Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA

Criminal law - Compensation order - Appellant convicted after a trial of 18 counts of fraud - Trial judge made a compensation order in favour of the victim - Appellant made payments pursuant to the compensation order - Appellant's convictions for fraud set aside on appeal and a new trial ordered - Whether the Court of Appeal has power to annul or set aside a compensation order upon the court allowing an offender's appeal against conviction and setting aside the judgment of conviction - Whether the Court of Appeal has power in those circumstances to order the victim to repay the amount of any compensation paid by the offender - Whether any power to order the victim to repay is discretionary and, if so, what considerations are relevant to the exercise of the discretion - Equitable set off - Stay - Payment into court

Criminal Appeals Act 2004 (WA), s 4(2), s 22, s 23, s 30, s 31, s 36, s 37, s 40

Criminal Code (WA), s 409(1)(d), s 694 (repealed), s 697 (repealed), s 717 (repealed), s 719 (repealed)

Rules of the Supreme Court 1971 (WA), O 52 r 2(1)

Sentencing Act 1995 (WA), s 4(1), s 109, s 110, s 111, s 114, s 114A, s 115, s 116, s 117, s 119, s 140

Supreme Court Act 1935 (WA), s 6, s 7, s 16, s 18, s 20, s 23, s 24, s 58

Supreme Court (Court of Appeal) Rules 2005 (WA), r 5(1)

The appellant's application filed 10 November 2016 for leave to adduce additional evidence is granted

The interim compensation order made by the primary judge is annulled

The non­party, Phoenix, is to pay into court the total amount paid by the appellant pursuant to the interim compensation order

Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT) [2009] HCA 41; (2009) 239 CLR 27

Ardrey v The State of Western Australia [2016] WASCA 154

Ascot Investments Pty Ltd v Harper [1981] HCA 1; (1981) 148 CLR 337

Byrnes v The Queen [1999] HCA 38; (1999) 199 CLR 1

Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380

Centurion Trust Company Ltd v Director of Public Prosecutions (WA) [2009] WASCA 97; (2009) 196 A Crim R 85

Certain Lloyd's Underwriters v Cross [2012] HCA 56; (2012) 248 CLR 378

Chaplin v Barnett (1912) 28 TLR 256

CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384

Commissioner for Railways (NSW) v Cavanough [1935] HCA 45; (1935) 53 CLR 220

Day v the Queen [1984] HCA 3; (1984) 153 CLR 475

Dietrich v The Queen [1992] HCA 57; (1992) 177 CLR 292

Director of Public Prosecutions (Vic) v Leys [2012] VSCA 304; (2012) 44 VR 1

DJL v The Central Authority [2000] HCA 17; (2000) 201 CLR 226

Easterday v The State of Western Australia [2005] WASCA 105; (2005) 30 WAR 122

Easterday v The State of Western Australia [2005] WASCA 202

Ex Parte Connell (1993) 10 WAR 414

Federal Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; (2012) 250 CLR 503

Grassby v The Queen [1989] HCA 45; (1989) 168 CLR 1

Hamilton v Oades [1989] HCA 21; (1989) 166 CLR 486

Hawes v Dean [2014] NSWCA 380

Hazcor Pty Ltd v Kirwanon Pty Ltd (1995) 12 WAR 62

Hogan v Hinch [2011] HCA 4; (2011) 243 CLR 506

Hou v The Queen [2003] WASCA 241

HP Mercantile Pty Ltd v Dierickx [2013] NSWCA 479; (2013) 306 ALR 53

Inco Europe Ltd v First Choice Distribution [2000] UKHL 15; [2000] 1 WLR 586

J & S Holdings Pty Ltd v NRMA Insurance Ltd [1982] FCA 78; (1982) 61 FLR 108

Jago v District Court (NSW) [1989] HCA 46; (1989) 168 CLR 23

James v Commonwealth Bank of Australia [1992] FCA 420; (1992) 37 FCR 445

Johnson v Tobacco Leaf Marketing Board [1967] VicRp 45; [1967] VR 427

Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178

Landsal Pty Ltd (in liq) v REI Building Society [1993] FCA 121; (1993) 41 FCR 421

Leach v The Queen [2007] HCA 3; (2007) 230 CLR 1

MacIntosh v Lobel (1993) 30 NSWLR 441

Minister for Employment and Workplace Relations v Gribbles Radiology Pty Ltd [2005] HCA 9; (2005) 222 CLR 194

Minister for Immigration v SZJGV [2009] HCA 40; (2009) 238 CLR 642

Newcastle City Council v GIO General Ltd [1997] HCA 53; (1997) 191 CLR 85

Nicholson v The Queen (Unreported, WASCA, Library No 980698, 7 December 1998)

Pelechowski v The Registrar, Court of Appeal (NSW) [1999] HCA 19; (1999) 198 CLR 435

Phoenix Eagle Co Pty Ltd v Ardrey [2016] WASC 175

Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355

R v Drury [1848] EngR 362; (1849) 3 CAR & K 190; 175 ER 516

R v Hughes [2000] HCA 22; (2000) 202 CLR 535

R v Mickelberg (1996) 90 A Crim R 126

R v PLV [2001] NSWCCA 282; (2001) 51 NSWLR 736

R v Young [1999] NSWCCA 166; (1999) 46 NSWLR 681

Re Ackland; Ex parte Love (1989) 1 WAR 562

Re Judge Schoombee; Ex parte Attorney General [2011] WASC 23

Re Judge Schoombee; Ex parte Attorney General [2012] WASCA 29

Re Macks; Ex parte Saint [2000] HCA 62; (2000) 204 CLR 158

Reid v Howard [1995] HCA 40; (1995) 184 CLR 1

Rimanic v Business Licensing Authority [2002] VSCA 64; (2002) 129 A Crim R 356

Saeed v Minister for Immigration and Citizenship [2010] HCA 23; (2010) 241 CLR 252

Smith v Peters (1875) LR 20 Eq 511

Taylor v The Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531

The State of New South Wales v Kable [2013] HCA 26; (2013) 252 CLR 118

Thiess v Collector of Customs [2014] HCA 12; (2014) 250 CLR 664

Turnbull v The Queen [2003] WASCA 80

Wentworth Securities Ltd v Jones [1980] AC 74

1 BUSS P: On 3 March 2015, after a five-week trial before Levy DCJ (the primary judge) and a jury, the appellant was convicted of 18 counts of fraud, contrary to s 409(1)(d) of the Criminal Code (WA) (the Code).

2 Each count alleged that on a specified date between 1 February 2006 and 4 October 2006, at Perth, the appellant, with intent to defraud, by deceit or fraudulent means caused a detriment to Phoenix Eagle Pty Ltd (Phoenix), namely the payment of a specified amount of money.

3 The total amount involved in the fraud offences of which the appellant was convicted was $AUD394,759.38.

4 On 29 May 2015, the primary judge sentenced the appellant to a total effective term of 4 years' immediate imprisonment with eligibility for parole. The sentence was backdated to 3 March 2015.

5 Also, on 29 May 2015, his Honour made, by consent, an interim compensation order in favour of Phoenix in the sum of $AUD394,759.38 (the Compensation Amount) pursuant to s 117 of the Sentencing Act 1995 (WA).

6 On 1 September 2016, this court (Buss P, Mazza & Mitchell JJA), relevantly, allowed the appellant's appeal against conviction, set aside the judgments of conviction entered by the primary judge and ordered a new trial on each of the 18 counts.

The appellant's application filed 13 September 2016

7 On 13 September 2016, the appellant filed an application (the Repayment Application) for an order that Phoenix repay to the appellant the Compensation Amount plus interest.

8 The Repayment Application raises a number of issues concerning:

(a) this court's power, when the court allows an offender's appeal against conviction and sets aside the judgment or judgments of conviction, to annul or set aside a compensation order made by virtue of the judgment or judgments of conviction; and

(b) if this court has power in those circumstances to annul or set aside the compensation order, whether the court also has power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender and, if so, whether the power is discretionary.

Background facts and circumstances relating to the interim compensation order

9 On 31 October 2011, Phoenix commenced civil proceedings (CIV 3072 of 2011) against the appellant in the General Division of the Supreme Court. Phoenix claimed against the appellant for, amongst other things, the recovery of amounts paid by Phoenix as a consequence of the appellant's alleged deceit or fraudulent means the subject of the criminal charges. The civil proceedings were stayed pending the determination of the criminal charges.

10 After the appellant was convicted on 3 March 2015 of the 18 counts of fraud, the appellant listed for sale his New York condominium (ts 3383). Defence counsel informed the District Court that the appellant had listed the condominium for sale so as to liquidate funds to compensate Phoenix (ts 3383 - 3384). Phoenix had not been informed of that intention, despite Phoenix having made inquiry of the appellant's lawyers on 21 April 2015 after Phoenix had become aware of the proposed sale. In the absence of a response to Phoenix's inquiry, Phoenix sought a restraining order in the Supreme Court of the State of New York to prevent the proposed sale. On 29 April 2015, a judge of that court granted a temporary restraining order.

11 After the temporary restraining order was granted, Phoenix and the appellant, through their respective lawyers, negotiated a settlement agreement under which it was agreed that the condominium would be sold and the net proceeds of sale (which the appellant's lawyers represented, in the course of the negotiations, would be about $US600,000) would be held on trust to be paid to Phoenix in or towards satisfaction of any compensation order made in its favour pursuant to s 117 of the Sentencing Act and any monetary orders made in its favour in CIV 3072 of 2011.

12 On 28 May 2015, defence counsel relied on a draft of the settlement agreement in making submissions on the appellant's behalf at the sentencing hearing. Defence counsel represented that the appellant's net equity in the condominium was in excess of $AUD500,000 (ts 3384). As I have mentioned, on 29 May 2015 the primary judge, by consent, made the interim compensation order in favour of Phoenix in the Compensation Amount. His Honour adjourned the balance of Phoenix's application for a compensation order, which sought interest on the total principal amount defrauded, and legal and investigation costs totalling in excess of $AUD165,000.

13 On 11 June 2015, the final version of the settlement agreement was signed by Phoenix and the appellant.

14 On 9 July 2015, a dispute arose between Phoenix and the appellant as to whether there had been 'an apprehended breach of the settlement agreement' as a result of the appellant proposing to make unauthorised deductions from the proceeds of sale of the condominium which would leave insufficient funds to satisfy the interim compensation order.

15 On or about 13 July 2015, the appellant, without notice to Phoenix, sold his home in Bulimba, Queensland.

16 On becoming aware of the sale of the Bulimba property, and in the context of the appellant's alleged 'apprehended breach' of the settlement agreement, Phoenix made an application in CIV 3072 of 2011 for a freezing order against the appellant and his property. On 6 August 2015, a judge of the General Division of the Supreme Court made a freezing order against the appellant and his property and, also, ordered the appellant to depose on affidavit as to his assets and liabilities and as to how he had disposed of the proceeds of the sale of the Bulimba property. The appellant failed properly to comply with the order in relation to the making of the affidavit and with subsequent orders in relation to the making of disclosure about the disposition of the sale proceeds.

