any evidence given at Mr Stribrny's trial as well as the exhibits which were before the Court.
22 In addition, photographs of the rooms in which the cannabis plants were being grown and of the exhaust/extraction equipment in the roof space of the Property were tendered.
Factual findings
23 I make the following findings of fact.
Family background and circumstances
24 Each of the plaintiffs was born in the Czech Republic. They married on 12 October 1996 and moved to Australia in June 1997.
25 Ms Stribrna's parents, brother and sister live in the Czech Republic. Mr Stribrny's parents have separated. His father lives in the Czech Republic and his mother lives in Perth.
26 The plaintiffs have three children, a son who is 18 years old and twin daughters who are 13 years old. The Property is the plaintiffs' family home. The Property was Ms Stribrna's usual residence at the time the Offence was committed and at the time she filed her objection. Ms Stribrna had no other residence at the time the objection was heard.
27 Ms Stribrna was brought up with a cultural expectation that women were raised to have a family, look after their children and have little say in their families' financial affairs. Her expectation was that the men of the family have the dominant say in financial matters.
28 English is Ms Stribrna's second language. Ms Stribrna's understanding of spoken and written English was poor when she arrived in Australia in 1997. Her command of English improved and she completed a Certificate III in Spoken and Written English in December 2008. Ms Stribrna gave evidence in English. She was able to understand questions put to her in cross-examination.
29 Throughout the marriage Mr Stribrny has exercised total control over the family's financial affairs. Mr Stribrny had credit card accounts and debts which he kept secret from Ms Stribrna. Ms Stribrna discovered the existence of these credit card accounts and debts after the police officers searched the Property on 29 February 2012. She ceased to trust Mr Stribrny thereafter and this strained their relationship.
30 Ms Stribrny has not been in paid employment at any stage in the course of the marriage. As she described herself in her affidavits, she is a housewife who looks after her children, her husband and works around the house.
31 Mr Stribrny operates a small earthworks business under the name K & D Earthworks. Ms Stribrna helps out with the paperwork by sorting out business receipts into various categories. She does this approximately once every two weeks.
32 Occasionally, Ms Stribrna has worked in the business as a labourer. Ms Stribrna was unable to say how often she has done this kind of work. Given her evidence that she is a housewife, the impression I have is that Ms Stribrna has not worked in Mr Stribrny's business as a labourer on a regular or frequent basis, and I so find. Ms Stribrna has not been paid for the work she has undertaken in her husband's business.
The acquisition of the Property
33 Mr Stribrny bought the Property in about 2004. The Property was registered solely in Mr Stribrny's name.
34 Mr Stribrny deposed that Ms Stribrna's name did not appear on the title because her English was poor in 2004 and it would have made 'the paperwork more complicated'. I find that the Property was registered solely in Mr Stribrny's name, in part, because Ms Stribrna's poor understanding of English may have complicated the paperwork and, in part, because the acquisition of the Property was a financial matter that Ms Stribrna would have left to Mr Stribrny.
35 The Property was purchased as part of a house and land package. The purchase price for the land was $88,000. This sum was provided by Mr Stribrny's father by way of a gift.
36 Mr Stribrny borrowed $140,000 to finance the construction of the house. This borrowing was secured by a mortgage over the Property.
37 Mr Stribrny borrowed further funds against the security of the Property to pay for various improvements and to purchase furniture.
38 Mr Stribrny makes weekly repayments in respect of the mortgage of $806.96.
39 Ms Stribrna has made no direct or indirect financial contribution to the acquisition or maintenance of the Property. I am not satisfied that Ms Stribrna's limited unpaid work in Mr Stribrny's business was capable of constituting an indirect financial contribution to the acquisition of the Property.
40 On 1 March 2015 there was approximately $375,521 secured by way of borrowings against the Property. This amount did not change significantly between 1 March 2015 and the hearing. No evidence was adduced as to the value of the Property and I am unable to make any findings in that respect.
The layout of the Property and its use
41 On the basis of the video footage of the search conducted by the police on 29 February 2012, I make the following findings as to the layout and use of the Property. Unless the context indicates otherwise, my findings are findings as to the layout and use of the Property at the time of the search.
