CINI v COMMISSIONER OF THE AUSTRALIAN POLICE [2015] VCC 1565

c) the sum of AUD $64,830 cash seized by members of the AFP from the Ayr Street property;

d) the sum of USD $39,000 cash seized by members of the AFP from the Ayr Street property;

e) a silver 2008 Subaru Liberty Sedan registration number WFZ 186 registered to the applicant at the Ayr Street property;

f) a silver 2005 Jeep Laredo Wagon, registration number XQP 648 registered to Motek Engineering Pty Ltd (Motek);

g) a yellow Sinotruk Hova 4x2 Terminal Tractor truck RHD (the second truck), purchased and imported by Motek, which arrived in Melbourne on 2 October 2013 and was seized from 4/1 Clelland Road, Brooklyn, Victoria;

h) a Sinotruk Hova 4x2 Terminal Tractor truck RHD (the first truck), purchased and imported by Motek, which arrived in Melbourne on 16 January 2013 and was seized from 4/1 Clelland Road, Brooklyn, Victoria.

2 At hearing, having heard argument various segments of the applicant's affidavit and the supporting affidavits sworn by his brother, Henry Cini were ruled inadmissible.

3 The material tendered consisted of affidavits with exhibits and various documents as follows:

• Subject to deletion of those parts ruled inadmissible, affidavit of Patrick Joseph Cini, sworn 18 December 2014;[1]

• Subject to deletion of those parts ruled inadmissible, two affidavits of the applicant's brother Henry Cini, sworn 27 March 2015 and 9 October 2015 respectively;[2]

• Affidavit of Foreign Exchange Consultant at Travel Money Oz, Graham Melrose Kilpatrick, sworn 13 October 2015 (the Kilpatrick affidavit);[3]

• Two statements from a Cheque account in the name of the applicant with the Bendigo Bank, Laverton Branch, for the period 21 August 2012 to 20 October 2012;[4] and

• Copy AFP Property Item Report printed on 6 March 2015 and Property Seizure Record completed 9 October 2015.[5]

• Affidavit of Senior Constable James Paul Midgley, sworn 19 June 2015 with exhibits (the Midgley Affidavit);[6]

• Statement of Detective Senior Constable Michael Donaldson (currently a Sergeant attached to the Faulkner Divisional Response Unit), taken on 31 October 2013 together with a copy of Auscript AFP record of search warrant and field interview transcript (the Donaldson statement);[7]

• Copy of an AFP record of interview between the applicant and Sergeant Donaldson, dated 21 November 2013 (the ROI);[8]

• Statement of Detective Senior Constable Mitchell Carrigan taken on 21 November 2013 (the Carrigan statement);[9]

• Affidavit of Police Officer Phillip Green sworn 14 October 2013 (the Green affidavit);[10]

• Affidavit of Customs and Border Protection Officer Lisa Kubale sworn 16 June 2015 (the Kubale affidavit);[11]

• First affidavit sworn 19 June 2015 by Federal Agent Malcom Scott who was stationed with the Criminal Assets Confiscation Task Force (the Scott affidavit);[12]

• Affidavit of Federal Agent Amanda Glover, sworn 24 June 2015 (the Glover affidavit);[13]

• An Agreed Summary of Facts for the pleas of Patrick and Rhys Cini.[14]

5 Three AFP officers were required for cross-examination. Senior Constable, Midgley, the case officer for the criminal proceedings involving the applicant, Sergeant Donaldson, who conducted the ROI, and Detective Senior Constable Carrigan, currently stationed in New South Wales. Detective Senior Constable Carrigan gave evidence via video link.

6 The applicant's credit was an issue. There were many inconsistencies between his oral evidence and other evidence discussed in more detail below. This was a case where I treated the applicant's evidence as unreliable unless supported by documentary or other admissible independent evidence.

7 The factual matters summarised below were not in dispute.

8 Having received information that the applicant was involved in importing drugs, Joint Organised Crime Taskforce (the JOCTF) commenced investigating his activities as part of Operation Ebrima from early September 2013.

9 On 9 October 2013, the applicant and his son, Rhys Cini, were arrested and charged with offences connected with the importation of 205 one-kilogram packages containing the border controlled drug, methamphetamine weighing in total 203.2 kilograms. The total pure weight was 161.5 kilograms. The packages were concealed in the tubeless tyres of the second truck transported by ship from China. The ship initially docked at the Port of Brisbane on 27 September 2013. Police substituted an inert substance for the drug before the ship resumed its journey to Melbourne, arriving on 2 October 2013.

10 The second truck had been imported by Motek, a company of which the applicant was the sole director, secretary and shareholder.

11 On 3 October 2013 the applicant collected the second truck from the docks and, with his son following in the applicant's car, the applicant drove the second truck to Motek's factory in Brooklyn (the factory).

