BETWEEN : CHIEF EXECUTIVE OFFICER OF CUSTOMS BY ROSS ALFRED BLACKALL, HIS DULY AUTHORISED DELEGATE

Customs - Smuggling, evasion of duty and false statements - Civil procedure - Sentencing - Multiple charges - Minimum penalties

Crimes Act 1914, s 4F, s 4K

Customs Act 1901 (Cth), s 233AB(1)(a)(ii), s 233(1)(a), s 234(1)(a), s 234(1)(d), s 244, s 245(1); s 247, s 254, s 255

Customs Legislation Amendment (Criminal Sanctions and Other Measures) Act 2000 (Cth)

Convictions and declarations by consent; imposition of pecuniary penalties

1 EM HEENAN J: By a writ of summons issued in the civil jurisdiction of this Court on 30 August 2000, the Chief Executive of Customs, by his duly authorised delegate, seeks a declaration that one or both of the defendants smuggled goods in contravention of s 233(1)(a) of the Customs Act in the manner and on the occasions set out in particulars later delivered; a declaration that one or both of the defendants evaded payment of duty which was payable in respect of the smuggled goods in contravention of s 234(1)(a) of the Customs Act in the manner and on the occasions particularised, and a further declaration that one or both of the second defendants knowingly or recklessly made statements to Customs Officers that were false or misleading in material particulars on occasions later particularised, contrary to s 234(1)(b) of the Customs Act. The writ of summons and the statement of claim also sought other declarations in the alternative but, in view of an agreement which has been reached between the parties to resolve this litigation, those alternatives are no longer pursued by the plaintiff and it is not necessary to describe them. In addition, the plaintiff now seeks orders convicting the first defendant in respect of the contraventions which are the subjects of the declarations for smuggling, evasion of payment of duty, and the knowing or reckless making of false or misleading statements to a Customs Officer. Finally, the plaintiff seeks orders for the payment of penalties by the first defendant in respect of each of the several offences. There are 28 allegations of smuggling, contrary to s 233(1)(a) of the Customs Act; 28 allegations of evasion of duty on those goods in contravention of s 234(1)(a); and 28 allegations of knowingly or recklessly making false or misleading statements to a Customs Officer contrary to s 234(1)(d)(i) of the Act.

2 This action is a "Customs' Prosecution" within the meaning of that term in s 244 of the Customs Act (1914) (Cth) and so may be instituted in the Supreme Court of a State pursuant to s 245(1). Although the action is seeking orders for the conviction of one of the parties and the imposition of substantial pecuniary penalties (fines), it has been commenced, prosecuted and proceeded with in accordance with the usual practice and procedure of the court in civil cases, there being no rules of practice established by the court for Crown suits in revenue matters nor any special directions given by the court or a Judge in relation to this particular action or claims of this kind generally - s 247. By s 255 the averment of the plaintiff contained in the claim is prima facie evidence of the matter or matters averred.

3 The resort to the civil jurisdiction of the court for the determination of issues involving the guilt or innocence of a person charged with a statutory offence and the imposition of statutory penalties, gives rise to the need to characterise the nature of the proceedings which the court is to determine, or perhaps more accurately, to ascertain whether the criminal or civil onus of proof and standard of proof apply. There is a line of established authority to the effect that these are civil proceedings, notwithstanding those substantial criminal overtones, and that the civil standard of proof applies. These authorities also decide that there is an onus of proof on a defendant to refute the allegations advanced against him or her and also that the defendant shall be a compellable witness, but these are matters which follow directly from the terms of s 255 and s 254 of the Act rather than as a consequence of a classification of the proceedings as criminal or civil or from the application of the civil rules of practice required by s 247. In this State this line of authority has been consistently applied and such prosecutions have been treated as being civil in nature with the civil standard of proof applying - Bridal Fashions Pty Ltd v Comptroller-General of Customs (1996) 140 ALR 681 (Full Court); and Chief Executive Officer of Customs v Tonmill Pty Ltd [2001] WASC 77 per Hasluck J at [14]. In Chief Executive Officer of Customs by his Duly Authorised Delegate Malcolm Ross Plant v Owens International Freight (Australia) Pty Ltd [2002] WASC 128 per Scott J, the issue was directly addressed and the proceedings were categorised as being civil in nature with the civil standard of proof applying. Other examples, where the civil procedure has been applied without objection or controversy in this State, are provided by the decisions in Goulding v Penello [1999] WASC 192; Chief Executive Officer of Customs v Pavlovich [2001] WASC 173 and Chief Executive Officer of Customs by his Delegate Robert William Scarfe v Coflexip Stena Offshore International SA [2001] WASC 346.

