The Commissioner of the Australian Federal Police v Cranston (No 12)

[2020] NSWSC 508

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:	The Commissioner of the Australian Federal Police v Cranston (No 12) [2020] NSWSC 508
Hearing dates:	01 May 2020
Date of orders:	07 May 2020
Decision date:	07 May 2020
Jurisdiction:	Common Law
Before:	Wright J
Decision:	(1) The orders made at paragraphs 49 and 50 of the orders made in these proceedings on 16 May 2017 be vacated. (2) The orders made at paragraphs 51 and 52 of the orders made in these proceedings on 16 May 2017 be vacated. (3) The orders made at paragraphs 54 and 55 of the orders made in these proceedings on 16 May 2017 be vacated. (4) The orders made at paragraphs 57 and 58 of the orders made in these proceedings on 16 May 2017 be vacated. (5) The orders made at paragraphs 63, 64, 65, 66 and 67 of the orders made in these proceedings on 16 May 2017 be vacated. (6) The order made at paragraph 141 of the orders made in these proceedings on 16 May 2017 be amended to read as follows: Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Item 2 of Schedule 88 of these Orders must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified in these orders. (7) The custody and control order made at paragraph 163 of the orders made in these proceedings on 16 May 2017 as amended in the Fourth Further Amended Summons filed on 6 July 2018 be amended to read as follows: Pursuant to section 38 of the Proceeds of Crime Act 2002 (Cth), the Official Trustee in Bankruptcy (Official Trustee) is to take custody and control of the property specified in Schedules 1 to 20 inclusive, Schedule 23, Schedule 25, Schedules 27 to 28 inclusive, Schedules 30 to 87 inclusive, Schedule 88 Item 2, Schedules 89 to 98 inclusive, Schedule 100, Schedules 102 to 106 inclusive, Schedules 110 to 121 inclusive and Schedules 123 to 129 inclusive, to this Summons.
Catchwords:	CRIME - Proceeds of Crime – Variation and vacation of orders under the Proceeds of Crime Act 2002 (Cth)
Legislation Cited:	Proceeds of Crime Act 2002 (Cth)
Cases Cited:	The Commissioner of the Australian Federal Police v Cranston and Ors (No 1) [2017] NSWSC 674
Category:	Procedural and other rulings
Parties:	The Commissioner of the Australian Federal Police (Plaintiff) Adam Michael Cranston (First Defendant) Jason Cornell Onley (Second Defendant) Simon Paul Anquetil (Third Defendant) Dev Menon (Fourth Defendant) Devyn Hammond (Sixth Defendant) Prescott Page Recoveries Pty Ltd (Twenty-Fourth Defendant) Dali Cvek (Twenty-Fifth Defendant) First to Tenth Respondents
Representation:	Counsel: G O’Mahoney (Plaintiff) P Bruckner (Fourth Defendant)   Solicitors: Criminal Assets Litigation, Australian Federal Police (Plaintiff) Pure Legal (Second Defendant) Hardinlaw (Fourth Defendant)
File Number(s):	2017/146280

Judgment

1. On 16 May 2017, Fullerton J heard an ex parte application by the Commissioner of the Australian Federal Police for orders under the Proceeds of Crime Act 2002 (Cth) (the POC Act) in respect of the suspected involvement of a large number of people in an organised taxation fraud.

2. On that occasion, orders were made restraining a number of individuals and entities from dealing with a large number of items of property listed in the schedules to the orders: The Commissioner of the Australian Federal Police v Cranston and Ors (No 1) [2017] NSWSC 624. Further orders have been made on a number of occasions since.

3. By an amended notice of motion filed on 12 March 2020, the Commissioner has sought in prayers 1 to 7 to vacate a number of orders made by Fullerton J on 16 May 2017 and to vary others of those orders. In short, the vacation and variation of those orders in all cases but one involves removing from the orders extant in these proceedings orders relating to motor vehicles which either have been disposed of by persons who had a security interest in them or were not under the effective control of a relevant defendant at the relevant time. The persons holding security interests were entitled, in accordance with the orders made in these proceedings, to dispose of the vehicles in order to recover amounts owed to them. In those cases, however, the proceeds of sale have not been sufficient to meet the amounts owed. As a result, no purpose is served by having extant orders under the POC Act relating to those vehicles and it may lead to confusion as to whether the vehicles are still subject to restraining orders. The other relevant item of property is an interest in a superannuation fund which had a nil balance and was closed prior to the making to the orders on 16 May 2017.