42 The Property was a single storey suburban family home. The accommodation comprised: an entrance hall; a master bedroom and en suite bathroom, used by the plaintiffs; a single bedroom occupied by the plaintiffs' son; a television room; a bedroom for the plaintiffs' twin daughters (though I note that Mr Stribrny gave evidence that his daughters slept in the 'theatre room'); a large kitchen and adjoining open plan area; a room fitted out as an office; a separate bathroom; a laundry and two further rooms to the rear of the house, being the rooms in which the cannabis plants were found. I infer that these rooms were originally intended for use as bedrooms. They were next to the laundry and close to the plaintiffs' son's room
43 For some time Mr Stribrny's parents lived with the plaintiffs and their children in the Property. Mr Stribrny's parents occupied at least one of the two rear rooms subsequently used for growing cannabis. After Mr Stribrny's parents moved out of the Property, the rear rooms were used as children's bedrooms. Mr Stribrny's evidence was that these rooms were used as the children's bedroom for 'quite a substantial time', (ts 5, 24 August 2015).
44 At some point, Mr Stribrny moved the children's beds from the rear bedrooms into the theatre room. Mr Stribrny's evidence was that he told his children that he was renovating the rear rooms, (ts 5, 24 August 2015). I interpolate that in her affidavit evidence Ms Stribrna said that Mr Stribrny told her that the rear rooms were being used to store his father's belongings. I find that as a housewife and primary carer for the plaintiffs' children, Ms Stribrna would have been interested in why her children could not use the two rear rooms and would have questioned the inconsistent explanations given by Mr Stribrny as to the use of the rooms.
45 After the children had been moved out of the rear rooms, Mr Stribrny installed the hydroponic cannabis cultivation system. Mr Stribrny said that this was about three months before the police searched the Property on 29 February 2012. I find that the hydroponic cultivation system was established by the beginning of December 2011.
46 The hydroponic cultivation system shown on the video recording of the search of the property warranted the description 'elaborate and sophisticated' given to it by his Honour, Magistrate Edward de Vries, before whom the criminal charge was heard.
47 Without being exhaustive, the system included lights, reflective screens and equipment associated with the lights known as 'ballasts'; a watering system; and an exhaust system. The exhaust system included a carbon filter and several metres of large ducting located in the roof space of the Property. The purpose of this exhaust system was to remove the pungent odour which emanated from the cannabis plants. To install the exhaust system the first plaintiff cut holes in the ceiling of each of the two rear rooms.
48 There were seven cannabis plants being grown in each of the rear rooms. The video footage and photographs tendered in the course of the hearing show mature plants with substantial foliage. The plants would have required regular tending by Mr Stribrny.
49 The plaintiffs and their family went on holiday to the Czech Republic in mid-January 2012 and returned in the late afternoon of 29 February 2012. The police searched the Property on the morning of that day. Mr Stribrny's father was present when the police officers searched the Property. Mr Stribrny had asked his father to look after the cannabis plants whilst he, Mr Stribrny, was on holiday with his family.
50 I will record my findings as to what Ms Stribrna knew about the cultivation of the cannabis plants in the course of considering whether Ms Stribrna was an innocent party.
Potential consequences of confiscation of the Property
51 I am satisfied that the events leading up to Mr Stribrny's conviction for the Offence and the conviction itself have created stress and disharmony between the plaintiffs. They gave evidence that their marriage is under strain and that they have contemplated divorce. I find that to be so.
52 I find, however, that the strain in the plaintiffs' relationship has been caused, in part at least, by Ms Stribrna's discovery that Mr Stribrny had credit card accounts and debts that he kept from her. This discovery engendered a lack of trust between them.
53 Before making further findings as to the likely consequences that may flow from a confiscation of the Property, I must refer to some aspects of the plaintiffs' evidence, and their submissions to me, to provide context for my findings. Ms Stribrna deposed that the deterioration in their relationship had caused Mr Stribrny to suffer stress and depression, which had caused him to stop working. Mr Stribrny said that he feared that if the Property was confiscated he would suffer a recurrence of the depression that he had suffered. Ms Stribrna's evidence was that if the Property was confiscated, then this might lead to a divorce, in which case she and her children would have nowhere in Australia to live and she and her children would have to go to live in the Czech Republic with her family. In the course of addressing me, Mr Stribrna informed me that he had been working really hard over the last years and '…making really good money'. He said that his business, '…is doing really, really good at the moment' (ts 24 - 25, 24 August 2015). Mr Stribrny informed me that he had offered to pay the defendant an amount equal to the net equity in the Property.