4 This approach is also in accordance with other long established Australian authority, including Minister for Business and Consumer Affairs v Evans (1982) 70 FLR 56; Evans v Button (1988) 13 NSWLR 57 (CA); Comptroller-General of Customs v Jayakoda, unreported; SCt of Victoria; 9 November 1993 (per Byrne J). Against this line of authority stands the decision of the Queensland Court of Appeal in Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd [2001] QCA 280; (2001) 162 FLR 230. In that case the Court of Appeal comprising McMurdo P, Thomas JA and Byrne J concluded that such proceedings were criminal in nature and that the criminal standard of proof applied, although McMurdo P dissented on the associated issue of whether or not the proceedings were criminal insofar as the application of the Evidence Act (1997) (Qld) applied. This decision was reached after a long analysis of the authorities dealing with Crown suits involving revenue prosecutions originating in the Court of Exchequer and by following and applying the decision in Murphy v KRM Holdings Pty Ltd [1985] FCA 495; (1985) 8 FCR 349 where Pincus and Beaumont JJ held that proceedings for breaches of s 234(1) of the Customs Act were criminal in nature. I note that special leave to appeal from the decision of the Queensland Court of Appeal in Chief Executive Officer of Customs v Labrador Liquor Wholesale (supra) was granted by the High Court of Australia as recently as 26 June last, and it is therefore to be expected that this controversy will be authoritatively resolved before long. Fortunately, except for one minor issue which I shall address later, this does not have any significant application to these proceedings in the light of the admissions which have been made by the first defendant and the agreement which has been reached for the disposition of the litigation between the parties. These render it unnecessary to resolve any controversies about the guilt or liability of the parties or, in doing so, to determine what standard of proof applies.

5 It has also been accepted that because such prosecutions may be commenced and proceeded with in accordance with the usual practice and procedure of the court in civil cases it is entirely proper for the parties to settle the proceedings on a commercial basis without, in any way, breaching the policy of the Customs Act or of the administration of the criminal law or in any way detracting from the discretion of the court with regard to sentencing. This conclusion seems to me, with respect, to be independent of and unaffected by, any controversy over what is the correct standard of proof to be applied in such proceedings. The readiness of courts to accept and apply resolutions of such prosecutions agreed by the parties also has a long history of supporting authority including Trade Practices Commission v Allied Mills Ltd [1981] FCA 142; (1981) ATPR 40-241 at 43, 181; Controller-General of Customs v Kingswood Distillery Pty Ltd, unreported; SCt of NSW (Sperling J) 5 December 1997; Walsh v N & M Gangemi Nominees Pty Ltd [2001] WASC 79 (Templeman J); Chief Executive Officer of Customs v Tonmill Pty Ltd (supra); Chief Executive Officer of Customs v Pavlovich (supra); and Chief Executive Officer of Customs v Coflexip Stena Offshore Oil International SA (supra).

6 In the present case both defendants have co-operated fully with the plaintiff's officers throughout and have provided information which has satisfied the plaintiff that the agreement which he has accepted will provide a proper disposition of this controversy. It involves an admission by the first defendant that she is guilty of each of the offences alleged and a readiness by her to pay whatever penalty the court considers appropriate. The agreement acknowledges that the second defendant has not committed any of the offences and is not liable for the payment of any duty or penalties, so that the proceedings against him should be dismissed. I see no reason why the court should not give effect to this agreement.