17 On 24 August 2015, the appellant sold the condominium. Phoenix alleged that the manner in which the proceeds of sale of the condominium were dealt with breached the settlement agreement. In particular, Phoenix alleged that unauthorised deductions were made from the sale proceeds to discharge personal debts of the appellant totalling $US159,229.47.

18 Phoenix contended that, as a direct result of the unauthorised deductions, the amount available to Phoenix, pursuant to the settlement agreement, from the proceeds of sale of the condominium was reduced to a little more than $AUD408,000. After deducting outstanding fees payable by Phoenix to its United States and Australian lawyers in connection with the recovery of the Compensation Amount, including the negotiation of the settlement agreement, the amount ultimately remitted to Phoenix on 5 October 2015 was $AUD100,869.96. An amount of $AUD13,419.46 (being the difference between the amount of a little more than $AUD408,000, on the one hand, and the Compensation Amount, on the other) was held on trust pending the resolution of the balance of Phoenix's application for a compensation order and the determination of the civil proceedings in CIV 3072 of 2011.

19 On 7 August 2015 and 7 September 2015, the primary judge heard submissions on the balance of Phoenix's application for a compensation order. On 11 September 2015, his Honour ordered that those parts of the balance of Phoenix's application which involved claims for interest and legal and investigation costs should be adjourned indefinitely, pending the determination of the civil proceedings in CIV 3072 of 2011. His Honour dismissed the remaining parts of Phoenix's application which related to fees paid and shares issued by Phoenix to the appellant.

The Repayment Application: the entities heard and the evidence received

20 On 13 September 2016, the appellant filed an affidavit sworn by him on that date in support of the Repayment Application. It is unnecessary to repeat or summarise the contents of the affidavit.

21 On 6 September 2016, the State filed written submissions in relation to this court's powers to set aside the interim compensation order and to make ancillary orders.

22 The court gave leave to Phoenix, as a non-party, to file affidavits and written submissions and to appear by counsel at the hearing. On 12 September 2016, Phoenix's lawyers filed an affidavit sworn by Clara Elisabeth Hagan. It is unnecessary to repeat or summarise the contents of Ms Hagan's affidavit, apart from reproducing par 37:

I am informed by Mark Richardson [a director of Phoenix] and verily believe [Phoenix] does not presently have sufficient cash available to meet any order for payment of the compensation order funds ... [Phoenix] is presently solvent in reliance upon loan facilities from directors and shareholders. An order requiring [Phoenix] to pay $394,759.38 ... may, subject to [Phoenix's] ability to raise further loan funds, affect [Phoenix's] solvency and ability to continue trading as a going concern.

23 On 23 September 2016, the court heard the Repayment Application. The appellant was self-represented at the hearing. The State was not represented. Phoenix appeared by counsel.

The appellant's application filed 10 November 2016 for leave to adduce additional evidence in support of the Repayment Application

24 On 10 November 2016, the appellant filed an application for leave to adduce additional evidence in support of the Repayment Application. The application for leave was supported by the appellant's affidavit sworn 9 November 2016. In the affidavit, the appellant deposes, relevantly:

(a) On 20 June 2016, the Supreme Court of the State of New York delivered a decision in pending proceedings in that court between Phoenix as plaintiff and the appellant as defendant [5].

(b) Phoenix is 'going through the extremely expensive process of appealing that Supreme Court decision' [6].

(c) Phoenix's appeal involves an 'expensive investment in legal fees' which 'contradicts' the statement in par 37 of Ms Hagan's affidavit that Phoenix 'does not have sufficient cash available to pay any order for payment of compensation order funds' [7].

Section 694, s 697, s 717 and s 719 (all repealed) of the Code

25 Each of s 694 and s 697 of the Code was repealed on 2 May 2005, pursuant to s 24 of the Criminal Procedure and Appeals (Consequential and Other Provisions) Act 2004 (WA).

26 Each of s 717 and s 719 of the Code was repealed on 4 November 1996, pursuant to s 26 of the Sentencing (Consequential Provisions) Act 1995 (WA).

27 Prior to 4 November 1996, ch LXIX of the Code was headed 'Appeal: Pardon' and comprised s 687 - s 707.

The operation of any order for the restitution of any property to any person made on a conviction on indictment ... shall (unless the court before whom the conviction takes place direct to the contrary in any case in which, in their opinion, the title to the property is not in dispute) be suspended -

(a) in any case until the expiration of 10 days after the date of the conviction; and

(b) in cases where notice of appeal or leave to appeal is given within 10 days after the date of conviction, until the determination of the appeal;

and in cases where the operation of any such order ... is suspended until the determination of the appeal, the order ... shall not take effect as to the property in question if the conviction is quashed on appeal. Provision may be made by rules of court for securing the safe custody of any property, pending the suspension of the operation of any such order or of the said provisions. (emphasis added)

The Court of Criminal Appeal [later amended to refer to the Court of Appeal] may by order annul or vary any order made on a trial for the restitution of any property to any person, although the conviction is not quashed; and the order, if annulled, shall not take effect, and if varied shall take effect as so varied. (emphasis added)

For the purposes of this chapter [Ch LXIX], the Court of Criminal Appeal [later amended to refer to the Court of Appeal] may, if they think it necessary or expedient in the interests of justice -

... [there are then set out a number of specific powers which may be exercised]

and exercise in relation to the proceedings of the Court any other powers which may for the time being be exercised by the Supreme Court on appeals in civil matters.

31 Section 697 was re-enacted, in a different form, in s 40 of the Criminal Appeals Act 2004 (WA).

(1) Where a person is convicted of an offence, and it appears to the sentencing court that there is in the possession of the offender or any other person -

(a) any property to which the offence relates; or

(b) any other property derived from any sale or disposition of any property to which the offence relates,

the court may, at any time, whether or not any punishment is imposed on the offender for the offence, order -

(c) that the offender, or any person in possession of the property to which the offence relates, transfer or deliver that property to the aggrieved person; or

(d) where that property has been sold or disposed of and it is inexpedient that it be transferred or delivered to the aggrieved person, that the offender or any person transfer or deliver to the aggrieved person any other property derived from the sale or disposition.

(2) An order under subsection (1) may be made by the court of its own motion or upon the application of the prosecutor or a person who appears to the court to have an interest in the making of the order.

...

(7) In this section -

'aggrieved person' means the person who appears to the court to be entitled to the benefit of an order under this section;

'disposed of' includes given as security for money lent.

33 Section 717 was re-enacted, in a different form, in div 3 of pt 16 of the Sentencing Act.

(1) Where a person is convicted of an offence and it appears to the sentencing court that a person (in this section called 'a person aggrieved') has suffered injury, loss or damage or incurred expense, whether directly or indirectly, as a result of the commission of the offence, the court may, at any time and in addition to any punishment to which the offender is liable, order that the offender shall, within such time as it may specify, pay a sum of money to that person by way of compensation for that injury, loss, damage, or expense.

(2) For the purposes of subsection (1), any property to which an offence relates which is damaged following the commission of the offence while it is out of the possession of the person entitled to possession, and which is subsequently recovered, shall be deemed to have been damaged as a result of the commission of the offence no matter how and by whom the damage was caused.

...

(4) An order under subsection (1) may be made by the court of its own motion or upon the application of the prosecutor or a person who considers that he is a person aggrieved.

...

(7) An award of compensation under subsection (1) is in addition to any other right or remedy to recover damages or compensation which a person may have against the offender or under the Criminal Injuries Compensation Act 1982, but -

(a) any sum paid under the order shall be deducted from any such damages or compensation; or

(b) any sum paid by way of such damages or compensation shall be deducted from any amount payable under the order.

35 Section 719 was re-enacted, in a different form, in div 2 of pt 16 of the Sentencing Act.

The relevant provisions of pt 16 of the Sentencing Act

36 Part 16 of the Sentencing Act is headed 'Reparation orders' and comprises s 109 - s 122.

37 Division 1 of pt 16 is headed 'General matters' and comprises s 109 - s 115.

38 Section 109 provides that, in pt 16, 'reparation order' means:

(a) a compensation order made under pt 16; or

(b) a restitution order made under pt 16.

39 Section 110 provides, relevantly:

(1) A reparation order is in addition to and not part of the sentence imposed on an offender.

...

(6) Despite subsection (1) an offender may appeal against a reparation order as if it were part of the sentence imposed on him or her.

40 By s 111(1), a reparation order may be made by a court on its own initiative or on the application of 'a victim or a prosecutor'.

41 The standard of proof applicable in deciding matters in connection with the making of a reparation order is proof on the balance of probabilities: s 114.

42 Section 114A makes provision for a victim to appeal against a court's decision to refuse to make a reparation order:

(1) If a victim applies to a court for a reparation order and the court decides to make or to refuse to make a reparation order, the victim may appeal against the decision.

(2) The appeal must be commenced and conducted under Part 2 or 3 of the Criminal Appeals Act 2004, as the case requires, which, with any necessary changes, applies as if a reparation order were an order that might be made as a result of a conviction.

(3) This section does not affect the prosecutor's rights of appeal under the Criminal Appeals Act 2004.

43 Section 115(1) provides, relevantly, that the making of a reparation order does not preclude civil proceedings being taken against an offender for any injury, loss or damage suffered. By s 115(2), relevantly, a court assessing damages or compensation (the award) for the injury, loss or damage resulting from an offence is to make the assessment without regard to the compensation set under a compensation order, but the person entitled to the award may only recover an amount equal to the amount (if any) by which the award exceeds the compensation ordered to be paid under the order.

44 Division 2 of pt 16 is headed 'Compensation order' and comprises s 116 - s 119A.

property includes real and personal property and everything, animate or inanimate, capable of being the subject of ownership;

victim, in relation to an offence, means a person who or which has suffered loss of or damage to his, her or its property as a direct or indirect result of the offence.

46 Section 117 is concerned with the making of a compensation order in favour of a victim. It provides, relevantly:

(1) A court sentencing an offender may make a compensation order in favour of a victim of the offence.

(2) Such a compensation order is an order that the offender must pay an amount of money set by the court to the victim as compensation for -

(a) the loss of, or damage to, the victim's property; and

(b) any expense reasonably incurred by the victim,

as a direct or indirect result of the commission of the offence.

47 By s 119(1), if the amount payable under a compensation order is not paid within 28 days after the date of the making of the order, the person in whose favour the order is made may enforce it by lodging a certified copy of it, and an affidavit stating to what extent it has not been complied with, with a court of competent jurisdiction. Section 119(2) provides that, when lodged, the order is to be taken to be a judgment of the court and may be enforced accordingly.

48 Division 3 of pt 16 is headed 'Restitution order' and comprises s 120 - s 122. It is unnecessary to make any further reference to those provisions.

49 In s 4(1), the term 'offence' is defined to mean an offence under a written law, and the term 'offender' is defined to mean a person convicted of an offence.

