The Queen v Hughes

[1999] HCATrans 387

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P58 of 1999

B e t w e e n -

THE QUEEN

Prosecutor

and

CRAIG ALLAN HUGHES

Defendant

For Directions

GUMMOW J

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 17 NOVEMBER 1999, AT 2.23 PM

Copyright in the High Court of Australia

MR R. RICHTER, QC:   If your Honour pleases, I appear with MR S.A. SHERIFFS for the applicant. (instructed by Fiocco Hopkins Nash)

MR D.J. BUGG, QC:   If your Honour pleases, I appear for the Queen, or the respondent in this matter. (instructed by the Commonwealth Director of Public Prosecutions)

MR D.M.J. BENNETT, QC, Solicitor-General for the Commonwealth:   If the Court pleases, I appear with my learned friend, DR M.A. PERRY, for the Attorney-General for the Commonwealth intervening.  (Dr Perry did not appear in Court.)  (instructed by the Australian Government Solicitor)

HIS HONOUR:   Yes, Mr Richter.

MR RICHTER:   Does your Honour have the two affidavits of Gary William Massey, one sworn 15 November 1999 and the second one sworn 16 November?

HIS HONOUR:   I have the 15th.

MR RICHTER:   I will summarise the effect of them for your Honour.

HIS HONOUR:   Yes, I have both.

MR RICHTER:   The effect so far as interveners is concerned is that notices went out to all the Attorneys with respect to the removal which was ordered.  Western Australia is still considering its position.  Queensland is not interested in intervening.  Tasmania is not interested in intervening, and in fact Tasmania is reconsidering – there are two letters exhibited.  The first one said they were not interested; the second one said they are reconsidering.

The ACT is not interested in intervening.  The Commonwealth is not seeking to intervene.  South Australia is considering its position and there have been no replies from New South Wales, Victoria and the Northern Territory.

HIS HONOUR:   Yes, thank you.

MR RICHTER:   So far as the matter of agreed facts and formulation of questions, the drafts are appended to the second affidavit of Gary William Massey.  Exhibit GWM3 is a draft of agreed facts.  It is not finalised, it has not been signed by the parties, but could I say this to your Honour, that so far as we were concerned, there was a fairly massive summary of facts which was put under section 100 of the Justices Act ‑ ‑ ‑

HIS HONOUR:   Yes, I have got a copy of that.

MR RICHTER:   - - - for the prosecution.  What we have sought to do essentially is to distil out of that the relevant fact for this application and put it in a form which is non-contentious.  There is one thing which is non‑contentious which arose during the application for removal, and that is the question of whether or not there were any constitutional corporations involved, and the answer is that there are none, which in fact verifies what was my initial view.

Indeed, on the last page of the affidavit there is an exhibited letter, in which, for our purposes, we could put the stated facts in no more than three lines and one word, and that is that the Crown case involves a group of investors in Australia putting ‑ ‑ ‑

HIS HONOUR:   I am sorry, whereabouts is the letter?

MR RICHTER:   It is the last page annexed to the affidavit.

HIS HONOUR:   Yes, I have it.

MR RICHTER:   Does your Honour see that?

HIS HONOUR:   Yes.

MR RICHTER:   It is a letter from our instructors to the Commonwealth Director of Public Prosecutions which essentially sets out what the case is about.  The Crown case involves a group of investors in Australia putting money offshore through overseas security houses with the money to be returned to the investors in Australia and there are no constitutional corporations involved.

HIS HONOUR:   What does one mean by “involved”?

MR RICHTER:   In any capacity.

HIS HONOUR:   There were foreign banks, I suppose.

MR RICHTER:   There are foreign banks, yes, but not foreign banks in Australia.  The money is being remitted from foreign banks overseas to Australia.

HIS HONOUR:   To an Australian bank.

MR RICHTER:   To a solicitor’s trust account.

HIS HONOUR:   Yes.  But the machinery, as it were, utilises, no doubt in an entirely innocent way, an Australian bank to transmit by telegraphic transfer, I suppose.

MR RICHTER:   Presumably.

HIS HONOUR:   You are using “involved” in the sense of a constituent element of the offence.

