United Mexican States v Cabal

Case [2001] HCA 60

HIGH COURT OF AUSTRALIA

GLEESON CJ,
McHUGH AND GUMMOW JJ

UNITED MEXICAN STATES  APPLICANT

AND

CARLOS CABAL (PENICHE) & ORS  RESPONDENTS

United Mexican States v Cabal [2001] HCA 60
Date of Order:  31 July 2001
Date of Publication of Reasons:  24 October 2001
M74/2001

ORDER

1.   Leave to appeal granted, the draft notice of appeal to stand as the notice of appeal.

2.   Appeal allowed.

3.   Set aside orders 1, 2, 3, 4, 5, 6 and 7 of the orders made by Kirby J on 19 July 2001 and in place thereof order that the summons dated 12 July 2001 be dismissed.

4. The first respondent to pay the costs of the appellant of the appeal and of the proceedings at first instance, including any reserved costs, and to have a certificate under the Federal Proceedings (Costs) Act 1981 (Cth).

On appeal from the High Court of Australia

Representation:

G T Pagone QC with K P Hanscombe and M M Gordon for the applicant (instructed by Director of Public Prosecutions (Commonwealth))

G Griffith QC with D S Mortimer for the first respondent (instructed by Fernandez Canda Gerkens)

No appearance for the second respondent

D M J Bennett QC, Solicitor-General of the Commonwealth with B E Walters for the third respondent (instructed by Australian Government Solicitor)

Notice:  This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

United Mexican States v Cabal

Criminal law – Practice and procedure – Bail – Whether High Court has power to grant bail – In what circumstances High Court will grant bail – What constitutes "special circumstances" – Whether special circumstances established where applicant subject to extradition determination, in custody for over 30 months and subject to extremely harsh conditions in detention – Whether risk of flight outweighs special circumstances.

Extradition – Bail – Whether High Court has power to grant bail pursuant to the Extradition Act 1988 (Cth) or pursuant to the Constitution – What constitutes "special circumstances" for the purposes of granting bail in extradition proceedings – Rationale for refusing bail in extradition cases.

High Court of Australia – Practice and procedure – Bail – Whether High Court has power to grant bail pursuant to appellate or original jurisdiction – Proper form of order for admitting prisoner to bail – In what circumstances High Court will grant bail – Where applicant for bail subject to extradition determination and application for special leave to appeal still pending – What constitutes "special circumstances" – Whether special circumstances established by applicant in this extradition proceeding – Whether risk of flight outweighs special circumstances.

High Court of Australia – Significance of referring hearing of application for special leave to appeal to Full Court of High Court.

Words and phrases – "special circumstances".

Extradition Act 1988 (Cth), ss 15, 19, 21.

  1. GLEESON CJ, McHUGH AND GUMMOW JJ.   On 31 July 2001, the Court made orders granting leave to the United Mexican States (Mexico) to appeal and…

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AGLC
United Mexican States v Cabal [2001] HCA 60
Case
[2001] HCA 60
Decision Date

CaseChat Overview and Summary

The High Court of Australia considered an application by the United Mexican States for leave to appeal against orders made by Kirby J concerning bail for Mr Cabal, who was subject to extradition proceedings. The dispute centred on whether Mr Cabal should be granted bail pending the determination of his extradition to Mexico, with the United Mexican States arguing against it.

The legal issues before the High Court included whether the Court possessed the power to grant bail in extradition cases, either under the *Extradition Act 1988* (Cth) or the Constitution, and what constituted "special circumstances" justifying the grant of bail in such proceedings. The Court also had to consider the weight to be given to the risk of flight and the rationale for refusing bail in extradition matters, particularly in light of Australia's international treaty obligations.

The Court reasoned that while the existence of special circumstances is a prerequisite for granting bail in extradition cases, the risk of flight is a highly relevant factor in the exercise of discretion. It held that granting bail where there is a real risk of flight could only be justified in extraordinary circumstances, as it could jeopardise Australia's international relationships and standing. The Court emphasised the significant interest Australia has in surrendering individuals to countries seeking extradition to fulfil treaty obligations, noting that failure to do so could lead to the breakdown of international cooperation in criminal matters. The Court also highlighted the substantial costs associated with extradition proceedings, which are put at risk if a defendant absconds.

The High Court allowed the appeal, setting aside the orders made by Kirby J that would have granted bail. Instead, the Court ordered that the summons for bail be dismissed.

Orders

Orders of the court

1. Leave to appeal granted, the draft notice of appeal to stand as the notice of appeal.

2. Appeal allowed.

3. Set aside orders 1, 2, 3, 4, 5, 6 and 7 of the orders made by Kirby J on 19 July 2001 and in place thereof order that the summons dated 12 July 2001 be dismissed.

4. The first respondent to pay the costs of the appellant of the appeal and of the proceedings at first instance, including any reserved costs, and to have a certificate under the Federal Proceedings (Costs) Act 1981 (Cth).