12 The next day both men removed the wheels of the second truck and began removing the packages from the tyres. The applicant was observed to use a large handsaw to cut into one of the tyres. Later that afternoon they secured the factory and both men attended a retail outlet where an angle grinder, hacksaw blades, heavy duty tyre lever and a sledgehammer were purchased. Afterwards the men returned to the factory where they cut into the tyres and removed the packages.

13 During the early evening both men secured the factory and attended another two retail outlets where they purchased six large plastic storage containers with lids and an industrial vacuum cleaner. The latter was used to clean up spilled product after the men returned to the factory. Later the same evening both men placed the six large plastic containers and a number of plastic bags into the rear of the applicant's car and, after securing the factory, they drove to the applicant's residence, the Ayr Street property. After a short stay, the applicant's son left and drove to his home.

14 In the days between Saturday 5 October and Wednesday 9 October 2013, among other things, the applicant instructed his son on 5 October 2013 not to attend work the following Monday and on 8 October 2013 the plaintiff ordered 12 truck tyres from a tyre supplier in Altona. On the same date, the applicant's son and a third person attended at National Storage in Hoppers Crossing where they were observed delivering packages to a storage unit. Later on the same day the applicant's son and the third person attended at Storage King in Hoppers Crossing where they were observed delivering packages to a unit.

15 On 9 October 2013 the applicant and his son attended the factory and were seen to remove the six large plastic containers from the rear of the applicant's car and place them in a shipping container in the factory before departing the factory.

16 On the same date the third person extended by three months the leases for storage at both storage premises.

17 Following arrest of all three men on 9 October 2013, police located packages of the substituted product at the following locations:

• 6 packages in an esky in the applicant's garage at the Ayr Street property;

• 126 packages stored in containers at the factory;

• 15 packages in the National Storage unit. The unit contained a locked trailer inside of which were 3 sports bags each containing 5 packages; and

• 15 packages at the Storage King unit. This unit contained a secured trailer inside of which were 3 sports bags each containing 5 packages.

18 On 12 March 2014, the applicant pleaded guilty to the Importation Offence. His son pleaded guilty to a charge of attempted possession of a commercial quantity of unlawfully imported methamphetamine contrary to sections 11.1 and 307.5(1) of the Code on 4 October 2013. Both men were convicted and sentenced to terms of imprisonment on 29 August 2014 by His Honour, Justice Croucher in the Supreme Court.

The statutory scheme - Part 2-3 of the Act and forfeiture

19 The Restraining Order relates to the Importation Offence. At hearing, having initially sought to exclude restrained property other than the second truck, the Exclusion Application was limited to the Ayr Street property, the USD $39,000 in cash seized by police and the first truck. It was conceded the cash sums of $64,380 and $3,000 and the Jeep, the Subaru and the second truck ought be forfeited.

20 Various aspects of the applicant's amended written submission filed in compliance with orders made on 21 September 2015 were misconceived. At hearing, it was conceded that Part 2-3 of the Act contains the statutory scheme for forfeiture to the Commonwealth of restrained property by operation of law where a person has been convicted of a serious offence.

21 Section 92 of the Act provides for forfeiture of restrained property without a forfeiture order if a person has been convicted of a serious offence:

(1) Property is forfeited to the Commonwealth at the end of the period applying under subsection (3) if:

(a) a person is convicted of a *serious offence, and

(i) at the end of that period, the property is covered by a *restraining order

under section 17 or 18 against the person that relates to the offence; or

(ii) the property was covered by such a restraining order against the

person, but the order was revoked under section 44 or the property

(c) the property is not subject to an order under section 94 excluding the property from forfeiture under this Part.

(a) the *restraining order was made before or after the person's conviction of the *serious offence; or

(b) immediately before the forfeiture, the property is the *person's property or another person's property.

(3) The period at the end of which the property is forfeited is:

(a) the 6 month period starting on the *conviction day; or

(b) if an *extension order is in force at the end of that period - the extended period relating to that extension order.

(5) A *restraining order in relation to a *related offence with which the person has been charged, or is proposed to be charged, is taken , for the purposes of this section, to be a restraining order in relation to the offence of which the person is convicted.

(a) under section 44, a *restraining order that covered particular property is

revoked, or particular property is excluded from a restraining order; and

(b) the security referred to in paragraph 44(1)(e), or the undertaking referred

to in paragraph 44(2)(e), in connection with the revocation or exclusion is

the property is taken, for the purposes of this section, to be covered by the restraining order.

22 Accordingly, under section 92 at the end of the six-month period, in this case, starting on 29 August 2014 or at the end of a period of extension, unless an exclusion order is made the restrained property is forfeited.