4. If the orders are vacated or varied as proposed, it will make clear that the vehicles in question and the superannuation fund are no longer the subject of restraining orders, for the benefit of the persons who have acquired the vehicles and the holder of the closed fund. It will also declutter the orders in these proceedings.

5. In addition, in prayer 8, the Commissioner sought a declaration that he and the Commonwealth are released from the usual undertaking as to costs and damages provided to the Court on 16 May 2017 in relation to the relevant items of property.

6. The persons affected by the orders sought in the amended notice of motion were identified as:

1. each of the first, second, third, fourth, sixth, twenty-fourth and twenty-fifth defendants, as the owners or suspected effective controllers of the relevant items of property; and

2. the ten respondents named in the amended notice of motion, who are the security holders and the persons who have acquired the vehicles.

7. The sixth defendant signed a form of orders by which he consented to the making of orders in accordance with prayers 1 to 8. Mr Bruckner, of counsel, who appeared for the fourth defendant informed the Court that his client consented to the making of orders in accordance with prayers 1 to 7 but opposed the making of an order in terms of prayer 8.

8. Each of the first, fourth, fifth, eighth, ninth and tenth respondents signed a form of orders by which they consented to the making of orders in accordance with prayers 1 to 8.

9. Copies of the letters sent to the remaining relevant defendants, except the twenty-fourth defendant, and the other respondents informing them of what had occurred when the amended notice of motion was last before the Court and of the hearing of the amended notice of motion on 1 May 2020, were also before the Court. None of these persons appeared at the hearing on 1 May 2020 or communicated any opposition to the orders being made. I shall deal with the position of the twenty-fourth defendant later in these reasons.

10. During the hearing, the Commissioner brought to the Court’s attention that there was a further person, Mr Bitar, who had acquired one of the vehicles from one of the respondents. An affidavit of service of the relevant documentation on Mr Bitar was read. He did not appear to oppose the orders being made.

11. The affidavits of Mr Drummond of 13 December 2019 and 30 April 2020 which were read by the Commissioner established the relevant circumstances concerning all the items of property except the Nissan GTR. These can be summarised in the following table:

16 May 2017 Order	Item of Property	Security Interest holder	Relevant Defendants	Relevant Respondent
49-50	Porsche 911 Coupe motor vehicle, VIN: WP0ZZZ99ZGS189834	Westpac Banking Corporation under security interest PPSR # 201605250042100	Dali Cvek -25th defendant Suspected to be under the effective control of Adam Cranston – 1st defendant	Vehicle was sold but was subsequently the subject of a statutory write-off on 16 May 2019
54-55	Mercedes SLK 350 motor vehicle, VIN: WDD1724472FO67676	Mercedes-Benz Financial Services Australia Pty Ltd under security interest PPSR# 201306260087574	Suspected to be under the effective control of Dev Menon - 4th defendant	Current owner Tanya Louise Iori - 5th respondent
57-58	Jeep Wrangler motor vehicle, VIN: 1C4HJWKG4FL720518	Macquarie Bank Limited under security interest PPSR # 201512140052358	Suspected to be under the effective control of Devyn Hammond - 6th defendant	Current owner Soul Fighters International Pty Ltd - 6th respondent
63 & 64	Audi Q3 motor vehicle, VIN: WUAZZZ8U4ER904125	Commonwealth Bank of Australia under security interest PPSR# 201502030033163	Jayo Pty Ltd in its capacity as trustee of the Jayo Family Trust – 27th defendant Suspected to be under the effective control of Jason Onley – 2nd defendant	Martin Zozi – 7th respondent who sold to current owner Marcel Bitar
63 & 65	BMW X6 motor vehicle, VIN: WBSKW820800G94368	BMW Finance Australia Limited under security interest PPSR# 201512080048271	Jayo Pty Ltd in its capacity as trustee of the Jayo Family Trust – 27th defendant Suspected to be under the effective control of Jason Onley – 2nd defendant	Current owner Mary Kathleen Pettingill – 8th respondent
63 & 66	Porsche Macan motor vehicle, VIN: WP1ZZZ95ZHLB63313	Commonwealth Bank of Australia under security interest PPSR# 201609220040783	Jayo Pty Ltd in its capacity as trustee of the Jayo Family Trust – 27th defendant Suspected to be under the effective control of Jason Onley – 2nd defendant	Current owner Shaun Reginald Treacy – 9th respondent
63 & 67	Porsche 981 Coupe motor vehicle, VIN: WP0ZZZ98ZGK190171	Commonwealth Bank of Australia under security interest PPSR# 201609220041721	Jayo Pty Ltd in its capacity as trustee of the Jayo Family Trust – 27th defendant Suspected to be under the effective control of Jason Onley – 2nd defendant	Current owner Nicholas Loxton – 10th respondent
141 & 163 where they refer to Item 1 in Sch 88	Superannuation fund held by a trustee in the Onepath Masterfund account number 61000738981	N/A	Simon Anquetil – 3rd defendant	Account had nil balance and was closed prior to 16 May 2017

