Tiplady v Gold Coast Carlton Pty Ltd

[1984] FCA 152

CATChi-JGRDS

?.idninistcat:ve law - applicazion for reTiew of decision of Macistrate made in the course of a comZttal groceedinq - discrstionary remedy - speciai circumstz?ces - appl ic3nts charged w L k conspiracy to Aefraud the Cosxonwealc12 .=PC! conspiracv to prevent or defeat the esecu-ccor. cf the laws of

the Commonwealth - the element of "dishonescy" in conspzracy

to defraud the Commonxealth - distinction Secweep evider,ce sufficient to pur: the accussd or! trial xd evidence L-Eising a

I

i

IN THE FEDEP-U COURT OF AUSTRALIA 1

)

VICTORIA DBTi?ICT REGISIRP	1	VG NOS. 56.75 and
)	80 OF 1983
GENERAL DIVISION	)
Between:	JOHN FF??2ICIS

-- EDW>iSS

- And :

%DOitALD

(Respondznts)

. _ (VG No. 66 of 19831

Between:

d A n :

-

Between:

(Respondents)

(VG NO. 80 of 1983)

Judcre HalcTna Order: - Snithers J.

Date of Order: 8 June 1984

Hhere Mad : Melbourne

-

. THE C O U W ORDEW T-T:

1. Each of the applicants' applications-be dismlssea.

2. Costs be reserved.

I

I

IN THE FEDD.AL COURT OF AUSTPALTA

1

VICTORIA	D STRICT	REGISTRY	1	VG NOS. 66.75 and
)	80 OF 1583

DIVISION GENERAL - 1

Between:

JOHN FRMJCIS

EDFl-W.DS

(Applicant)

.

(Respondents)

(VG No. 66 of 1983)

. .

. Setrzeen: - I-AN GPAHT

(Applicant)

(Respondents,

(VG No. 75 of 1583)

BEtweent. IAN DAVID STkWGRD

COLLIE

-

- (Applicant)

m: IAN VOM EIMEM and	ROBERT Z1CHiW.D
McD@NALD

(Respondsnts)

(VG No. 81) of 1583)

Coram: Smithers J.

8 June lC.!4

Melbourne.

2 .

REllSONS FOR JLZGXENT

.

Before che Court are proceedincrs brcught separately by

. John Francis Edwards (Edwards), ian Grant (Grant), and Ian

Davld Staffora Collie (Collie) (alternativsly referred to as

the applicants) against the respondems 2ursuant to the

provisions of s . 7 of the Administrative Feclsicns (Sudlcial

Review) Act 1977 ( A ~ J J R Act).

. . _ .

In each of the applications of Edwards and Grant relief

is sought under S. i6 of ~ the ADJR Bcc, intsr alia, by way of an

order quashing cr settin? aside Yne deci-slsns t3at chere was

sufficient evidence to put the applicants m trial, and t<at

there <cas a stro?-.F or probable gresumpticrr of cuilt on the

part of ths applicanLs and thar: the ac_clicants should be

cautioned p~rsuanc to s.56(11(31 of the K ~ ~ i s ~ r s t s s tSummarx

Proceedinus) 2ct 1975 . (the- Bcz) in respect cf the

charges brought aqainst them. in the appl5cation of Collie the relief ultimately sought was a declarzzion as to the law

relevant to the charges aqainst him.

The relief sought is discretionary. Although a

Magistrate's decision to cautijn an acc&ed person under

s.56(13 of the Act is a decislon siiD~ert tz review under the

ADJR Act. it is -CO be recognizsd that suck a review is an

Interference with the administracion of the criminal law.

This is an important consideration in t h exercise oi che

Court's discretion. It was said in Lamb -U. Moss and Another

(1983) 49 ALR 533 ar: p. 564 that the power &,o make an order of

review under the Act in respect of caii..ir:tal proceedings

should be exercised only in most exceptions: cases, especially

in respect of a decisicn in the course CC the proceedinus.

Additional considerations miqht intrude & the final staue,

L

for example in respect of coirmittzi f o r tekl or commitment to

pr-ison p'ending trial.

In this case I have taken in62 accounr: tiiree

considerations.. Tie first is the alleqztionl f che aE)plicar?ts

that the firsc r.esFondenr: (che Magiscrzce), bein? concerned eo CmSider 77hetthsr the conducr ai1eGz:i agcinst the a?plicants Was enTaqe5 ir. dishonestly, error.eo1Lsly ssTlied ?A objscr:~se

tesr: racher thzn a s&;f;jecrive test. Tk szzond is thac che

Magistrate. prgFerly directing himself, cc;~~.Iri not nave formed i

the opinion either tnaz there was sufficiezt evidznce t o pur:

-

-

the appilcants on trial or that there was a strocg or probable

. presumption of quilt of the applicants. Tie third is that

this case, having cakn eignt weeks before %he Magiscrate, is

expected to occupy between three znd six rz5nths and gserhaps

lonqer in the Supreme Courr; if a trial 1s arsered.

It appeared to me chat if the f l r s t cr particularly the second of these allegations were made a=% a case for tine

exercise of tks Court's ilscretion miqht arcse. I entertained

t'nis application for review having in mim€ thac che magnitude

- - ..I

of the proceedings and the interests of bot3 the Crown and the

accused ju_stify Consideration of submlssf3ns which if valid

miqht have brought the proceedinqs to a clcst.

On 0 October, 1982 an Information For An Offence was

laid and sworn by the second respondenr; STzinst Edwards in

which the second responasnt allecz5:-

(a) thx the said J O ~ L Francis Z:dwards MEljourne, Perth,

-

Syh-ey and other places, ktween L July 1979 and l8 March 1982 did consplre wit! Stsven Zcfi~i Saker, Wllllam

(b)

thzt the s a d Jok!.Francic E‘dwards zt Melbourne, Perch.

Sydnsy and other plsces. between 1 July 1979 a d 19

Kart% 19E2 dra conspire wiZh Steven ;An Baker, klilliarn

Leaver. Peca	Joy Fisher. Colin EELlep Coqhill, Ian
the C?im?s Act	19i.4:

Sydney and other' places, between I July 1979 and 18

March 1982 did conspire wlth Steven Sohn Baker, William

Leaver, Peta Joy Fisher, Colin Hailey Coghill, Ian

Grant, Ian David Stafford Collie ~ R C X ocher persons to

prevent or defeat the execution or Enforcement of a law

of the Commcnrrealth namely s.9 of the Sales Tax

Assessmenc Act	(WO. 71 1930 contrar? to	s.86(l)(b) of
the Crimes Act

A t the' same time.charges of having similarly conspired

were laid again$t the apFlicants Grenr; smd Csliie.