The relevant provisions of the Criminal Appeals Act

50 Part 3 of the Criminal Appeals Act is headed 'Appeals from superior courts' and comprises s 22 - s 35A.

51 The term 'superior court' is defined in s 4(2) of the Criminal Appeals Act to mean the Supreme Court and the District Court but not the Court of Appeal.

52 Division 1 of pt 3 of the Criminal Appeals Act is headed 'Preliminary' and comprises s 22.

53 Section 22 provides that, in pt 3:

offender means a person who has been convicted of an offence;

trial court, in relation to an appeal under this Part, means the superior court that dealt with the case that is the subject of the appeal.

54 Division 2 of pt 3 is headed 'Rights of appeal' and comprises s 23 - s 26.

55 Section 23(1) is concerned with the rights of appeal of an offender who is convicted of an offence on indictment:

An offender convicted of an offence on indictment may appeal to the Court of Appeal against any or all of the following decisions -

(a) the conviction;

(b) the sentence imposed on the offender or any order made as a result of the conviction;

(c) a refusal to make an order that might be made as a result of the conviction.

56 Division 3 of pt 3 is headed 'Commencing and deciding appeals' and comprises s 27 - s 34.

57 Section 30 applies in the case of an appeal against a conviction by an offender. It provides for, amongst other things, the circumstances in which an appeal must be allowed or dismissed.

58 By s 30(5), if this court allows an offender's appeal against conviction, 'it must set aside the conviction of the offence' and it must, relevantly, order a new trial (s 30(5)(a)) or enter a judgment of acquittal of the offence (s 30(5)(b)).

59 Section 31(1) provides that s 31 applies, relevantly, in the case of an appeal commenced by an offender under s 23(1) against:

(a) the sentence imposed or any order made as a result of a conviction on indictment (s 31(1)(a)(i)); or

(b) a refusal by a superior court to make an order that might be made as a result of such a conviction (s 31(1)(b)).

60 Other provisions of s 31 provide for, amongst other things, the circumstances in which an appeal to which s 31 applies may be allowed or dismissed, and the orders which the court must or may make if it allows an appeal. In particular, s 31(4), s 31(5) and s 31(6) provide:

(4) The Court of Appeal may allow the appeal if, in its opinion -

(a) in the case of an appeal referred to in subsection (1)(a), a different sentence should have been imposed; or

(b) in the case of an appeal referred to in subsection (1)(b), an order should have been made.

(5) If the Court of Appeal allows an appeal referred to in subsection (1)(a), it must set aside the sentence and -

(a) may instead impose a new sentence that is either more or less severe; or

(b) may send the charge back to the court that imposed the sentence to be dealt with further.

(6) If the Court of Appeal allows an appeal referred to in subsection (1)(b), it -

(a) may make any order that should have been made; or

(b) may send the charge back to the court that refused to make the order to be dealt with further.

61 Division 4 of pt 3 is headed 'Miscellaneous' and comprises s 35 and s 35A. It is unnecessary to make any further reference to those provisions.

62 Part 4 is headed 'Provisions applicable to any appeal' and comprises s 36 - s 45.

63 Section 36 provides that, in pt 4, unless the contrary intention appears:

appeal court, in relation to an appeal, means the division of the Supreme Court that has jurisdiction to hear the appeal;

lower court, in relation to an appeal, means the court that made the decision that is the subject of the appeal.

64 By s 37, pt 4 applies to any appeal under the Criminal Appeals Act.

65 Section 40(1)(l) provides that, '[f]or the purposes of dealing with an appeal, an appeal court may ... exercise any power that the Supreme Court may exercise in a civil case'.

The powers exercisable by the Supreme Court in a civil case

66 The powers exercisable by the Supreme Court in a civil case include the powers conferred by s 24(7) of the Supreme Court Act 1935 (WA).

67 Section 24(7) provides:

The Court, in the exercise of the jurisdiction vested in it by this Act, in every cause or matter pending before it, shall have power to grant, and shall grant, either absolutely or on such reasonable terms and conditions as shall seem just, all such remedies whatsoever as any of the parties thereto may appear to be entitled to in respect of any and every legal or equitable claim properly brought forward by them in such cause or matter; so that, as far as possible, all matters so in controversy between the parties may be completely and finally determined, and all multiplicity of legal proceedings concerning any of such matters avoided.

68 By O 52 r 2(1) of the Rules of the Supreme Court 1971 (WA):

The Court may, on the application of any party to a cause or matter, make an order for the detention, custody, preservation or inspection of any property which is the subject-matter of a cause or matter, or as to which any question may arise therein.

69 Order 52 r 2(1) confers on the court wide power to do what is necessary, reasonable and ancillary to the due performance by the court of its functions, namely the administration of justice at the hearing of the proceedings. See Smith v Peters (1875) LR 20 Eq 511, 513 (Sir George Jessel MR). The rule extends to every case in which the court considers that, as between the plaintiff and the defendant, there is something which ought to be done for, relevantly, the security of property. See Chaplin v Barnett (1912) 28 TLR 256, 257 (Cozens-Hardy MR, Fletcher Moulton & Buckley LJJ agreeing). It is relevant, in deciding whether to make an order under O 52 r 2(1), to consider what will be involved in the ultimate determination of the proceedings, how the ultimate determination of the proceedings relates to the property in question and, also, whether it is in the interests of justice to make the proposed order so as to prevent the ultimate determination of the proceedings proving abortive. See Johnson v Tobacco Leaf Marketing Board [1967] VicRp 45; [1967] VR 427, 430 (Gowans J).

70 By r 5(1) of the Supreme Court (Court of Appeal) Rules 2005 (WA), those rules must be read with the Rules of the Supreme Court.

71 The Supreme Court (of which this court is a division) is a superior court of record. See s 6(2), s 7(1), s 16, s 18, s 20 and s 58 of the Supreme Court Act. Although conferred by statute, the court's powers are identified by reference to, relevantly, the powers of the superior courts at Westminster at the commencement of the Supreme Court Ordinance 1861 (UK). See s 16 of the Supreme Court Act. See also s 23 and s 24 of that Act.

72 The inherent power of a superior court of record arises from the court's general responsibility for the administration of justice. The court exercises the full plenitude of judicial power in the discharge of that responsibility. See Grassby v The Queen [1989] HCA 45; (1989) 168 CLR 1, 16 (Dawson J).

73 The Supreme Court has inherent power to control and supervise proceedings within its jurisdiction for the purpose of enabling it to act effectively within that jurisdiction and to prevent injustice. The criteria for determining what constitutes injustice in a civil case, in the context of the inherent power, will necessarily be different from the criteria for determining that issue in a criminal case. The power is not restricted to defined and closed categories. See Hamilton v Oades [1989] HCA 21; (1989) 166 CLR 486, 502 (Deane & Gaudron JJ); Jago v District Court (NSW) [1989] HCA 46; (1989) 168 CLR 23, 25 - 26 (Mason CJ); Dietrich v The Queen [1992] HCA 57; (1992) 177 CLR 292, 364 (Gaudron J). However, the court's inherent power is not at large. See Reid v Howard [1995] HCA 40; (1995) 184 CLR 1, 16 (Toohey, Gaudron, McHugh & Gummow JJ). For example, although the court may exercise its inherent power in respect of matters regulated by a statute or the rules of court, it may only do so if the inherent power can be exercised without contravening the statute or the rules. See Landsal Pty Ltd (in liq) v REI Building Society [1993] FCA 121; (1993) 41 FCR 421, 427 - 428 (Keely, Burchett & Drummond JJ); Centurion Trust Company Ltd v Director of Public Prosecutions (WA) [2009] WASCA 97; (2009) 196 A Crim R 85 [58] - [59] (McLure JA, Owen JA agreeing), [181] (Buss JA).

74 Inferior courts lack the inherent powers of superior courts, but have analogous implied powers. See Grassby (15 - 17); Pelechowski v The Registrar, Court of Appeal (NSW) [1999] HCA 19; (1999) 198 CLR 435 [50] (Gaudron, Gummow & Callinan JJ); Byrnes v The Queen [1999] HCA 38; (1999) 199 CLR 1 [32] (Gaudron, McHugh, Gummow & Callinan JJ); DJL v The Central Authority [2000] HCA 17; (2000) 201 CLR 226 [24] - [26] (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ); Hogan v Hinch [2011] HCA 4; (2011) 243 CLR 506 [21] (French CJ).

No appeal in the present case against the making of the interim compensation order

75 In the present case, the appellant did not appeal, pursuant to s 110(6) of the Sentencing Act, against the making of the interim compensation order.

76 The appellant submitted that, as a result of this court having allowed his appeal against conviction and having set aside the judgments of conviction, there was no longer an 'offence' or an 'offender', and Phoenix was no longer a 'victim', for the purposes of div 2 of pt 16 of the Sentencing Act.

77 It was submitted that, in those circumstances, this court should set aside the interim compensation order made by the primary judge in favour of Phoenix and should order Phoenix to repay to the appellant immediately the whole of the Compensation Amount plus interest.

78 Alternatively, the appellant submitted, in effect, that this court should order Phoenix to pay into court the whole of the Compensation Amount plus interest pending the outcome of the appellant's new trial on the 18 counts (appeal ts 196, 223).

79 The State argued in its written submissions that this court has power to set aside the interim compensation order made by the primary judge in favour of Phoenix. It was submitted, in reliance on Easterday v The State of Western Australia [2005] WASCA 105; (2005) 30 WAR 122 (Easterday (No 1)), that:

(a) the power to set aside the interim compensation order was necessarily to be implied as ancillary to the power to set aside the appellant's convictions [21] - [26]; and

(b) once the appellant's convictions were set aside, it inevitably followed that the interim compensation order was 'null and void' as that order depended on, and fell away with, the convictions [27].

80 The State also argued that whether this court has power to order the repayment of money paid pursuant to a compensation order raises a 'more complicated issue'. It was submitted, in reliance on Easterday (No 1), that:

(a) this court has power to order repayment [28] - [35]; and

(b) the power is 'arguably' discretionary [37] - [48].

81 It was submitted that the power to order repayment is 'arguably' discretionary because the language of the legislation which applied in Easterday (No 1) is different from the language which applies in the present case. In particular, the chapeau of s 697 (repealed) of the Code contained the words 'necessary or expedient in the interests of justice'. Those words were of significance in the conclusion of the Court of Criminal Appeal in Easterday (No 1) that the power to order repayment was discretionary [39]. See also Easterday v The State of Western Australia [2005] WASCA 202 [11]. However, the relevant words in the chapeau of s 697 do not appear in s 40 of the Criminal Appeals Act.

82 Counsel for Phoenix did not contend that this court has no power to make orders binding non-parties. However, counsel submitted that orders binding non-parties are exceptional, especially where the orders affect substantive rights of a non-party. Counsel cited Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380 [50], [54], [57] (Gaudron, McHugh, Gummow & Callinan JJ); Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178, 203 (Dawson J); and Ascot Investments Pty Ltd v Harper [1981] HCA 1; (1981) 148 CLR 337, 354, 357 (Gibbs J, Stephen J agreeing).