54 Against the background of that evidence, I find that the confiscation of the Property may well cause the plaintiffs' to suffer further stress and disharmony. I find, however, that Mr Stribrny has a good income earning capacity and at least access to some capital, which he can use to provide alternative housing for Ms Stribrna and their children, whether they stay together as a single family unit or whether Mr Stribrny and Ms Stribrna separate and/or get divorced.
55 I am not prepared to speculate as to whether confiscation of the Property will cause the plaintiffs to get divorced. Should that unfortunate event occur, I am not satisfied that it will be necessary for Ms Stribrna to return to live in the Czech Republic with her children.
Can Ms Stribrna rely on the hardship provision to set the Freezing Notice aside?
56 Section 82(3) of the CPCA sets out the criteria which an objector, who is a spouse, de facto partner or dependent of an owner of property, must satisfy before a court may set aside a freezing notice or freezing order. The onus is on the objector to establish that it is more likely than not that each criterion exists or existed at the relevant time.
57 As I have found Ms Stribrna was Mr Stribrny's spouse, she was usually resident in the Property at the time the Offence was committed and when she filed her objection. I have found that she has no other residence. Thus, the criteria identified in s 82(3) (a), (c), (d) and (e) are satisfied.
58 There were disputes as to whether:
(a) Ms Stribrna is an innocent party, s 82(3)(b).
(b) Ms Stribrna would suffer undue hardship if the Property is confiscated, s 82(3)(f).
(c) It is 'not practicable' to make adequate provision for Ms Stribrna by other means, s 82(3)(g).
Is Ms Stribrna an innocent party?
59 The term 'innocent party' is defined in s 153 of CPCA. Section 153(1) is directed to the circumstances in which property is crime-used because the relevant criminal act or omission was done or omitted to be done or facilitated on the property. Section 153(2) is directed to the circumstances in which the property was actually used in or in connection with the relevant confiscation offence. There will be cases, such as the present one, in which both definitions may be relevant.
60 It was submitted by the defendant, and I accept, that the knowledge, or reasonable grounds for suspecting, either that the relevant confiscation offence was committed on a property or that a property was used in connection with the confiscation offence, must be knowledge or reasonable grounds for suspicion in respect of each element of the relevant confiscation offence or wilful blindness to those elements, Hong Yen Le v Director of Public Prosecutions [2007] VSCA 72; (2007) 171 A Crim R 196.
61 The elements of Offence were: the cultivation of cannabis; and an intent to sell or supply.
62 I accept that Ms Stribrna was not in any way involved in the cultivation of the cannabis plants and that, therefore, she satisfies s 153(1)(a) of the CPCA.
63 Ms Stribrna must establish that it was more likely than not that she did not know or, that she had no reasonable grounds for suspecting, Mr Stribrny was growing cannabis plants in the rear rooms of the Property. Stripped of the double negative, if Ms Stribrna knew or had reasonable grounds for suspecting that Mr Stribrny was growing cannabis plants in the Property, she is not an innocent party.
64 In her affidavits Ms Stribrna deposed that she did not have access to the two rooms in which the cannabis plants were being grown. She said the rooms were locked and she did not have the keys. As I have noted, Ms Stribrna said that Mr Stribrny told her that he was storing his father's belongings in the rooms. She deposed that she only found out that Mr Stribrny was growing plants in the rooms two days before the family left to go on holiday in January 2012. She said when she discovered the plants she suspected they were cannabis plants and confirmed they were by searching the internet. Ms Stribrna maintained her denials of knowledge of Mr Stribrny's activities in cross-examination, (ts 18, 24 August 2015).