On 11 Eprll, 1583 in the Naglstrates' Court at Mel-

boucne, before the Magistrace, the appli;cinrs w r e charged

with the afo<ementioned offences. Tnt praceedings before the

Magistrate were by way of preliminary exzir?ar:ion conducced

-

pursuznt to the provisions of-s.56(1) of t k Act and 5.68 of

the Judiciarv Act i903-1973 (Commonwealthl. At all material

times the Nagistrate was exercising jurisciiction pursuant to

an Act of che Common-,-ealtii, t'nac is. tks Judiciarv Act

1903-1973 and any decision made in the cocrse of the said

proceedings was	made pursuant to that jurfsdictlon and under
that enaccment.

At the cocclusion of the Ccsm case and in order to

exercise his jurisdiction in accordance 57it3 law and pursuant

to s.51(l)(a) and (b) cf the Act t h e Magistrzte tias required:-

6.

(a) if the evidence KZS not sufficienr; in his opinion to put the accused person on kis trial for an inaictablc

offence - order him to be discharged out of custody as to the informacion then under enquiry; or

I .

_ .

(B) if'in his opinion the evldence was sufficient to put r;he

accused upon his trlal for t'ne indfftable offence wlth

which he was charced or if, in hls opinion the evide;lce given for. the prosecution raised a strcnq or probable presumption cf silt of ths accussd persm in respect of

that chsrcz, read the chzrgs to.hiz again and. say t o

him the words set forth in s.56;l):b) of the Act and

. .

call upon him to plead guilty or not	qui1.t~	as th2 case
nay be.

- -

On 27 April 1983 and after the cznclusion of the

evidence given for the prosecution, CoLin Halley Coghill

(Coqhill) and Eiiwards submitted to the Kaqistrate :-

(.a) that the evidence before him was noE sufficient to put

. them upon his trial;

(b) that he vidence befcre the i%?istrar;e did not

constitute a prima facie case aqainst then o r raise a

strong or probtlbie presumption of his quilt such as to

permit the Mauistrate to put them upon their trial:

1

7.

!

(c) that ‘Coghill and Edwards ought to be discharged out of

custody as to the information then unaer enquiry.

The applicant Grant made no-submissions and as yet ha8 called no evidence. The applicanc Collie made no shmission

but he has given evidence. After hearing Coghi11 and Edwards

the Magiscrate gave reasons f o r judwent on 23 B p r l i 1383

_.

which judgmsnt was applicable to.all the accused xncluding -,he

applicants in this case.

-

The !laFistrate, havlnq formed che qinions that r;he

evidence wzs suFflcient to put ths applicants lipon their trial

and thGx thzre =as E strong or prabable pres.lrr,pr;ion of their

guilt, did not Cisc5arFe the applicants. The Magistrate

proceeded to c3ution t h e apslicants ln terms of s.56(i)(b) of

-

the Act, and ths applicants were called to plead to r;he

charges. Each of the applicants announcEd a plea of “nor;

guilty“ to each of the said chrirges. At the time of

announclnq his opinions and deciding to czution rhe iccused r;he Maqistrate gave reasons therefor in tine following terns :-

“In this case tins prosecution has proceeded by way of

the hand-up brief provisions cihich are set out in

sections 45 and 46 of the 2-hqiScrctitpS (Sumxary Procetdings) Acc 1975. A large nuirker of witnesses‘ statements have been tenderta cogether with a voluminous nmber ci exhibits. (The word Tzoluainous is

a statement f r o m i4r. Judd).

In accordance w ~ c h sub-section ( 9 ) OS section 45 a

significant number of witnesses have‘ Zctended for

1

8.

cross-examinacion. Additional exhibits have also been

tendered through the witnesses that ve been called.

The prosecution has now closed its case and after a

good deal of discussion Mr. Smlth, Corn-sel appearing

for CSDiin Hallq Co$-All indicated t k t he wished tD

make a submission as to why I should nnt caution his

client. Mr. Judd Cho appears as junior counsel eo Mr.

PIerkel one of Her Majesty's ccunsel (K% has not as

yet attended these Froceedinqs) lnfonued me that he

wished to take a similar course.

..Each of che remaining defendants ?Eve indlcatea

thro*i their .respectivz counsel ch3t 'hey dfd not

want to make a submission at this staos but would do

so after	a i l r;he oral evidence in chis-case had been
completei.

I havs indicated a procedural course t k t chls case

should take. albeit. without any .statEtcrry or conmon ..

law aurkority to quide as. However, 15 is a course

-

which I believe x o d d noc unfairly dis.?.&vzntage any of

- tne c21 srdancs - . -

It should of course be realised chat cheso proceedinas

ace at this s t z q e governed by ~.56(11(51 of %he

Magistrates (Sunnary Procsedings) Act. T h ~ s section provides che crxceria eo be applied by a court when

consi5sriy.g whether or not an accused person should be

caut:cnec i.e. -

(I)	wkther the evidence is sufficient to pur;
the accused person upon his trial for the indictable offencE with wkicl? he is charqed; or
(ii)	if the evidence civen by the prosecution
raises a strong r probable prS-sumpt1on of
the guilt of the accused person in respect
to that charge.

A ' stronz sr probable presumption of w5lt appears to

be established hy evidence or-circumst~nc%s that point

to the csmissim of a crime and to zhe accused

persocs as the crxminals, vhich clrcuinstzmes are not

compler,ely explained. and cleared up by tk evidence of the accused. (See irvlne's Zustices of the Peace 2nd Edition pp.4i-42)

I chink ic also follows fron a decisioz In re Robers

C19677 1 5Zi? at 474 tiiac an zccused person should be

discharged <;here nao reasonable jury could convict on

the presfnt stlte af r;he evidence.

9.

However it should be remembered that tkZs court is not

required eo deternine che guilt or innmc-cence of each

of the-defendants but has the task c;i determining whether or not thFre is sufficient eviZencs to warranr

sending the accused persons f o r trial herore i. jury.

Applying these principles I have declckd ar; this stage

that there 5 s sufflcient evldence to p k c e each of the

accused on his trial for each of che offences chat

they have been chxged wlth. I wiz1 evencually

caution ezch accused hoxever because c5 the lenqthy

submissicns that have been made on Eehalf of Mr.

CoThill and Mr. 2&zrds I consider that I should rake

a few observations of the evidence as it 302 stands.

In doing so I will be brief because 153 not r7ant to

unnecessarily traverse the faces in vier; 'nf th? co'xse

thac is co be followed bp each of xke accused.

Indeed. i do-not belisve in commitcal p r a c e e d ~ n g g that

the faces should be canvassed at l e n q f i bp the ceurt

when cmmitzing an zccused person for zrizl - the

reason for this belief are I chink cb;ric!x.

Each of the accused are charged wich t h e e S ~ Z C L K G ~ ~ .

offences cf conspiracy under section Bi(l)(b) and

86( 1) ( e ) of the Commonxealth Crimss A c t .

The flrsc question that I should ~ s k in chess

prgceedings is - was there an zareemerxt between each

of the applicants?