83 It was argued that pt 16 of the Sentencing Act is 'markedly different in effect' from the provisions of the Code that were considered in Easterday (No 1).

84 According to counsel, pt 16 of the Sentencing Act 'discloses a legislative intention to remove reparation orders from being part of the sentencing process and from being enforced by supervision of the sentencing court, and instead to create a separate civil jurisdiction to make reparation orders'. It was argued that this separate civil jurisdiction is enlivened by 'the fact of sentencing an offender', but the jurisdiction is 'a separate and discrete judicial process, considering different evidence [and] resulting in a judgment enforceable directly by the victim ... under the Civil Judgments Enforcement Act 2004 (WA)'.

85 It was submitted that the making of, and the satisfaction of, the interim compensation order made by the primary judge in favour of Phoenix '[was] not invalidated by the subsequent quashing of [the appellant's] conviction'. Counsel referred to Commissioner for Railways (NSW) v Cavanough [1935] HCA 45; (1935) 53 CLR 220, 225 (Rich, Dixon, Evatt & McTiernan JJ) and MacIntosh v Lobel (1993) 30 NSWLR 441, 459 - 460 (Kirby P). It was also submitted that the compensation order could only be annulled by 'a further order of a competent court, made within its power'.

86 Counsel argued that s 694 (repealed) of the Code provided for an automatic stay of restitution orders pending appeal, and conferred on the Court of Criminal Appeal an express power to annul or vary a restitution order and to make rules of court for securing the safe custody of property in the interim. By contrast, Parliament did not enact provisions to that effect in pt 16 of the Sentencing Act or in the Criminal Appeals Act. Rather, Parliament conferred on an offender, pursuant to s 110(6) of the Sentencing Act, an express right of appeal against a reparation order. According to counsel, if Parliament's omission to confer an express power on this court to annul a restitution order, consequent upon a successful appeal by the offender against his or her conviction, is deliberate, the implying of a power on a similar basis to the implication made in Easterday (No 1) would frustrate Parliament's intent. If the omission is 'a slip', then 'it is too big an omission to be corrected by judicial interpretation'. Counsel referred to Taylor v The Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531 [38] (French CJ, Crennan & Bell JJ).

(a) Easterday (No 1) should not be followed. This court should find that, in the present case, there is no power to make an order annulling the interim compensation order or an order requiring Phoenix to make repayment to the appellant or a payment into court.

(b) If (contrary to counsel's contention) such a power does exist and this court annuls the interim compensation order, Phoenix is entitled in equity to set off the Compensation Amount against the amount Phoenix claims from the appellant in CIV 3072 of 2011 and, accordingly, this court should not make an order requiring Phoenix to make repayment to the appellant or a payment into court.

(c) If (contrary to counsel's contention) such a power does exist, this court annuls the interim compensation order and the appellant's claim is not negated by equitable set-off, this court should not, as a matter of discretion, require Phoenix to make repayment to the appellant or a payment into court.

(d) In any event, any order requiring Phoenix to disgorge the proceeds of the interim compensation order should be stayed pending the outcome of the appellant's new trial on the 18 counts and the outcome of the proceedings in CIV 3072 of 2011.

The relevant principles of statutory construction

88 In Federal Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; (2012) 250 CLR 503, French CJ, Hayne, Crennan, Bell and Gageler JJ observed:

'This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text' [Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at 46 [47]]. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself [39].

See also Saeed v Minister for Immigration and Citizenship [2010] HCA 23; (2010) 241 CLR 252 [31] (French CJ, Gummow, Hayne, Crennan & Kiefel JJ); Thiess v Collector of Customs [2014] HCA 12; (2014) 250 CLR 664 [22] (French CJ, Hayne, Kiefel, Gageler & Keane JJ).

89 The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The statutory text is the surest guide to Parliament's intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of the provision, in particular the mischief it is seeking to remedy. See Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 [69] (McHugh, Gummow, Kirby & Hayne JJ); Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT) [2009] HCA 41; (2009) 239 CLR 27 [47] (Hayne, Heydon, Crennan & Kiefel JJ).

90 The context includes the existing state of the law, the history of the legislative scheme and the mischief to which the statute is directed. See CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384, 408; Newcastle City Council v GIO General Ltd [1997] HCA 53; (1997) 191 CLR 85, 112 - 113.

91 The purpose of legislation must be derived from the statutory text and not from any assumption about the desired or desirable reach or operation of the relevant provisions. See Certain Lloyd's Underwriters v Cross [2012] HCA 56; (2012) 248 CLR 378 [26] (French CJ & Hayne J). The intended reach of a legislative provision is to be discerned from the words of the provision and not by making an a priori assumption about its purpose. See Minister for Employment and Workplace Relations v Gribbles Radiology Pty Ltd [2005] HCA 9; (2005) 222 CLR 194 [21] (Gleeson CJ, Hayne, Callinan & Heydon JJ).

92 The propriety of implying words into the statutory text has been an issue of longstanding controversy. See, for example, R v Young [1999] NSWCCA 166; (1999) 46 NSWLR 681 [3] - [37] (Spigelman CJ); R v PLV [2001] NSWCCA 282; (2001) 51 NSWLR 736 [80] - [88] (Spigelman CJ, Simpson J & Smart AJ agreeing); Director of Public Prosecutions (Vic) v Leys [2012] VSCA 304; (2012) 44 VR 1 [45] - [111] (Redlich & Tate JJA & T Forrest AJA).

93 In Wentworth Securities Ltd v Jones [1980] AC 74, Lord Diplock specified three conditions that must be fulfilled in order to justify reading into a statute words which are not expressly included in it. First, it must be possible to determine from a consideration of the statute, read as a whole, 'precisely what the mischief was that it was the purpose of the Act to remedy' (105). Secondly, it must be apparent that the draftsperson and Parliament had 'by inadvertence overlooked, and so omitted to deal with, an eventuality that required to be dealt with if the purpose of the Act was to be achieved' (105). Thirdly, it must be possible to state with certainty 'what were the additional words that would have been inserted by the [draftsperson] and approved by Parliament had their attention been drawn to the omission before the Bill passed into law' (105).

94 In Taylor, French CJ, Crennan and Bell JJ reviewed the case law on the circumstances in which a court will be justified in construing a statutory provision as if it contained additional words and on whether a court may construe a statutory provision in a manner which has the effect of giving it an expanded operation.

95 French CJ, Crennan and Bell JJ said that, consistently with the High Court's rejection of the adoption of rigid rules in statutory construction, 'it should not be accepted that purposive construction may never allow of reading a provision as if it contained additional words (or omitted words) with the effect of expanding its field of operation' [37]. Their Honours elaborated:

The question whether the court is justified in reading a statutory provision as if it contained additional words or omitted words involves a judgment of matters of degree. That judgment is readily answered in favour of addition or omission in the case of simple, grammatical, drafting errors which if uncorrected would defeat the object of the provision (Director of Public Prosecutions (Nauru) v Fowler [1984] HCA 48; (1984) 154 CLR 627 at 630 per Gibbs CJ, Murphy, Wilson, Deane and Dawson JJ; Minister for Immigration and Citizenship v SZJGV [2009] HCA 40; (2009) 238 CLR 642 at 651 - 652 [9] per French CJ and Bell J). It is answered against a construction that fills 'gaps disclosed in legislation' (Marshall v Watson [1972] HCA 27; (1972) 124 CLR 640 at 649 per Stephen J) or makes an insertion which is 'too big, or too much at variance with the language in fact used by the legislature' (Western Bank Ltd v Schindler [1977] Ch 1 at 18 per Scarman LJ, cited by Lord Nicholls of Birkenhead in Inco Europe Ltd v First Choice Distribution [2000] UKHL 15; [2000] 1 WLR 586 at 592; [2000] UKHL 15; [2000] 2 All ER 109 at 115) [38].

96 French CJ, Crennan and Bell JJ referred to Lord Diplock's three conditions (as reformulated in Inco Europe Ltd v First Choice Distribution [2000] UKHL 15; [2000] 1 WLR 586, 592) and said that the Court of Appeal of New South Wales in Taylor was right to consider that satisfaction of each of those conditions could be treated as a prerequisite to reading the statutory provision in question as if it contained additional words before the Court of Appeal required satisfaction of a fourth condition of consistency with the wording of the provision [39]. However, their Honours added that it was unnecessary to decide whether Lord Diplock's three conditions are always, or even usually, necessary and sufficient [39]. This was because 'the task remains the construction of the words the legislature has enacted' [39]. Their Honours continued:

In this respect it may not be sufficient that 'the modified construction is reasonably open having regard to the statutory scheme' (Director of Public Prosecutions (Vic) v Leys [2012] VSCA 304; (2012) 296 ALR 96 at 126 [96]) because any modified meaning must be consistent with the language in fact used by the legislature. Lord Diplock never suggested otherwise. Sometimes, as McHugh J observed in Newcastle City Council v GIO General Ltd, the language of a provision will not admit of a remedial construction. Relevant for present purposes was his Honour's further observation, '[i]f the legislature uses language which covers only one state of affairs, a court cannot legitimately construe the words of the section in a tortured and unrealistic manner to cover another set of circumstances' ((1997) [1997] HCA 53; 191 CLR 85 at 113. See also IW v City of Perth [1997] HCA 30; (1997) 191 CLR 1 at 12 per Brennan CJ and McHugh J) [39].

97 Finally, French CJ, Crennan and Bell JJ referred, with approval, to the comments of Lord Nicholls of Birkenhead in Inco Europe (592) that, even when Lord Diplock's conditions are met, the court may be inhibited from interpreting a provision in accordance with what it is satisfied was Parliament's underlying intention because the alteration to the statutory text in such a case may be 'too far-reaching' [40].

The issues raised by the Repayment Application

98 The Repayment Application raises three broad issues.

99 First, when this court allows an offender's appeal against conviction and sets aside the judgment or judgments of conviction, does the court have power to annul or set aside a compensation order made by virtue of the judgment or judgments of conviction and power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender?

100 Secondly, if the answer to the first issue is 'yes', does this court have a discretion as to whether to exercise the power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender and, if so, what considerations are relevant to the exercise of the discretion?

101 Thirdly, how should the Repayment Application be determined?

The first issue raised by the Repayment Application

102 I will begin my examination of the first issue by considering the powers of the Court of Criminal Appeal (later the Court of Appeal) under s 694, s 697, s 717 and s 719 (all repealed) of the Code.

103 In Easterday (No 1), the applicants were convicted in 1993 of one count of conspiracy to defraud and 10 counts of false pretences. They were ordered, pursuant to s 717 of the Code, to pay restitution in favour of a company. The applicants' appeal against conviction was dismissed. The restitution orders were enforced and the applicants paid moneys to the company.

104 In 2003, the Court of Criminal Appeal quashed the applicants' convictions on a petition referred under s 140 of the Sentencing Act. The applicants applied for orders that the restitution orders be annulled and the company repay the restitution moneys plus interest to the applicants.

