The Commissioner of the Australian Federal Police v El Chami

[2021] NSWSC 728

Supreme Court

New South Wales

Medium Neutral Citation:

The Commissioner of the Australian Federal Police v El Chami [2021] NSWSC 728

Hearing dates:

17 June 2021

Date of orders:

17 June 2021

Decision date:

21 June 2021

Jurisdiction:

Common Law

Before:

Adamson J

Decision:

(1)   The First Defendant to file and serve a Notice of Motion as foreshadowed in paragraph 36(b) of the affidavit of Mohamad Sakr sworn 16 June 2021, together with any evidence in support and grounds for such relief, by 15 July 2021.

(2)    The time for compliance in respect of Orders 12 and 13 made on 1 March 2021 and served on 30 April 2021 be extended to 20 July 2021.

(3)    List the matter for mention before Adamson J on 16 July 2021 at 9.15am with a view to any directions being made if any notice motion is filed.

(4)    Liberty to restore on 3 days’ written notice to the associate to Adamson J.

(5)    Reserve the question of whether the first defendant should be ordered to pay the Commissioner's costs thrown away occasioned by the first defendant's breach of the orders made on the 30th of April 2021.

(6)    These orders be entered forthwith.

Catchwords:

CIVIL PROCEDURE — Re-listed on the application of the plaintiff by reason of continued defaults by the first defendant in complying with orders — Orders made ex parte pursuant to the Proceeds of Crime Act 2002 (Cth) — First defendant seeking further time for compliance — Deprived of opportunity to obtain legal advice while incarcerated — Extension granted

Legislation Cited:

Criminal Code Act 1995 (Cth), ss 134.2, 400.3, 400.9

Proceeds of Crime Act 2002 (Cth), ss 39A, 266A, 319

Cases Cited:

The Commissioner of the Australian Federal Police v Cranston (No 2) [2017] NSWSC 673

Category:

Procedural rulings

Parties:

The Commissioner of the Australian Federal Police (Plaintiff)
Issac El Chami (First Defendant)
Chenqi Lu, also known as Ryan Lu (Second Defendant)

Representation:

Counsel:
E Sullivan (Plaintiff)
H Somerville (First Defendant)
H Yang (Second Defendant)

Solicitors:
The Commissioner of the Australian Federal Police (Plaintiff)
Dib & Associates Lawyers (First Defendant)
Auslaw Partners (Second Defendant)

File Number(s):

2021/58202

Judgment

Introduction

1. This matter was re-listed on the application of the Commissioner of the Australian Federal Police (the plaintiff) by reason of continued defaults by Issac El Chami (the first defendant) in complying with orders of this Court.

2. The orders with which the first defendant has failed to comply were made pursuant to the Proceeds of Crime Act 2002 (Cth) (the Act) by Campbell J ex parte on 1 March 2021, being the day on which these proceedings were commenced by the filing of the summons in Court. The orders were made on the basis that an authorised officer reasonably suspected the first defendant of offences under s 134.2(1) (dishonestly obtain an advantage from the Commonwealth by deception) and s 400.9(1) of the Criminal Code Act 1995 (Cth) (Criminal Code) (dealing with money (at least $100,000) that is reasonably suspected of being the proceeds of crime).

3. The orders relevant to the plaintiff’s application to re-list the matter before me are as follows:

“12    Pursuant to section 39(1)(ca) of the Act, Issac El Chami is directed to give the Plaintiff within 28 days of service of these orders a sworn statement in the form set out in Schedule Four setting out:

(a)    all of his interests in property within the meaning of the Act, worldwide, not including any asset or interest in property with a value of less than AUD5,000 as at the date of these orders; and

(b)    all of his liabilities, worldwide, not including any liability with a value of less than AUD5,000 as at the date of these orders.

13    Pursuant to section 39(1)(d) of the Act, Issac El Chami is directed to give the Plaintiff within 28 days of service of these orders a sworn statement setting out the particulars of, or dealings with, the property in Schedule One and Schedule Two.”