MR RICHTER:   Relevantly, yes, or in the sense of relevantly involved in terms of regulation of activities of constitutional corporations.

HIS HONOUR:   Yes.

MR RICHTER:   So, we have summarised it in that way, distilling it from that very lengthy, complex statement of assertions.  It is effectively in the sense stated as the Crown case and, of course, will be argued on the basis that if the Crown make ‑ ‑ ‑

HIS HONOUR:   Yes.  The relevant fact for the Full Court really is what the prosecution asserts its case is.  I think that is the ‑ ‑ ‑

MR RICHTER:   That is right.  Precisely, taken at its highest.

HIS HONOUR:   Yes.

MR RICHTER:   So we are happy with that.  The list of questions that we have formulated appear to us to be the questions arising.  I am told by our learned friends that they would like another question inserted, namely, whether or not section 45 of the Corporations Act is relevant at all, because I think the way they will be putting their case will be on the basis that they are relying on section 29 of the State Act.

HIS HONOUR:   And nothing else.

MR RICHTER:   And nothing else.  We say that given the nature of the scheme the question of section 45 arises as the sort of complementary Commonwealth acceptance.

HIS HONOUR:   Yes, I understand that.

MR RICHTER:   So that that is why we formulated it both as to section 45 and section 29.

HIS HONOUR:   Yes, now the questions you have formulated, whereabouts are they?

MR RICHTER:   They are exhibit GWM4, the exhibit after the facts.

HIS HONOUR:   Yes.  Now, one would need to annex the information, would one not?

MR RICHTER:   I am sorry your Honour.

HIS HONOUR:   One would need to annex a copy of the information.

MR RICHTER:   The indictment?

HIS HONOUR:   Yes.

MR RICHTER:   It is in the application book, your Honour, exhibit CGN‑1 at page 11.

HIS HONOUR:   It is a technical matter but the question is, what are the four walls of the material that the Full Court gets?  That is what I am getting at, if you see what I mean.

MR RICHTER:   What we have in mind is that the Full Court will get the indictment, of course.  It must get the indictment.

HIS HONOUR:   What will it get?  What materials will it have?

MR RICHTER:   We would say ‑ ‑ ‑

HIS HONOUR:   What I am doing is acting under section 18 of the Judiciary Act.  I send them material.  They do not already have it and they will not have it unless we do something here.

MR RICHTER:   Yes, for our part ‑ ‑ ‑

HIS HONOUR:   All they will have is what was removed into the court and they will not really have that either because that is here.

MR RICHTER:   I am told the file has been removed, but essentially what has been removed one supposes is the indictment against which there is a motion to quash.

HIS HONOUR:   Yes, that is right.

MR RICHTER:   And the indictment together with the statement of facts that we have submitted is sufficient for the purposes of the challenge, in our respectful submission.

HIS HONOUR:   That is right.  But all I am saying is when we say “statement of agreed facts”, I think that should include - in the early paragraphs, it should annex the indictment, it should annex the motion to quash.

MR RICHTER:   Yes, your Honour.

HIS HONOUR:   It should annex the order removing him to this Court and then it should carry on, and then it should ask questions at the end.  That is all I am getting at.

MR RICHTER:   Yes, indeed, your Honour, we accept that.  We might add we have had ‑ ‑ ‑

HIS HONOUR:   Is that enough, the indictment, the motion to quash, the order of removal?  I would have thought so.

MR RICHTER:   Yes, your Honour.

HIS HONOUR:   Plus these questions, plus these agreed facts and questions.

MR RICHTER:   We would have thought so, your Honour.  The facts are not finally agreed in the sense ‑ ‑ ‑

HIS HONOUR:   No.

MR RICHTER:    ‑ ‑ ‑ that Mr Bugg, I think, still wants to consider the position about it and also with respect to the questions, but those are what we say are the salient facts and the salient questions.

HIS HONOUR:   Yes, thank you, Mr Richter.  Can I just ask you a couple of questions.  Some of my colleagues are not over‑attracted to the proposition that it is the Crown rather than the DPP who is prosecuting.  It would avoid debate if one used the words “the prosecution asserts”.

MR RICHTER:   Yes, your Honour, I would be delighted to put “Mr Bugg” there.