7 Consequently, I consider that the court should declare that:-

(a) Between 10 October 1997 and 3 March 2000 the first defendant smuggled goods on 28 occasions, as particularised in the Schedules to the Statement of Claim, in contravention of s 233(1)(a) of the Customs Act 1901; and

(b) between 10 October 1997 and 3 March 2000 the first defendant evaded payment of duty which was payable on 28 occasions, as particularised in the Schedules to the Statement of Claim, in contravention of s 234(1)(a) of the Customs Act 1901;

(c) between 10 October 1997 and 3 March 2000 the first defendant knowingly or recklessly made statements that were false or misleading in material particulars on 28 occasions, as particularised in the Schedules to the Statement of Claim, contrary to s 234(1)(d) of the Customs Act 1901.

8 Similarly, there will be orders convicting the first defendant for the following offences:-

(a) smuggling goods on 28 occasions between 10 October 1997 and 3 March 2000 in contravention of s 233(1)(a) of the Customs Act 1901;

(b) evading the payment of duty on 28 occasions between 10 October 1997 and 3 March 2000, contrary to s 234(1)(a) of the Customs Act 1901;

(c) knowingly or recklessly making statements that were false or misleading in material particulars on 28 occasions between 10 October 1997 and 3 March 2000 in contravention of s 234(1)(d) of the Customs Act 1901.

In addition it will be ordered that the first defendant do pay to the plaintiff the costs of these proceedings fixed at the amount of $15,000. Again, in accordance with the agreement between the parties, the plaintiff's claim against the second defendant will be dismissed with no order as to costs. It remains for the court to determine the penalties payable by the first defendant in the light of these convictions. This requires an analysis of the illegal conduct which was undertaken and of the principles which apply in determining penalties under this legislation.

9 The first defendant was born in Hong Kong in 1971 and, therefore, is now aged 31 years. She was aged 26 to 29 during the period October 1997 to March 2000 when these offences were committed. The first defendant migrated to Australia and married the second defendant in August 1996. At sometime shortly after their marriage a business was established in their joint names under the name "Auto Boutique". This was conducted from a small shop in Carillion Arcade in the central Perth business district from which were retailed a variety of automotive accessories, soft furnishings and fittings for use in motor vehicles. It is not disputed that the second defendant established this business to allow his wife, the first defendant, to have an occupation and an interest and that it was predominantly operated by her. The business began trading in November 1997. The plan was to import items for sale from Hong Kong and orders were placed through one principal supplier in Hong Kong for goods to be despatched to Western Australia. Between 10 October 1997 and 3 March 2000 there were 21 separate shipments of automotive accessories from Hong Kong to Perth for use in the business. On each arrival of the goods in Western Australia the first defendant, via a firm of customs brokers, lodged a form with the Australian Customs Service which contained details of each shipment, including its date, invoice price paid for the purchase of the goods (in Hong Kong dollars), the customs value of the goods on arrival in Australia (in Australian dollars), and the duty payable calculated in accordance with that information. These are known as "Nature 10 Entry for Home Consumption" ("the Nature 10's"). Further, between about 5 August 1998 and 3 March 2000, the first defendant imported a series of automotive accessories into Australia in separate consignments by post. There were seven of these postal importations and, in respect of each one of them, the first defendant completed an Informal Clearance Document ("ICD") which was delivered to a Customs Officer. Each of these ICD's contained information giving the invoice price for the goods purchased in Hong Kong (in Hong Kong dollars), the declared Customs value of the goods at the date of importation into Australia (in Australian dollars) and the duty payable in Australia in accordance with those figures.

10 In respect of each of the 28 consignments imported into Australia via the Customs agents, and in respect of each of the seven postal importations, duty on the goods was assessed by the relevant Customs Officer in reliance on the accuracy of the information contained in the "Nature 10" or the "ICD's" and the duty so assessed was duly paid in the ordinary way by the first defendant. In or about March 2000 Customs Officers conducted an investigation into importations by the first defendant which led to a re-examination of each of the 28 transactions dating back to October 1997. These investigations revealed, in relation to the "Nature 10" statements for goods imported through the Customs brokers, that each invoice price given was in fact below the true invoice price of the goods supplied in Hong Kong; and that the customs value given was in fact below the true customs value. As a consequence, the amount of duty which was assessed and paid in relation to each importation was less than the amount of duty payable on the true values of the goods.