105 The Court of Criminal Appeal was required to determine whether the court had power to annul the restitution orders and, if so, whether the court had power, upon annulling the orders, to order repayment or retransfer of any money or property that had been paid or transferred pursuant to the orders.

106 Steytler J (Wheeler & Roberts-Smith JJ agreeing) referred to s 694 of the Code and held that there was nothing in s 694 which could be read as providing for powers of the court, whether supervisory or otherwise, of the kind contended for. His Honour said:

Section 694(1) provides that the operation of any order for the restitution of any property to any person made on a conviction on indictment shall (unless the primary court directs otherwise in a case in which title to the property is not in dispute) be suspended until the determination of an appeal instituted within 10 days of the conviction and that, if the conviction is quashed, the order shall not take effect. There was consequently no need, in the case of an appeal of the kind described, to provide for a power to annul the order where the conviction is quashed. However, it was presumably thought necessary to give to the Court the power, on an appeal, to annul or vary the order even though the conviction is not quashed and that is all that s 694(2) is directed towards [19].

107 However, Steytler J held that Parliament, in giving the Court of Criminal Appeal the power to quash a conviction, must have intended that the court should also have the power to annul orders made by it which depended solely upon the fact of the conviction [26].

108 His Honour referred to s 697 of the Code, which conferred supplemental powers on the Court of Criminal Appeal, including powers which may be exercised by the Supreme Court on appeals in civil matters. His Honour made these comments about s 697:

The section has been considered by the Court of Criminal Appeal on a number of occasions. In R v Mickelberg (1996) 90 A Crim R 126, Malcolm CJ (with whom I agreed) said, at 129, that the section was 'sufficient to bring into play' all of the powers of the Full Court in civil appeals and that it also brought 'into play the residual powers of the court in its inherent jurisdiction: Muto v Faul [1980] VicRp 3; [1980] VR 26 at 27 and 31; Lewandowski v Lovell (1994) 11 WAR 124 at 137 and Hughes v Gales (1995) 14 WAR 434 ...'. Those views were agreed with by Kennedy J (with whom White and Scott JJ were in agreement) in Nicholson v The Queen, unreported; CCA SCt of WA; Library No 980698; 7 December 1998 and in Turnbull v The Queen [2003] WASCA 80 Murray J, with whom Scott and Wheeler JJ agreed, said that they were 'undoubtedly correct'. (See also Hou v The Queen [2003] WASCA 241 at [20], per Malcolm CJ, Steytler and Parker JJ and R v Court [2003] WASCA 308 at [93], per Miller and McKechnie JJ.) It may consequently be accepted that the section imports a very wide range of powers for use in appropriate circumstances [20].

109 Steytler J decided that recourse to the supplemental powers conferred by s 697 was unnecessary in relation to whether the court had power to annul a restitution order. His Honour was satisfied that the Court of Criminal Appeal's power to annul a restitution order upon quashing a conviction was 'necessarily to be implied as ancillary to the power to quash a conviction' [21]. He cited Cavanough.

110 In Cavanough, the High Court dealt with, relevantly, the effect of the quashing of a conviction. Rich, Dixon, Evatt and McTiernan JJ said:

The effect of the reversal of a conviction by proceedings in error has long been settled, and the same effect is produced by quashing it, or setting it aside upon a statutory appeal. The conviction is avoided ab initio. 'The judgment reversed is the same as no judgment' (per Coleridge J, R v Drury (1849) 3 Car & K, at p 199; 175 ER, at p 520) (225).

111 Their Honours quoted, with approval, the following passage from Archbold's Criminal Pleading, Evidence and Practice (21st ed, 1893), 226 - 227:

[U]pon the reversal of a judgment against any person convicted of any offence, the judgment, execution and all former proceedings become thereby absolutely null and void. If living, he (or if dead, his heir or personal representative, as the case may be) will be entitled to be restored to all things which he may have lost by such erroneous judgment and proceedings, and shall stand in every respect as if he had never been charged with the offence in respect of which judgment was pronounced against him (225).

112 In Easterday (No 1), Steytler J also held that the Court of Criminal Appeal had power, by reason of s 697, 'to order repayment of what was transferred pursuant to [a] restitution order' where the conviction on which the restitution order was based had subsequently been quashed [34]. His Honour referred to numerous authorities in the civil jurisdiction which establish that, upon a judgment being set aside on appeal, the successful appellant is entitled, in principle, to recover all moneys paid under the judgment that has been set aside, and the court can make an order accordingly [31]. His Honour said that the rationale for the existence of the power in civil proceedings is equally applicable to a case in which a restitution order has been made by a criminal court (and executed) on the strength of a conviction which is subsequently quashed [34]. He elaborated:

In a civil case the Full Court is doing no more than restoring what was lost by an erroneous judgment. This is precisely what a Court of Criminal Appeal might be expected to be called upon to do when quashing both a conviction and an executed restitution order which depended upon the conviction. As was said by Callaway JA (with whom Winneke P and Vincent JA were in agreement) in [Rimanic v Business Licensing Authority [2002] VSCA 64; (2002) 129 A Crim R 356] (at 361):

'The common law principle in Cavanough's case is fundamental to a fair system of criminal justice. A wrong has been done to the person whose conviction is quashed or set aside and that person must be restored, so far as may be, to his or her former position ... That principle gives effect to a basic human right ...'

There is accordingly good reason for the power to be included amongst those imported by s 697 for use by the Court of Criminal Appeal for exercise in relation to proceedings before it where that use is considered to be 'necessary or expedient in the interests of justice' [34] - [35].

113 Steytler J then considered whether the Court of Criminal Appeal had a discretion in relation to the exercise of the power under s 697. His Honour referred to a number of cases which indicate plainly that, in the civil jurisdiction, restitution follows 'as of course' [38] - [39]. However, his Honour held that, by virtue of the opening words of s 697 (namely 'the Court of Criminal Appeal may, if they think it necessary or expedient in the interests of justice'), the power under s 697 to order repayment was discretionary, and the power should only be exercised where the Court of Criminal Appeal considered it 'necessary or expedient in the interests of justice' [39]. He added:

That said, given the weight of authority over many years as regards what is necessary or expedient in the interests of justice in this context, it must be accepted that, at least in the ordinary case, restitution will be ordered. Were the position otherwise, the successful appellant would not be restored to what he or she had lost as a result of the erroneous conviction [39].

114 I will now examine the first issue by reference to the current statutory framework, namely the relevant provisions of pt 16 of the Sentencing Act and the relevant provisions of the Criminal Appeals Act.

115 A number of propositions may be stated in relation to the current statutory framework.

116 First, although, by s 110(1) of the Sentencing Act, a compensation order is in addition to and not part of the sentence imposed on an 'offender', despite s 110(1), s 110(6) confers on an offender a right to appeal against a compensation order 'as if it were part of the sentence imposed on him or her'. The words 'as if' in a statutory provision are a convenient drafting device. They introduce a fiction or a hypothetical contrast in that they deem something to be what it is not or compare it with what it is not. See R v Hughes [2000] HCA 22; (2000) 202 CLR 535 [24] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ); Re Macks; Ex parte Saint [2000] HCA 62; (2000) 204 CLR 158 [115] (McHugh J). The effect of the phrase 'as if it were', in s 110(6) of the Sentencing Act, is that the provisions of the Criminal Appeals Act with respect to an appeal by an offender against sentence (including the powers of the court in relation to an appeal by an offender against sentence) apply, with necessary modifications, to an appeal under s 110(6). The victim will, of course, be a party to the appeal.

117 Secondly, an offender against whom a compensation order has been made may appeal against the compensation order, pursuant to s 110(6) of the Sentencing Act, whether or not the offender has also appealed against conviction or sentence.

118 Thirdly, the provisions of the Criminal Appeals Act with respect to an appeal by an offender against sentence include, relevantly, those contained in s 31 of that Act. In particular, this court may allow the offender's appeal if, in its opinion, a different sentence should have been imposed (s 31(4)(a)) and, if the court allows the appeal, it must set aside the sentence and may, relevantly, instead impose a new sentence that is either more or less severe (s 31(5)(a)).

119 Fourthly, the effect of s 110(6) of the Sentencing Act, properly construed, read with the relevant provisions of the Criminal Appeals Act with respect to an appeal by an offender against sentence, is that, if this court allows an offender's appeal under s 110(6), the court may set aside or vary the compensation order and may, for the purposes of dealing with the appeal, do any or all of the matters set out in s 40(1) of the Criminal Appeals Act including 'exercise any power that the Supreme Court may exercise in a civil case' (s 40(1)(l)).

Fifthly, the power of a court to make a compensation order under pt 16 of the Sentencing Act is not engaged unless:

(a) the person against whom the order is proposed to be made is an 'offender'; that is, a person who has been convicted of an offence under a written law; and

(b) the person in favour of whom the order is proposed to be made is a 'victim' of the offence.

See s 117(1) of the Sentencing Act; the definitions of 'offence' and 'offender' in s 4(1); and the definition of 'victim' in s 116.

121 Sixthly, by s 30(5) of the Criminal Appeals Act, if this court allows an offender's appeal against conviction, 'it must set aside the conviction of the offence' and it must, relevantly, order a new trial (s 30(5)(a)) or enter a judgment of acquittal of the offence (s 30(5)(b)).

122 Seventhly, neither pt 16 of the Sentencing Act nor the Criminal Appeals Act confers on this court (or any court), in the context of an appeal against conviction under s 30 of the Criminal Appeals Act, a specific power to annul or set aside a compensation order or a specific power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender. No other statutory provision confers on this court (or any court), in the context of an appeal against conviction under s 30 of the Criminal Appeals Act, a specific power to annul or set aside a compensation order or a specific power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender.

123 Eighthly, when this court allows an offender's appeal against conviction and sets aside the judgment or judgments of conviction, those orders do not automatically or of themselves annul or set aside a compensation order made by the Supreme Court or the District Court or oblige the victim to repay (with or without interest) the amount of any compensation paid by the offender. See Cavanough (225); MacIntosh (459 - 460) (Kirby P); Easterday (No 1) [45] - [47]; The State of New South Wales v Kable [2013] HCA 26; (2013) 252 CLR 118 [32] - [33] (French CJ, Hayne, Crennan, Kiefel, Bell & Keane JJ).

124 Ninthly, however, in my opinion, if this court allows an offender's appeal against conviction and sets aside the judgment or judgments of conviction, the court has inherent power to annul or set aside a compensation order made against the offender, consequent upon his or her conviction, pursuant to pt 16 of the Sentencing Act, and inherent power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender.

125 A power to annul or set aside a compensation order and a power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender are necessary to enable this court to act effectively within its appellate jurisdiction in an appeal by an offender against conviction and to prevent injustice, where:

(b) the judgment or judgments of conviction are set aside (whether with an order for a new trial or the entry of a judgment or judgments of acquittal);

(c) a compensation order has previously been made against the offender on the basis of the conviction; and

(d) the offender has paid compensation to the victim pursuant to the compensation order.