4. Schedule One of the summons identified two St George Bank accounts in the first defendant’s name. Schedule Two of the summons identified a 2015 Mercedes Benz registered in the first defendant’s name.

5. The first defendant seeks further time for compliance with orders 12 and 13. At the conclusion of the hearing on 17 June 2021, I made the following orders:

“(1)    The First Defendant to file and serve a Notice of Motion as foreshadowed in paragraph 36(b) of the affidavit of Mohamad Sakr sworn 16 June 2021, together with any evidence in support and grounds for such relief, by 15 July 2021.

(2)    The time for compliance in respect of Orders 12 and 13 made on 1 March 2021 and served on 30 April 2021 be extended to 20 July 2021.

(3)    List the matter for mention before Adamson J on 16 July 2021 at 9.15am with a view to any directions being made if any notice motion is filed.

(4)    Liberty to restore on 3 days’ written notice to the associate to Adamson J.

(5)    Reserve the question of whether the first defendant should be ordered to pay the Commissioner's costs thrown away occasioned by the first defendant's breach of the orders made on the 30th of April 2021.

(6)    These orders be entered forthwith.”

6. What follows are my reasons for making the orders.

Factual background

7. In the affidavit filed in support of the summons, Federal Agent Scott McAllister deposed as to his suspicion that there may be further property of the first defendant which has not been specified in the summons and is the proceeds of crime and/or an instrument of the suspected offences. He deposed that there was a total of $2,342,358.25 standing to the first defendant’s credit in the two St George Bank accounts specified in Schedule One and that there was a total shortfall of at least $221,075.75 between the funds standing to the credit of the first defendant on 24 February 2021 and the total refunds from the Australian Taxation Office.

8. The summons, the affidavit and the orders made by Campbell J were served on the first defendant. His solicitor, Mohamad Sakr, filed a notice of appearance on 3 March 2021.

9. On 18 March 2021, the first defendant was arrested and taken into custody by the Australian Federal Police (AFP). He was subsequently charged with an offence pursuant to s 400.3(2) of the Criminal Code (dealing with proceeds of crime in excess of $1m). His bail application was refused by the Local Court. He remained in custody on remand at the Metropolitan Remand and Reception Centre at Silverwater (Silverwater) until he was released on 3 May 2021 pursuant to a grant of bail from this Court. While he was in custody, it was not possible for Mr Sakr to visit him to obtain instructions.

10. On 30 April 2021, the matter came before Garling J for directions. The first defendant sought an extension of the time for compliance with orders 12 and 13. Over the plaintiff’s objection, he was granted an extension until 28 May 2021 on the basis that he had been unable to obtain legal advice while he was in custody.

11. Before 3 May 2021, Mr Sakr briefed counsel to provide advice to the first defendant relating to this matter.

12. On about 12 May 2021 the criminal brief was served on Mr Sakr.

13. On 26 May 2021, the counsel whom Mr Sakr had briefed in respect of these proceedings indicated that he had reviewed the material but considered that he was not sufficiently expert in proceeds of crime to appear on behalf of the first defendant in these proceedings.

14. At 10.20pm on 27 May 2021, the eve of the new date for compliance, Mr Sakr contacted the plaintiff and sought a further extension of the time for compliance. He did so because he realised that the statements could not be ready by 28 May 2021. Further, he had not yet obtained instructions from the defendant about whether he wanted to apply for a stay of these proceedings pursuant to s 319 of the Act pending the criminal trial or whether there should be an application for ancillary orders, such as under s 266A of the Act (for non-disclosure).

15. On 1 June 2021, Mr Sakr briefed Mr Somerville of counsel, who appeared on behalf of the first defendant on 17 June 2021. Mr Sakr has had regular contact with Mr Somerville relating to the matter since 1 June 2021.