65 Ms Stribrna must satisfy me on the balance of probabilities that she is an innocent party. The explanation given by Mr Stribrny that he undertook the work required to set up the hydroponic cultivation system and tended to the cannabis plants whilst Ms Stribrna was at the shops or at the gym, and Ms Stribrna's denials of knowledge must be weighed against the objective circumstances as I have found them to be. Those objective circumstances are as follows:
(a) the Property is a relatively modest family house able to accommodate a family of five comfortably if the rear rooms were used for accommodation purposes but less so if they were not;
(b) Ms Stribrna is a housewife who looks after her children and works around the house, the two rooms in question were next to the laundry and close to the plaintiffs' son's bedroom;
(c) Ms Stribrna would have had an interest in why her children could not use the rear rooms given that they had occupied them for some substantial time after Mr Stribrny's parents had moved out of the Property;
(d) Mr Stribrny had told his children that he had moved them into the theatre room because he was going to renovate the rooms - an explanation which differed from that given by him to Ms Stribrna as to the use to which at the rooms were being put, that is, storage of his father's belongings;
(e) the work required to establish the hydroponic cultivation system was considerable: within the rooms themselves the work involved the installation of lights, reflectors, ballasts for the lights, an irrigation system, growing pots, the blacking out the external windows with chipboard and the cutting of holes in the ceilings; externally, the system involved the installation of exhaust system in the roof space of the Property and ducting from the ceilings of each of the rooms to the exhaust system;
(f) it would have been necessary for Mr Stribrny to spend some time, on a regular basis, tending to the plants and the cultivation system;
(g) Mr Stribrny worked in his earth moving business; and
(h) for at least some of the period in which the cannabis plants were being grown the plaintiffs' children were on holiday from school.
66 Against that background, I am not satisfied that Ms Stribrna did not know that the Property was being used for the cultivation of cannabis. Taking into account the circumstances to which I have referred, in my view, it is highly improbable that Ms Stribrna did not know that cannabis was being grown in the rear rooms. I am satisfied that Ms Stribrna was aware that both rooms were being used to grow cannabis plants using a hydroponic system of some sophistication and that she was aware of these matters much earlier than she was prepared to admit in her affidavits and in her evidence before me.
67 The next question is whether Ms Stribrna did not know that Mr Stribrny intended to sell or supply cannabis to others, or had no reasonable grounds to suspect that Mr Stribrny intended to sell or supply cannabis to others.
68 In my view, the fact that two rooms were being used to grow cannabis plants and the scale of the cultivation system are all facts which constitute reasonable grounds for suspecting that cannabis was being grown with intent to sell or supply. As I have found, Ms Stribrna was aware that the two rooms were being used to grow cannabis plants and was aware of the cultivation system. I conclude that she had reasonable grounds to suspect that cannabis was being grown with intent to sell or supply to others.
69 I am not satisfied that Ms Stribrna is an innocent party and for this reason she cannot succeed in setting aside the Freezing Notice on the basis of the hardship provisions of s 82(3).
70 Whilst my conclusion that Ms Stribrna is not an innocent party means it is not necessary to do so, for the sake of completeness I will consider the remaining criteria of s 82(3), namely, whether Ms Stribrna will suffer undue hardship if the Property is confiscated and whether it is 'not practicable' to make adequate provision for Ms Stribrna by other means.
Will Ms Stribrna suffer undue hardship if the Property is confiscated?
71 The phrase 'undue hardship' is not defined in the CPCA. In BJF v The State of Western Australia [2011] WASC 163 Murray J considered the meaning of the phrase as it appears in s 82(3)(f). His Honour did so against the background of the statutory predecessor to the CPCA, namely the Crimes (Confiscation of Profits) Act 1988 (WA), (the 1988 Act). At [42] his Honour observed that, having regard to the structure of the CPCA, the approach adopted under the 1988 Act no longer applied. His Honour continued in the following terms at [46] - [49]:
…The question of undue hardship requires a judgment about the impact of confiscation upon the innocent objector in the particular circumstances of the case.
Lake is a decision of the Court of Criminal Appeal of NSW, concerned with the then recently enacted Crimes (Confiscation of Profits) Act 1985 (NSW). Kirby P, Lee CJ at CL and McInerney J agreeing, said:
In considering hardship, it is necessary to bear in mind that, of necessity, in achieving its objects, the Act will cause a measure of hardship in the deprivation of property. Indeed that is its intention. It is not that kind of hardship, therefore, that can give rise to the relief under s5(1)(b)(ii). The provision for relief on that ground must not be so interpreted as to frustrate the achieving of the purpose of Parliament in enacting the exceptional provisions of the Act. Something more than ordinary hardship in the operation of the Act is therefore meant. Otherwise the Act would have, within it, the seeds of its own ineffectiveness in every case (66 - 67).