11 In each case, therefore, three offences were committed in quick succession, namely, each particular set of goods was smuggled into Australia contrary to s 233(1)(a) of the Act; in the process the first defendant evaded payment of duty payable on each occasion, in contravention of s 234(1)(a) of the Customs Act; and, also on each occasion, the first defendant knowingly or recklessly made a statement that was false or misleading in a material particular, contrary to s 234(1)(d) of the Act. Similarly, in relation to the postal importations and the statements contained on each of the ICD's, the Customs investigation revealed that the ICD's were false in that the declared value of the goods in each importation was in fact below the true value of the goods; and that the customs value given was in fact below the true customs value of the goods. As a consequence, in respect of each of the postal entries, the amount of duty which was paid, or in some instances where no duty was paid, there was an evasion of duty payable in that the amount paid was less than was payable or, in instances where no duty was payable, duty should have been paid had the true value of the goods been disclosed. Again, in relation to each of these seven postal importations, three contraventions of the Customs Act occurred in quick succession namely; smuggling, evasion of duty payable, and the making of a false or misleading statement.

12 This was a deliberate plan of deception of the Customs authorities in Australia. Exhibits 1(a), (b), (c) and (d) comprise copies of correspondence (the originals in Chinese (but with agreed translations in English accompanying them) from the first defendant to the Hong Kong suppliers, requesting the suppliers to refrain from sending two invoices and, instead, to provide invoices with each shipment which significantly understated the purchase price of the goods. The reason for this, in the correspondence, was variously ascribed to the following purposes:-

• "So that it will be convenient for me to do my bookkeeping."

• "It will be easier for Customs clearance! Because the invoice is a very good one, looks real enough."

These documents show that, in relation to many of the importations, the false invoices were written at about 30 per cent of the true purchase price of the particular goods in each consignment. The first defendant's explanation, by her counsel, was that she had been misled by a family friend in Hong Kong into believing that the use of false invoices for importation purposes was a common accepted business practice and that she naively gave the wrong prices to the authorities in Australia. I do not see how this explanation can be accepted because it is quite evident from the documents that false information, substantially undervaluing the goods imported, was being provided to the Customs authorities in order to secure a commercial advantage through the reduction, and thus the evasion, of the Customs duty payable. Whatever may have been the belief by the first defendant about the prevalence or acceptability of such practices there can be no doubt that, as she now admits, her conduct was false and misleading and in breach of the law. Counsel for the plaintiff rightly submits that the duration of this illegal conduct was for a period of three years and that it may well have continued but for a fortuitous interception by a Customs officer in 2000.

13 The plaintiff submits, and it is now accepted by counsel for the first defendant that, in relation to the 28 importations, the financial position with respect to duty avoided and duty payable is as follows:

Duty avoided $10,914.62

Duty payable $15,204.82

Counsel for the plaintiff also submits that the letters from the first defendant to the Hong Kong supplier show the quality and seriousness of the offence in that they disclose an organised systematic plan of deception and that this is especially serious and warrants deterrent penalties where the system of assessment of customs duties relies, to a considerable extent, upon self assessment. This means, it was submitted and I accept the submission, that substantial deterrent penalties are necessary for the enforcement of the Customs legislation when offences of this nature, which are difficult to detect, are revealed, both in order to punish the individual offender and deter her from further such conduct and to provide a deterrent for others who might be tempted to take their chance against the ability of the authorities to detect such unlawful conduct.

14 The policy of imposing substantial deterrent penalties is achieved by the form of the legislation which, as I have already described, creates a series of separate offences for various steps taken in succession in any one of the acts of illegal importation and, in providing irreducible minimum penalties for some of these as will be explained later. It was in relation to this effect of the legislation, and when dealing with a submission that only one conviction should be entered in relation to each illegal importation, that the separate and cumulative nature of the several offences was explained by Kitto J in L Vogel & Son Pty Ltd v Anderson (1967) 120 CLR 157 at 161. His Honour's decision in this respect was later upheld on appeal by Taylor, Menzies and Owen JJ at (1968) 120 CLR 165. In that case Kitto J said:

"A submission was made on behalf of the defendants that they ought not to be convicted of more than one offence in respect of each evasion of duty. It was said that in each case the importing with intent to defraud the revenue, the presentation of a false invoice as genuine, the making of a false entry and the production of a document or documents containing an untrue statement or untrue statements were merely steps by which the ultimate offence of evading payment of duty was permitted. Each step was undoubtedly one of a connected series of steps, but each was a separate and distinct piece of conduct for all that, and each involved its own deliberate contravention of the Act. Moreover, the ultimate step, the successful getting of the goods through the Customs without payment of full duty, far from being merely the sum of the means employed to that end, was itself a separate piece of conduct in furtherance of the general intent, for it resulted from the defendants' deliberately putting aside the opportunity that still remained to them, even after what they had already done, to pay the full amount of the duty."