12. The affidavit of Mr Edwards of 10 December 2019 was also read. That affidavit concerned the Nissan GTR and established the following:

16 May 2017 Order	Item of Property	Security Interest holder	Relevant Defendant	Relevant Respondent
51 & 52	Nissan GTR motor vehicle, VIN: JN1GANR35A0460050	BMW Finance Australia Limited under security interest PPSR# 201609290083208	Prescott page Recoveries Pty Ltd – 24th defendant Suspected to be under the effective control of Adam Cranston – 1st defendant	Robert Lane – 1st respondent The vehicle was acquired by the 1st respondent prior to 16 May 2017

13. In these circumstances, I accept that it is now inappropriate for restraining or other orders to remain in respect of each item of property identified above.

14. In relation to the twenty-fourth defendant I am satisfied that, in accordance with the Commissioner’s usual practice, notice of the hearing on 1 May 2020 was probably given to the twenty-fourth defendant, even though the correspondence to this effect was not before the Court. Further and even if I am wrong in that regard, since the evidence established that ownership of the Nissan GTR had passed from the twenty-fourth defendant to the first respondent before the relevant orders were made on 16 May 2017 and the vehicle was not under the effective control of the first defendant by that date, vacating the relevant orders cannot have any adverse effect on the twenty-fourth defendant.

15. I note that prayer 8 in the amended notice of motion was dealt with when I made orders (2) and (3) on 1 May 2020 as follows:

“2. The question of the granting of relief sought in prayer 8 of the notice of motion is stood over for directions on 16 July 2020 at 9.30am.

3. The parties have liberty to restore on three days' notice.”

16. Accordingly, in respect of prayers 1 to 7 of the amended notice of motion filed by the Commissioner on 12 March 2020, the Court makes the following orders:

1. The orders made at paragraphs 49 and 50 of the orders made in these proceedings on 16 May 2017 be vacated.

2. The orders made at paragraphs 51 and 52 of the orders made in these proceedings on 16 May 2017 be vacated.

3. The orders made at paragraphs 54 and 55 of the orders made in these proceedings on 16 May 2017 be vacated.

4. The orders made at paragraphs 57 and 58 of the orders made in these proceedings on 16 May 2017 be vacated.

5. The orders made at paragraphs 63, 64, 65, 66 and 67 of the orders made in these proceedings on 16 May 2017 be vacated.

6. The order made at paragraph 141 of the orders made in these proceedings on 16 May 2017 be amended to read as follows:

Pursuant to section 18 of the Proceeds of Crime Act 2002 (Cth), the property specified in Item 2 of Schedule 88 of these Orders must not be disposed of or otherwise dealt with by any person except in the manner and circumstances specified in these orders.

7. The custody and control order made at paragraph 163 of the orders made in these proceedings on 16 May 2017 as amended in the Fourth Further Amended Summons filed on 6 July 2018 be amended to read as follows:

Pursuant to section 38 of the Proceeds of Crime Act 2002 (Cth), the Official Trustee in Bankruptcy (Official Trustee) is to take custody and control of the property specified in Schedules 1 to 20 inclusive, Schedule 23, Schedule 25, Schedules 27 to 28 inclusive, Schedules 30 to 87 inclusive, Schedule 88 Item 2, Schedules 89 to 98 inclusive, Schedule 100, Schedules 102 to 106 inclusive, Schedules 110 to 121 inclusive and Schedules 123 to 129 inclusive, to this Summons.

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Amendments

12 May 2020 - Title of proceedings - amended to No.12

Decision last updated: 12 May 2020