16. On 2 June 2021, the first defendant met with Mr Somerville for the purpose of preparing draft statements to comply with orders 12 and 13. These statements have been prepared in draft form but have not yet been sworn because the first defendant wants to obtain advice about whether to make the applications referred to above. According to Mr Sakr, the first defendant does not presently have access to his bank accounts because of the orders made on 1 March 2021 and therefore cannot provide particulars of his dealings with his bank accounts as required by order 13.

17. Further material was served in the criminal proceedings on 9 June 2021. Mr Somerville estimates that it will take about four weeks for the criminal brief to be reviewed and advice to be given to the first defendant about the prospects of the applications referred to above being made.

18. On 10 June 2021, the matter was listed before me as Duty Judge on 17 June 2021.

Consideration

19. The dispute between the parties was as to the length of extension to be granted to the first defendant to comply with orders 12 and 13 made on 1 March 2021, as extended in the meantime. Mr Somerville contended that it was necessary to extend the time for compliance to 20 July 2021, in order to permit the first defendant a reasonable opportunity to consider whether to make an application as referred to above. He accepted that such application, if it was to be made, ought be made by 15 July 2021. Ms Sullivan, who appeared for the plaintiff, contended that the first defendant ought be granted only a short indulgence and that he ought bring any application by 21 June 2021 and, if no application is made, he ought be required to provide the sworn statements referred to in orders 12 and 13 by 24 June 2021.

20. In the usual course, proceedings under the Act, which are civil proceedings, are entirely separate from criminal proceedings. The privilege against self-incrimination in these proceedings has been expressly abrogated by s 39A of the Act. The restraint and forfeiture of assets does not depend on criminal conviction. The time limits under the Act are, in general, fixed, and cannot be extended by this Court, except in limited circumstances for which the Act makes express provision. Orders that the defendant provide sworn statements as to the defendant’s asset position, as imposed by orders 12 and 13, are commonly made in proceedings such as these. The obligation is not generally modified to take account of pending criminal proceedings or the need to obtain legal advice. As Fullerton J said in The Commissioner of the Australian Federal Police v Cranston (No 2) [2017] NSWSC 673 at [6]:

“The obligation to furnish the sworn statement of assets and liabilities is imposed upon each of the defendants. While it may be necessary, perhaps even desirable, that legal advice is sought in order to ensure full compliance with the order, the obligation is not conditional upon receipt of that advice and even less on the defendants’ legal adviser seeking the advice of other professionals. The time fixed for compliance with the order, even if the statement needs to be augmented as more information comes to light, is in recognition of the operation and reach of the civil forfeiture regime under the POCA and the need to ensure that any property that may be the subject of forfeiture or a pecuniary penalty order is able to be identified by the Commissioner and, where necessary, orders made restraining the disposition or dealing in that property. I note that ancillary orders I made on 16 May 2017 in respect of a large number of defendants are in identical terms to those binding the 9th and 13th defendants.”

21. Nonetheless, the extension sought by Mr Somerville is relatively short. The first defendant was, effectively, deprived of the opportunity to obtain legal advice while he was incarcerated. Further, the offence with which he has been charged involves dealing with proceeds of crime, which is at the heart of the matters in respect of which he is required to give sworn statements. The time between the commencement of the proceedings and the hearing on 17 June 2021 has been the subject of detailed evidence from Mr Sakr. While there have been instances of failure on the part of Mr Sakr to communicate with the AFP, I accept that none of the delay is attributable to the first defendant. Although the Act severely limits the basis on which a stay can be granted under s 319 of the Act, it would not be appropriate to prejudge the prospects of the first defendant obtaining such a stay. Further, it is understandable that he is concerned that he will be required to incriminate himself by complying with orders 12 and 13. Although that may be the inevitable consequence of the provisions of the Act and the orders made by the Court, Mr Somerville has persuaded me that he ought be granted the extension ordered before being required to provide sworn statements to the plaintiff.

22. For the reasons given above, I made the orders set out in [5] above.

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Decision last updated: 21 June 2021