Chief Executive Officer of Customs v Jiang

20 Those responsible for drafting these provisions no doubt hoped that their enactment would put an end to the delays and other abuses which were perceived to have resulted from fragmentation of the criminal justice process brought about by the misuse of applications for judicial review. However, one difficulty with the new provisions is that they fail to address specifically whether decisions made in relation to prosecutions brought to recover penalties fall within their ambit, and are therefore excluded from judicial review.

21 In the present case the proceeding involves prosecutions under the Customs Act 1901 (Cth) ("the Customs Act"). There are, of course, other proceedings which involve prosecutions brought to recover pecuniary penalties. The issues raised in this appeal may therefore be of more general application, and may be relevant to other similar proceedings.

22 The issue to be determined in this appeal is whether Customsprosecutions are within the scope of Sch 2 of the Jurisdiction of Courts Act so that decisions taken in relation to those prosecutions are excluded from judicial review. Or are those decisions to be regarded as being outside the scope of Sch 2 because they are made in relation to proceedings which are essentially civil in nature?

The background to the present proceeding 23 By statement of claim filed in the District Court of New South Wales on 22 December 1998, the Chief Executive Officer of Customs ("the CEOC"), as plaintiff, claimed against JFA International Pty Ltd ("JFA") as first defendant, against Alan Jiang as second defendant and against Li Ying as third defendant the following relief, namely: "$180,000.00 in pecuniary penalties in respect of the cause of action pleaded overleaf and seeks the conviction of each of the Defendants for offences against the Customs Act, 1901, plus reparations, interest and costs." 24 The CEOC pleaded his cause of action as follows: "… 4. At all material times the Second Defendant was a person who gave instructions to the First Defendant, its employees, officers and agents to perform the acts pleaded and averred, and did manage the First Defendant. 6. At all material times the Third Defendant was a person who gave instructions to the First Defendant, its employees, officers and agents to perform the acts pleaded and averred, and did manage the First Defendant. … 8. By reason of the knowledge of the Second and Third Defendants pleaded and the management of the First Defendant by the Second and Third Defendants, the Second and Third Defendants had full knowledge of each of the matters pleaded and averred. 9. The conduct of the Second and Third Defendants was within the authority conferred on the Second and Third Defendants by the First Defendant. 10. During 1988 the First Defendant (a) smuggled goods; (b) evaded payment of customs duly payable on the import of the goods, and (c) knowingly omitted from statements made to a customs officer matters without which the statements were misleading in a material particular. in contravention of the Customs Act, 1901 ("the Act"), and the Plaintiff charges hereinbelow that the First Defendant committed offences in those terms against the Act, being respectively, offences under sections 233(1)(a), 234(1)(a) and 234(1)(d)(ii) of the Act. …" 25 In his pleading, the CEOC stated that he pleaded and averred his cause of action pursuant to s 255 of the Customs Act in the terms set out above. Section 255 of the Customs Act provides that in any "Customs prosecution" the averment of the prosecutor or plaintiff contained in the information, complaint, declaration or claim shall be prima facie evidence of the matter or matters averred. By s 244, proceedings by Customs for the recovery of penalties are, with some immaterial exceptions, referred to as "Customs prosecutions". 26 As noted above, the statement of claim relied upon ss 233 and 234 of the Customs Act. These sections are contained within Pt XIII which contains "penal provisions". Division 2 of Pt XIII deals with "penalties". Section 233 deals, inter alia, with "Smuggling and unlawful importation". It provides that a person shall not smuggle any goods (s 233(1)(a)). It further provides that a person who contravenes s 233(1)(a) is guilty of an offence punishable upon conviction as provided by s 233AB(1) (see s 233(1AA)). 27 Section 233AB deals, inter alia, with "Penalties for offences against sections 233 and 233A". Subsection (1) provides that where an offence is punishable as provided by this subsection the penalty applicable to the offence is: "(a) where the Court can determine the amount of the duty that would have been payable … … a penalty not exceeding 5 times the amount of that duty and not less than 2 times that amount; or (b) where the Court cannot determine the amount … a penalty not exceeding $50,000." 28 Section 234 deals with "Customs offences" by providing that a person shall not evade payment of any duty which is payable, or knowingly or recklessly omit from a statement to an officer any matter or thing without which the statement is misleading (see s 234(1)(a) and s 234(1)(d)(ii)). A person who contravenes s 234(1)(a) is guilty of an offence punishable upon conviction upon the same footing as provided by s 233(1AA) (see s 234(2)). Where a person who contravenes s 234(1)(d) is convicted of an offence a Court may impose a penalty not exceeding $5,000 and twice the amount of the duty payable (s 234(3)). 29 Reference was also made in the statement of claim to s 236. That section provides that whoever aids, abets, counsels or procures or is in any way directly or indirectly concerned in the commission of any offence against the Act shall be deemed to have committed such offence and shall be punishable accordingly. 30 The statement of claim gave particulars of the facts relied upon which were said to constitute the offences pleaded. It was alleged and averred that JFA had, on or about 19 October 1998, smuggled a large quantity of cigarettes into Australia, and that it had evaded payment of duty which was payable in relation to those cigarettes. Mr Jiang and Ms Ying were said to have been complicit in the commission of these offences. It was further alleged that the amount of duty payable on the goods was no less than $106,414.10. The statement of claim was said to have been "brought and laid in the name of the Office of the Chief Executive Officer of Customs". The orders sought included the conviction of JFA for offences contrary to ss 233(1)(a), 234(1)(a) and 234(1)(d)(ii) of the Customs Act, and like convictions of Mr Jiang and Ms Ying through the operation of s 236 of that Act. Orders were also sought for the recovery of penalties against all three defendants and for reparations to be paid by them pursuant to s 21B of the Crimes Act 1914 (Cth) ("the Crimes Act"). 31 After being charged with these offences, Mr Jiang and Ms Ying commenced a proceeding in this Court challenging the validity of various search warrants issued under s 198 of the Customs Act. That proceeding was brought under both the ADJR Act and the Judiciary Act. The warrants had been obtained in order to search various premises, and a number of documents had been seized as a result of those searches. Mr Jiang and Ms Ying claimed that Customs officers had misled the justice who had issued the warrants into doing so. They also claimed that there was insufficient material placed before the justice to justify the warrants being issued. They challenged the form of the warrants, contending that they were too wide and uncertain. They also contended that the manner in which the warrants had been executed was unlawful. They sought to have the warrants set aside, and the documents seized returned to them so that they could not be used in the course of the District Court proceeding. 