Wills v Petroulias

Case [2003] NSWCA 390

NEW SOUTH WALES COURT OF APPEAL

CITATION:      WILLS v PETROULIAS [2003]  NSWCA 390

FILE NUMBER(S):
40219/03

HEARING DATE(S):               16 December  2003

JUDGMENT DATE: 22/12/2003

PARTIES:
Nikytas Nicholas Petroulias
(Applicant/Opponent)
Gary Andrew Wills
(Respondent/Claimant)

JUDGMENT OF:       Spigelman CJ Handley JA Santow JA   

LOWER COURT JURISDICTION: Supreme Court - Common Law Division

LOWER COURT FILE NUMBER(S):          SC 12242/02

LOWER COURT JUDICIAL OFFICER:     Simpson J

COUNSEL:
N Clelland SC  (Applicant/Opponent)
P Hastings QC  (Respondent/Claimant)

SOLICITORS:
Coadys  (Applicant/Opponent)
Commonwealth Director of Public Prosecutions  (Respondent/Claimant)

CATCHWORDS:
CRIMINAL LAW
Defrauding the Commonwealth
Element of loss
Whether evidence thereof
CRIMINAL PROCEDURE
Appeal from committal
Where evidence presented in summary form
Exercise of discretion on appeal
Whether charge should be settled by magistrate

LEGISLATION CITED:
Crimes Act 1914 (Cth) s 29D
Justices Act 1902 ss 41, 41A, 104, 109, 110
Supreme Court Act 1970 s 76

DECISION:
Application granted.  Orders of 3 October 2003 vacated and substituted.

JUDGMENT:

- 4 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40219/03

SPIGELMAN CJ
HANDLEY JA
SANTOW JA

Monday 22 December 2003

Gary Andrew WILLS  v  Nikytas Nicholas PETROULIAS

FACTS

The Opponent in the appeal in which judgment was given by the Court of Appeal on 3 October 2003 (Wills v Petroulias [2003] NSWCA 286) applied pursuant to Pt 40 r 9 of the Supreme Court Rules 1970 to have that judgment set aside or varied. The main appeal (pursuant to s 104 of the Justices Act 1902) concerned the committal of the Opponent (Petroulias) on a charge of defrauding the Commonwealth (Crimes Act 1914 (Cth), s 29D). Petroulias was accused that when he was a First Assistant Tax Commissioner, he procured the issue of Private Binding Rulings in favour of certain employee productivity incentive schemes in the promotion of which he had an interest.

Simpson J allowed the appeal against committal on that charge on the basis that there was no evidence that the Private Binding Rulings were arguably incorrect so that there was no evidence of the element of loss. Her Honour was persuaded to quash the committal pursuant to s 109 of the Justices Act 1902 (the Act) by the decision of Kiefel J in Essenbourne Pty Ltd v Commissioner of Taxation [2002] FCA 1577. The Court of Appeal allowed the appeal from that judgment, holding that her Honour has misinterpreted the effect of Essenbourne.  Furthermore the Court held that it was only necessary for the prosecution to demonstrate that he was genuinely asserting a contrary position to that in the Rulings or that there was a genuine dispute about the issue, rather than to show that they were arguably incorrect.  The Court held that evidence of such an assertion existed and confirmed the committal, although not upholding the charge in its original form. 

The Applicant in this proceeding (Petroulias) claimed that the Court of Appeal made errors in respect of its treatment of the judgment of Simpson J, the existence of certain evidence and its reliance on…

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AGLC
Wills v Petroulias [2003] NSWCA 390
Case
[2003] NSWCA 390
Decision Date

CaseChat Overview and Summary

This matter concerned an application by Wills (the applicant) to review a decision of a magistrate to commit Petroulias (the respondent) for trial on charges of defrauding the Commonwealth. The dispute centred on whether there was sufficient evidence before the magistrate to establish the element of loss required for the offence. The applicant sought to have the committal order set aside.