In answering tKat questlon I have noted z&t it is not

necessary t:mt persons who are Involvec?. 5n an allecred

conspirxy join togecher ar; the same tfzz. In such a

cnarce any one of the parties may not kqow all che

othcr parties but only chat others arE involved. He

may not know the full extent of the scl~ze to wnich he

attaches himself but he must understznd thac his

invoiveaent is part of a larger schEnrE-- The overall

question in censpiracies of this kind 5 s not whether the number of persons have a common mLzwful purpose hut't.ihechec any of c k m either knows ai %as reason c o

believs that his activicies are part of a larger

design. -

It has been puc to me on behalf of Mr. CcThill and Mr.

EC~7ards thac they wsre not part of 3.y agreerenc althouqh I think it is conceded tkar: there may be some

.

evidence that Coghili and Edxards pl&xe5 a small or

mincr ro le . In my view it is irrelevant rhe extent of

sach person's role as long as they were part of the

acreemenc. In any even? T am of the a@yion that on

the evidefice as	it now stands lncludirq the evidence
in che hand-u:,	brief the oral evidence of varlous

witnesses and the documentary evidence that both Mr. Coqhill and Mr. Edwaras played an important ?art in

! the agreement between each of the defendants.

Havin? found that there was .an aqreeaent the next

question is whether chat agreement	was to do an
unlawful act, i.e.

(i) to defraud the Commonwealth;

(ii) to

prevent or defeat tire execution or

enforcement of section 9 of the Sales

. Tax Assessment I-ct (No. 3 ) ; ane

(iii) to FrevEr?t or defeat the execution or

enforcmer,t of seccion 9 of r;he Sales

Tax assessment Act !No. 7 ) .

The evidence in this case as it presently stands shows

that each of the defendants agreed to pronoce a scheme

whet-ebrr zales ~ a x G7oUld nor: be- paib. Khecher the

scheme involved an avcidance cc- an evasion of sales

tax is in my view l r r e l e v a n c . T3e quescion is zhethsr

the non-paymenc of sales tax 67~s unlarful. In ny

view, such non-paymenc of sales c3x was = clear breach

of the Sales Tax Assessmenc Act. it has been

correctly conceded by both defence counsel who made

subnissions to me chat a defer?aar.+, cancc EXCUS~

himself by sa>-lng, t h t , o1;inq to h15 igzorance of the

law ne aid not reaiiss such an acr; was unlawful.

Although it has nor: bsen conceded by egther counsel

that section 9 has been breached there has been no

substantial argument put forward to support t‘nis

contention except that the qoods concerned do not fsli

within the categories sec out in section 3 of .the No.

3 and WO. 7 Acts. In my view the evidence does not

support this arcrument.

Except for some observations that I will make lacer I

think it follows from vhat I have said that a case to

answer lies against each of the defendancs in respect

to count 2 and 3 on the informations.

insofar 3 s the charge of consiracp to defraud the

Commonsiealth is concerned, it has bten puz EO me that I could noc 3s satisfied that suc5 it cbrge was open because no elemenc cf dishonesty or aecsit 77as present. Mr. Smith referred me to a decision of Wellhain J. reporcsd in 196.1 A.C. 103 and also the

latesc addition cf Arci?bold whereby It is said chat -

to defraud is “dishonestl? to prejutice or take the

risk ~f prejudicing anocher‘s righr; knonoc7inq thac

you have no right to do s o " .

Mr. Judd has referred me to a Court of &?peal decision

of R. v.- Landy xhich is reported at (19811, 1 WLF? paqe

355 where it was said at paae 365 -

"What che prosecution had to prove LFLS a consplracy

to defraud :5nch is an agreemenc diskcnestip to do

somethinq which will or may siuse loss or prejudlce

to another. Tine offence is une of aX&~nrscp." --

M.c. Eurnslde sppearing for the informanE also referred

me to the samz of chis- decislon	where	it vas sald
-

"Bur: if the jury, applying their GLT. notions Of

what is konest and what 1s cat, concluds that he

could not have believed that ?E was acting

honestly, t'nen the elemencs of dlshoneszy will have

been escahlished" .

His Hmour also	said tlrct It would be p=;r:ssi%le	f o i
a jur:? m sag -

"Ne are sure he was acr-inc dishanescly D?CJ.USE we . - .

can see no L-ezson wky a san of hi5 ictzlligence and

experlexe would noc have acozeclited, a s

rigkt-minded peo,le would k v e dons, zb.t u k t ire

was doin? was dishonesy. .

I have come to the flrm conclusion thaE if I were ts

apply any of t:?ese Tests, ani in FarticrLx the lzst.

there is a sti-ong or. ?robable presumprion tnac che

elemect of dishonesty has been sarisflea- I zherefore

find chat chere is suificiens evidence zo place the

accused person upon their crial.

In vier-; of che s&!r.isEionz put to ICE I chlnk it

necessary C O Rake some general observasicns.

1. I have been referred to a decision c? C?urchill v.

Walton (1967), l A l l E.B. 497 at 503 -6 a decisicn

of Canara v. g?P (l574), Bpp. Cas. 334 which in n;r

view nor2 succlnctly pucs the proposition (that) "a

sincere belief in a state sf facts s M c h if crue

would render che illeqal conduct le-2 wouli be a

. good answer to any charge of consr,lrzc;".

Mowever in chis case I havs not beerr referred to

any stace of facts which are capable of being used

to support the proposition and. these	dscisions are
therefore inapplicable.

2. It 'nas been put to me that if the transactions were

l2

I

a sham t&n enc i ty C would neve r be Eab le t o s a l e s

c a s a n d t h e l i a b i l i t y would remain wich the last

wholesa i t r . I can see no re le rznce i n this

s u 5 m i s s f . x (which I believe t o be c o r r e c t i n l a w )

as t o cchEch2f there has been conspzracp. As t o

whether ths t ransac t ions c o n s t i t u t t a sham I

be l ieve tkere i s a s t rong i n fe re rxe that r;he

majority. if nor; a l i the t r ansac t ions were a sham.

sayizi? In this I a m reminded t p z t these ace

criminal charges and as such it is F s r m i s s i b l e t o

determlns the r e a l r e l s t i o n s h i p -3ich exzsr-ed

between var ious t5e en t iz fes . It i s a l s o

_ .	peFrnissi3le- to look not only ar; tze surrounding circumsczncEs b u t a l so t o look zt rhe evidence
which inZicar-es che in t en t ion of t h e &fendanr;s.

3 . Some attempt has been nack by tkz- defence to

suggest Ehat they were e m i t l e d to r e l y on t h e

opinion cf Xr. Forspt‘h Q.C. and a 25vice from a

Perth ffra of s o l i c i c o r s . i.e. Lkssrs Stone Jamec &

-

Co. I =m nor; ea3c t ly 51xe h O G i thls argunent i s

. -

put , or . AOXJ such r e l i z x e WCUL? provide a

. . - _

ClIi4cenz?. i ievertheless I should s c i n r ; out thr-

tiioss p ~ r s o n s expressl:; rkat -,key wt-e noc advisiz,? as t o r-‘ne SZlJ+ cax lia3llit:J ( o r b~

in ferencz t h e criiclnal I l a b i i i c y ) of ,L .E and C.