126 In particular, a power to annul or set aside a compensation order and a power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender are necessary in those circumstances in that:

(a) If this court allows an offender's appeal against conviction, the court does not have a discretion in relation to the setting aside of the conviction. By s 30(5) of the Criminal Appeals Act, the conviction must be set aside.

(b) The setting aside of the conviction avoids the conviction from the beginning. That is, '[t]he judgment reversed is the same as no judgment': R v Drury [1848] EngR 362; (1849) 3 CAR & K 190, 199; [1848] EngR 362; 175 ER 516, 520 (Coleridge J).

(c) The compensation order previously made depended upon and could not have been made without the entry of the judgment of conviction.

(d) If this court did not have power to annul or set aside the compensation order or power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender it would, at least ordinarily, be productive of injustice to the offender whose conviction has been quashed. As Callaway JA (Winneke P & Vincent JA agreeing) observed in Rimanic v Business Licensing Authority [2002] VSCA 64; (2002) 129 A Crim R 356:

The common law principle in Cavanough's case is fundamental to a fair system of criminal justice. A wrong has been done to the person whose conviction is quashed or set aside and that person must be restored, so far as may be, to his or her former position ... That principle gives effect to a basic human right ... [14].

(e) The powers can be exercised without contravening any statutory provision or rule of court. In particular, the powers can be exercised consistently with s 40(1) and the other provisions of the Criminal Appeals Act. Indeed, s 40(1)(l), which empowers this court '[f]or the purposes of dealing with an appeal', to exercise any power that the Supreme Court may exercise in a civil case, 'brings into play' all of the powers of this court in civil appeals and, also, 'the residual powers of the court in its inherent jurisdiction'. See, in the context of the comparable provision in s 697 of the Code, R v Mickelberg (1996) 90 A Crim R 126, 129 (Malcolm CJ, Steytler J agreeing); Nicholson v The Queen (Unreported, WASCA, Library No 980698, 7 December 1998) 4 (Kennedy J, White & Scott JJ agreeing); Turnbull v The Queen [2003] WASCA 80 [2] (Murray J, Scott & Wheeler JJ agreeing); Hou v The Queen [2003] WASCA 241 [20] (Malcolm CJ, Steytler & Parker JJ); Easterday (No 1) [20]. I understand Malcolm CJ's reference in Mickelberg (129) to 'the residual powers of the court in its inherent jurisdiction' to include the court's inherent power.

(f) The existence of the powers is not inconsistent with the right of appeal conferred by s 110(6) of the Sentencing Act. That right of appeal is not conditioned by a requirement that the offender challenge the correctness of his or her conviction. An appeal under s 110(6) may be allowed (depending, of course, on the facts and circumstances of the particular case) without the conviction being quashed. That an offender could have brought both an appeal against conviction and an appeal under s 110(6) does not exclude inherent powers of the kind I have described. As I have mentioned, those powers are picked up and brought into play, in the context of an offender's appeal against conviction, by s 40(1)(l) of the Criminal Appeals Act.

(g) There is no direct inconsistency between the right of appeal under s 110(6) and the provisions of pt 16 of the Sentencing Act with respect to civil proceedings, on the one hand, and s 40(1)(l) of the Criminal Appeals Act and the inherent powers, on the other. All of those provisions can operate harmoniously. Also, the statutory text does not indicate that the right of appeal conferred by s 110(6) of the Sentencing Act, and the rights and obligations of the victim and the offender under pt 16 of that Act with respect to civil proceedings, were intended to cover the field in relation to the circumstances in which a compensation order may be set aside and an order that the victim repay (with or without interest) the amount of any compensation paid by the offender may be made.

127 Tenthly, the status of the victim (in the present case, Phoenix), as a non-party to the offender's (in the present case, the appellant's) appeal against conviction, is not an impediment to the existence or exercise by this court of an inherent power to annul or set aside a compensation order, or an inherent power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender. If the victim has received a benefit from the offender pursuant to a judicial order made upon the faith of a judgment of conviction, and the conviction is set aside on appeal, it will, at least ordinarily, be just and equitable that the benefit be restored to the offender upon his or her conviction being quashed. It will be necessary, of course, as happened in the present case, for the victim, as a non-party to the offender's appeal against conviction, to be accorded procedural fairness before the court makes a restorative order.

128 I will now make some comments about the propositions I have stated in relation to the current statutory framework, on the one hand, compared to the decision in Easterday (No 1) in relation to the previous statutory framework, on the other.

129 In my opinion, the conclusion in Easterday (No 1) that the court had power, upon quashing the applicants' convictions on a petition referred under s 140 of the Sentencing Act, to annul the restitution orders which had previously been made and enforced against the applicants, was, with respect, correct. The reasoning which underpinned the court's conclusion was that the power was 'necessarily to be implied as ancillary to the power to quash a conviction' [21] and that Parliament, in giving the court the power to quash a conviction, 'must have intended that it should also have the power to annul orders made by it which depended solely upon the fact of the conviction' [26]. By that process of reasoning, the court filled what it perceived was a gap in the express powers conferred on the court by the legislation. Section 694(1) expressly suspended a restitution order pending the determination of an appeal against conviction and expressly provided that the order should not take effect if the conviction was quashed on appeal. Each of the applicants in Easterday (No 1) appealed against conviction but their appeals were dismissed. Neither the Code nor the Sentencing Act conferred a specific power on the court to annul a restitution order, which had previously been made and enforced, when the court quashed the offender's conviction on a petition referred under s 140 of the Sentencing Act. The court's conclusion in Easterday (No 1) was based on an implication that a power to annul a restitution order was ancillary to the express power to quash a conviction on a petition referred under s 140. The court's conclusion was not based on an implication from the statutory text or on the court's inherent power. I would not, with respect, adopt the process of reasoning of the court in Easterday (No 1), in relation to the power to annul a restitution order, in construing the current statutory framework. As I have mentioned, the Supreme Court (of which this court is a division) is a superior court of record with inherent powers. It is not an inferior court with analogous implied powers. See [71] - [74] above.

130 Also, in my opinion, the conclusion in Easterday (No 1) that the court had power, upon annulling the restitution orders which had previously been made and enforced against the applicants, 'to order repayment of what was transferred pursuant to [the] restitution order[s]', was, with respect, correct [34]. As the court noted, that power was conferred by s 697 of the Code; in particular, that part of s 697 which conferred on the court 'any other powers which may for the time being be exercised by the Supreme Court on appeals in civil matters'.

131 Further, in my opinion, the conclusion in Easterday (No 1) that the court had a discretion in relation to the exercise of the power under s 697 of the Code was, with respect, correct. That conclusion necessarily followed from the opening words of s 697 which stated, in effect, that the court 'may, if they think it necessary or expedient in the interests of justice', exercise any of the powers specified in s 697 [39].

132 The current statutory framework, as embodied in pt 16 of the Sentencing Act and the relevant provisions of the Criminal Appeals Act, is, of course, different from the statutory framework that was embodied in s 694, s 697, s 717 and s 719 of the Code. For example, the previous statutory framework did not include a right of appeal of the kind embodied in s 110(6) of the Sentencing Act, and the current statutory framework does not include a provision comparable to the opening words of s 697 of the Code. However, the current statutory framework, properly construed, produces an outcome in relation to this court's power to annul or set aside a compensation order and its power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender, upon allowing the offender's appeal against conviction, which is not different in effect from the outcome mandated by Easterday (No 1) in relation to the previous statutory framework.

133 My construction of the current statutory framework and my opinion as to the existence of an inherent power to annul or set aside a compensation order and an inherent power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender, upon this court allowing the offender's appeal against conviction, does not involve construing the statutory text as if it contained additional words or construing the text in a manner which has the effect of giving it an expanded operation. Those powers do not arise from implications made in the statutory text. They are picked up and brought into play by s 40(1)(l) of the Criminal Appeals Act.

134 I am therefore satisfied that when this court allows an offender's appeal against conviction and sets aside the judgment or judgments of conviction, the court has power to annul or set aside a compensation order made by virtue of the judgment or judgments of conviction and power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender.

The second issue raised by the Repayment Application

135 I will begin my examination of the second issue by referring again to the powers of the Court of Criminal Appeal (later the Court of Appeal) under s 697 (repealed) of the Code.

Section 697 read, relevantly, that 'the Court of Criminal Appeal [later amended to refer to the Court of Appeal] may, if they think it necessary or expedient in the interests of justice ... exercise in relation to the proceedings of the Court any ... powers which may for the time being be exercised by the Supreme Court on appeals in civil matters'.

137 In Easterday (No 1), Steytler J held that, by virtue of the opening words of s 697, the power under s 697 to order repayment was discretionary, and the power should only be exercised where the Court of Criminal Appeal considered it 'necessary or expedient in the interests of justice' [39]. His Honour added, however, that, at least in the ordinary case, restitution will be ordered because otherwise 'the successful appellant would not be restored to what he or she had lost as a result of the erroneous conviction' [39].

138 I will now examine the second issue in the context of the current statutory framework.

139 As I have mentioned, in the course of determining the first issue:

(a) neither pt 16 of the Sentencing Act nor the Criminal Appeals Act confers on this court (or any court), in the context of an appeal against conviction under s 30 of the Criminal Appeals Act, a specific power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender; and

(b) no other statutory provision confers on this court (or any court), in the context of an appeal against conviction under s 30 of the Criminal Appeals Act, a specific power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender.

140 I am satisfied, generally for the reasons I have given in determining the first issue, that this court's inherent power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender includes a discretion as to whether to exercise the power subject to conditions or at all.

141 A discretion as to whether to exercise the inherent power subject to conditions or at all is necessary to enable this court to act effectively within its appellate jurisdiction in an appeal by an offender against conviction and to prevent injustice. The inherent power arises from this court's general responsibility, as a superior court of record, for the administration of justice. The court's discretion is an incident of its inherent power to order the victim to repay (with or without interest) the amount in question. The discretion is to be exercised having regard to the facts and circumstances of the particular case and in a manner which the court considers is in the interests of justice as between the offender and the victim, and generally. For example, the discretion may, depending on the particular facts and circumstances, be exercised differently if the court enters a judgment or judgments of acquittal instead of ordering a new trial for the offender. That example is merely an illustration and is not intended to confine the nature or breadth of the discretion.

142 The power to order repayment (with or without interest) and the discretionary character of that power are, as I have mentioned, picked up and brought into play by s 40(1)(l) of the Criminal Appeals Act, which empowers this court '[f]or the purposes of dealing with an appeal', to exercise any power that the Supreme Court may exercise in a civil case. That grant of power includes the court's inherent power. The power to order repayment (with or without interest) and the discretionary character of that power are not conferred by the express provisions of the Supreme Court Act (for example, s 24(7)), the Rules of the Supreme Court (for example, O 52 r 2(1)) or the Supreme Court (Court of Appeal) Rules.

143 I am therefore satisfied that this court has a discretion as to whether to exercise the power to order the victim to repay (with or without interest) the amount of any compensation paid by the offender.