32 The application for judicial review was brought well out of time. For that reason, on 13 June 2000, Mr Jiang and Ms Ying filed with the Court a notice of motion seeking to have time extended. Annexed to that notice of motion was a draft application to review which, they foreshadowed, would be filed if time were extended. The present appellants immediately raised an objection to the competency of the application for an extension of time, and the foreshadowed application for review. They contended that the Court had no jurisdiction to entertain either application upon the basis that the Jurisdiction of Courts Act precluded this Court from reviewing decisions relating to the criminal justice process in circumstances where a prosecution had been instituted. 33 The learned primary judge determined that he would deal with the objection to competency as a preliminary question. By notice of motion dated 31 July 2000 the appellants moved the Court for the determination of the following preliminary question: "…whether the Court has jurisdiction to hear and decide the applicants' notice of motion dated 13 June 2000." 34 His Honour ordered that the preliminary question be answered "yes". He also ordered that the appellants pay Mr Jiang's and Ms Ying's costs of determining the preliminary question. He granted leave to appeal against his decision.

The reasoning of the learned primary judge 35 His Honour concluded that the object or mischief at which the new provisions were aimed was to prevent the frustration of the "ordinary criminal justice process" by the bringing of collateral proceedings by way of judicial review of administrative action. He held that the proceeding brought in the District Court should not be viewed as part of that "ordinary criminal justice process", but rather as action taken in the form of a special Customs prosecution. His Honour said: "In the present statutory context, in my view, the reference in Act No. 57 of 2000 to the "criminal justice process" is intended to pick up criminal proceedings in the ordinary sense and this conclusion is, I think, reinforced by reference to the explanation of the aim of the legislation given in the Second Reading Speech." 36 His Honour reasoned that proceedings to recover and enforce a penalty under the Customs Act may be either civil or criminal, depending upon the nature of the procedure used to initiate them. He observed that when the proceeding to recover a penalty is a civil proceeding, it remains a civil proceeding notwithstanding that it is penal in nature. He added that while the procedures invoked in the present case could be regarded as "quasi-criminal" they were not "ordinary criminal proceedings". He concluded that they therefore fell outside the intended scope of the amendments effected by the Jurisdiction of Courts Act. It followed from his Honour's reasoning that this Court retained jurisdiction to entertain both the notice of motion seeking an extension of time and the foreshadowed application for judicial review.

The appellants' contentions 37 Mr Johnson, counsel for the appellants, submitted that his Honour had erred in construing the new provisions contained in the Jurisdiction of Courts Act as being inapplicable to the prosecution brought by the CEOC in the District Court. He submitted that the prosecution was "a prosecution for an offence against a law of the Commonwealth". He also submitted that the application for judicial review foreshadowed by the respondents fell relevantly within the ambit of s 9A(1) of the ADJR Act which, taken in conjunction with s 9A(4), was an application: "…by the person who is or was the defendant in the prosecution, in relation to a related criminal justice process decision". 38 Similarly, the foreshadowed application for judicial review, to the extent that it relied upon s 39B of the Judiciary Act,now fell within the ambit of s 39B(1C)(c) which, taken in conjunction with s 39B(3), was a: "…matter in which the person who is or was the defendant in the prosecution seeks a writ of mandamus or prohibition or an injunction against an officer or officers of the Commonwealth in relation to a related criminal justice process decision". 39 In broad terms, Mr Johnson submitted: · Whether the District Court proceeding should properly be characterised as being essentially civil or criminal in nature, it certainly involved "a prosecution for an offence against a law of the Commonwealth". · While the procedures which were to be followed in the course of that proceeding were closely aligned with those normally followed in civil cases, the District Court proceeding also bore a number of features typically associated with a criminal prosecution. That proceeding could relevantly be described as one involving "the criminal justice process". · This conclusion was fortified by the fact that a number of the provisions dealing with "Sentencing, imprisonment and release of federal offenders" contained in Pt 1B of the Crimes Act had been held by this and other Courts to be applicable when assessing penalties for the commission of Customs Act offences: as to s 19B of the Crimes Act see Hayes v Weller (1988) 33 A Crim R 305 at 309; and Stitt v CBI Constructions Pty Ltd (1990) 93 ALR 325 at 351-352; as to s 21B of the Crimes Act see Murphy v HF Trading Co Pty Ltd (1973) ALJR 198 at 200; JCT Wong & Anor v Kelly [1999] NSWCA 439; and Hookham v The Queen (1994) 181 CLR 450 (in the context of taxation offences under s 8Y(1) of the Taxation Administration Act 1953 (Cth)). · The respondents' attack upon the validity of the search warrants, and the manner of their execution, fell squarely within the definition of the expression "related criminal justice process decision" in each of s 9A(4) of the ADJR Act, and s 39B(3) of the Judiciary Act. What was under challenge was "a decision in connection with the issue of a warrant, including a search warrant or a seizure warrant …" (see par (4) of the definition of "relevant criminal justice process decision" in s 9A(4) of the ADJR Act). · The learned primary judge had erred in construing "criminal justice process" in Sch 2 of the Jurisdiction of Courts Act as having the limiting effect of including within the ambit of the new ouster clauses only "criminal proceedings in the ordinary sense". There was no justification for restricting the ambit of the new provisions in that way. The expression "related criminal justice process decision" was apt to include decisions taken in the course of an investigation or prosecution of a Customs Act offence. Customs prosecutions were, at the least, hybrid proceedings with both civil and criminal features associated with them. · Each of the arguments against fragmentation of the criminal justice process which formed the basis for the introduction of the new provisions was as compelling when applied to Customsprosecutions as when applied to whatever was intended by the expression the "ordinary criminal justice process".