I rrould %zve chought i t Sxndanz ly c l ~ z r to each of

. -

tine def tx%nts ; J ~ O had re& che zaEzs that t 5 s y

- -

could no? r e ly SE i t to p rovide S. (IEzence witinout

fi-rsr- =atisf:ixng thems32.v-s of leg51 the

ef fec t iveness of A, 9 and-C. -

4. It has h e n pur; t o me b; Mr. Judd that c e r t a i n

assurancss and underLakings ui-xn to Eis c l i e n t and

o thers L?? Fir. Baker could I n some V E ~ S be r e l i e d

upon. In my view tha t 1 s l o g i c a l l y S.n.posszble. I

would i?,?,Tr? t‘nouuht that such an &=surance would

have i m s d i s t e l ? nade a F a s z c i p a u t wary of t i e

e f f i cacF of che scheme.

. 5. Mr. Judd has refer red me to a a e c i s t c n of t h e F u l l

Cour t of che Suprsae Court of Hew Sou51 Males i n P -

v. C a h i l L L O t h e r z tchich i s r e p o z E 5 i n (19781, 2

NSGLR 453 crhich he t e l l s me. and I ZzceDt. i s the

' .	15.
I	,
' I

Wnilst I am obviously not prepared to accede to che

sujmissions put bp Mr. Smith and Mr. Judd, I thank

you both for the way you have arcrued your clients'

cause and your courtesy in allowing	ne to have your
submissions in writing.

Ths only furthsr observacions I have eo make before

cautionlnq ezch of the accused is that tne

criteria co be applied bp a court w h e ~ considering

whekher or not an accused perzon should be

cautionsd, (i.e. pursuant o sect5.cn 56(1)(b))

appears to be the same as thsc rcTdired under-

section 59(7) (i.e. wben I nave LEzrd all tine evidence in the case includinu any ETidence WnlCh may be qiven bp the accused person) a??5I then have

to decide whether	an accused perscn should	be
commltted for crial.

Two avenues of atcack hzve been fglL.z~ed. Flrst, thac the Magistrate misdirected hiinself s s to ckz 1257, 2nd secxd, '

that there was no evidence before him on z-f-3ck he could Lavs

formed. eicher of the opnions which h? dfZ namely tizt tke evidence was sufficient to put the applfzar.cs upon their

trial, or Lhat chere vas a strong 0:- prcbale presumption 05

.-

their guilt.

On bthalf of each of the applicants ic vas s&mitted

that che Maglscrate misdirected himself ta the effect tinat

. although dishonesty on tine part of the splicancs was an

element of ths offence under s . 8 6 - i l ) ( e ) of tlze Crimes Act 1914

dishonesty wzs relevantly established if en tine conduct and

knowledce and other facts proved aqainst the applicants,

looked at objectivelp, a breach of the law was involyred.

Reliance is placed OT? the passaue doove in w3ich the learned Magistrate, having found that there was a rslevanc agreement

I 14.

between the alleged conspirators. said “tkz next question is

whether that zgreement was to do an unkwful act i.e. to

defraud t‘ne Ccmonweaith or to prevent or &feat the e:iecutioi;

or enforcement of 5.9 CL the Sales Tax Acs+ssaent Act or s.5 -

of the -Sales Tax Assessment Act No. 7”. and solved this

question by sayinq thac-the evidence show& that each of the

applicants agresd to prcnote a scheme wher=j_v sales ‘tax would -.

not. be paid 3nd chat- non-payment of =des tax in the

circumstances r . 7 3 ~ unlaxful.

It vas not contested that a fraudulE?t purpose could Se

said to be Erzablished r?kere an a~reemexf operated to the

detriment of t3e Connoncealth and =as eriteret inzo dishonestly

in t h t respect.

It is sai5 that the passages referred to reveal that the _ _

Maqistrate took the v2f.w that the relcranr: mens rea was established once it appeared that the aqretment ‘was to brtng

about a state c€ affair= in which non-paymsTr, of sales tax was

unlawful. In t3is contezt emphasis Gas plz.::ed on che sentence

- “GIhether the scheae i.nvolred an avoidancsz or an evaslon of sales tax is in my view irrelevant”. 511s sentence might indicate some error irt the Magistrate’s =.?roach if, as is

allqed by t k appiicznts, ir; related to the matter of mens

rea. But on z correct reading of the rezsons it is related

sol~lp to the	issue of	the unlzwfulnesc of non-paymenc of
sales tax.

The Magistrate dealt with the- matter of mens rea in

those passages in which he discuss& the lemenr: of

.dishonesty. On a fair reading of the rezons it is apparent

that the Magistrate was well .aware szzd accepced that

-

dishonesty rjas an essential element in the offence of

conspiracp to defraud the Commonwealth.

I consider -thab the Magistrate is tc 32 understood as

. ..	indicating that' dishonesty on the part of zn accused person had to be proved by _the Crown and thzt that elsxent of
dishonesr:y s-;ouid be established where a $E-? lookzxng aT; the
facts proved, and. applying their o r . notions of [:bat is honest
and what is not, conclEded fiar: the accui&i could not have
believed that he actinF honestly. if %he accused was a
person of sufficienc intelligence and ezpzience to realize - -
t h t whac he was doing was dishonesr; zccordin? to the
standards of right minded people chen LT the absence of
evidencs to the concrarp dishonesty on the ~ z r t of the accused
might be found to exist. Se Qent on to s a that in his view.
and applying this test, the element of dcshonesty had been

. ~ satisfied hp the evidence before him.

-

Bccordingly, it is my view that the contention that the

P-Iaqistrace erroneously applied an objec-2i-Je cest to the

eiement of dishonesty is not established. Bt the hearing

before me there W& considerable -iiscussiaE as to che nacure

16.

' .

!

or quality of the state of mind of an accused ~7hich will

constitute dishonesty. To my mind it Gxuld be unsound to

attempt a definition. It is sufficient ta accept what was

said in R. v. Ghosh Cl9823 2 B11 El? 683 ac 696:-

"Tnis brinTs us to the heart of the problem. Is

.	"dishonestly" in s.1 of the -1368 >KZ intended to
characterise a course of conduct? Or is it
intenderl to describe a state of xnind? if the
former, then we can well understan6 that it couli

be establ','shed independently of the knowledge or belief of the accused. But if, as X= think, ic is

the latter, then the knowledge and Szlief of che

accused are at the root of the prcblEyt.

...