23 Section 93 confers a discretion on the court that made the restraining order to extend the period at the end of which property is forfeited.

(1) the court that made a *restraining order referred to in paragraph 92(1)(b) must make an order excluding particular property from forfeiture under this Part if:

a) a person (the applicant) has applied for an order under this section; and

b) the court is satisfied that the applicant has an *interest in the property covered by the restraining order; and

d) a person has been convicted of a *serious offence to which the restraining order relates; and

e) the court is satisfied that the applicant's interest in the property is neither *proceeds of *unlawful activity nor an instrument of unlawful activity; and

f) the court is satisfied that the applicant's interest in the property was lawfully acquired.

25 Section 317 provides that an applicant in any proceeding under the Act carries the onus of proving the matters necessary to establish the grounds for making an order and subject to sections 52 and 118 (neither of which are relevant to the present application) any question of fact is to be decided on the balance of probabilities.

26 Section 329 of the Act defines what constitutes 'proceeds' or an 'instrument' of an offence:

a) it is wholly derived or realised, whether directly or indirectly, from the commission of the offence; or

b) it is partly derived or realised, whether directly or indirectly, from the commission of the offence;

whether the property is situated within or outside *Australia.

a) the property is used in, or in connection with, the commission of an offence; or

b) the property is intended to be used in, or in connection with, the commission of an offence;

whether the property is situated within or outside *Australia.

3. Property can be proceeds of an offence or an instrument of an offence even if no person has been convicted of the offence.

4. Proceeds or an instrument of an *unlawful activity means proceeds or an instrument of the offence constituted by the act or omission that constitutes the unlawful activity.

27 Section 338 of the Act defines unlawful activity to mean an act or omission that constitutes:

a) an offence against a law of the Commonwealth; or

b) an offence against a law of a State or Territory; or

28 It was common ground that for the purposes of the Act the Importation Offence constituted a 'serious offence'.

29 A further charge against the applicant under the Code, namely attempted possession of a commercial quantity of unlawfully imported methamphetamine in Melbourne on 3 October 2013 (an Attempted Possession Offence) was not pursued. The facts germane to commission of an Attempted Possession Offence were, nonetheless, relied on by the Commissioner in opposing this application. I will explain how this comes about shortly.

30 The Exclusion Application was made on 13 February 2015 together with an application under section 93 of the Act for an extension order.

31 On 17 February 2015 His Honour, Judge Murphy made orders, among other things, extending the period at the end of which the property covered by the restraining order was forfeited pursuant to section 92 to the date of the hearing of the Exclusion Application, being a date no later than 29 November 2015.

32 At hearing, the applicant's application to clarify and vary the extension order was supported by the respondent, the Commissioner of the Australian Federal Police (the Commissioner). I varied the extension order by extending the period at the end of which the property covered by the restraining order was forfeited to midnight on 28 November 2015.

33 Opposition to the Exclusion Application was based on paragraphs 94(1)(e) and (f) only.

34 Section 140 of the Evidence Act 2008 (Vic) provides as follows:

1. In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.

2. Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account -

a) the nature of the cause of action or defence; and

b) the nature of the subject-matter of the proceeding; and

35 The civil standard requires a court to be affirmatively satisfied of the occurrence or existence of the facts in issue. The matters section 140(2) required be taken into account reflect common law principles derived from Briginshaw v Briginshaw.[15] Essentially, the matters to which section 140(2) refer are relevant to a court being satisfied by the party carrying the burden of proof to the civil standard.

36 In accordance with section 317 of the Act the applicant bore the onus of proof, with questions of fact to be decided on the balance of probabilities. He carried the legal and initial evidentiary burden of proving on balance that the restrained property he sought to exclude was neither proceeds nor an instrument of unlawful activity and was lawfully acquired.

37 In effect, the applicant was required to prove a negative on the balance of probabilities. He was required to satisfy the Court on the balance of probabilities that the property he sought to exclude was not wholly or partly derived or realised, whether directly or indirectly, from or used in, or in connection with an offence constituted by an act or omission that constitutes an offence against a law of the Commonwealth, of a State or Territory, or of a foreign country.

38 I was referred to a number of authorities. Two of these discuss, among other things, the onus of proof and the initial evidential burden, either under the Criminal Proceeds Confiscation Act 2002 (Q) by the High Court in Henderson v Queensland,[16] or under an earlier version of the Act, the Proceeds of Crime Act 1987 (Cth) (the earlier Act) by the Full Court of the Supreme Court of Queensland in DPP v Brauer.[17] A third authority on which the applicant specifically relied, involved a decision also made under the Act by a single judge of the Supreme Court of Western Australia in Commissioner of the Australian Federal Police v Courtenay Investments Ltd[18].

