Criminal Property Confiscation Act 2000 (WA), s 47, s 62, s 63, s 65, s 101, s 104, s 110

Misuse of Drugs Act 1981 (WA), s 32A

Mule v The State of Western Australia [2002] WADC 103; (2002) 29 SR(WA) 95

Permanent Trustee Co Ltd v The State of Western Australia [2002] WASC 22; (2002) 26 WAR 1

Reid v Howard (No 2) [1995] HCA 40; (1995) 184 CLR 1

Sorby v The Commonwealth [1983] HCA 10; (1983) 152 CLR 281

1 On 15 June 2004, on the application of the respondent, I ordered that within 28 days of service of the production order on him, the first applicant produce to the officer in charge of the Asset Investigation Unit of the Western Australian Police Service, property-tracking documents falling within four classes of such documents specified in the order. I indicated at the time of making the order that I would publish reasons for the order. These are those reasons.

2 By reason of the secrecy provisions of s 70(1) of the Criminal Property Confiscation Act 2000 (WA) ("the Act"), the full names of the applicants should not be published.

3 By notice of motion for production order dated 3 March 2004, made under ss 62 and 63 of the Act, the respondent sought an order that the first applicant produce property-tracking documents falling within four classes of such documents, being: (1) personal tax returns for the financial years 1998 to 2003 inclusive; (2) business records relating to the eighth applicant, and to the ninth applicant between 1 July 1998 and the date of the order; (3) all taxation returns and corporate registers for the eighth applicant for the financial years 1998 to 2003 inclusive; and (4) all trust registers for the ninth applicant for the financial years 1998 to 2003 inclusive.

4 By s 62(1) of the Act, the DPP may apply to the District Court for a production order for a property-tracking document. By s 101(1), the Supreme Court has jurisdiction in any proceedings under the Act. Thus, this Court is able to determine an application for a production order for a property-tracking document.

5 On 9 May 2002 the first applicant was arrested and charged with criminal offences pursuant to the Misuse of Drugs Act 1981 (WA).

6 On 13 May 2002 the first applicant was served with a copy of a freezing notice issued under the Act.

7 On 22 May 2002, the first applicant commenced objection proceedings under the Act by making a statutory declaration pursuant to s 47 of the Act and filing a notice of objection in relation to the freezing notice.

8 The first applicant still faces charges arising out of his arrest on 9 May 2002. He has pleaded not guilty to the indictment presented against him. On the best estimate of counsel for the first applicant, the charge the subject of that indictment is unlikely to be the subject of a trial until the latter part of 2005.

9 The objection proceedings ultimately depend for their success upon whether or not a declaration that the first applicant is a drug trafficker is made pursuant to s 32A of the Misuse of Drugs Act. Such a declaration may be made if the first applicant is convicted at trial of the offence charged.

10 In effect, pending the trial, the proceedings relating to the freezing notice and the objection proceedings under the Act have been adjourned.

11 Notwithstanding that those proceedings have been adjourned, the respondent seeks the production order against the first applicant for property-tracking documents and submits that it is presently entitled to such an order under the Act.

Production order for a property-tracking document

12 Section 63(1) of the Act provides as follows:

"On hearing an application under section 62, the court must order a person identified in the application to produce the property-tracking document described in the application if there are reasonable grounds for suspecting that the person has the document in his or her possession or control."

13 The respondent submits that once the respondent establishes that there are reasonable grounds for suspecting that the first applicant has a property-tracking document or documents in his possession or control, the Court must make the order sought. That submission, in my view, is correct.

14 It is necessary for the Court to be satisfied that there are "reasonable grounds for suspecting" that the "person identified in the application" (namely, the first applicant) has the "property-tracking document described in the application" in his "possession or control".

15 The Act does not say that the person identified in the application must be a person the subject of a freezing notice, or other process under the Act. A production order thus may be directed to any person. The question in each case is whether there are reasonable grounds for suspecting that the person has possession or control of the property-tracking document described in the application.

16 Ultimately, the power of the Court to issue a production order under ss 62 and 63 is dependent upon it being established that there is a "property-tracking document" as defined in the possession or control of the person identified in the application.