The respondents' submissions 40 Mr King, counsel for the respondents, submitted that the learned primary judge had held correctly that Customs prosecutions did not fall within the ambit of the new provisions. 41 In substance he submitted: · The CEOC had elected to proceed by way of statement of claim in the District Court following the civil procedures of that court, when he could have opted to invoke either the criminal jurisdiction of the District Court, or the criminal jurisdiction of the Local Court. Having made that election, in all likelihood in order to obtain for the prosecution the advantages associated with utilising civil rather than criminal proceedings, he was bound to accept, as a consequence, the continued availability of judicial review to the respondents in this Court. · The weight of recent authority strongly favoured the view that Customs prosecutions brought using civil procedures in the higher courts were civil, and not criminal, in nature. · The expression "related criminal justice process decision" could not be read as including within its ambit a challenge to a decision made during the course of an investigation into the possible commission of offences under the Customs Act. The word "criminal" in that expression limited the meaning which might otherwise be accorded to the expression "a prosecution for an offence against a law of the Commonwealth". A prosecution for an offence under the Customs Act brought in the higher courts using the civil procedures of those courts could not be viewed as being part of or sufficiently related to "the criminal justice process". · All penalties recovered under any Customs prosecution are to be applied as the CEOC directs rather than going into consolidated revenue (s 264(1) of the Customs Act). Accordingly, Customs prosecutions could not be viewed as being analogous to criminal proceedings.

Reasoning on the appeal 42 Historically, in England, many of the administrative departments of state exercised their powers by means of penalties, separate from the ordinary processes of the criminal law leading to far harsher punishments. A good example of this was to be found in the Customs Law Consolidation Act 1876 (39 & 40 Vic Ch 36) which was replete with penalties for different revenue offences, all of which could be recovered before justices: Stephen, A History of the Criminal Law of England Vol 3 at p 267. 43 In Bainbridge-Hawker v The Minister of State for Trade and Customs (1958) 99 CLR 521 Williams J examined in detail the origins of Customs prosecutions in England. He pointed out that as far back as 1793 it was said that "an information for the duties is nothing more than the King's action of debt", brought in the name of the Attorney-General as informant. He also noted that such informations were originally brought in the Court of Exchequer, as part of the prerogative of the Crown. Later, when that court was abolished, revenue cases were dealt with by the Exchequer Division. Later still they came to be dealt with by what was known as "the King's Bench Division of the High Court of Justice, on its revenue side". 44 The position in England today bears no resemblance to that described above. In EL Cooper, Customs and Excise Law 1984, the learned author observes that the old procedures discussed by Williams J were brought to an end by the enactment of s 33 of the Finance Act 1953 (UK). More recently the Customs and Excise Management Act 1979 (UK) conferred upon the Commissioners of Customs and Excise wide ranging powers designed to protect the revenue. That Act included a series of what may loosely be termed "smuggling offences". Among these was the offence of "fraudulent evasion of duty". In England today many, if not most, Customs offences are indictable. They are, on any view, "ordinary criminal offences". A detailed examination of these offences is to be found in Archbold, Criminal Pleading: Evidence and Procedure, 1999 ed. 45 It is somewhat surprising that in Australia we have continued to follow, since 1901, the archaic procedures formerly associated with Customs prosecutions in England. This has given rise to many difficulties over the years. Despite many judicial pronouncements on the subject, it has still not been determined definitively whether a Customs prosecution is to be regarded as involving the commission of a criminal offence, or whether it is a civil proceeding aimed at recovering a pecuniary penalty. This debate lies at the heart of this appeal. 46 Widely divergent views have been expressed on this subject. In Moore v Jack Brabham Holdings Pty Ltd (1986) 7 NSWLR 470 Hunt J (as his Honour then was) said at 482: "I conclude therefore that the true nature of the proceedings brought in the Supreme Court as a customs prosecution is (or was in relation to offences committed prior to the repeal of s 242 in 1982) criminal and not civil, despite the civil nature of the procedure which is made applicable to them by s 247. Although it was also debated fully before me in this application, it is not necessary for me at this stage to go on to deal with the related (and equally difficult) question of the burden of proof carried by the plaintiff in a customs prosecution …" 47 On appeal, in Jack Brabham Holdings Pty Ltd v Minister for Industry, Technology and Commerce (1988) 85 ALR 640, Kirby P (as his Honour then was) agreed with Hunt J. Kirby P concluded that s 247 of the Customs Act, upon its proper construction, operated to ensure that a Customs prosecution proceeds "in accordance with the usual practice and procedure of the Court in civil cases". However, the section did not make Customs prosecutions civil in nature. His Honour said at 650: "The respondent sought to classify proceedings as either "criminal" or "civil" such that never the twain would meet. I do not accept that classification." 48 His Honour continued at 652: "I would readily concede that for some purposes the nature of a Customs prosecution for the recovery of a penalty may be assimilated to civil process (as s 247 contemplates). However, that does not stamp on such proceedings, for all purposes, the badge of a civil action. … A long series of cases, including in the High Court of Australia, dealing with s 247 and its equivalents in other statutes had made the point that the section has a hybrid characteristic: see R v Associated Northern Collieries (1910) 11 CLR 738 at 741. Thus the fact that, for the purposes of an appellate statute, proceedings for the recovery of a statutory penalty do not amount to a "criminal cause or matter" cannot determine the question now before this court …." 