39 These authorities establish, among other things, that an applicant's onus could be discharged by adducing evidence of some fact or facts the existence of which, in the absence of further evidence, was sufficient to justify the drawing of inferences that it was more likely than not that restrained property was neither proceeds nor an instrument of unlawful activity and was lawfully acquired.

40 The Commissioner appropriately accepted that, should the applicant satisfy the preliminary evidentiary burden, the evidentiary burden shifted to the Commissioner to adduce evidence in opposition to prevent such inferences of fact actually being drawn in the circumstances of this case.

41 Of the authorities mentioned, only Courtenay referenced the application of the principles in Briginshaw.

42 Two applications were made in Courtenay. The first involved the AFP's application for forfeiture under section 49, a provision in Part 2-2 of the Act relating to property suspected of being proceeds of indictable offences. The second involved an application for exclusion by the defendant companies.

43 In Courtenay the AFP submitted a director had knowingly contravened section 232(2) of the Corporations Law (Cth). The director's conviction in a criminal trial had been quashed. Retrial was not pursued. Rather, pursuant to section 19 a restraining order was obtained over shares and the money proceeds from the sale of shares. This section permits restraint of property suspected of being proceeds of indictable offences. For the purpose of section 19 it was alleged the shares constituted an instrument of a serious offence. Unlike the present application, the AFP carried the burden of proving the property was an instrument of unlawful activity.

44 On the evidence available to him His Honour Justice Edelman found contravention of section 232(2) of the Corporations Law had been proven by the AFP to the civil standard. His finding that the director had instructed another individual to destroy documents which connected him to each of the defendant companies and other findings adverse to the director, were, His Honour said, made under the Act with due regard to the principles in Briginshaw. As His Honour explained:[19]

In broad terms, people are generally taken to be of good character and unlikely to commit crimes or wrongdoing. The more serious the allegation against a person, the more care ought to be taken before reaching a conclusion on the balance of probabilities which is adverse to that person.

45 This statement of itself was not indicative of any different approach to the civil standard of proof but reflected the long-held view that courts should take care in finding that an individual has engaged in criminal conduct. I note that in this regard, in Courtenay the director was not a party to the application, his earlier conviction had been overturned and he had no prior record.

46 The forfeiture application failed because Justice Edelman found that, whilst the relevant shares were an instrument of the offence, the offence was not a serious offence under the Act.

47 The parties agreed Courtenay was an unusual case.

48 Neither the AFP nor the defendant companies called any witness. Rather, pursuant to section 64(2) of the Act, the AFP relied on transcripts from the criminal trial. As His Honour Justice Edelman explained, he was constrained by the limitations applying in the case of a proceeding conducted wholly or substantially on the record. He spoke of the disadvantages in assessing the credibility of the only witness in the criminal trial whose evidence of dishonesty of the director had been central to proving the criminal offence against him. This circumstance, His Honour said, called for extreme caution in assessing the transcript of the evidence of the witness for the purposes of the application before him, where the latter involved finding, as he did, that the director had knowingly contravened the Corporations Law.

49 Section 329 of the Act, does not reverse the onus of proof or alter the effect and intent of section 94(1) of the Act, nor does it create a circumstance whereby the Commissioner is required to rebut the evidence called by the applicant.

50 As mentioned, in the present application the applicant carried the burden of proving a negative. Courtenay is not authority for the proposition that, where under the Act, as in this case, the applicant is required to prove a negative, the approach to determining whether the standard of proof has been met by the applicant who carries the burden of proof is other than as required by section 140 of the Evidence Act.

51 Accordingly, I rejected the applicant's submission to the extent that it was intended to mean the Commissioner bore the burden to rebut the evidence presented by the applicant; that such rebuttal must be interpreted in the light of the principles contained in Briginshaw or, that a finding on the civil standard of acts or omissions constituting offences additional to the Importation Offence required application of these principles beyond the requirements of section 140 of the Evidence Act.

52 As my discussion of other case law below shows, for the purposes of sections 94(1) and 338 an offence could be the Importation Offence or an Attempted Possession Offence (including the Attempted Possession Offence of which the co-offender was convicted) or, as submitted by the Commissioner, an Attempted Trafficking Offence if the applicant failed to satisfy the Court that his acts or omissions did not constitute one or other of these offences.

53 Based on a plain reading of the provisions of the Act, the Commissioner submitted, in my view correctly, that unlawful activity in this application under section 94, was not restricted to the serious offence which, on conviction, triggered forfeiture under section 92. The provisions direct attention to conduct constituting an indictable offence and allow for the possibility that the restrained property was the proceeds of or an instrument of an offence. What matters for the purposes of the Act is that the restrained property was not wholly or partly derived from or used in or in connection with unlawful activity, irrespective of whether or not the applicant or any other person has been charged with or convicted of the offence.