HIS HONOUR:   Yes.  In f) on page 2, is there any need to explain how that was affected?

MR RICHTER:   We would have thought not, your Honour.

HIS HONOUR:   All right.  In j), repaid by whom?

MR RICHTER:   By the co-accused.

HIS HONOUR:   By the co-accused.  Perhaps that would ‑ ‑ ‑

MR RICHTER:   We can put that in.

HIS HONOUR:   Yes.  The indictment could be annexed at paragraph 4, if you look on page 3 and you would need to put another paragraph in dealing with the motion to quash, I suppose, and another paragraph dealing with the order for removal.

MR RICHTER:   Yes.

HIS HONOUR:   I am a little worried as to what someone uninstructed might make of what is intended by the phrase “did not involve a constitutional corporation”.

MR RICHTER:   We could take out that paragraph, your Honour.

HIS HONOUR:   I am not sure about that.  That is a question of what is meant by “involve”, that is all.  You gave an explanation of it just now which I thought encapsulated it quite well.

MR RICHTER:   Yes, I understand that.  Other than for the transmission of money through telegraphic transfers, there are no corporations, Australian corporations or foreign corporations in Australia acting in any way.

HIS HONOUR:   Yes, if you and Mr Bugg could give that some attention, that is all I am suggesting.

MR RICHTER:   Yes, indeed.

HIS HONOUR:   Perhaps I should hear from Mr Bugg.

MR BUGG:   Yes, thank you, your Honour.  I have no concerns about whether I am the Crown or the prosecution.  I am still suffering an identity crisis, I must say, but in any event we considered that it would be more appropriate if the outline of the prosecution case, the section 100 statement, was included just for completeness.  I realise my learned friend is anxious to obviously keep the matter as simple as possible, but it would be unfortunate if, in considering ‑ ‑ ‑

HIS HONOUR:   I think that could be right, Mr Richter.

MR RICHTER:   We do not mind that, your Honour.  We just wanted to focus on essential matters.

HIS HONOUR:   I understand that, and I am not suggesting it substitute for it, but I think towards the end you might have a paragraph annexing that as well.

MR BUGG:   Yes.  Certainly my first reaction was, we really do not have any agreed facts, as such; that is, the Court is not dealing with any facts, but, of course, bearing in mind it is a motion to quash, it would be unfair on the applicant to call for some concessions or admissions of fact at this stage, which, in due course, may be seen as either ‑ ‑ ‑

HIS HONOUR:   Yes, it is a fact of a special variety, as I was discussing with Mr Richter.

MR BUGG:   Yes.  So, accepting that, your Honour, there may be, and I have had some brief discussions with my learned friend, Mr Bennett, about the matter and the concerns are whether or not, as an issue, it may arise as to how the officer from the Commonwealth Director of Public Prosecutions Office had authority to sign the actual document, that is, the indictment which was filed in court, which, of course, is an issue which is subject to debate in the Bond matter.

HIS HONOUR:   It is not in this one yet, is it?

MR BUGG:   No, but whether or not, as a side issue, it does arise in any debate that occurs before the Court, whether it is appropriate to have annexed the documentation which supports that position.

HIS HONOUR:   Well one is really in Mr Richter’s hands, I think.

MR BUGG:   Yes.

HIS HONOUR:   At the moment he is not putting it forward and if it is not put forward, it will not be in the Full Court.

MR BUGG:   Certainly.  Then, as far as the facts are concerned, your Honour ‑ ‑ ‑

HIS HONOUR:   And special leave was not really granted on that point.

MR BUGG:   No.  So, your Honour, I would be content if, as a fact, the outline of the prosecution case, which was pursuant to section 100, is an annexure.  The questions do cause me some concern and if I can take your Honour to those.  Question No 1 – we contend it just does not arise in these proceedings, but, of course, that is a matter for the applicant if he contends that it is relevant to his argument, but I would suggest that a more appropriate form of question 1 would be, “Is section 45 applicable in any way to the prosecution of the applicant in Western Australia?”

MR RICHTER:   Your Honour, with respect, if the question does not arise, the Court will answer it, “The question does not arise.”