15 The factors to be taken into account when fixing the appropriate penalty in such a case were addressed recently by Scott J in Chief Executive Officer of Customs by his Authorised Delegate Malcolm Ross Plant v Owens (supra) at [17] - [20]. These include the seriousness of the offence, its prevalence, the obvious difficulty of detecting breaches, the consequent need to impose deterrent penalties, whether the offences were committed by persons generally of good character, the legislative policy embodied in the Customs Act, the conduct of the defendant in relation to the charge and in particular whether the defendant has assisted the authorities in relation to the investigation of the matters in question. In this case the plaintiff accepts that, despite the deliberate and contrived nature by which the offences were committed over a significant period, the first defendant was relatively young and inexperienced in business and that the overall scale of importation was small. It was put that, while the conduct was towards the higher end of the range of criminality the amount of duty avoided was relatively modest and that taking into account the otherwise accepted good character of the first defendant, this was not an example of the worst pattern of offending.

16 On detection of these offences the first defendant immediately disclosed to the Customs officers all the relevant financial details and the full value of the goods from which the outstanding duty could readily be calculated. An amount of $17,000 on account of unpaid duty was then promptly paid. By her counsel, the first defendant has fully accepted responsibility for what has occurred and has co-operated in reaching the agreement for the disposition of the litigation which has already been described. These are matters which may be taken into account in mitigation - Radebe v The Queen [2001] WASCA 254. Also, while it is necessary to recognise that, with respect to each importation, three separate and distinct offences have been committed each of which involves its own penalty those various sets of offences are "substantially contemporaneous and connected": L Vogel & Son Pty Ltd v Anderson (1967) 120 CLR 157 at 168.

17 Therefore, in considering the penalties which should be imposed, it is necessary to have regard to the provisions of the Customs Act which deal with the specific penalties available for such offences. Sections 233 and 233AB provide that in the case of an offence of smuggling goods contrary to s 233(1)(a) the penalty applicable is, where the court can determine the amount of the duty which would have been payable, a penalty not exceeding five times the amount of the duty. Prior to the amendments to the Customs Act 1901 effected by the Customs Legislation Amendment (Criminal Sanctions and Other Measures) Act 2000, Item 12 Schedule 2, which came into effect on 26 May 2000, there was a minimum penalty of not less than two times the amount of the duty payable also applicable to this offence. Section 4F(2) of the Crimes Act (1914) (Cth) applies in these circumstances. That section is in the following terms:

(1) Where a provision of a law of the Commonwealth increases the penalty or maximum penalty for an offence, the penalty or maximum penalty as increased applies only to offences committed after the commencement of that provision.

(2) Where a provision of a law of the Commonwealth reduces the penalty or maximum penalty for an offence, the penalty or maximum penalty as reduced extends to offences committed before the commencement of that provision, but the reduction does not affect any penalty imposed before that commencement."

18 Counsel for the plaintiff submitted that the mere removal of a minimum does not "reduce the penalty" within the meaning of subs 4F(2). I do not accept this submission because it seems to me that, in every practical sense, the removal of an irreducible minimum penalty, leaving a court free to impose a penalty within the statutory range but lower than the previous minimum, is in every sense a reduction of the penalty which a court is free to impose. I note that this is the view of the effect of s 4F upon penalties which can be imposed for a breach of s 233(1)(a) of the Customs Act taken by Bongiorno J in Chief Executive Officer of Customs v Astawia [2001] VSC 303 where, speaking of the amendment to the Customs Act which took effect on 26 May 2000 by which the penalty for smuggling was changed to a maximum of five times the amount of the duty with no minimum, his Honour concluded that the defendant was entitled to the benefit of this amendment. It was submitted by counsel for the plaintiff that, in Chief Executive Officer of Customs v Astawia (supra), this issue was not contested before Bongiorno J but that does not appear to me to be any reason why I should take a different view. I consider, with respect, that his Honour was correct in the effect which he attributed to the amendment removing the minimum penalty. Consequently, in the present case, I conclude that the penalty which the court may impose in relation to the offences of smuggling are fines of any amounts up to, but not exceeding, five times the value of the duty payable.