54 At hearing, neither party was able to direct my attention to a single authoritative analysis of the construction of section 94(1). The Commissioner, nonetheless, relied on analysis of provisions containing analogous expressions in the earlier Act in Brauer. Two decisions of the New South Wales Court of Appeal were later submitted by the Commissioner following the hearing, Jeffrey v DPP (Cth) and Studman v CDPP.[20]

55 As is evident from the case summaries below, these cases contained relevant discussion of 'proceeds' of an offence and 'an instrument' of an offence as well as the various expressions used to define these terms either under the earlier Act or the Act.

56 Dealing first with Brauer, section 48(4) of the earlier Act provided as follows:

a) a person (in this subsection called the 'defendant') has been convicted of, or has been or is about to be charged with, a serious offence;

b) a court, in reliance on the conviction, charged or proposed charging, makes a restraining order against property;

d) the defendant applies to the court for a declaration under the subsection in relation to the interest; and

i. the property was not used in, or in connection with, any unlawful activity and was not derived, directly or indirectly, by any person from any unlawful activity; and

ii. the defendant's interest in the property was lawfully acquired;

the court may, by order, declare that the restraining order, to the extent to which it relates to the property, shall be disregarded for the purposes of section 30.

57 Section 4(1) of the earlier Act defined "unlawful activity" to mean an act or omission that constitutes an offence against the law in force in the Commonwealth, a State, a Territory or a foreign country.

58 Whilst the word 'any' qualified the phrase: 'unlawful activity', as the Commissioner submitted, paragraph 48(4)(e)(i) was expressed in very similar terms to section 94(1)(e) of the Act.

59 The respondent in Brauer was convicted under section 233B of the Customs Act 1901 (Cth) of importing a commercial quantity of a prohibited import, cannabis resin. This was classified as a serious narcotics offence under the earlier Act. The drug had been brought to Australia in a yacht. The respondent successfully persuaded a lower court to declare another yacht lawfully acquired by him be disregarded for the purposes of automatic forfeiture. However, on appeal the Full Court found that the respondent's yacht had been used by a principal in the crime during the critical period when the crime was planned and affected and for the purpose of maintaining a presence in the general vicinity where the illegal importation was to occur.[21] The Full Court found the respondent had not discharged the onus of proof that his vessel was not used in or in connection with any unlawful activity.

60 In Brauer, whilst expressing concern about the reach of the earlier Act, the Court nonetheless, confirmed the legislative intent was to require the respondent to satisfy the Court that his vessel had not been used in or in connection with any unlawful activity.

61 Jeffrey also involved the appellant seeking declarations pursuant to section 48(4) of the earlier Act negating restraining orders made in respect to real property, motor vehicles and cash.

62 The appellant had been convicted of being knowingly concerned in the importation of cannabis. Without canvassing all the issues in detail, in Jeffrey the Court of Appeal had cause to consider 'proceeds' and the meaning of the expression 'unlawful activity' under section 48(4)(e)(i) of the earlier Act. At first instance the unlawful activity identified by the judge in relation to the real property was the failure of the appellant to lodge tax returns contrary to the Taxation Administration Act 1953 (Cth) (the TAA). In relation to the cash it was for offences contrary to the Cash Transaction Reports Act 1988 (Cth) (the CTRA).

63 The judge had not been satisfied that the real property and cash had not been derived directly or indirectly from unlawful activity quite apart from the serious offence for which the appellant had been convicted.

64 The Court of Appeal rejected the appellant's argument that because the offences under the TAA and the CTRA were not indictable offences they were not unlawful activities within the meaning of the earlier Act. In doing so, among other things, the Court of Appeal relied on the clear unambiguous words of the earlier Act with respect to the expression 'an offence' and the absence of evidence of any legislative intent to limit unlawful activity to indictable offences or to read into the definition of unlawful activity a qualification to offences not prosecuted where, as occurred in Jeffrey, the Australian Tax Office had not prosecuted the offence under the TAA.

65 In Studman the appellant, who used the pseudonym "Michael Simpson", had pleaded guilty to offences involving stealing property from and defrauding the Commonwealth under the Crimes Act 1914 (Cth) to the tune of $365,000. These were serious offences for the purposes of the Act.

66 The disposition of certain funds held in a bank account and shares held in the name of Michael Simpson had been restrained by order made pursuant to section 18 of the Act.

67 Following conviction, the appellant's application to exclude the property under section 31 after the restraining order had been made and his further application to exclude the property from forfeiture under section 94 of the Act were rejected at first instance. Having determined that an exclusion order under section 31 should not be made, the judge concluded there was no point in considering the further application for an extension order under section 93.