17 A "property-tracking document" is an expression defined by the Glossary to the Act, which states that it has the meaning given in s 155 of the Act. By s 155, the expression includes a document that, amongst others, is relevant to:

" ...

(c) identifying or locating any or all constituents of a person's wealth;

(d) determining the value of any or all constituents of a person's wealth;

... "

18 Having regard to the long title of the Act, which states that it is an Act to provide for the confiscation in certain circumstances of property acquired as a result of criminal activity and property used for criminal activity, the "person" whose "wealth" is referred to in s 155(c) and (d) must be a person who is already the subject of a relevant process issued under the Act, such as a freezing notice, whose wealth may be confiscated by virtue of operation of the Act. Thus, a production order under ss 62 and 63 could not be made where the documents identified in the application are relevant only to the wealth of a person who is not in any way the subject of a freezing notice, or some other relevant process issued under the Act. It cannot be used as a tool in the investigation of the wealth of some person quite unaffected by the operation of the Act.

19 In this case, of course, the first applicant himself is the subject of a freezing notice and the question for consideration is whether there are reasonable grounds for suspecting that the first applicant has the documents described in his possession or control and whether those documents are property-tracking documents as defined.

20 The Court "must order" the person identified in the application to produce the property-tracking document or documents if the particular circumstances referred to in s 63(1) are established. The Court, therefore, has no discretion in the matter.

21 The first applicant, through counsel, does not strongly contend that there are no grounds for suspecting that the first applicant has property-tracking documents in his possession falling within the classes of property-tracking documents described in the respondent's application, although counsel did suggest that the personal tax returns of the first applicant could not satisfy either of the descriptions set out in s 155(c) and (d). However, in my view, a personal tax return may well be relevant to identifying or locating any or all constituents of a person's wealth and may also be relevant to determining the value of any or all constituents of a person's wealth.

22 Counsel for the first applicant also suggested that a production order that requires "all records" relating to the eighth applicant and to the ninth applicant between the relevant dates is too broad to justify its inclusion in the order. In my view, that is not so, at least not in this case. The production order proposed would require particular business documents to be produced. If there are other documents not immediately satisfying those more particularised document descriptions, but still relating to the defendant and the unit trust, they should be produced.

23 The affidavit of Alma Denise Kurtze in support of the respondent's application sets out in some detail the first applicant's connection with the entities which would be the subject of the production order. I accept that the documents that the respondent seeks production of may well be relevant to identifying the first applicant's wealth and determining the value of his wealth, in particular to:

(1) identifying the extent of the first applicant's interest as a unit-holder of the ninth applicant since its creation in October 1998; and

(2) determining whether or not the first applicant has effective control of the property the subject of item 3 of the freezing notice since it was purchased by the ninth applicant in November 1998.

24 The first applicant is the sole director, secretary and shareholder of the eighth applicant and the eighth applicant is the trustee of the ninth applicant.

25 A former accountant of the eighth applicant informed police officers on 29 May 2002 that he had returned all documents relating to the eighth applicant to the first applicant.

26 I find that it is reasonable to suspect that the first applicant has in his possession or control the property-tracking documents identified in the application.

27 On the face of it, therefore, the respondent is entitled to a production order for property-tracking documents under ss 62 and 63 of the Act. However, the first applicant contends that the Court should consider that it has a general discretion not to issue a production order. This argument is put in different ways.

28 Counsel for the first applicant draws attention to s 104 of the Act which provides for stays of proceedings in the following terms:

"The fact that criminal proceedings under this Act or any other enactment have been instituted or have commenced is not a ground on which the court may stay proceedings under this Act that are not criminal proceedings."

29 Counsel for the first applicant says that in this case, unless the first applicant is convicted of the charge the subject of the indictment, the freezing notice will fall away. In these circumstances, it is submitted, because there will not be a trial of that charge until late 2005, it is inappropriate or at least premature for a production order to go at this point.

30 Counsel for the first applicant says that if there is some reason in addition to the existence of related criminal proceedings, then s 104 does not preclude the staying of proceedings until such a time as the criminal proceedings have been resolved.

31 The inference in this submission is that by reason of the stay power of the Court under s 104, and having regard to particular circumstances of the first applicant whereby he will probably not have a trial on the charge pending in the related criminal proceedings until late 2005, there should, in effect, be a refusal or stay of the respondent's application for a production order.