19 In relation to the offences of evading payment of duty contrary to s 234(1)(a) of the Customs Act, the penalty provided by s 234(2)(A) is a penalty not exceeding five times the amount of that duty and not less than two times that amount. Accordingly, the penalties which are to be imposed range from the minimum of twice the duty evaded to a maximum of five times the duty evaded. Counsel for the plaintiff submitted that the penalty was not less than two times nor more than five times the duty payable on the goods rather than the duty evaded, in this case between twice and five times the amount of $15,204.82 rather than similar multiples of the duty avoided of $10,914.62, but counsel for the first defendant submitted that the penalty related to the duty actually evaded. The answer to this controversy appears to me to be provided by s 234 itself when imposing a penalty for evading payment of any duty which is payable. Section 234(1)(a) imposes a penalty, in relation to a case where a court can determine the amount of the duty on goods, the payment of which would have been evaded by the commission of the offence. Section 234(2)(a)(i) refers to the penalty not exceeding five times and being not less than two times "the amount of that duty". Admittedly, there is some ambiguity in whether the penalty relates to a multiple of the duty payable or a multiple of the duty evaded, but it seems to me that the preferable interpretation is to treat the amount of duty evaded as being the basis for the computation of the penalty. Not only do I prefer this as the grammatical meaning of the section but this approach appears to me to observe the established convention that, in determining the meaning of a penal statute the ordinary rules of construction must be applied, but if the language of the statute remains ambiguous or doubtful, the ambiguity or doubt may be resolved in favour of the subject - The King v Adams [1935] HCA 62; (1935) 53 CLR 563 at 567 - 568; Smith v Corrective Services Commissioner (1981) 147 CLR 124 at 139; Piper v Corrective Services Commissioner of NSW (1986) 6 NSWLR 352 and Waugh v Kippen [1986] HCA 12; (1986) 160 CLR 156 at 164.

20 With regard to the offences of making false and misleading statements contrary to s 234(1)(d) of the Act (prescribed penalty s 234(2)(c) and s 234(3)), the court may impose a penalty not exceeding the sum of $5,000 plus twice the amount of the duty payable on those goods, but without any minimum penalty being imposed. Accordingly, it was submitted that in relation to the 28 offences of making false statements, the penalty may be a fine of an amount up to $170,409.64 being (28 x $5,000) + (2 x $15,204.82). This maximum figure of $170,409.64 was contended for by the plaintiff at the hearing, whereas counsel for the first defendant submitted that the maximum was $161,829.24 (28 x $5,000) + (2 x $10,914.62). It will be noticed that the difference between the parties is that, when it comes to adding to the figure of $5,000 for each offence a further amount equal to twice the duty, the plaintiff has made the calculation on the amount of the duty payable whereas the submissions for the defendant proceed on a calculation of twice the duty evaded. In this case the language of s 234(3) appears to me to be clear and that the penalty is $5,000 or up to $5,000 plus twice the amount of the duty payable.

21 Applying these conclusions to the facts of the present case, the range of penalties which the court may impose can be set out in the following matrix:

22 It is now necessary to consider the further submissions made by the parties in relation to the statutory provisions which apply for the imposition of penalties in these circumstances. Counsel for the defendant submits that the court is free to impose one penalty only in respect of these offences in view of the application of subs 4K(3), (4) of the Crimes Act 1914. Those subsections provide:-

"4K(3) Charges against the same person for any number of offences against the same provision of a law of the Commonwealth may be joined in the same information, complaint or summons if those charges are founded on the same facts, or form, or are part of, a series of offences of the same or a similar character.