68 The appellant's failure to also appeal the decision not to consider the granting of an extension order was fatal to his appeal because in the meantime the property had been forfeited, rendering the appeal futile.

69 The Court of Appeal's reasons for stating the appeal would have been dismissed in any event are, nonetheless, instructive in the present case.

70 The 'unlawful activity' identified by the DPP in Studman involved breaches of the Financial Transaction Reports Act 1988 (Cth) (the FTRA) and the TAA. The offences under these Acts arose from the appellant's use of the false name in which to open the bank account and hold the funds and to operate the stockbrokers' account through which the shares were purchased.

71 The appellant had engaged in 'unlawful activity' because contractual rights and obligations or choses in action which existed between the bank and the appellant were found to have derived wholly or partly from opening the account in breach of the provisions of the FTRA and the account was used in or in connection with the offence of operating the account in a false name. So far as the shares were concerned the judge found that by using the false name for the purpose of the account with the stockbrokers, the shares purchased through that account were derived from the illegal use of a false name. The judge was not satisfied that the property the subject of the restraining order was not 'proceeds of unlawful activity' and declined the application pursuant to section 31 of the Act. Whilst also satisfied that the appellant had breached the TAA, His Honour did not proceed to determine whether the funds or shares the subject of the restraining order were in whole or in part the product of this illegality.

72 As to whether the property was proceeds of unlawful activity under section 94(1)(e) of the act, the Court of Appeal explained as follows:

• by opening and operating the relevant accounts in a false name the appellant breached the provisions of the FTRA;

• the right to the monies in the accounts was derived directly from the commission of this offence;

• because the shares were obtained from funds deposited with the stockbrokers in an account which was opened in breach of the provisions of the FTRA, under section 330 of the Act the shares were proceeds of an unlawful activity. The latter provision extends the meaning of an offence to include property wholly or partly acquired using proceeds of the offence;

73 As to whether the property was an instrument of unlawful activity under section 94(1)(e) of the Act, the Court of Appeal explained as follows:

• although the words 'is used in' suggest a direct relationship between instrument and the offence, the words 'in connection with' are of wide import. However, the Court also acknowledged earlier disagreement in the authorities about whether the legislature intended there be a 'substantial connection' before the property could be forfeited;

• in this case the chose in action was the vehicle by which the appellant operated the relevant accounts under a false name. The property was both used in and in connection with the offences, making the bank accounts and the account with the stockbrokers instruments of unlawful activity.

74 As to whether the property was lawfully acquired under section 94(1)(f) of the Act, the Court of Appeal stated as follows:

• the chose in action was acquired in breach of the FTRA and continued operation of the accounts was not lawful. The shares acquired with funds from the stockbrokers' account, which was acquired in breach of the FTRA were also not lawfully acquired.

75 In the present application the Importation Offence was complete once the drugs were imported. The Commissioner, nonetheless, relied on the Importation Offence alleging, for example, that the Ayr Street property was an instrument of that offence. The expression: 'in connection with' permitted, so the Commissioner submitted, consideration of matters beyond just the elements of the offence. As my discussion of the decision of the Court of Appeal in Chalmers v The Queen[22] in due course shows this interpretation of the expression was probably correct.

76 As mentioned, the Commissioner, referred to acts or omissions indicative of unlawful activity other than the Importation Offence for the purposes of the Act. These included the acts or omissions constituted by an Attempted Possession Offence and by an attempted trafficking offence (an Attempted Trafficking Offence), offences the Commissioner submitted had a stronger connection to the Ayr Street property.

77 In Courtenay the requirement that property be used 'in' or 'in connection with' with the commission of an offence required, His Honour said:[23]

... clarity in defining the alleged facts involved in the commission of the offence. This permits the relevant conduct to be assessed to determine whether it involves the use of the property 'in' or 'in connection with' the commission of that offence.

78 It was common ground that in this application the acts or omissions constituting unlawful activity must be clearly defined, whether that be in respect to an Attempted Possession offence or an Attempted Trafficking offence.

79 Based on admissible evidence, discussed in more detail in due course, the applicant failed to satisfy me that the property sought to be excluded was neither proceeds nor an instrument of unlawful activity constituted by the Importation Offence and/or an Attempted Possession Offence and/or an Attempted Trafficking Offence.

80 The Commissioner submitted, in my view correctly, that the definition of 'instrument' calls for an objective assessment. Irrespective of whether this also involved a desire to protect his son, the applicant's motivation was irrelevant to establishing the restrained property was neither proceeds nor an instrument of unlawful activity.

81 In addition to the cases to which I have already referred, various further authorities were cited to assist in the interpretation of the expression 'used in, or in connection with the commission of an offence' under the Act. Two authorities to which both parties referred were relatively recent decisions of the Victorian Court of Appeal under the Confiscation Act 1997 (Vic).