There remins t k objection f l ~ t TO adopt a

subjzctii-e test is to abandon all ccandards but

that c5 t k e accuzed himself, and tc irifiq about a

stazt of affeira ir! Cfiich "Ecbin ti@,z3 would be no

robber" (See R. v. Greenseein). "-is objeccim-3 misunderstands che nature of the sejective test.

It is no defencs f o r a man to say, "I knew chat

whac L was doning is generallF regariea 3,s -

dishonest; but I do not regard ir: as dishonest

myself. Tinerefore I am not guilty." F%at he is. bOGje-rer, PIltFtled to say is. " i dici ?lot k~o:? %kat

anybody wouid regard whac I v z z s doing as

dishonesc." He may not be believa?.: just as he may not be klieved if he sets u~ "a claim of right" under s.",l) of the 1368 Act. c r assercs

that he believed th cz-ur-h in of a

misrepresentatlon under 5.15 of the 3 6 8 Act. But

if he is believed. or raises a rea: doubt about

the natter, the jury cannot be s u c z that he was

dishcnest.

In determining whether the prosecutim has proved

that t'& defendant wzs actizg dishonzstly, a 2ur:r

muse first of all decide whether accIrdlnq to the

ordinary scandarcis of reasonable and lionssc people

what GTZS done t7as dishonest. if it was noc

dishor-est by thosz standards. that 5s the end of

the matter and t'?? prosecution fails, If it wes dishonest by thnse scandards, then the jury muse

cor.sider i?hether the defendant himself must have

realised thst whaE he was doing ZES by those

standare5 dishocest. In most cbsss where che

17.

actions are obviously dishonest by ordinary

standards, there will be no doubt about it. It

will be obvious that the defendant himself knew

that he was acting dishonestly. It is dishonest

for a defendant to act in a way c73ich he knows

ordinary people consider to be dissonest, even if

he asserts or Tenuinely believes that he is

morally justified in accinq as he did. For

example, Robin Hood . .. 'I.

On this basis there is in my view na fault to be found

x7ith the approach of the Maglstrate - identifying the

elements of che offence of conspiracy to defraud th

Cornmenwealth under s.86(1)(e) of the Crimes Act 1914.

~ The scated reasons of the Plagistcs-te ;?ere also actacked

on the qsound that hey reveal an tz-ror as to the

circmstances in which it would be proper for him to conclude

that a strong or probable presumptfcn of guilt was

estab1iEhed. Attention vas focussed on t k passage "A strong

or probable presumption of guilt appears tc Se established. by

evidence o r circumstances that point CO t k comnission of a

crime and to the accuser? person as t k criminal, which

l

circumstances are not completely explatnefi or cleared up by

the evddence of the accused".

Considerable emphasis was placed on t'Je final adjeccival

clause. It 57as said that its presence Lndicated that the

magistrace's view W ~ S that tine necessary strong or probable

presuxption of guilt was established %here evidence or

circmstances polnted to the commisslon of a crime by the

18.

accused, no matter how waverinuly, unless the implication of

the accused arisinq therefrom was completely nesatived by

evidence of. or called by, the accused. It appears to me,

however. that the Magistrate is to be understood as sayinq

that, where the questlon whether chere is a strong or probable

presumption of quilt arises for decision. an affirmative

answer m$y be given where the evidence of the prosecution the circumstances point to the commission of a or

crime by the

accused unless the implication of r,he accused in the crime

arisinq from such evidence -or circumstances is explained away

by evidence of, or called by. The accused. The word

“completeiy“ in the pzssage crrder discussion CS inaptly

inciuded. The uitimate qUestim sould not be whether the

evidence for che accused conpletely rebutted. the imolication

of the accused arisin? from the evidence of the Crovn. but

rchether it	so weakened thac	mplicacion chac it could no
-

longer be said to be suffici2nt either to require that t h e

accused be put upon his trial or to stgport ths exiscence of a

strong oc probable presumption of guilt. Reading t’ne reasons as a whols I am nor, persuadecl th=t the Magistrate did not so

understand the problem before him.

It is to opinion the evidence is sufficient to put the accused person 5e observed thac it is only where in his

upon his trial for the relevant offence or, in his opinion the

evidence qiven for the prosecution rzisec a stronq or probable

presumptlon of guilt of the accused person. that it 1 s the

-

---;	,------_	_- -______ -----U	--__ ---L,-
:
i
;	1

19.

;

duty of the Magistrate under s.56(l)(b) of the Act to caution

the accused. 3sd where the question al-hes under s.59(7).

~

after evidence has been-given by the accusE3 or his witnesses,

if any. whether ths accused shall be directed to be tried for

the offexe fn qur-stion, the duty so ta Zirect arises cniy

where the Mqisvate holds the opinirrrz- elther that the

evidence is Eufflcient to put the accEs=d person upcn his

trial or raisss z strong or probable presaption of quilt. The word “presuzipcion“ :nchess contexts nay introduce a

perplsxit?. r- ,:muL -2. is involved is a p-ocess of drawing

’ inferences. L -9resmption is somsthkq. that dces n o t

necessxily prcxerG bp inference oc evzn Sy lc.;ic. Hovever,

19 thls context 2 relevant presuEptiorL	z ~ l y	ex1sc:s	K k r e
inference is frxtiiied.

~ observations oi Lord Reid in Pxmah v. The Gavernment of Ghar.3

!

C19633 X l57 at 2 2 9 , it would appear that before the

Magistrate waTAd contamplate cautioning or committing an

i	accused b-3 rsferefice to an opinim thzt the evidence was
1	suffic?enc to put the accused on.his trial he would weigh it

! . .

to see whztker in Lis opinion twelve reascn%ble nen and women

could all propsrlp chink it sufficiently ccni-incing t o satlsfy them beyond reasunable.doubt of the guilt of the accused or,

alternatively. ~7het‘ner z case had been mac.? out fit for later

consideration by a jury. The esgressZor: “Fit for che

1

I

,.

, I consideration of a jury" would appear to mean fit be o

considered by a jury on the question of whethtr on the

evidence it is satisfied beyond reasonable doubt of the quilt

of the accucer?. Eut it would seem that on this latter test

also, the opinion is one CO be formed by the Magistrate on the

evidence apd rjould nornzlly be an opiniotl to the effect that

the evidence could be chought by a jury to be adequate CO support a conviction. But c7hen one considers action to caution

or cqmmit upon an oJinion of the NaalstratE that the evidence

raises a s~ronq or prosable presumption of guilt, what is

involved is Ycat the Pkgistrate. considerizg and weighlng all the'evidence far himsslf, should be of the =?inion chat chere is.& stron? or probable presumpcion ci g u i l t . In thzt case, as Lord Reid says at p.229 he musr; "decide whether he, not a hypotheticd jury, thinks it probajle zh3t zhe accused committed the offence. "nd "prohble" dce.5 not mean certain

or nearly . cerfam, and on the-. other ani it does not mean a

mere possibility.	See also Lord Pearce 5 2	the same case at
p. 253.