HIS HONOUR:   Yes.

MR BUGG:   It is pointless for the Court to consider whether it is a valid exercise of the legislative power of the Commonwealth if it does not arise, because, it seems to me that it is a wasted exercise of judicial deliberation.

HIS HONOUR:   But I think question 1 was, what was in mind at the removal application?

MR BUGG:   I am sorry, your Honour.

HIS HONOUR:   I think the construction of section 45 is a matter that was in the Court’s mind at the time of the application for removal.  I am not sure about question 2 though.  It just looks like a bit of an oppressive examination.

MR BUGG:   Yes.  Well then, “If yes, is section 45 applicable in any way to the prosecution of the applicant in Western Australia?”

HIS HONOUR:   That might be a better form of question 2, I think, Mr Richter.

MR RICHTER:   I do not mind adding questions but it is a different issue because we agitate the question of is there a law of the Commonwealth against which an offence is committed, and that appears to us to be a very, very salient question.

HIS HONOUR:   Yes, but it is at large at the moment.  “If yes, against which laws of the Commonwealth is an offence”?

MR RICHTER:   Yes.

HIS HONOUR:   What offence?

MR RICHTER:   That is what we want to know, any offence.

HIS HONOUR:   No, no.

MR RICHTER:   This offence.

MR BUGG:   This offence.

HIS HONOUR:   It is the offence with which your clients are charged, is it not?

MR RICHTER:   Yes, indeed.

HIS HONOUR:   But it does not limit it at the moment.  That is what I am getting at.  It is at large.

MR BUGG:   In these offences.

HIS HONOUR:   It is really the offences in the indictment, is it not?

MR RICHTER:   Yes.

MR BUGG:   Which is the prosecution of the applicant in Western Australia, which is the question.

HIS HONOUR:   Which in a way is related to what Mr Bugg is putting.

MR RICHTER:   So we will reformulate that, your Honour, as “If yes, against which laws of the Commonwealth is the offence alleged in the indictment committed?”  Thank you, your Honour.

HIS HONOUR:   Any other queries, Mr Bugg?

MR BUGG:   Yes, thank you, your Honour.  I will not dwell on question 3 in light of the way the other matters have resolved themselves.  Question 4 is fine.  Question 5 probably requires some clarification.  “If offences, by the State Act, are ‘taken to be’ offences against the laws of the Commonwealth, against which laws of the Commonwealth are offences committed?”  Once again, I think that probably has the same rider that is necessary for question 2 that we have just ‑ ‑ ‑

HIS HONOUR:   I think it does, Mr Richter.

MR RICHTER:   If the offence as alleged in the indictment is acceptable.

HIS HONOUR:   Yes.

MR BUGG:   And then question 6 is really, it seems to me, an extension of question 4 but, once again, I suppose if we narrow the questions and then find that they need to be expanded at a later time, I know who will get into trouble.

HIS HONOUR:   Probably me from my colleagues.

MR BUGG:   We will not hear about that, your Honour.

HIS HONOUR:   I do not know.

MR BUGG:   Yes.

MR RICHTER:   9 c) is otiose, it occurs to me, your Honour.

HIS HONOUR:   Yes, I think so, it is rather rubbing it in, I think.

MR BUGG:   Just dealing with then question 7, “Do Sections 31 and 33 of the State Act constitute a valid and effective conferral of function or power upon “…an officer or authority of the Commonwealth …” to prosecute offences against the State Act?”, that should be, I suppose, “that State Act”.

HIS HONOUR:   Yes.

MR BUGG:   And question 8, I would prefer that question to ‑ ‑ ‑

HIS HONOUR:   I do not think “able to accept” is quite the right way to put it.

MR BUGG:   No, what I was going to put to your Honour is that the question should be asked in this form:  “By what legislative authority is the Director of Public Prosecutions of the Commonwealth able to exercise the purported conferral?”

HIS HONOUR:   Or empowered to exercise it.

MR RICHTER:   Right, yes, we will accept that.

MR BUGG:   Empowered to exercise.  Yes, I would not seek to amend that further than that which I have suggested, your Honour, that is:  by what legislative authority is the Director of Public Prosecutions of the Commonwealth empowered to exercise the purported conferral?  Then 9 c), I agree, is really otiose.