The court was required to determine two primary legal issues. Firstly, whether there was evidence before the magistrate that satisfied the requirements of sections 41(2) and 41(6) of the relevant Act, which relate to the establishment of loss in the context of defrauding the Commonwealth. Secondly, the court had to consider whether, based on the evidence presented, there were sufficient grounds to authorise an order of committal under section 110 of the Act.

The court reasoned that the evidence before the magistrate, including the existence of a Public Ruling from the Australian Taxation Office (ATO) and internal ATO views, demonstrated a "genuine assertion" of a particular position regarding fringe benefits tax. The court found that the summary manner in which evidence was presented, including a Schedule of Particulars, did not detract from its sufficiency. This Schedule, although prepared for an issue of dishonesty which was not in dispute, effectively summarised a large body of evidence that established the existence of a strongly held view within the ATO. The court applied the principle that for a committal, it is sufficient to identify evidence capable of satisfying a jury that there was a reasonable prospect of conviction, and that the evidence presented was adequate for this purpose in a "paper committal" scenario.

The application was granted, and the orders of 3 October 2003 were vacated and substituted.

Orders

Orders of the court

Application granted. Orders of 3 October 2003 vacated and substituted.

Background

Background to the litigation

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Evidence

Evidence Before The Court

The Court further concluded that there was evidence before her Worship which would satisfy the requirements of s41(2) and s41(6) of the Act and that there were sufficient grounds to have authorised an order of committal within s110 of the Act. The second of the two grounds for this application as set out above challenges these findings. (See [6](ii) above.) It is convenient to deal with that matter first.The Evidence Point I summarised the nature of the evidence before the magistrate in par [78] of the previous judgment:“[78] The element of ‘genuineness’ was established on the basis of the contrary opinions expressed, the contrary rulings made and the circumstances and manner in which they were made.” I had earlier stated, in pars [56] and [58], that there was evidence before the magistrate of the strongly held view, within the ATO, that the fringe benefits tax regime would in fact apply to the schemes the subject of the relevant Private Rulings. Indeed, those views culminated in a formal Public Ruling to that effect. In this regard the evidence was plain, in my opinion, that a particular position was being genuinely asserted. The very existence of the Public Ruling was, I believed, sufficient in this regard. During the course of the argument before this Court I raised the question of evidence with counsel for the Claimant in terms of the formulation of King CJ in The Queen v Kastratovic (1986) 42 SASR 59 at 65. I raised the question with counsel for the Opponent in terms of whether the evidence of “the differences of view in the tax office” was evidence capable of supporting the relevant element. The summary manner in which evidence before the magistrate was placed before Simpson J does not detract in any manner from the force of this conclusion this Court reached. A Schedule of Particulars was tendered before her Honour. That Schedule had been prepared on the issue of dishonesty. However, dishonesty was not in issue. The evidence that was before the magistrate, upon which the Schedule was based, was set out in a column in the Schedule and its effect summarised in another column. That summary, by reference to the body of statements and documents in evidence, established that a particular view was held, indeed strongly held, in the ATO on this matter. That this particular document was prepared for a purpose other than the identification of the element of detriment in the charge of defrauding, does not detract from its utility for purposes of determining whether or not evidence existed capable of satisfying a jury, and upon which there was a reasonable prospect that a jury would convict, with respect to the existence of a ‘genuine dispute’ or a ‘genuine assertion’ of a position. The magistrate was conducting an inquiry in accordance with the system referred to, conveniently, as a ‘paper committal’. This was not a trial. What was required was the identification of evidence which would satisfy the requirements of the two steps in s41 of the Act and, in the event, the test in s110. The summary of the large body of evidence by means of the Schedule was a convenient way of presenting the actual evidence before the magistrate to Simpson J. As Mr Richter QC, who originally appeared for the Opponent, told this Court: “the exhibits at the committal were all tendered notionally”. The Schedule summarised many of those exhibits.

Decision

Reasons for decision

SPIGELMAN CJ

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Ratio Decidendi

Legal Principle Established

Established by: SPIGELMAN CJ

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