Thus there is CO be a Qarninq at a c~mittal where the

evidence is sxh that he Magistrate is of r;he opinion that a

jury could be satisfied of quilt beyond reasonable doubt, or

the Magistrate bizself is of the opinion thar: there is a

strong or proki3le presumption arising from the evidence that

the accused Is guilt?. It is in the light of these

observatiocc chat the F!gistrate had to fovm his opinion on

21.

the evidence and I have to consider whether there was evidence

upon which-he could form the opinion he did.

The statexsnt of the Magistrate that there is a strong

or probable presumption of gui-it where the evidence or

circumstances “point to“ the commission of the offence by the

accused. ilas criticised and does raise a question whether the

Magistrate had in mind evidence of implication of the accused

sufficient to supporr: -strong or.grob&le presumption that the

accused was guilty or that the evicerice was sufficienr: to put

the .accused on trial as exFlained by Lord %id, or something

less. I thlnk, hoi;errer, readinq his reasap5 as a dnole that

%-e iz to 3e underztcod as referrir.9 CO evidznce sufficient-to

.zJgqorc both of the oplnior?s referred to. Ele pointed cur: that

tht accused should be discharged where CO reasonable jur:~

could convicr- on t-he evicience. and that it was not for him r:o

. -

determine guilt or innocence but. rather, acting on the

principles to which he referred, to decide at the then current

stage whether chere was sufficienr; evidence to place the

accused on trial for each of the offences. tie then devoted

his atcention to the elements of the offences: vas there an

. agreemenz? Has it for an unlawful purpcse? Did the accused

play a part in the relevant aqreement? P k S there dishonesty?

Pft;r discussing the t e s t s by refsrence to which a findlng of

dishonesty micht be made, he stated that he had come to the

conclusion that applying any of the tests to which he referred.

zhere was a stron? or probahle presusption that the element of

22.

dishonesty has been satisfied.

The reaszning of th2 Masistrate is c5allenged also on

the qround that in discussing the releT&ce of reliance on

legal opinions given by Mr. Forsyth Q.C. and Messrs Stone,

James S. Co., solicitors of Perth b3.A.. h? stated, “I am not exactly sure how zhis argument ir put, or how such rellance

wolJld provide a difference.“. This is -3 rather puzzlinu

statement becauze reliance on l e g d opinions- would be relevant

to the existence of dishonesty in th? mZn5 of the accused.

P.cco5dir.q to circumstarices a learnzd o2irrkn that a certsin

course was iata-ui could be significantz.; material in an

assessment of the credibility of a statezent by an accused that he really belleved thar: ?:is courss of action w a s .

according to the tests mentioned &eve, z ~ r knnest one.

- -

If the Maqistrate is to be understocd to say that in

. forming his opinion he considered that i3e existence of a

relevznt legal opinion was of no significmct that would be an

error. However, the Magistrate did look st the matter on the

basis that the opinions nignt be taken f ~ t o account on the

issue of diskonesty. He took the view t’kt on tine issue of

the accused‘c belief chat hls conduct %=S not dishonesr.

because of r,he contents of re1evar.t leual opinions his

statement to that effect would have to 3e examinad in the

light of the actual opinion given. . In this respect the

howledge and Experience of the accused in the area of sales

23.

tax lia5ility and business generally, and %he likelihood that

the person miqht seek further assurances zs to the lawfulness

of the actual conduct to be engaged in mder the agreemenr;

were relevant considerations. In the light of the foregoing I

am noe sacisfied that the Magistrate miscXrEct2d hinself in

any respecc.

The Evidence GenGrallv .

The . gmeval situation disclosed scrainst all the

applicancs is that a Mr. Eaktr bat conceT.-%rl a scheme winich

570Uld ogerate in a situaLicn ?;here a rihaLesaler desired to -

sell goods by wholesale to a retailSr. T k 2 r the sche!ne the

ownership of those goods was to be Lransfercsi to the retailer throuqh a series of intermediate tracsactioca. The goods were t o be sold wholesale by r;he wholesaler I;z 3- coapan:r caller!

company B and dealt viYn in dealinas 5etwE?,=c company A and two

other companies. called B and C, and as ke2r7een.S and C, in

such a way that C would ultimately be enz31ee to and would

sell those goods to the retailer. It apcpars tinat in tinat

.	series of transactions sales tax. was not, ,accosdlng to law, payable by the zjholesaler o r r;he retailer. -Tie wholesaler was
able to sell tc the retailer at a consider21e dlscount and at
the same time enjoy a reduction of his outgcinqs. For tinis he
was to remunerate the author and rnanacer of tlze scheme.

It appears that Baker, the author c- the scheme. was

24.

secretive about the nature of the dealincs between companies

B , B, or C. The theory was that those broucrht intcj the

operation of the scheme, the promoters, could rely on the

assertion of Baker that such was the cature of the dealings

that the legal result was that =des tar cias Rot payable by

the wholesaler or the retailer and that no liability for sales

tax attached . to companies A, 9 o r C. Baker sought and

obtaiEed learned 1eqal advice. This advicE was to the eifecc

that under the scheme the tiholesaler and the retailer incurred

no liability< for sales tax.- Aavice as to xhether A , 8 cr C

Evldence Concernlfic Edx7ards

-

It is nor: clear how fa r Edwards =as ===re of the nature

of the transactions between 9, 9 and C. HE did know, ho~rever.

that the scheme did involve sales by a cflolesaler to h and

dealings between A, B and C and ultimately a sale Sy wholesale

by C to the retailer. As secretary of .a company called

Lowanna Securities Ptg. Ltd. he communicated with pocential

customers of the scheme in the following tfums:-

Furcher to our telephone conversations, I enclose

a copy of the Proposal.

25.

Implementation of the Proposal involves the

position of B. a and C, (referred to in the

Qpinion contained in the proposal enclosed), beinq _ .

occupied three by Victorlan incorporated

companies. ohnsrshig and control of which is

vested in a person	living	in	Perth, Western
Australia.

The marketinu of the Proposal in.llelbourne is

being handled for and on behalf of the Perth

interests by Lova~na Securities Pty. Ltd. of the

above address and Corporate Structures Pty. Ltd.,

of Level 9. Cir;p Mutual Euildlng, 459 Collins

Street, Nelbourne.

We are assured by our priccipal, CXho will be

named provided you decide to procee6 with the

Proposal?. thac zoqecher the two co;o?anies

mtmtionzd above are solely resgonsible for

implemencing the - Proposal in the Easr;&n States.

Ycu map rest assured that nirktxq of the

. Proposzi will proceed solely on t3e basis of

personal references and introciuccxcns thrGUTiI

Lowanna Securities Pty. Ltd. z x i Corporace

Structures Pty. Ltd.

Our principal has advised:-

1.     Thzt none of t'ne companies A, 3 or C are

colla-med. -
2 .	Tnat there is no reduction of price between

A, B or C.