HIS HONOUR:   So it will be a) or b)?

MR BUGG:   Yes.  They are the only matters in relation to the questions.  I must say, your Honour, my approach in coming to Court today I had thought that the parties might benefit from a brief adjournment to enable them to look at these issues but I also accept that there is a need for expedition because there are a number ‑ ‑ ‑

HIS HONOUR:   What I was proposing is that you both go away now and produce, with the aid of the transcript of today, a final document and that can be submitted through the Registry and I could make the necessary order in Chambers if need be.  If not, I can sit again on Monday, 29 November at 2.15, if something goes wrong.  That is in Canberra.

MR BUGG:   Your Honour, just in relation to that, an anticipated hearing date, is that something I could explore with you whilst I am on my feet because my office is under some pressure?  No doubt my learned friend, Mr Richter, has not told everyone about what has happened, but as the word spreads, applications for stay are being made in pending matters.

HIS HONOUR:   Yes, I am conscious of it and I will discuss it with the Chief Justice.

MR BUGG:   Thank you, your Honour.

HIS HONOUR:   Let me just ask ‑ ‑ ‑

MR RICHTER:   Sorry your Honour.  I gave away 9 c) but it occurs to me, with respect, that c) might say “of the Capital Territory”, because on one construction ‑ ‑ ‑

HIS HONOUR:   I think that is right, Mr Bugg.

MR RICHTER:   Yes.  On one construction one can say that the indictment discloses an offence known to the law of the Capital Territory.  So perhaps c) should be “of the Capital Territory”.

HIS HONOUR:   Yes, I think that is right Mr Bugg.  Yes Mr Solicitor, is there anything you could add?

MR BENNETT:   Yes, your Honour.  We have not had the opportunity to consider this as much as we would like.  But the issue which concerns us which may arise in this case is the ambit of the executive power of the Commonwealth in relation to areas not within, or arguably not within, section 51.  It involves to some extent an issue related to that considered in Re Wakim about the power to consent to a Commonwealth officer having other powers conferred upon him or her.

The particular aspect of that which affects the stated case, or the agreed facts, is the aspect which was involved in the Clothing Factory Case in the 1930s.  I have not brought it but it was the case which ‑ ‑ ‑

HIS HONOUR:   King Gee?

MR BENNETT:   No, your Honour.  The Attorney-General for Victoria (At Relation of the Victorian Chamber of Manufactures) v The Commonwealth 52 CLR 533. That was a case where it was held that it was permissible for a Commonwealth clothing factory which had made military clothing to devote some of its practice to the production of civilian clothing.

HIS HONOUR:   Yes, not defence clothing.

MR BENNETT:   No, not defence clothing, because otherwise it would have surplus capacity and that way it could most efficiently manufacture.  Now one of the arguments which might arise in this case is that if one can validly confer the powers conferred in this case in relation to matters within the scope of the corporations power but cannot in relation to prescribed interests not involving constitutional corporations - - -

HIS HONOUR:   Or, I suppose, the banking power or the insurance power or ‑ ‑ ‑

MR BENNETT:   Or any power.  Where one has an administrative structure involving offences under the Corporations Law of the States of which, say, 99 per cent involves constitutional corporations and 1 per cent involves prescribed interests, other factors similar to the Clothing Factory Case which make it convenient for the executive power of consent to be exercised in relation to that.  Now, it seems to me we might need a few facts in order to put that argument and they would be in a fairly narrow compass and they would be unlikely to be controversial.

HIS HONOUR:   Yes.  But what would the facts be?

MR BENNETT:   Presumably, your Honour, as to the percentage of Corporations Law matters which involve non-constitutional corporations and the degree of inconvenience which would be involved if they were hived off from this scheme.  It would be simply those facts.  It is an argument which only conditionally arises because it may be one does not get to the validity of these provisions.  It may be that one can defend the validity of the scheme in a number of other ways and it may be that it fails

for a number of other possible reasons, but on one view of it that issue could be decisive and we would wish to have the opportunity of discussing with the parties some short facts along those lines to be added to the document.