Background

Background to the litigation

The orders contained in these books and the orders made by Fullagar J are precedents that are readily adaptable to orders granting bail in criminal and extradition cases in this Court. In our view, orders in bail cases in this Court should follow these precedents, so that all those required to obey bail orders will have no doubt about their obligations. The background to the proceedings On 11 November 1998, Mr Cabal was arrested under a provisional warrant issued in accordance with the Act. He was taken before a Magistrate and remanded in custody. In December 1998, Mexico made a formal request for his extradition. Mexico alleged that Mr Cabal was guilty of 23 offences against the Law of Credit Institutions of Mexico and three offences against the Federal Criminal Code in Matters of Common Law for the Federal District and in Federal Matters for the Republic of Mexico. The maximum penalty for the offence contrary to the Law of Credit Institutions is 10 years imprisonment. For the offence contrary to the Federal Criminal Code, the maximum penalty is 12 years imprisonment. The offences involved allegations of fraud, taxation evasion and money laundering. Mexico alleged that the offences had caused economic loss of US$242,722,590 to a bank and three private companies[6]. [6]Affidavit of Daniel Donato Caporale, sworn 29 May 2001. After a long hearing, the Magistrate determined that Mr Cabal was eligible for surrender to Mexico under the provisions of s 19(9)(a) of the Act. The Magistrate signed a warrant committing Mr Cabal to the Melbourne Assessment Prison or Port Phillip Prison to await surrender to Mexico. After being committed by the Magistrate, Mr Cabal challenged the determination of the Magistrate in the Federal Court of Australia. In August 2000, French J dismissed Mr Cabal's application for judicial review made under s 21(1)(a) of the Act[7]. In April 2001, an appeal against the decision of French J was unanimously dismissed by the Full Court of the Federal Court[8].[7]Cabal v United Mexican States (No 3) [2000] FCA 1204.[8]Cabal v United Mexican States [2001] FCA 427. Mr Cabal then applied to this Court for special leave to appeal. On 22 June 2001, Gummow, Kirby and Callinan JJ heard the application. Their Honours referred the application to the Full Court of this Court for determination. They directed that at the hearing the parties should argue the matter as if it were an appeal. Mr Cabal has now withdrawn his special leave application. In the forefront of that application for special leave to appeal was the claim that s 21 of the Act is invalid. Mr Cabal contended that s 21 purports to direct the Federal Court to perform an administrative function and to exercise administrative powers in the performance of the function. He contended that this was an invalid attempt by the Federal Parliament to confer non-judicial powers on the Federal Court. He claimed that s 21 is a fundamental and non-severable element of the Act and that consequently the whole Act is invalid. If that is so, the Magistrate had no power to commit Mr Cabal to prison. Mr Cabal also contended that, insofar as ss 19(5) and 21(6)(d) of the Act prohibited him from adducing evidence in support of his case, they are invalid because they denied the judicial power of the Federal Court to stay proceedings in that Court when those proceedings are an abuse of process. Mr Cabal contended that these sections are not severable from the Act and that the whole Act is invalid. Finally, Mr Cabal contended that in any event the Full Court of the Federal Court had erred in finding that ss 19(5) and 21(6)(d) prohibited him from adducing evidence in support of his claim that an extradition objection had been established. He submitted that evidence would show that the extradition proceedings ought to be stayed as an abuse of process.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

HUGH AND GUMMOW JJ

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by: HUGH AND GUMMOW JJ

In the United States, the practice is to consider the risk of flight and only then to consider whether special circumstances exist. If there is a real risk of flight, the application for bail is refused whatever the special circumstances may be. In Australia, the existence of special circumstances is an essential condition of the grant of bail. It seems proper, therefore, to determine whether special circumstances exist before considering the question of flight, a matter that is highly relevant in the exercise of the general discretion. It may be going too far to say that, if there is any risk of flight, the Act requires that bail be refused, even if there are special circumstances. In a particular situation, the special circumstances may be so cogent that bail should be granted although there is a slight risk of flight. Nevertheless, to grant bail where there is a real risk of flight could only be justified in the most extraordinary circumstances. In the vast majority of cases, the proper exercise of discretion requires the refusal of bail if there is such a risk. To grant bail where a risk of flight exists is to jeopardise Australia's relationship with the country seeking extradition and to jeopardise our standing in the international community.The rationale for refusing bail in extradition cases Where a person is found in Australia and an extraditable offence is alleged against him or her, this country is obliged to return that person to the country seeking extradition. Australia therefore has a very substantial interest in surrendering the person in accordance with its treaty obligations. If Australia fails, when requested, to return a person against whom there is probable cause for concluding that he or she has committed an extraditable offence, it breaches its obligations under international law[94]. If Australia fails to comply with a treaty, the rules of international law entitle the other party to the treaty to repudiate or suspend the performance of its own obligations under the treaty[95]. A repudiation or suspension by another country of its extradition treaty obligations to Australia would hinder this country's ability to enforce its own laws. In an era where much crime is transnational, the breakdown of international co-operation in apprehending criminals would be disastrous for the peoples of the countries concerned. Such a breakdown may do more than inhibit the apprehension of persons who have committed crimes against Australian law. If other countries think it not worthwhile to seek extradition from Australia, Australia may become a haven – at least for a time – for those who have committed serious crimes in other countries. They may well commit similar offences here.[94]Wright v Henkel 190 US 40 at 62 (1903). [95]Vienna Convention on the Law of Treaties, (Vienna, 23 May 1969), Art 60: 1974 ATS No 2; 1155 UNTS 331. If the defendant flees Australia after being granted bail, the expense of enforcing Australia's treaty obligations has been incurred for no gain to this country. Even if the defendant is re-captured, further public money will have been expended. The cost of extradition proceedings is often substantial. In the present case, for example, there were extremely lengthy proceedings before the Magistrate, an appeal to the Federal Court, and an appeal to the Full Court of the Federal Court. In the proceedings before Kirby J, Mexico and the Commonwealth asserted that they were the "beneficiaries of costs orders against Mr Cabal which amount, in aggregate, to about $2m."[96] But the cost of any extradition proceeding is certain to be considerable. It is obvious that Australia and often the extraditing State may have to spend large sums on extradition proceedings, most of which may be irrecoverable from the defendant. To these costs must be added the cost of keeping the defendant in custody. All this expenditure is put at risk when a defendant is granted bail.[96](2001) 180 ALR 593 at 607-608 [59].