82 In Chalmers, the Court considered the correct interpretation of this expression in the context of the definition of 'tainted property' contained in the Victorian Act. Having analysed numerous authorities Australia wide, the Court of Appeal stated:[24]

77. ...We would respectfully adopt the following propositions which emerge from those authorities:

1. The word 'used' should be given its ordinary meaning of 'employed, or made use of, for a particular end or purpose'.

2. The statutory phrase is of a wide scope. The inclusion of the words 'in connection with' was plainly intended to extend the scope of the definition of 'tainted property' beyond circumstances where the property could be said to have been 'used in the commission of' the offence.

3. Whether there is a connection between the use of the property in the commission of the crime is a question of fact and degree. It is not necessary for it to be established that there was a 'substantial' connection, or that the crime could not have been committed without using the property.

4. The nature, extent and significance of the use of the property in connection with commission of the crime will be matters which go to the Court's discretion whether or not to order forfeiture of the property.

78. Very often, the decisive issue will be whether the relevant property can be said to have been 'used', since 'use' is "by definition" employment for a purpose. Once it is concluded that the offender 'used' the property at or around the time of the commission of the offence, it will usually follow that there was the requisite connection between the use of the property and the commission of the offence. Put differently, if the offender (or some other person) 'employed or made use of' the property for a purpose associated with the offending, then it would follow that the property was 'used in connection with the commission' of the offence.

80. Express statutory provisions apart, the mere fact that an act is done in or on a particular property will ordinarily not suffice to bring the property within the definition. That is because, as a matter of ordinary language, this could not be characterised as a 'use' of the property. In their joint judgement in White, French CJ and Crennan and Bell JJ said:

On the face of it, the mere doing of an act in or on a property in connection with the commission of the confiscation offence, does not necessarily fit comfortably with the concept of use applied to property. The relevant ordinary meaning of the verb 'use' is to [m]ake use of [thing], esp. for a particular end or purpose; utilise, turn to account.

81. It is only when the property, or some feature or attribute of it, has been turned to advantage by the offender, or enlisted to the offender's purpose, that it will be possible to say that the property has been 'used'....

82. Conduct after an offence is completed may also constitute a use of property in connection with the commission of the offence....

83 In Chalmers the Court of Appeal upheld the trial judge's decision not to order forfeiture in circumstances where nothing about the location of the murder in the apartment in which the appellant and victim lived, had facilitated or furthered the commission of the murder offence.[25]

84 In the DPP v Moran,[26] the Court of Appeal repeated at length the principles derived from the authorities as discussed in Chalmers and stated:[27]

As the authorities show, there may well be cases where premises will be held to be tainted property because items of property used in the commission of an offence were concealed or stored at the premises. These are, as the Court of Appeal observed in Chalmers, questions of fact and degree. Additionally, the authorities show that it would not be correct to conclude that simply because absent the property, the offence would not have occurred.

85 In Moran the Court of Appeal upheld the trial judge's conclusion that the balance of the proceeds of sale of premises at which the vehicle used to drive the offenders to and from the place of murder was garaged and where various items used in the murder, including the murder weapon and clothing worn by the offenders were stashed in a safe, were not tainted property. In Moran there was insufficient evidence that the garage door had been closed for the purpose of concealing the view of the vehicle from the street. Moreover, the act of storing the other items in a safe at the premises was not considered to be use of the premises in the way contemplated by the Victorian Act.

The applicant's affidavit material supporting the Exclusion Application

86 It is convenient at this juncture to set out the various matters to which the applicant and his brother, Henry Cini deposed in support of the application to exclude the property restrained as well as the matters established by the Kilpatrick affidavit.

87 At hearing the applicant attested to the accuracy of his affidavit. Without repeating the content of the his affidavit in full, the applicant deposed to and, in some instances, produced documents relevant to establishing the following matters.[28]

88 The applicant married in 1977. In 1987 the applicant and his former wife purchased the Ayr Street property. Since then the applicant has lived at the Ayr Street property either with his former wife and two children or alone. As part of a divorce settlement the applicant paid $100,000 borrowed from the ANZ bank on 2 March 2006, to his former wife in exchange for her interest in the Ayr Street property.

89 By 6 August 2010 the applicant had discharged the outstanding loan to the ANZ bank by making fortnightly payments from his wages. This unchallenged evidence satisfied the requirements of section 94(1)(f) by establishing that the applicant's interest in the Ayr Street property had been lawfully acquired.

As to the applicant's financial circumstances to November 2010

90 The applicant was previously employed as a contractor in facility management at the Victoria docks. He was working full-time for Patricks as a Facilities Maintenance Manager when made redundant on 31 January 2010. He received a lump sum payment of $27,034.53.