3 . That erther our Principal or A, P, and C will

be responsible for an~7 leoal costs In .

defending "E%olesaler" or "Retailer" againsr;

actions or assessnents or collection f sales

tax arislng from transactions entered inzo by

"Wholesaler", "Retarler", B. I3 or C.

. .

4. Our Principal undercakes to "Fiholesaler" and

"Retailer" to pay any sales assessed to

B . B or C provided that the assessment is

. . upheld upon final appeal and provided also

that A. B or C do nor; pay the	amount
assessed.

5. Thzt the invoice from C to "Rtcailer" will bear the words "Prlce includes any sales tax payable".

26.

l

I look forward to discussing the Proposal wir;h you

at a later date. "

He knew that sales tax was not to be paid by any party

involved in the scheme. It appears also t k t he had access to

an oFinion given by Mr. Forsyth Q.C. in v;hic31 it was said:-

"Like my instructing solicitors. I am not asked to

analyse the dEzlings betw-72e A, B czd C nor che

question of whether any of chem is l i a b l e to pay

sales tax. And indeed I hsve not reached any concluded view upon chat mescion. It is enousn

for present purposes to aake the very worst

assumption. nanely- t3ac A ar.d/or B ailor C

become liable to pay sales cax, and that the

liability is concealed, or az.least :5t>h21d, from

the salts cax auzhoricies by the fz<lur= CO make an:r retun (as re2uired by Each of tke Assessinens Acts, 2.q. s~ccicn 7 of the Sales ?=X Assessnenc

Act (Pio.3,). I must stress t*&t this is nereiy an

- assumzzi.zn for the purpo-ies of corsidering the

positior;. of Retailer 2nd Eaolesaler I n t:?e irorst

possible light. It is no t to say tEat I know or

have reason to suspect t;kt thls Ss clbat will

actual13 occur. But if c b c is in fzct what does happen, nonetkeless in my opinion neZ5hei- Retaller

nor GCiclEsaler incurs sny Lizbilirx- ... In so -

far as the actions of A, B zcd C conzcituce leqal

and-honest avoldance. in m-; opiniar, it is clear

that no posslble secondary liabilitF could attach

to Cvholesaler or Retailer. . . . Eut Zf or?e adds, to

measures thouTht to be effective b~ esploitir.5 a "loophole" or inconsistency i n ths Act, or come subtle distinction of t'ne lawF ci2liberate concealsent or non-disclosure (in cf-zumstancee ~n

which Yne la57 requlres dizclosure to be made -

e.g. by rsklnq sales tax .reCurns), the avoidance

ceases zo be "legal avoidance" =E becomes a

criminal offence if, accordina to t k view of the

law ttak is finally upheid by k>e Court, a

liability did exist to pay sales tzz andlor make

the retcrn ss the case may 're. L3kTt-e there is

conceakent or misrepresentacion c5 that kind,

there viii 'usually be a criminal cffence. That

goes 3eyand "iegal avoidance", . ..

There is svidsace that GTder the sckeme the intention ~73.5 that

' i

I

2 7 .

sales cas would not be paid by wholesaler or rezailer or by

1

companies A , B or C, that C CJOuld not reqistzr as a wholesaler

prescribed under S . 11 of the Scles Tax Bssessnent Act (No. 1)

.i930-1973 and would make no recurns cE sales by it by

wholesale to retaiiers under S. 7-of the S&es Tax Assessment

ACE - (WO. 3) 1930-1973. Edwards =as to be remunerated by way

of conmission according	to his parr: irr business done in
accordance x7ith che scheme.

It is apparent even on these facts tkzt. if by law sales

tax was paya3le 5y C then. by conducting tke cransaczlons In a

manner khaz they ~70uii not come tct the ngticz of the Sales Tax

Departmcnt. althouqh r:here was a risk th& the7 might. sales

tax w o d d cot paid. In that event the szheneme involved the

comnss>on of unlacfui cor.duct C O the .lstriment of the

Comnonweaith. The justification f o r i-ondLctlng the

-

transacticns in this way was tiiat there vas genuine acceptaxe of the a~surznce of Baker that the nature CE izhs trznsactions

bet~een 1, 2 and C and cke wholesaler and retailer concerned

were such a c CO zbbsolvc them all from iiabZLZty for sales tax.

Such coniuct wzs therefore intrinsically irmosent and would be

. - 50 regarded by any reasonable man. Bur: the view might well be

taken that the "possibility" that there wz5 an avenue of tax

immunity in the 2ct which could be exploite by Baker's secrsr:

formula would be likely to be questlone& 57 any honest man

especially an accountant, ac Edwards wzs. Fkuid an honest man

invited to enter into che scheme and parricipate in it for

2 8 .

profit have wanted to know more about the scheme. h%at could

. there be in tke nature of the transactions which would absolve

C, who sold by wholesale to a retailer. from liability to pay

sales tax on his sales? He might have wanted to know why.

while learned opinions were being sought as co che 1iabiiir;y

of wholesaler and recailer, an opinlon was not sought as to

the sales tax lla3ilitp of A , E and C. Faat could be che

"magic" of the nature of the transactions bemeen A , S and C which could hai-e the legal effect alleged? POW could Eaker's claim to secrecy. even against those joinlng in the scheme, be

accepted WithO1iC quescion? The difficulty is chat it may well

be thought to 3~ bsziond the wit of an oreinary professional .

man CO contemplate a basis upsn which the inzerposition of

intsrxediaries between the LTholesaler and. recailer would

exempt all the parties from iiabilicy to sales tax espscially

as it must hare been clear chat the transaction be~ween C and

-

the retailer ~ 7 ~ s piainljr a sale by a wholesaler co a retailSr.

In my v2zw it is unnecessary to proceed further to come

to a conclusion that in the absence of credible evldence fron

Edwards as co 3is real stzte of mind ths Magistrate could well

form the o2inions which he did concerninq che cas2 againsc

Edrca r d s .

T?F Evlaence ccncernir.q Grant

The evidence shows that Granr: was introduced into c3.e

29.

scheme by Collie. He became the admlnistrat5ve and executive

manaqer of the scheme in Melbourne. He was at the material

times secretary of companies occuayinq the positions in the

scheme of A . B and C. He handled the HJceipt from the

retailer of che purchase price f o c the oao&s scld to it. He took ouc of the sun so received 25%, beinq az'ker's commission, kept 10% of thzt for his own fees, and diL-LZed the balance between the promoters.. HE controlled the bazking flouinq from

money transactions arising from the the purckss hp C of a one

half interest irt the ownership of che goods iror?. B and the

other half interest from B, the purchase bp 3 from B of one

half incerest E?& the purchase of the ~ o a c k 59 i ? ! f r n m the

orighsl wholeszler. That discribution of fuxfis left A , 9 and

C witbut notley. On completion of each dis5zlbutrcn none of

them could hare _;aid any smount due by any 05 thea for sales

tax. The intention of all parties vas, to Grafit's knowledrre,

that no sales should be paid by anyhc852. It is also

inherent in the scheme that all the trzcsactions were

artificlai, in the sense that none of B , E 0.c C entered into

the trzzsaction for zny commercial reason. 'Tney were in no

<;ense traders f c r commerzial reward. The.;- were mere legal

entities interposed between the wholesaler d che retailer to

enter into the transaccions for the pun;z==.;e of avoidinq

payment of sales tax otherwlse payable on che sale by the

wholesaler to thc retailer on t'ne simple trznsaction between

them. The relevanr; docanents were created in Perth and

transmitted to Grant. They were presared in bulk.