32 However, the first applicant has not made an application for a stay of proceedings under the Act. The freezing notice continues to apply. The first applicant has not, apart from commencing the objection proceedings under the Act which have been adjourned, sought to set aside the freezing notice. In short, the proceedings relating to the freezing notice and the objection proceedings stand adjourned in this Court. They have not been stayed in any formal sense.

33 In all of these circumstances, an application for production orders under ss 62 and 63 of the Act falls to be determined on its own terms.

34 Section 65(5) of the Act expressly provides that a person is "not excused" from complying with a production order on the grounds that complying with the order would tend to incriminate the person or render him or her liable to penalty.

35 A production order may be made in respect of any person, not necessarily a person who is already the subject of a freezing order or some other application, notice or order issued under the Act.

36 A production order plainly is intended by the Act to be an investigative tool to assist the DPP and other relevant agencies pursue the objects of the Act.

37 In the present circumstances, there is, on the face of it, no reason why the production order should not go. As I have already found, there is nothing in the nature of the documents sought by the respondent that suggests their production is not relevant to the process of revealing the constituents of the wealth of the first applicant. In the event that the first applicant is ultimately convicted of the charge the subject of the indictment and a declaration is made under s 32A of the Misuse of Drugs Act, then the freezing notice will have continued application to the wealth of the first applicant.

38 There is no reason in principle why the respondent should not now be entitled to pursue its wealth investigations in respect of the first applicant with the assistance of a production order, notwithstanding that the proceedings under the Act in respect of the freezing notice and the objection are adjourned pending the trial of the first applicant on the charge the subject of the indictment.

39 In that regard, it should be noted that s 110 of the Act protects the first applicant, as it renders inadmissible in any criminal proceedings any document or information produced or made available pursuant to a production order, except in proceedings for an offence under s 65 of the Act.

40 Thus any property-tracking document or information contained therein cannot be used in evidence against the first applicant in the pending trial on the charge in the indictment.

41 Counsel for the first applicant further submitted that even if the Court does not have a discretion concerning the issue of a production order under s 63(1), it may nonetheless control the time for compliance with any production order by virtue of the power of the Court under s 63(3) to "specify the time and place for the document to be given or made available". Section 63(3) provides:

"The order must specify the time and place for the document to be given or made available."

42 On the one hand, it might be argued, as counsel for the first applicant did, that s 63(3) independently empowers the Court to have regard, in effect, to any prejudice that a person may suffer if required to comply with a production order at an early date and such factors as whether in the Court's opinion the application is premature. Counsel for the first applicant submitted that, having regard to all the circumstances of this case, and the fact that the freezing notice will not continue unless the first applicant is convicted at trial, at the earliest in late 2005, it is premature to make a production order now. Counsel invited the Court, if it considered it was obliged to make a production order, to specify the time and place for the document to be given or made available at some time after the conduct of the trial.

43 On the other hand, the view may be taken, as submitted by counsel for the respondent, that s 63(3) merely requires the Court, in making a production order, to specify the time and place for production in order to achieve the proper compliance with the order. On this view, s 63(3) is not the source of a free-standing power in the Court to regard such matters as prematurity and so to specify a time and place for compliance that has the effect of delaying the applicant's request for a production order.

44 In my view, there may well be circumstances disclosed by a person the target of a proposed production order that suggest that the time for giving property-tracking documents should be delayed. However, in my view, they will be circumstances that are related to the object of the Act that enable such orders to be made in the proper investigation, for example, of the wealth of persons affected by a freezing notice. There may be some practical impediment to the early production of a document and delay in its production may then explicitly be provided for in the order.

45 However, the desire of the first applicant not to provide property-tracking documents until his guilt on the present charge the subject of the indictment has been determined one way or the other, is not, in my view, a proper basis for delaying the time for the giving of the property-tracking documents the subject of the application.

46 In all of these circumstances, I am satisfied that the Court must make the production order sought in the respondent's application and that the relevant documents should be given or made available within 28 days of the making of the order, this being a reasonable period in all of the circumstances for the first applicant to comply with the order.