The third issue raised by the Repayment Application

144 I will now deal with the third issue, namely the manner in which the Repayment Application should be determined.

145 As I have mentioned, counsel for Phoenix submitted that Phoenix is entitled in equity to set off any obligation it may have to repay the Compensation Amount against the amount Phoenix claims from the appellant in CIV 3072 of 2011 and, accordingly, this court should not make an order requiring Phoenix to make repayment to the appellant or a payment into court.

146 An equitable set-off is available where the party claiming the set-off can establish a recognised equitable ground for being protected, to the relevant extent, from the other party's demand. The set-off must essentially be bound up with and go to the root of, challenge, call in question or impeach the title of the other party. The mere existence of a cross-claim or cross-demand is not sufficient to establish an equitable set-off. There must be a recognised ground for equitable intervention (beyond the mere existence of a cross-claim or cross-demand) so that the equity of the party claiming the set-off impeaches the title of the other party to the legal demand which it is seeking to enforce. See J & S Holdings Pty Ltd v NRMA Insurance Ltd [1982] FCA 78; (1982) 61 FLR 108, 127 (Blackburn, Deane & Ellicott JJ); James v Commonwealth Bank of Australia [1992] FCA 420; (1992) 37 FCR 445, 457 - 462 (Gummow J); Hazcor Pty Ltd v Kirwanon Pty Ltd (1995) 12 WAR 62, 67 - 68 (Kennedy J, Malcolm CJ & Murray J agreeing); HP Mercantile Pty Ltd v Dierickx [2013] NSWCA 479; (2013) 306 ALR 53 [136] (Emmett JA, Beazley P relevantly agreeing & Meagher JA agreeing); Hawes v Dean [2014] NSWCA 380 [59] - [65] (Barrett JA, Bathurst CJ & McColl JA agreeing).

147 In the present case, the appellant's claim for repayment of the Compensation Amount arose by virtue of this court having set aside the judgments of conviction which the primary judge entered against him. The foundation for the making of the interim compensation order was the convictions; in particular, the appellant's status as an 'offender' (as defined in s 4(1) of the Sentencing Act) and Phoenix's status as a 'victim' (as defined in s 116 of the Sentencing Act). By s 115(1) of the Sentencing Act, relevantly, the making of the interim compensation order did not preclude Phoenix from commencing or maintaining civil proceedings against the appellant for any injury, loss or damage Phoenix had suffered. However, by s 115(2), relevantly, a court assessing Phoenix's damage or compensation (the award) for the alleged injury, loss or damage resulting from the appellant's offences must make the assessment without regard to the compensation set under the interim compensation order, and Phoenix may only recover an amount equal to the amount (if any) by which the award exceeds the compensation ordered to be paid under the interim compensation order.

148 I am not persuaded that Phoenix has an entitlement in equity to set off any obligation it may have to repay the Compensation Amount, pursuant to any order this court may make in the exercise of its inherent power, against the amount Phoenix claims from the appellant in CIV 3072 of 2011. Phoenix's claims against the appellant in CIV 3072 of 2011 are disputed by the appellant and have not yet been made out. The claims do not depend upon the appellant's convictions. I am satisfied that the claims are not essentially bound up with and do not go to the root of, challenge, call in question or impeach the appellant's rights under any order this court may make, in the exercise of its inherent power, requiring Phoenix to repay the Compensation Amount to the appellant or to pay that amount into court.

149 In my opinion, this court should exercise its inherent power to annul or set aside the interim compensation order which the primary judge made on 29 May 2015 in favour of Phoenix. That exercise of power is appropriate in view of the court's decision to allow the appellant's appeal against conviction and to set aside the judgments of conviction entered by his Honour on the 18 counts in the indictment.

150 However, this court should, in the exercise of its discretion, order that Phoenix pay the Compensation Amount into court. The court should not order that Phoenix repay the amount in question to the appellant and the court should not stay the order that Phoenix pay the relevant amount into court. I have arrived at those conclusions after evaluating and weighing all the relevant facts and circumstances, including the following.

151 First, the foundation for the making of the interim compensation order, namely the entering of the judgments of conviction, fell away upon this court allowing the appellant's appeal against conviction and setting aside the judgments of conviction. That factor militates against granting a stay of any order that Phoenix pay or repay the Compensation Amount. Secondly, the court has ordered that there be a new trial of the appellant on each of the 18 counts and has not ordered that judgments of acquittal be entered. That factor militates against ordering Phoenix to repay the Compensation Amount to the appellant. Thirdly, the background facts and circumstances relating to the interim compensation order and the affidavit material reveal cause for concern as to the appellant's willingness and ability to pay the amount of a new compensation order in the event the Director of Public Prosecutions (WA) (the DPP) proceeds with the new trial and the appellant is convicted again. That factor militates against ordering Phoenix to repay the Compensation Amount to the appellant. Fourthly, although the affidavit material indicates that Phoenix has relied for its solvency upon loan facilities from directors and shareholders and that an order requiring Phoenix to repay the Compensation Amount to the appellant or to pay that amount into court 'may', subject to Phoenix's ability to raise further loan funds, affect Phoenix's solvency and ability to continue trading as a going concern, the affidavit evidence does not indicate that any of the directors or any of the shareholders are unwilling to advance additional loans or other credit facilities. That factor militates against granting a stay of any order that Phoenix pay or repay the Compensation Amount. Fifthly, the settlement agreement between Phoenix and the appellant required that the net proceeds of sale of the appellant's New York condominium be paid by the purchaser to and held on trust by Phoenix's United States lawyers. The agreement provided that, if a compensation order was not made in favour of Phoenix, the net sale proceeds were to be held on trust by Phoenix's lawyers and the appellant's lawyers pending the final determination of the proceedings in CIV 3072 of 2011. The provisions of the settlement agreement to which I have referred militate against ordering Phoenix to repay the Compensation Amount to the appellant and in favour of ordering Phoenix to pay that amount into court. Sixthly, granting a stay of any order that Phoenix pay or repay the Compensation Amount would be identical, in practical substance, to refusing to make an order that Phoenix pay or repay that amount until the DPP decides whether to proceed with the new trial on all or any of the 18 counts and, if the new trial proceeds, its outcome. That factor militates against granting a stay of any order that Phoenix pay or repay the Compensation Amount.

152 I would not, however, at least at this stage, order that Phoenix pay any interest on the Compensation Amount. That issue should await the DPP's decision as to whether to proceed with the new trial on all or any of the 18 counts and, if the new trial proceeds, its outcome.

153 Each of the appellant, Phoenix and the State should have liberty to apply, regarding the Compensation Amount which Phoenix must pay into court, in the event of new facts and circumstances emerging; for example, the DPP deciding not to proceed with the new trial, the DPP deciding to proceed with a new trial on some but not all of the 18 counts, and any requirement the appellant may have for money to fund his defence at a new trial. Those examples are illustrations and not an exhaustive statement.

154 This court should retain control over the Compensation Amount until the DPP decides whether to proceed with the new trial on all or any of the 18 counts and, if the new trial proceeds, its outcome. At that stage it may be appropriate to transfer control to the judge in the General Division who is managing the proceedings in CIV 3072 of 2011 in which the freezing order concerning the appellant and his property was made. I note that the amount of $AUD13,419.46, being the balance of the proceeds of sale of the condominium to which I have referred at [18] above, was paid into court pursuant to an order made on 19 February 2016 by the judge in the General Division who is managing CIV 3072 of 2011.

1. The appellant's application filed 10 November 2016 for leave to adduce additional evidence in support of the Repayment Application is granted.
2. The interim compensation order made by the primary judge on 29 May 2015 in favour of Phoenix is annulled.
3. By 4.00 pm on 4 April 2017, Phoenix is to pay the Compensation Amount into court.
4. The appellant has liberty to apply on not less than 14 days written notice to Phoenix and the State in relation to the payment by Phoenix of interest on the Compensation Amount.

1. Each of the appellant, Phoenix and the State has liberty to apply on not less than 14 days written notice to the others in relation to the Compensation Amount which Phoenix is required to pay into court.

156 The parties should be heard in relation to costs.

157 On 3 March 2015, the appellant was convicted, after trial, of 18 counts of fraud in the District Court of Western Australia. On 29 May 2015, the primary judge ordered the appellant to pay $394,759.38 (the Compensation Amount) to the complainant, Phoenix Eagle Pty Ltd (Phoenix). That order was made under s 117 of the Sentencing Act 2005 (WA), which empowers a court sentencing 'an offender' to make a compensation order in favour of a victim of the offence. The appellant was treated as 'an offender' only because he had been convicted of the offences.[1]

158 On 1 September 2016, this court allowed the appellant's appeals against his convictions, set aside the convictions and ordered a retrial on all 18 counts.[2]

159 The appellant now seeks an order for repayment of the Compensation Amount.

Power to declare that the compensation order is null and void

160 In Easterday v The State of Western Australia,[3] the Court of Criminal Appeal held that the effect of an order setting aside a conviction was to avoid the conviction from the beginning. The court also held that the statutory power to quash a conviction implicitly carried with it the power to declare that a consequential order depending solely on the conviction is null and void.[4] Subsequent legislative changes, including making separate provision for an appeal against a compensation order,[5] do

not undermine that conclusion. The requirement that this court set aside the appellant's convictions when it allowed his appeals[6] implicitly carries with it the power to declare that the compensation order, which could not have been made in the absence of the convictions, is null and void.

161 That approach does not involve inserting words to correct an 'obvious drafting error' to give effect to the objectively ascertained purpose of the legislation.[7] Rather, it applies the established principle that the grant of power carries with it everything necessary for its exercise. That is, the conferral of statutory jurisdiction or powers on a court carries with it such powers as are incidental and necessary to the exercise of the jurisdiction or powers so conferred.[8] In this context 'necessary' is used in the sense of matters which are reasonably required or legally ancillary (as opposed to 'essential') to the exercise of the jurisdiction or powers.[9]

162 The compensation order did not entirely lack legal effect when it was made. A person who executes a judgment may rely on the judgement to justify their conduct (which may otherwise be tortious) notwithstanding its removal, reversal or annulment.[10] Further, an order of a superior court,[11] even when made outside of jurisdiction, is valid until set aside.[12] However, once this court sets aside a conviction, it may declare a consequential compensation order that depends only on the conviction to be null and void. Once the declaration is made, the compensation order is taken never to have had effect, although it may still be relied upon to justify what may otherwise have been unlawful action taken before the declaration to execute the compensation order.

163 The convictions having been set aside, the compensation order made on the basis of the convictions should be declared to be null and void.

164 The court in Easterday also considered the power, contained in s 697 of the Criminal Code (as it was then),[13] to exercise 'any other powers which may ... be exercised by the Supreme Court on appeals in civil matters' where the court thought it 'necessary or expedient in the interests of justice' to do so. The court held that this conferred a discretionary power to order restitution of money paid to satisfy an order based only on a quashed conviction. The court expressed the view that, at least in the ordinary case, the discretion would be exercised to order restitution.[14]

165 We do not accept Phoenix's submission that Easterday should not be followed on the basis that the court has no power to make a restitutionary order against a person who is not a party to the criminal proceedings. Phoenix correctly recognises that courts may exceptionally make orders affecting the rights of third parties. This is an exceptional category of case, where the Sentencing Act provides for an order to be made for the benefit of a victim who is not a party to the criminal proceedings. Having received the benefit of a coercive order made while it was not a party to the criminal proceedings, Phoenix must also accept the burden of the court's jurisdiction to deal with the consequences of the conviction being set aside.