HIS HONOUR:   Yes.  The facts that you would want to show Mr Richter and Mr Bugg had better be got together fairly quickly, I think.

MR BENNETT:   Yes, the time frame your Honour suggested is a convenient one.  I do not know if the 30th ‑ ‑ ‑

HIS HONOUR:   I do not want to bring these gentlemen over from the other side of the country, though, if it can be avoided.

MR BENNETT:   Your Honour, hopefully, we can agree, in any event.

HIS HONOUR:   Yes.

MR RICHTER:   I am not sure that we can, your Honour, because we say it does not arise at all and I do not know whether we can agree on a percentage involve constitutional corporations because the definition of corporations that fall under 50(xx) is not that clear and are we to embark on an examination of every case the Commonwealth DPP has handled in the last 10 years to see whether it has involved constitutional corporations or not?  It is something that seems to us, with respect, to be a matter of judicial notice that the Commonwealth DPP has for the last nine years prosecuted the Corporations Act matters, and, undoubtedly, a large percentage of them involved corporations that might fall within the compass of section 50(xx).

HIS HONOUR:   Yes, but not these prescribed interest provisions.

MR RICHTER:   They certainly do not fall within any of that.

HIS HONOUR:   That is what makes this case special.

MR RICHTER:   It is the legislation that makes all these cases now special ‑ ‑ ‑

HIS HONOUR:   Quite.  It is hard to see, perhaps, how one could rewrite the prescribed interest, or what is the other expression?

MR RICHTER:   They have now been repealed by the way, your Honour.

HIS HONOUR:   There is something instead, I am sure.

MR RICHTER:   Yes, managed investment schemes, your Honour.

HIS HONOUR:   Yes.  I have not got the right copy of the Act.

MR RICHTER:   In any event, we will consider what our learned friend proposes, obviously, but is presently advised, it appears to us, with respect, that the question really does not arise.  We are dealing with incidental power.  We are not dealing with an exercise of power pursuant to the corporations power; we are dealing with an Act for the good government of the ACT, or an Act by the Parliament of Western Australia.

HIS HONOUR:   Yes.  Just pardon me for a minute.  “Participation interests”.  “Participation interests” defined in section 9, they do not seem to be connected, necessarily to corporations at all. 

MR RICHTER:   No.  That is right, but it would not matter whether there was a connection, on our argument, in any event, because we say the principal Act is not a Commonwealth law; it is a law for the government of the ACT, not for the good government of the Commonwealth, and it says so.

HIS HONOUR:   Yes.  You have heard what has been said, Mr Solicitor.

MR BENNETT:   Yes.  Your Honour, we seek at this stage the opportunity to have two weeks to negotiate over the words.  If we do not agree we would have to deal with that matter as and when it arises.

HIS HONOUR:   Yes.

MR BENNETT:   I wonder if the 30th is equally convenient to your Honour as the 29th, but I do not want to interfere.

HIS HONOUR:   Monday the 29th?

MR BENNETT:   I was going to ask if the 30th was equally convenient, which was during the same sitting.

HIS HONOUR:   No, it is not, actually.

MR BENNETT:   I do not press that, your Honour.

HIS HONOUR:   How are you gentlemen placed on the 29th?  Mr Bugg.

MR BUGG:   Yes, it is not a problem for me, your Honour.

MR RICHTER:   The 29th is no problem.

HIS HONOUR:   All right. 

MR BUGG:   It does occur to me, if I might just say whilst I am on my feet, one aspect that troubles me is the potential implication for concluded proceedings, and I may just wish to consider the breadth of some of those questions in light of that as well, because whilst we are looking at a specific situation in Western Australia there may be implications for proceedings past which need to be considered.

HIS HONOUR:   Yes, all right.  I think all I will do is stand this matter over for further consideration and hopefully for approval of a final embracement on 29 November at 2.15.  If the parties can agree a final form before then and an order can be made in chambers, contact the Registry and that will be done but, if that cannot be done, I will sit again at 2.15 on 29 November.

MR RICHTER:   Thank you, your Honour.

AT 2.56 PM THE MATTER WAS ADJOURNED
UNTIL MONDAY, 29 NOVEMBER 1999