49 His Honour went on to say at 653: "The offences are expressed in terms of criminal wrongdoing. At the relevant time, the conviction, although not immediately resulting in a risk of imprisonment, could lead on to loss of liberty for a second conviction. Conviction necessarily involves public opprobrium and condemnation for such an offence is one against the public law.… Seeking to characterise these proceedings for the purpose of the application of the relevant rule for a stay of abuse of process, they are much more closely akin to criminal proceedings, properly so called than, say, protective proceedings involving professional discipline. All that s 247 is concerned with is the way in which such prosecutions are proceeded with. It relates to the matters of practice and procedure, once the prosecution is under way." 50 Kirby P referred in the course of his judgment to Jackson v Gromann [1948] VLR 408. There, Fullagar J, then a judge of the Supreme Court of Victoria, held that s 247 of the Income Tax Assessment Act 1936 (Cth), which provided for the enforcement of pecuniary penalties, involved civil and not criminal proceedings. However, his Honour was prepared to describe these proceedings as "quasi-criminal" because they led to a "conviction" for an "offence" and a penalty was exacted. Kirby P remarked that in the same way proceedings under the Customs Act were brought to recover penalties for "offences". Such penalties were imposed only when a person was found "guilty" of an "offence". The "offence" was "punishable" on "conviction". 51 It is to be noted that only Kirby P found it necessary in Jack Brabham Holdings to determine whether a Customs prosecution was to be regarded as a criminal or a civil proceeding or, as his Honour held, as a hybrid of the two. Neither Mahoney JA nor Clarke JA proffered any conclusion on this issue. 52 More recently, in Comptroller-General of Customs v D'Aquino Brothers Pty Ltd (1996) 85 A Crim R 517 the question whether Customs prosecutions should be viewed as criminal proceedings was considered by the New South Wales Court of Criminal Appeal. That court was firmly of the view that such prosecutions should be viewed as criminal in nature. Hunt CJ at CL (with whom Ireland and Dowd JJ agreed) observed at 530-531: "These offences are offences against the public law, punishable on conviction: Evans v Button (1988) 13 NSWLR 57 at 74; Moore v Jack Brabham Holdings Pty Ltd (1986) 7 NSWLR 470. I do not accept that any such offence punishable on conviction can properly be called a civil offence. I maintain the view which I have previously expressed that a customs prosecution is a proceeding in relation to a criminal offence and thus of a criminal nature: Moore v Jack Brabham Holdings Pty Ltd (supra) at 482. The only qualification which has been suggested is that a customs prosecution in the Supreme Court (to which this Court's civil practice and procedure applies pursuant to s 247) should more properly be described as a "hybrid" (Jack Brabham Holdings Pty Ltd v Button (1988) 85 ALR 640 at 651) - although even then it was said to be still "quasi-criminal" and "much more closely akin to criminal proceedings, properly so-called, than to purely civil litigation between parties". … (Kirby P said … that I had been correct in the view which I had expressed (as stated in the text), although I had been incorrect as to the test to be applied in an application for a stay of such proceedings for abuse of process. The other two judges found it unnecessary to express any opinion upon the issue: see also Second Life Decor Pty Ltd v Comptroller-General of Customs (1994) 53 FCR 78 at 84.) In England - again, where the offence involved was not one punishable on conviction - the proceedings to recover a penalty for such an offence have been described as "quasi-criminal". In its Discussion Paper relating to its Customs and Excise reference dealing with customs prosecutions, jurisdiction and administrative penalties, the Australian Law Reform Commission said that customs prosecutions brought in courts of summary jurisdiction are treated as criminal cases and in the same way as ordinary criminal prosecutions, which it said was the accepted view but which was nevertheless of doubtful validity. I agree. Common error - if common error there has in fact been - does not validate a practice which is not in accordance with the relevant statutory provisions. Not even the mystique surrounding these "peculiar" procedures for the recovery of penalties for revenue offences can save the procedure where it does not comply with those statutory provisions." (some footnotes omitted) 53 This reasoning in D'Aquino is supported by dicta in an earlier decision of the Full Court of this Court in Murphy v KRM Holdings Pty Ltd (1985) 8 FCR 349. In that case it was held that a decision by a Customs officer to seize certain motor vehicles believed to be forfeited goods was not a decision to which pars (e) and (f) of Sch 2 of the ADJR Act applied because that decision did not bear the necessary degree of connection to any investigation or prosecution under the Customs Act. Had there been that necessary degree of connection to a proceeding for a penalty under that Act, as there plainly is in the present case, the result in Murphy would no doubt have been different. 54 It should be noted that par (e) of Sch 2 of the ADJR Act excluded from the obligation to provide reasons "decisions relating to the administration of criminal justice". The Schedule in its present form relevantly provides: "Schedule 2 - Classes of decisions that are not decisions to which section 13 applies … (e) decisions relating to the administration of criminal justice, and, in particular: … (iv) decisions in connection with the issue of seizure warrants under Division 1 of Part XII of the Customs Act 1901; and… (emphasis added) A decision to issue a search warrant under s 198 of the Customs Act is a decision "in connection with the issue of seizure warrants under Division 1 of Part XII of the Customs Act 1901" within the meaning of Sch 2 par (e)(iv) of the ADJR Act. It follows that at least for the purposes of that Act, challenges to search warrants issued under s 198 are regarded as challenges to "decisions relating to the administration of criminal justice". 