166 Phoenix submits that courts make orders binding on third parties only where it is necessary to do so in order to maintain the integrity of the court's proceedings as between the parties.[15] However, this court's jurisdiction to deal with the consequences of a conviction being set aside is necessary to maintain the integrity of the criminal process as between the prosecution and the accused. That jurisdiction allows for the effective correction of errors so that the criminal proceedings do not themselves become an instrument of injustice.

167 Of course, it remains necessary to give a person who has received payment under a compensation order an opportunity to be heard before making a restitutionary order (as was done in this case). But the fact that Phoenix is not a party to the primary criminal proceedings or this appeal does not preclude this court from making a restitutionary order.

168 In our view, for the reasons explained in Easterday,[16] s 40(1)(l) of the Criminal Appeals Act gives this court the power to make restitutionary orders consequential upon the setting aside of a conviction. Section 40(1)(l) relevantly provides:

For the purposes of dealing with an appeal, an appeal court may do any or all of the following:

...

(l) exercise any power that the Supreme Court may exercise in a civil case;

169 As held in Easterday, in a civil case the court has power to order restitution of an amount paid under an order based only on a judgment that has been set aside on appeal.

There is no discretionary reason to refuse to make a restitutionary order

170 In our opinion, the exercise of a power to make a restitutionary order is discretionary. In Easterday, Steytler J (with whom Wheeler & Roberts-Smith JJ agreed) held that the power to order the repayment of the executed restitutionary order was discretionary.[17] This was by reason of the requirement, found in the opening words of s 697 (now repealed) of the Criminal Code, that the court be satisfied that the relevant order was 'necessary or expedient in the interests of justice'. These words do not appear in s 40(1) of the Criminal Appeals Act.

171 However, the source of the discretionary power in s 40(1) is the opening words of the subsection:

'For the purposes of dealing with an appeal, an appeal court may do any or all of the following' (emphasis added).

172 In an appropriate context, a provision that a court 'may' exercise a power will be construed as conferring a power which is to be exercised in a case where the power arises.[18] However, the context in which the term appears in s 40(1) makes it clear that 'may' is used in a discretionary, rather than a mandatory, sense. The subject matter of the many of the powers is inconsistent with s 40(1) imposing a duty to exercise the powers in any particular case. For example, it cannot have been contemplated that the court would be under a duty to admit additional evidence,[19] order particulars[20] or amend a ground of appeal[21] whenever the power to do so arose. Having regard to the nature of the powers contained in the subsection, the word 'may' confers a discretion on the court as to whether, in any particular case, any or all of them should be exercised.

173 Accepting the power to be discretionary, there is no discretionary reason in this case for refusing to make a restitutionary order. Phoenix claims that it is entitled to the money in any event, and is entitled to an equitable set-off. These claims do not provide a basis for refusing to make a restitutionary order. Phoenix commenced civil proceedings against the appellant (Supreme Court proceeding CIV 3072 of 2011) in which it claims, but has not yet established, a right to payment of money (Civil Proceeding). The appellant disputes that claim. Phoenix received payment of the Compensation Amount only because the appellant had been convicted of the offences. Once the convictions are set aside, there is no basis for Phoenix to retain funds which it had no established right to receive but for the compensation order which was based only on convictions that are now to be regarded as void.

174 We accept that there is a prospect that repayment will impose financial hardship on Phoenix. It also appears that Phoenix has used at least some of the Compensation Amount to discharge its own liabilities to third parties, including liabilities incurred in seeking to recover the money from the appellant. However, neither of these circumstances justifies Phoenix retaining money to which it has no established entitlement to receive.

175 In determining the appropriate form of a restitutionary order, it is necessary to bear in mind the nature of the appellant's entitlement to restitution, and the unusual means by which payment was made in this case.

to be restored to all things which he may have lost by such erroneous judgment and proceedings, and shall stand in every respect as if he had never been charged with the offence in respect of which judgment was pronounced against him.

177 Had the appellant paid the Compensation Amount using funds to which Phoenix had no undisputed entitlement, the appropriate restitutionary order may have been for repayment of the Compensation Amount directly to the appellant. Even in that event, the form of the order may have needed to take account of the freezing order which has been made in the Civil Proceeding.

178 However, in the present case, it is significant that the funds used to discharge the compensation order came from the proceeds of the sale of an apartment owned by the appellant in the United States. The manner in which the proceeds of that sale were to be disbursed was the subject of an agreement made between Phoenix and the appellant on 11 June 2015. There is no relevant dispute about the terms or operation of that agreement if the compensation order had not been made. That agreement required the net proceeds of the sale to be paid directly by the purchaser to, and to be held on trust by, Phoenix's United States attorneys. The agreement also provided that, if no compensation order was made, the United States attorneys were directed to pay the funds into a special purpose trust account to be held jointly by the appellant's and Phoenix's solicitors. Those funds were to be held on trust for the purposes of satisfying any further debt owed by the appellant to Phoenix arising out of the Civil Proceeding, until final resolution of that proceeding.[23]

179 Therefore, the appellant was not entitled to immediately receive the proceeds of the sale of his apartment. If the compensation order had not been made, the net sale proceeds would have been held on trust until the final resolution of the Civil Proceeding (which has not yet occurred). That is the position in which the appellant should be placed: the Compensation Amount should be restored to the trust established by the agreement.

180 After the appellant's former solicitors ceased to act for him, the trust funds (being the balance of sale proceeds of $13,419.46 after payment of the Compensation Amount) were paid into court pursuant to an order made in the Civil Proceeding by Kenneth Martin J on 19 February 2016. The order of the General Division bringing the trust funds into court may be seen as an exercise of the court's jurisdiction to intervene in the administration of the trust,[24] so that it did not fail for want of a trustee. Kenneth Martin J has recognised that the sale proceeds already paid into court remain subject to the trust established by the agreement.[25] In these circumstances, the appropriate restitutionary order, which will place the appellant in the position in which he would have been if no compensation order had been made, is that Phoenix pay the Compensation Amount into court. The ultimate disposition of the trust funds, augmented by the Compensation Amount, can then be determined in the Civil Proceeding. This may include applying the funds to the payment of any future compensation order that may be made if the appellant is convicted of some or all of the offences on re-trial. Otherwise, funds will be disbursed according to the appellant's and Phoenix's respective rights as determined in the Civil Proceeding.

181 We agree with Buss P that the question of interest on the Compensation Amount should await the final outcome of the criminal proceedings.

182 Phoenix contended that any restitutionary order should be stayed pending the outcome of the appellant's retrial. In our view, a stay is not appropriate.[26] A stay would have the same effect as denying the order pending a retrial.

183 Further, it is not the case (as submitted by Phoenix) that the appellant obtains no benefit from the money being paid into court at this time. Although he does not have an immediate right to access the money, once it is paid into court the Compensation Amount will be secure from the impact of future events that may affect the solvency of Phoenix. That is a significant consideration in a context where Phoenix has adduced evidence that its continued solvency depends on loans from directors and shareholders.[27] It counts against the grant of a stay, as well as against the exercise of the court's discretion to refuse to make a restitutionary order.

184 For these reasons, we agree that orders 1 - 4 proposed by Buss P should be made. In our view, it is unnecessary to make an order giving liberty to apply in relation to the Compensation Amount which Phoenix has paid into court. Issues regarding that money which Phoenix pays into court can be dealt with in the Civil Proceeding.

[1] Sentencing Act, s 3(1) (definition of 'offender').

[2] Ardrey v The State of Western Australia [2016] WASCA 154.

[3] Easterday v The State of Western Australia [2005] WASCA 105; (2005) 30 WAR 122.

[5] Section 110(6) of the Sentencing Act provides for an appeal against a compensation order on grounds independent of the setting aside of a conviction.

[6] Criminal Appeals Act 2004 (WA), s 30(5).

[7] As to which, see Minister for Immigration v SZJGV [2009] HCA 40; (2009) 238 CLR 642 [9], [12], [63] - [65]; Taylor v The Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531 [38] - [40].

[8] In addition to the authorities cited in Easterday [14] - [17], see Pelechowski v The Registrar, Court of Appeal (NSW) [1999] HCA 19; (1999) 198 CLR 435 [50]; Byrnes v The Queen [1999] HCA 38; (1999) 199 CLR 1 [32]; DJL v The Central Authority [2000] HCA 17; (2000) 201 CLR 226 [25].

[10] Commissioner for Railways (NSW) v Cavanough [1935] HCA 45; (1935) 53 CLR 220, 227.

[11] Section 42 of the District Court of Western Australia Act 1969 (WA) gives the District Court all the jurisdiction and powers that the Supreme Court has in respect of any indictable offence, except where the maximum penalty is life imprisonment. In exercising the criminal jurisdiction and powers conferred by that section, the District Court has been recognised as having the status of a superior court of record, at least 'so long as it is acting within that jurisdiction': see Re Ackland; Ex parte Love (1989) 1 WAR 562, 567; Ex Parte Connell (1993) 10 WAR 414; Day v the Queen [1984] HCA 3; (1984) 153 CLR 475, 479; cf Re Judge Schoombee; Ex parte Attorney General [2011] WASC 23 [26] - [28] and Re Judge Schoombee; Ex parte Attorney General [2012] WASCA 29 [49].

[12] The State of New South Wales v Kable [2013] HCA 26; (2013) 252 CLR 118.

[13] Section 697 of the Criminal Code was repealed by s 24 of the Criminal Procedure and Appeals (Consequential and Other Provisions) Act 2004 (WA).

[15] Citing Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380 [50], [54], [57] (in relation to asset preservation orders) and Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178, 172 (in relation to costs orders).

[18] Leach v The Queen [2007] HCA 3; (2007) 230 CLR 1 [38].

[19] Section 40(1)(e) of the Criminal Appeals Act.

[20] Section 40(1)(i) of the Criminal Appeals Act.

[21] Section 40(1)(k) of the Criminal Appeals Act.

[22] Archbold's Criminal Pleading, Evidence and Practice (21st edition, 1893) pages 226 - 227, cited with approval in Cavanough , 225, 227 - 228 and Easterday [23].

[23] Clause 2(iii) and (v) of the Agreement.

[24] See Palmer v Ayres [2017] HCA 5 [84]; CPT Custodian Pty Ltd v Commissioner of State Revenue [2005] HCA 53; (2005) 24 CLR 98 [17].

[25] Phoenix Eagle Co Pty Ltd v Ardrey [2016] WASC 175 [13] - [14].

[26] Easterday v The State of Western Australia [2005] WASCA 202.

[27] Affidavit of C E Hagan sworn on 9 September 2016 [37].