(4) If a person is convicted of 2 or more offences referred to in subs (3), the court may impose one penalty in respect of both or all of those offences, but that penalty shall not exceed the sum of the maximum penalties that could be imposed if a separate penalty were imposed in respect of each offence."

23 Counsel for the first defendant submits that each of these offences which were admitted by his client, is founded on the same facts or forms or is part of a series of offences of the same or similar character. So much can readily be accepted, having regard to the circumstances under which the offences were committed as I have already recounted. However, the submission proceeds on the implied premise that the one penalty which may be imposed, if subs 4K(4) applies, may be less than the aggregate of the penalties which would be imposed if the offences were taken separately or in groups. As argued, the submission also seemed to imply that the one aggregate penalty which might be imposed, if subs 4K(4) applies, may avoid or attenuate the effect of the statutory minimum penalties which apply, in this case to the offences against s 234(1)(a) of the Act. However, that result does not appear to me to follow even if s 4K were, otherwise, to apply to this prosecution. It seems to me, with respect, that s 4K, when it applies, allows a court to take into account the principles of proportionality and totality which are generally applied when there are a number of similar or associated offences committed by an offender in close proximity arising out of the same, or a series of, related unlawful activities, but that this approach must always yield to any evident legislative policy which prescribes the penalties for the offences in question, especially legislation which imposes a minimum penalty. This was one of the reasons why Heenan J rejected a submission relying upon s 4K of the Crimes Act in a similar customs prosecution in the case of Goulding v Penello [1999] WASC 192 at [18]. With respect, I agree with that approach and apply it again here although, as I have endeavoured to explain, I am of the opinion that the application of s 4K, if it did apply, would have no effect upon the determination of the penalties to be imposed in this present case.

24 Counsel for the plaintiff submits that subs 4K(3) and (4) of the Crimes Act can have no application in the present case because these are not proceedings on indictment. He relies upon authorities which have decided that the application of s 4K is confined to prosecutions in courts of summary jurisdiction - R v Bibaoui [1997] 2 VR 600 CA and R v Jackson (1998) 72 SASR 490 (Ct Crim App). Neither of those two cases dealt with a Customs prosecution and certainly not with such a prosecution in the civil jurisdiction of a superior court. Nevertheless, they are strong authority against the application of s 4K in this present case and Heenan J was content to treat them as excluding its operation in a case such as the present by his decision in Goulding v Penello (supra). A similar approach appears to have been taken by Hasluck J in the Chief Executive Officer of Customs v Tonmill Pty Ltd (supra) at [36] - [42]. With respect, I agree with those approaches and consider that I should apply them here to exclude the application of s 4K to the circumstances of this case. If, however, the appeal in Chief Executive Officer of Customs v Labrador Liquor Wholesale presently pending before the High Court of Australia were to result in a reclassification of these prosecutions as being criminal in nature, there is a possibility that this view may need to be reconsidered but, even then, the decisions in R v Bibaoui (supra) and R v Jackson (supra), would appear to deny any application of s 4K to these proceedings in their present form. There is nothing to be gained by pursuing these uncertainties in the present case.

25 As these three groups of offences each constituted separate acts of proscribed conduct in respect of which penalties are imposed by legislation, I consider that penalties reflecting the gravity of the conduct concerned and the need for deterrence should be imposed in respect of them all but that, at the same time, the aggregate of the penalties should reflect the fact that the offences were substantially contemporaneous and connected. On this basis, I consider that the following penalties should be imposed:-

• For the 28 smuggling offences an amount of $30,409.64, or twice the amount of the duty payable on each charge.

• For the 28 offences of evading payment of duty, the sum of $21,829.24 being twice the amount of duty evaded on each charge.

• For the 28 offences of making false and misleading statements to Customs Officers, the amount of $14,000.00 being $500 for each offence.

26 The aggregate of these penalties is, therefore, an amount of $66,238.88. That is the total of the penalties imposed by the court and which amount is payable pursuant to this judgment to the plaintiff. I will hear counsel as to the precise terms of the orders that are to be made to give effect to this decision, but it appears that the formal orders should follow the memorandum of proposed consent orders filed by the plaintiff and dated 16 April 2002 with the last mentioned amount being the total of the penalties to be fixed under par 7 of the minute.