55 In Murphy v KRM Holdings Pty Ltd Pincus J, with whom Beaumont J agreed, said at 352-353: "It was argued, however, before us, that proceedings for breaches of s 234(1) are not criminal in nature. The authorities chiefly relevant to that submission, so far as Australia is concerned, appear to be the decisions of the High Court in Mallan v Lee (1949) 80 CLR 198 and Naismith v McGovern (1953) 90 CLR 336. They concerned proceedings under income tax legislation, but are of assistance because of the presence in such legislation of provisions similar in effect to certain sections in Pt XIV of the Customs Act. Section 244 of the Customs Act says that, inter alia, "proceedings by the Customs for the recovery of penalties other than a pecuniary penalty referred to in s 243B under this Act …" are referred to as customs prosecutions." 56 Pincus J then further referred to Mallan v Lee (1949) 80 CLR 198. He noted that among the members of the High Court only McTiernan J had expressed a conclusion as to whether a prosecution under the income tax legislation under consideration in that case involved conduct which should be characterised as criminal. McTiernan J had concluded that it should be so characterised. 57 Pincus J then continued at 353-354: "Contraventions of s 234(1) may lead to a person's being held guilty of an offence punishable upon conviction - subs (2) says so. It is not easy to see what language the legislature could have selected more plainly to indicate the intention that those who contravene have infringed the criminal law rather than being guilty merely of a breach of the civil law. It follows that decisions taken in connection with the investigation or prosecution of persons for offences under s 234(1) of the Customs Act are within sub-par (e)(i) of Sched 2 of the [ADJR Act]." (emphasis added) 58 It follows from these dicta in Murphy v KRM Holdings Pty Ltd that decisions taken in connection with the investigation or prosecution of persons for offences under s 234(1) of the Customs Act are regarded as "decisions relating to the administration of criminal justice". Clearly that expression in par (e) of Sch 2 of the ADJR Act is very similar to the expression "related criminal justice process decision" in Sch 2 of the Jurisdiction of Courts Act. Both the language of Sch 2 par (e) of the ADJR Act, and the observations of the majority in Murphy are therefore of considerable importance to the resolution of the issue in this appeal. 59 Another authority which supports the conclusion that Customs prosecutions are not to be characterised in an unqualified way as civil proceedings is Second Life Decor Pty Ltd v Comptroller-General of Customs (1994) 53 FCR 78. There Heerey J cited with approval the observations of Kirby P in Jack Brabham Holdings (supra). 60 The weight of more recent authority appears to be against this view. In JCT Wong & Anor v Kelly (1999) 154 FLR 200 the New South Wales Court of Appeal held that Customs prosecutions were not criminal proceedings for the purposes of the Evidence Act 1995 (NSW). Stein JA, with whom Mason P and Meagher JA agreed, said at 209-210: "The appellants contend that the proceedings were criminal proceedings for the purposes of the Evidence Act and his Honour was in error in not so concluding. The effect of this submission, if upheld, is that the records of interview with Mr Wong made on 27 April 1987 ought not to have been admitted because of the operation of s 86 of the Evidence Act. The dictionary to the Evidence Act defines "criminal proceeding" to mean "a prosecution for an offence". The respondent argues that the proceedings are not a prosecution for an offence but proceedings for the recovery of a civil penalty. This latter type of proceeding is expressly recognised in a number of provisions in the Evidence Act in contradistinction to the commission of an offence: see, eg, ss 125(1)(a), 130(4)(d) and 131(2)(j). Whether customs prosecutions are criminal or civil has been a vexed question for the courts. The preponderance of authority is that they are proceedings of a civil nature. Carruthers AJ so found in his ruling on 29 April 1998. In Evans v Button (1988) 13 NSWLR 57 the court held that the purpose of s 247 of the Customs Act was to assimilate customs prosecutions to proceedings of a civil nature. [His Honour then set out s 247.] Mahoney JA, with whom Priestley and McHugh JJA agreed said: "It was, in my opinion, the purpose of that provision relevantly to assimilate Customs prosecutions to proceedings of a civil nature… It was, in my opinion, the legislative purpose that Customs prosecutions, when brought in the Supreme Court, should be subject, inter alia, to the powers of amendment appropriate to such proceedings." I agree with Carruthers AJ that Jack Brabham Holdings v Minister (1998) 85 ALR 640 did not disturb the authority of Evans v Button, which has been applied on a number of occasions: see Kelly v JRA Ltd (1990) 92 ALR 651 and Comptroller-General of Customs v Kingswood Distillery Pty Ltd (Sully J, unreported, NSW Supreme Court, 11 February 1997). In addition, the judgment of Byrne J in Comptroller-General of Customs v Jayakody (unreported, Supreme Court of Victoria, 9 November 1993) and Pearce v Button (1985) 8 FCR 388 per Pincus J are also very helpful. … In my opinion, Carruthers AJ was right to treat the proceedings before him as civil and not criminal proceedings and apply the standard of proof in Briginshaw v Briginshaw (1938) 60 CLR 336." 61 The High Court subsequently refused special leave to appeal from this decision. 62 As noted in JCT Wong, several judges at first instance have determined over recent years that Customs prosecutions should be dealt with on the basis of the application of the civil, rather than the criminal, standard of proof. In Comptroller-General of Customs v Kingswood Distillery Pty Ltd (unreported, Supreme Court of New South Wales, 11 February 1997) Sully J followed an earlier decision by Byrne J of the Supreme Court of Victoria in Comptroller-General of Customs v Jayakody (unreported, Supreme Court of Victoria, 9 November 1993) to that effect. 63 A recent discussion of the debate surrounding this issue, which is particularly helpful, is to be found in the judgment of Atkinson J in Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd [2000] QSC 171. The case concerned a prosecution of a company and two individuals by the CEOC for breaches of various provisions of the Excise Act 1901 (Cth), and also for breaches of ss 33, 234(1)(a) and 234(1)(d) of the Customs Act. The prosecution had been commenced by statement of claim. The relief sought was virtually the same as that sought by the CEOC in the present proceeding. The parties, by consent, asked the Court to determine a series of preliminary questions. These included questions directed towards elucidating the standard of proof required of the plaintiff in order to obtain convictions, and whether or not Customs prosecutions were criminal proceedings for the purpose of the Evidence Act 1977 (Qld). 