Bearing that in mind, it seems to me that, in the context of s 82, the term 'undue hardship' bears its ordinary meaning. The Oxford English Dictionary refers, among other things, to hardship being the quality of being hard to bear, painful, difficult, involving suffering or privation. The adjective 'undue', in its dictionary meaning, requires a comparison of the hardship found with what might ordinarily be encountered from the occurrence of the event which creates the hardship, so that the hardship suffered goes beyond what is warranted and becomes excessive or disproportionate.
In the context of this legislation, an objector may be held to suffer undue hardship if the property is confiscated because that person would, more likely than not, suffer greater hardship or deprivation than would ordinarily flow from the confiscation, to a degree or of a kind that causes the court to conclude that such hardship should not be imposed on the objector.
72 I have no doubt that the confiscation of the Property will cause Ms Stribrna and her children hardship. I do not under-estimate the emotional distress that Ms Stribrna and her children may experience. Such hardship and distress is the inevitable consequence of the confiscation of a family home. As I have said, I am not prepared to find that the confiscation of the Property will have the additional consequences that the plaintiffs will get divorced and that Ms Stribrna and her children will be obliged to leave Australia to live with her family in the Czech Republic.
73 The question which I must answer is whether the hardship that will be suffered by Ms Stribrna is greater hardship than would ordinarily flow from the confiscation of a family home - that is, whether it is undue hardship. As I have said, I do not under-estimate the hardship which Ms Stribrna and her children will suffer as a result of the confiscation of the Property, but I do not consider that it is greater hardship than that which would flow ordinarily from the confiscation of a family home. It is not undue hardship as that phrase must be understood in the context of the CPCA.
Is it not practicable to make adequate provision for Ms Stribrna?
74 I have found that Mr Stribrny has the financial resources to provide alternative housing for Ms Stribrna and her children. On this basis, I am not satisfied that it is not practicable to make adequate provision for Ms Stribrna by some means other than by setting aside the Freezing Notice.
75 For the reasons I have set out above, Ms Stribrna has not established the criteria set out in s 82(3) which would permit the Court to set aside the Freezing Notice.
Is Ms Stribrna entitled to a proportionate share of the proceeds of sale of the Property - s 82(5) of CPCA?
76 I have found that Ms Stribrna is not an innocent party and this is an insurmountable obstacle to the success of a claim by Ms Stribrna to a proportionate share of the proceeds of sale of the Property.
77 For the sake of completeness, I will consider whether Ms Stribrna satisfies the balance of the requirements of s 82(5) that need to be satisfied to establish an entitlement to a share of the sale proceeds.
78 Ms Stribrna's affidavits set out matters which were directed to establishing that she has an equitable interest in the Property.
79 To establish an entitlement to share in the proceeds of sale, Ms Stribrna needs to establish each of the following:
(a) the property is not effectively controlled by Mr Stribrny, within the meaning of that phrase as defined in the CPCA;
(b) she is an owner of the Property within the meaning of the CPCA, that is, relevantly, that she has an equitable interest in the Property; and
(c) she is an innocent party in relation to the Property.
Does Mr Stribrna effectively control the Property?
80 Mr Stribrna is the registered owner of the Property and thus does not fall within the definition of a person who has effective control of a property as that term is defined in s 156(1) of the CPCA.
Does Ms Stribrna have an equitable interest in the Property?
81 The first basis upon which Ms Stribrna might claim an equitable interest in the Property is that she and Mr Stribrny had a common intention that the Property should be held by Mr Stribrny for them jointly and that Ms Stribrna acted to her detriment in not taking steps to have the Property transferred into their joint names, (a common intention constructive trust: see Allen v Snyder (1977) 2 NSWLR 685).
82 I have found that the Property was registered in Mr Stribrny's name because Ms Stribrna's command of English at the time the Property was purchased was such that she would have had difficulty understanding the relevant paperwork, and because of the cultural expectation that this was a matter with which Mr Stribrny would deal.