1

30.

Unconnected transactions were conceived of and documented as

all taking place at zhe one time. The artificiality of the

transactlons xas inevitably apparent to any person

implementing the schene. It was not lntendfd that A, B or C

should be registered- as wholesaiers under the Sales Tax

Assessnent Acts or t3at they should submit any returns under those Acts. - it <+S said that these features were all consistent with honest;? and there were no sign posts in the evidence suagEst;inq chat Grant did not hozzscly believe that sales tau was ?at paya5le by the entities pzrtlcipating in the

scheme. I think thzre were sign posts aatside the general

nature cf thr schsn?. Buc- for the purpsses of the issues

befare r.e I dc not t%nk it necessary to examine chsc rnacter.

The current cr5tical issue before me is 5;hEYcer with relation

to the charge a5alnst Grant under s.86(1)1~) of t5e Act there

was evidence c5 dishonesty upon which ths MaT-iscrste might; -

form the opinions which he did.	I	do nct doubt that there
was.

Of course, if Grant, or' indee6 any of the applicants,

give evxaence' that they believed their pzrticipation in the

.	scheme would b? reqarded as honest by rignE minaed people and
if that eviderize is zccepted, or if the effgct of the evidence
is such that on consideration of the %hole of it the

Maqiscrate ceases to hold either of the opinions expressed by him in his statement of reasons for deciszon then. no doat,

he will Tive effect to that stzte of affairs.

! 31.

Collie's Aoallcation

In the proceedings before the Eagistrate the statement

of the reasons of the Magistrate for issuing the cautim

pursuant to s.56(1)(b) of the Act were stated ir. the presence

of tine applicant Coilie. Collie t h m gave lengthy evidence.

No decision has get been made by the Magistrate as to xbether

this applicant should- be directed	to stand trill	or .be
discharged. .

In these circumstances Collie can hzrdly clalm rellef

in respecr; of the Magistrate's decision. He has accepted it

and elltered upon a course of accion cn ths basis that the

decision tinae was made should stard. Thus he has advar.ced the

proceedings before the Magistrate to a stage at which a duty

_ _

has arisen in the Magistrate t o aake a decision under s.59(7)

of the Act.	The application of this applicant must therefore
be dismissed.

However, no objection wzs taken 50 Mr. Cummins on behalf

of Collie making subnxssions as to the law. Mr. Cummins

contended that it was to be gathered from the Magistrate's

statement of reasons that he had asked himself whether there

was an agreement between ths promoters of che scheme that

sales Ea:< be not paid and had answered that question in the

affirmative. He said thzt the Magistrate had omitted to

32.

observe that the agreemenr; proved miqht have been to take

- steps to brinu about a situation in which sales tar would not

be papable. Fe contended that an zgreement of this latter

kind would be cuite iz-z-ul. It would be an agreement in which

although the parties Intended sales tax not to be paid such

non-paymtnt would occur in circumstances in rchich they did cot

know or believe that it was payable. Th+ it 57as c a d vas

critical cn th,? question of mens rea. If the Maqistrate had

put to himself in categorical terl;i-s the o_uesr;ion. "did the

particlpants acJree to operate a scheme unckr which sales tax

G70Uld lz:+fulI.>- r?oc be payable.. -5" , then, according to r;he

opinions arrivtd a% by ths Msgistrate, the answer c;ould hsvr

been t i a t , believing that sales tar mi9b-t 5: pzg&le, tney

agreed. to operzt? a scheme under Khicz1 koceiully - saies tax

wouid l z~eul lz r.ot be payable but whether tzx was or TZ.S not

payable, in ffther event, tax would Rot bs paxd. As WES

._

recognized. bp Y r - Cummins in this case "all roads lead to

dishonesty.	that	is what	this	c2se	% S all	abouc".	I .
!

Accordingly, in ny opinion it may Se of minor signlflcance as

to which of the two questions the f<q'isc~-zte asked hinself.

However, the r.a';ure and contenr; cf the agreement between the

promoters 57as a question of fact. And if zhere Gas evidence

to support the oprnion thzt the aqreement wkich was made xas

an agreement that sales tax be not paid then the Magistrace

was sncitled to form the opinlon he did. And I am not

persuaded that chsre was not such evidence.

33.

I

Charces Under Sectinn 86(1)(5)

In rescect of these chzrges there was considerable

! debate at ths hearing Sefore me as to the nature of the

conspiracy with which s.86(1)(b) of the Crimes Act 1914 is

I

I -

concerned. The t¶qistrate formra ths opirzor. that in respect

i

.

I of the charges.against tine applicants undsr s.86(l)(b) there

was sufficiert evidence to 31<ce thz accuse5 on trial for each

of the offences. He took the view that 3 e agreement which

the applicants had. m+de Gnth each otEer GE= that sales cax be not paid the ii:-cumscancss beincr. h3wever. =hat sales tax wzs legally payale. iiaVlng recard to' 3-55 views of tiis

appropriate test as to presence of dishonesty in a

transaczion, c-frich he ez?resss?t in reiatE.sn to the charqes

under s.R6(11(e) and to his views as to tkz evidence of the

presence of iishonestg in relction to t3ose charges, and

-

whether or not he considered that dishonesty Gas an element in

. the chzrqes unsex- s.S5(1)(3), there was a s-iliiicient basis for

ar: opinicn Y??t it vould be orjen to a jury to find beyond

reasonable do&z that each of che applicants entered ints the

agreenent believing, at least;, that sales tzz night be payable

according to law. buc intending that it shuld not be paid,

whether or not that was the czse, and Lntendinq that the

vendor cornpant- "C", referred to d o v s , should not recrister as

a wholeseler b 3 r make returns of its sales pursuant to the

Sales Tzx Aszsssssnt Acts. T h consplrac.;. arisinq from that

agreement woul& ir.evicab1y be one to pre-rent or defeat r;he

I+ !

- .

2: I -.-_- L __-_ __I-_I ..--I . -- A..

l

I

, a

I 34 .

l

I

I execution or enforcement of the r levant provisions of the

Sales Tax Assessment Acts. .

Accordingly, the applications of each of the applicants

must be dismissed.