64 After setting out in detail the relevant provisions of the Customs Act, including, in particular, s 247, Atkinson J noted that there were no rules of practice established for Crown suits in revenue matters. For that reason the action had proceeded in accordance with the usual practice and procedure of the Supreme Court of Queensland in civil matters, and as directed by her Honour. She noted too the defendants' submission that the proceeding was essentially criminal in nature in that a Court was being asked to determine whether the defendants should be convicted of various offences. 65 Her Honour traced the genesis of s 247 of the Customs Act to the practice which had existed in England in 1901, the year the Customs Act was enacted. She noted that prior to the abolition of the Court of Exchequer in 1873 there had been division as to whether or not an information filed in that court by the Attorney-General against a defendant for a breach of the Customs law was a criminal proceeding. In Attorney-General v Radloff (1854) 10 Ex; 156 ER 366, Pollock CB and Parke B held that an information for a breach of the Customs law was a criminal proceeding. However, Platt B and Martin B held that it was not. 66 Her Honour referred to the leading English case of Attorney-General v Bradlaugh (1885) 14 QBD 667. There Brett M R observed at 688-689: "Now comes the question whether an information by the Attorney-General on the revenue side of the Court of Exchequer is or is not a criminal proceeding in any sense. In order to answer this question, we must consider Attorney General v. Radloff. It is not binding on this Court; it is a case in the Court of Exchequer, and we are bound to exercise our own judgments upon it. It is a case in which the judges were equally divided in opinion, and, therefore, it could not bind any Court, but certainly could not bind this Court. Two of the judges were of the opinion that unless there was something very peculiar in the Act of Parliament, such as that it in terms enacted that it was to be a criminal matter, the proceeding on the revenue side of the Court of the Exchequer for the recovery of a penalty in the name of the Attorney General was not a criminal proceeding. The other two were of opinion that it was. I will not go into the reasons; the reasons were given by the eminent judges on both sides, but, to my mind, if I had been a member of the Court at that time, I should have seen no answer to the reasoning of Martin, B, in that case, and I should have been of opinion in that case that an information for a penalty in the Revenue side of the Court of Exchequer could not at any time, unless there were special and clear words in an Act of Parliament saying it was so, be considered as a criminal proceeding." 67 In that case Cotton LJ thought that the question of whether or not the appeal before them was a criminal cause was a matter about which he had considerable doubt, but which it was not necessary to decide. Lindley LJ merely thought that the question of whether the proceedings were criminal or civil was not free from doubt. 68 After summarising the effect of these old English authorities, Atkinson J noted that s 242 of the Customs Act had been repealed in 1982. That section had allowed a court to imprison any person convicted of a Customs offence for which a pecuniary penalty was provided in the event that such a person had been previously convicted of a similar offence. She noted too that there was a sound argument that if a person upon whom a penalty was imposed by the Court failed to pay that penalty, the person might be liable to imprisonment. She referred in that regard to s 15A(1) of the Crimes Act. That section renders a law of a State or Territory relating to the enforcement or recovery of a fine imposed on an offender applicable to a person convicted in the State or Territory of an offence against a law of the Commonwealth. Her Honour did not however consider whether the word "fine" was to be equated with a penalty or pecuniary penalty. 69 Atkinson J drew attention to s 261 of the Customs Act which operates to ensure that no person shall be twice imprisoned upon the same conviction. The section further provides that the suffering of imprisonment for non-payment of a penalty does not release the penalty or affect the right of Customs to collect the amount in any manner provided by the Act, other than by imprisonment of the person convicted. Her Honour gleaned from these provisions, when viewed in the aggregate, a tangible link between Customs prosecutions and the criminal justice process. 70 Her Honour also observed that s 245(3) of the Customs Act had been repealed in 1989. That subsection had made special provision for the procedures to be followed in relation to Customs prosecutions commenced in the Local Courts or courts of summary jurisdiction. She commented at pars 73-74: "As a result the same procedure applied to prosecutions in all of the Courts and the distinction which led to them being considered criminal proceedings in the Magistrates Courts and civil proceedings in the Supreme and District Courts was abolished. "In its report on Customs and Excise, the Australian Law Reform Commission said that the present situation with regard to customs prosecutions was unsatisfactory and would contribute to continuing uncertainty. The Commission was of the view that it was desirable to put an end to the extensive legal argument which uncertainty on this issue had generated and said that that would be achieved if the true criminal nature of the proceedings were recognised. The Law Reform Commission recommended that the offences be prosecuted summarily. This was designed to avoid the effect of s 80 of the Constitution …. The Commission however said that it recognised that the current state of the law at the time of the report was that the standard of proof was on the balance of probabilities subject to the rule of prudence that the court must examine the evidence with great care and caution before it is satisfied that an offence has been established." 71 In the final analysis Atkinson J concluded that the weight of recent authority compelled her to the conclusion that the standard of proof which applied in Customs prosecutions was the civil standard. Moreover, such prosecutions were not criminal proceedings for the purposes of the Evidence Act 1977 (Qld). 72 Her Honour observed at par 101: "It is surely time that parliament put this matter beyond doubt by stating whether or not the matters are civil or criminal proceedings and the appropriate burden of proof, as previously recommended by the Australian Law Reform Commission."