83 In my view, these findings do not provide a sufficient basis for me to infer that there was a common intention that the Property was to be held by Mr Stribrny for himself and Ms Stribrna jointly. No evidence was adduced by the plaintiffs about the ownership of the Property beyond the evidence of why the Property was registered in Mr Stribrny's name. No evidence was adduced about their approach to the ownership of other assets which might illuminate their intentions in respect of the ownership of the Property. In short, there was no evidence that would enable me to make findings more favourable to Ms Stribrna on the question of whether the necessary common intention existed.
84 I am not satisfied that Ms Stribrna had an equitable interest in the Property on the basis of a common intention constructive trust.
85 The second basis upon which Ms Stribrna might have an equitable interest in the Property is on the basis of the principle in Baumgartner v Baumgartner (1987) 164 CLR 137. The principle was described in the following terms by Gleeson CJ (Priestley JA agreeing) in Green v Green(1989) 17 NSWLR 343, 353:
Nevertheless, it is now well-settled that there are circumstances in which a court of equity will intervene to declare the existence of a proprietary interest in a family home on the part of [a] spouse or de facto partner, and the unifying principle underlying the cases where such intervention is regarded as appropriate is that in the circumstances of the case, and in accordance with equitable doctrines, it would be unconscionable on the part of the person against whom the claim is set up to refuse to recognise the existence of the equitable interest: Baumgartner v Baumgartner (1987) 164 CLR 137at 147 per Mason CJ, Wilson and Deane JJ.
The most common case of intervention of that kind to be found in the law reports is the case where the person in whose favour a constructive trust is found has, directly or indirectly, made a financial contribution towards the cost of acquiring, improving, or maintaining the property in question.
86 The passage from Gleeson CJ's judgment cited above appears after a passage in which his Honour had emphasised that the existence of a de facto relationship, in combination with express or implied undertakings to provide support or accommodation, will not constitute a sufficient basis for imposing a constructive trust under which a proprietary interest in a home occupied by the parties is created.
87 In Green the Court was concerned with a de facto relationship. Mr Stribrny and Ms Stribrna are married, but this makes no difference to the application of the principle.
88 Contributions of a non-financial kind may be taken into account in determining whether a spouse or de facto has a proprietary interest. In Muschinski v Dodds (1985) 160 CLR 583, Deane J said the following:
[A]ny assessment of what would and would not constitute unconscionable would obviously be greatly influenced by the special considerations applicable to a case where a husband and wife or persons living in a 'de facto' situation contribute, financially and in a variety of other ways, over a lengthy period to the establishment of a joint home. In the forefront of those special considerations there commonly lies a need to take account of a practical equation between direct contributions in money or labour and indirect contributions in other forms such as support, homemaking and family care.
89 As Murray J held (Hasluck J agreeing) in Lloyd v Tedesco (2002) 25 WAR 360 at [30]:
The guiding principle is unconscionability. In this, as in every such case of a failed de-facto relationship, there must be more than simply the performance by the plaintiff of the valuable role of the provision of love, care and support. The provision of such a contribution will be sufficient only if it is related in some factual way to the generation of wealth as part of a joint effort or endeavour to provide for the parties' mutual material welfare and security.
90 I have found that Ms Stribrna did not make any direct or indirect financial contributions to the purchase or maintenance of the Property.
91 I have no reason to doubt that Ms Stribrna has contributed in many positive non-financial ways to her family. These contributions were not related, however, in a factual way to the generation of wealth as part of a joint endeavour with Mr Stribrny.
92 In reaching this conclusion I am influenced by the nature of the contributions themselves (domestic and child rearing responsibilities), and by the fact that Mr Stribrny was in total control of the family's financial affairs. This militates against the existence of a joint endeavour of the nature required to establish an equitable interest in the Property.
93 I am satisfied that Ms Stribrna does not have an equitable interest in the Property on either of the bases which I have canvassed above.
Conclusion
94 For the reasons I have set out above, Ms Stribrna is not able to rely on the provisions of s 82(3) of the CPCA to set aside the Freezing Notice and nor is she able to rely on the provisions of s 82(5) to claim a proportion of the proceeds of sale of the Property when it is sold.
95 I dismiss the plaintiffs' objections and their application to set aside the Freezing Notice.
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