Conclusion 73 As noted earlier the issue to be determined in this appeal is whether Customsprosecutions are within the scope of Sch 2 of the Jurisdiction of Courts Act. Are decisions taken in relation to Customs prosecutions, which have been commenced, now excluded from judicial review? Or are those decisions to be regarded as being outside the scope of Sch 2? 74 There can be no doubt that a Customs prosecution instituted by the CEOC in the District Court of New South Wales is "a prosecution for an offence against the law of the Commonwealth". One problem to be resolved is whether an application to review a decision by a justice to grant a search warrant under s 198 of the Customs Act, is properly to be described as an application to review a "related criminal justice process decision". Another is whether an application to review the manner in which that warrant was executed can be regarded as falling within that expression. 75 In accordance with the definition of "related criminal justice process decision" contained in s 9A(4) of the ADJR Act and s 39B(3) of the Judiciary Act, these questions are to be resolved by determining whether the decision to grant the warrant, and the conduct associated with its execution, can properly be said to have been "made in the criminal justice process" in relation to the offence in question. 76 The learned primary judge concluded that the decision to grant the warrant could not properly be so described. His Honour did not address the separate question whether a challenge to the manner in which the warrant was executed fell outside the terms of a "related criminal justice process decision". However, having regard to his primary conclusion there is no doubt that his Honour would have held that it did. 77 We have concluded that a decision taken in the course of an investigation leading to a Customs prosecution, such as a decision to issue a search warrant under s 198 of the Customs Act, is a "related criminal justice process decision". Such a decision is properly to be regarded as one "made in the criminal justice process". 78 The provisions which create offences under the Customs Act lead, upon findings of guilt, to convictions for offences and the imposition of penalties. This strongly suggests that the legislature intended that prosecutions for such offences should be regarded as being at least quasi-criminal in nature. The fact that the provisions of the Crimes Act dealing with sentencing, imprisonment and release of federal offenders have been held to be applicable to Customs prosecutions tells strongly in support of this conclusion. So too does the possibility of imprisonment for failure or neglect to pay any penalty imposed. 79 Customs prosecutions are instituted by the CEOC in the name of his office. They are not instituted by private individuals. The penalties which may be imposed upon conviction can significantly exceed the amount of the duty evaded by the commission of the offence. Customs prosecutions are clearly instituted not merely to recover debts due to the Commonwealth, but also to punish the offenders. 80 It is also of some significance that, unlike s 78 of the Trade Practices Act 1974 (Cth), there is no provision in the Customs Act which provides that Customs prosecutions are not criminal proceedings. In addition, unlike income tax prosecutions, Customs Act offences are not expressly exempt from the definition of criminal proceedings in the Evidence Acts of the Commonwealth and New South Wales. 81 The meaning to be attributed to an expression such as "a related criminal justice process decision" which is a legislative construct, does not reflect any established usage. The underlying purpose of Sch 2 of the Jurisdiction of Courts Act, as expressed so clearly in the Second Reading Speech, must constantly be borne in mind. A construction which promotes the purpose or object underlying an Act is to be preferred to a construction that would not promote that purpose or object: s 15AA of the Acts Interpretation Act 1901 (Cth). 82 Customs prosecutions have about them a number of features typically associated with criminal proceedings. It is difficult to see how it may be said that they do not involve "the criminal justice process". There is no doubt that the authorities are divided upon the question of how such prosecutions should be characterised. There are observations in the judgment of Pincus J (with whom Beaumont J agreed) in Murphy v KRM Holdings Pty Ltd which provide powerful support for the conclusion that decisions taken in relation to Customs prosecutions should be characterised as being decisions which relate to the "criminal justice process". Moreover, Sch 2 par (e) of the ADJR Act expressly provides that decisions taken in connection with the issue of warrants under s 198 of the Customs Act are to be regarded as "decisions relating to the administration of criminal justice". That too is a very important consideration. At the very least, Customs prosecutions ought to be regarded as "quasi-criminal" or "hybrid" in nature. Decisions taken in relation to them cannot be regarded as being divorced from the criminal justice process. 83 In these circumstances, a decision to issue a search warrant pursuant to s 198 of the Customs Act seems to us to be a "related criminal justice process decision", and one "made in the criminal justice process". 84 The learned primary judge concluded that Customs prosecutions could not properly be described as part of the "ordinary criminal justice process". That may be so. However, there is nothing in the expression "related criminal justice process decision" which suggests that the legislature intended any limitation based upon a requirement that the prosecution be part of the ordinary criminal justice process to be read into that expression. 85 It is perhaps more difficult to regard an application for judicial review which is based upon the manner in which a search warrant was executed as involving a "related criminal justice process decision". However, the ADJR Act, in ss 5 and 6,encompasses review of both decisions and conduct relating to the making of those decisions. It would be most unlikely that the legislature intended that this Court be denied the power to review the decision to issue a search warrant, but not the power to review the conduct of those who executed that warrant. 86 The fact that the procedures used to prosecute Customs offences in the higher courts are civil, and not criminal, obviously has implications so far as the standard of proof is concerned. It also has implications when determining whether Customs prosecutions are criminal proceedings for the purpose of the various statutes which deal with the admissibility of evidence. However, the fact that civil procedures are used in such cases does not mean that decisions taken in relation to them are not to be regarded as "related criminal justice process decisions". 87 Customs prosecutions appear to us to share many of the characteristics of criminal proceedings. Notwithstanding some differences of procedure and form, and some differences of substance, these prosecutions sufficiently resemble criminal proceedings to make it appropriate to describe decisions take in relation to them as being decisions which fall within the scope of Sch 2 of the Jurisdiction of Courts Act. It follows that such decisions are outside the range of decisions now amenable to judicial review in this Court. 88 We are unable to accept Mr King's submission that it would have been open to the CEOC to have instituted proceedings on indictment against the respondents. The offences in question are not punishable by imprisonment for a period exceeding twelve months. They are not therefore "indictable offences" within the meaning of that expression in s 4G of the Crimes Act. 89 Nor are the offences charged within the list of those punishable by the Supreme Court of New South Wales in its summary jurisdiction pursuant to s 475A of the Crimes Act 1900 (NSW). There is no equivalent summary jurisdiction in the District Court. 90 It is difficult to see what initiating process the CEOC could have used to bring these prosecutions in the District Court, apart from the procedures in accordance with the usual practice and procedures of that court in civil cases, or in accordance with the directions of the court or a judge, as contemplated by s 247 of the Customs Act. 91 Mr King submitted that if the CEOC or the Commonwealth Director of Public Prosecutions ("the DPP") were to attend at the District Court Registry with "something in the nature of a criminal process", the Registry "would simply make up a file", and send it to a District Court judge for directions. He submitted that this would enable a trial on indictment to take place. 92 On one view, that submission may have found favour with the learned primary judge who observed that: "proceedings to recover and enforce a penalty of the kind in question here may be either civil or criminal proceedings, depending upon the nature of the procedure used to initiate them." 93 An alternative interpretation of his Honour's remarks is that his Honour was merely reflecting upon the fact that the proceedings could have been instituted on information in the Local Court. 94 In any event, we doubt that the words "or in accordance with the directions of the Court or a Judge" in s 247 of the Customs Act admit of the filing of an indictment (or presentment) by the DPP. Plainly the CEOC cannot himself file an indictment - only the DPP, or a duly authorised State counterpart, may do that. Similarly, only the DPP may file an ex-officio indictment: Director of Public Prosecutions Act 1983 (Cth) s 6(2D). 95 We do not accept Mr King's submission that because penalties recovered under Customs prosecutions are applied to such purposes as the CEOC may direct, rather than going into consolidated revenue, such prosecutions are to be regarded as being wholly civil in nature. The Australian Customs Service is an arm of government. The CEOC is not to be equated with a private individual seeking to recover compensation for some wrong done to him. 96 The fact that the CEOC may have been able to proceed on information had he determined to deal summarily with these offences in the Local Court does not mean that he was bound to bring the proceeding in that way. Where a Customs prosecution for a pecuniary penalty is instituted in a court of summary jurisdiction the amount of the pecuniary penalty that may be sought is limited to $5,000. A penalty of that order might be regarded as derisory in the circumstances of this case. It would be contrary to both principle and policy, and manifestly contrary to the objects of the Jurisdiction of Courts Act, to put the CEOC into the invidious position of having to elect between instituting a Customs prosecution in a court of summary jurisdiction in order to avoid the possibility of judicial review in this Court, and instituting such a prosecution in a higher court in the knowledge that it might be thwarted, or at least delayed, by such review. 97 We do not think that the legislature intended the new provisions contained in Sch 2 of the Jurisdiction of Courts Act to operate in such a capricious or irrational manner. However, if, on a literal reading, it could be said that they did operate in that way, a competing interpretation which produces a fairer and more convenient operation would be preferred: Cooper Brookes (Wollongong) Pty Ltd v Commissioner of Taxation (Cth) (1981) 147 CLR 297 per Mason and Wilson JJ at 321. See also MacAlister v The Queen (1990) 169 CLR 324at 330; Saraswati v The Queen (1991) 172 CLR 1 at 22; Hospital Benefit Fund (WA) Inc v Minister for Health (1992) 39 FCR 225 at 229; and Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389. 98 In Wang v Minister for Immigration and Multicultural Affairs (1997) 71 FCR 386 at 396 Merkel J referred to a comment by Lord Diplock in "The Courts As Legislators" The Lawyer and Justice, where his Lordship observed: "if…the Courts can identify the target of Parliamentary legislation their proper function is to see that it is hit; not merely to record that it has been missed." 99 It follows from all that we have said that we consider that the appeal should be allowed. The preliminary question formulated for separate determination by the learned primary judge should, in our view, have been answered "no". We would therefore set aside his Honour's orders. 100 The respondents must pay the appellants' costs of the appeal. The effect of this judgment is to bar the respondents' claims for review in this Court. The objection to competency filed by the appellants below must succeed. It follows that the respondents must also pay the costs of that proceeding. I certify that the preceding one hundred (100) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.

Solicitor for the Appellants: Australian Government Solicitor