91 On 10 November 2010 the applicant deposited in his Cheque account an inheritance from his mother's estate, namely the sum of $180,525.19. This deposit was documented and after making allowance for sums already in the account and a cheque cashed, the balance in the Cheque account on 10 November 2010 was $188,366.80. Notably, no further documentary or other evidence was adduced that linked payments from this Cheque account to the Motek account or the Motek Engineering Superannuation Fund (the MESF) account in relation to the ordering and purchase of the first truck in late 2012.

92 On 19 January 2012 the applicant invested $60,000, allegedly "earned" by him, in a six-month, 5.65% per annum term deposit with the Bendigo Bank at Laverton in the name of the MESF (the term deposit). The term deposit matured on 19 July 2012. The further allegation that the sum deposited had been earned lawfully was ruled inadmissible. There was no documentary or other evidence to explain/confirm the source of this alleged investment sum in January 2012. The two private Cheque account statements comprising Exhibit A2, only covered transactions between 21 August 2012 and 19 October 2012.

93 Under cross-examination, the applicant claimed the money invested in the MESF account had been "earned" from his company account. Evidence adduced by the Commissioner shows that Motek declared substantial losses in the financial year preceding this investment.

94 On 27 July 2012 the applicant deposited $61,685.74 in a Bank of Queensland 'Premier Investment Account' for the MESF. The statement and transaction documents exhibited to the affidavit further reveal that in January 2013 various amounts were deposited or withdrawn from the same account. Interest of $1554.82 was paid on 27 January 2013 and, on 29 January 2013, $2000 was withdrawn.

95 On 9 July 2013, the balance of the account, $61,240.56 was redeemed. There was no documentary evidence to pinpoint where this sum was deposited, although I infer from the evidence of Federal Agent Scott, to which I refer in due course and the timing of the transactions that $60,000 of this sum was deposited in the Motek account the next day on 10 July 2013.

96 As the evidence shows in due course, the withdrawal from and redemption of the monies in the MESF account post-dated the ordering and delivery of the first truck and the payments made from the Motek account on 24 August 2012 and 24 October 2012 in the sum of $17,588 and $44,836.30 to Sinotruk Import and Export Co Ltd (the Chinese company) respectively. The withdrawal and redemption also post-dated the first payment made for the second truck on 7 May 2013 to the Chinese company from the Motek account in the sum of $18,345.85. The further payment for the second truck was made from the Motek account on 11 July 2013 in the sum of $48,173.54.

97 However, having originally sworn the cash seized by the AFP in the sum of $64,830 was not the proceeds of crime, at hearing it was conceded on behalf of the applicant that this sum ought be forfeited.

98 Without specifying which truck, the applicant alleged he had received this amount of cash as payment for the truck.

99 The evidence of conversion of AUD to USD in the Kilpatrick affidavit was that these exchanges occurred in September and October 2012, well before receipt of payment of the deposit and the balance of the purchase price in cash for the second truck.

100 As my discussion of the documentary evidence adduced by the applicant shows in due course, this evidence was insufficient to link the sum of USD found in the safe to any documented exchange transaction. Indeed, the only evidence of currency conversion documented from the search of the Ayr Street property in the Property Item Report and the Property Seizure Record comprising Exhibit A5 involved the currency exchange receipts in the name of Rhys Cini and recorded as: "ALL BELOW 10K".[29]

101 On 25 February 2013 the applicant received a $3539 tax refund from a self-managed super fund. The total withdrawn from the super fund account on 4 February 2013 was $4427.92. The ATO record documenting this refund indicated a cheque refund for $4427.92 dated 4 February 2013 but no related evidence of withdrawal of this sum from the MESF account. At hearing the applicant conceded this cash ought be forfeited.

102 Having previously alleged these vehicles were lawfully acquired, at hearing it was conceded they ought be forfeited.

103 This was purchased in an effort to import and resell: "as a way of supplementing" the applicant's income following redundancy. It was alleged money taken from the applicant's superannuation account on 1 February 2013 was used for this purchase. Clearly, given the timing of the transaction and the matters already noted above, this money was not used in the purchase of the first truck. As mentioned, the actual source of the funds withdrawn from the Motek account to purchase the first truck by two payments in August and then October 2012 was not apparent from any of the documentary evidence tendered. The applicant, nonetheless, rejected the Commissioner's allegation that the first truck was purchased as a practice run.

104 The applicant conceded the second truck ought be forfeited as the proceeds of unlawful activity.

105 Henry Cini, who apparently holds his brother's Power of Attorney, swore two affidavits on 27 March 2015 and 9 October 2015 respectively.

106 Various parts of the brother's affidavits were ruled inadmissible. His admissible evidence amounted to the following:[30]

• Henry Cini had obtained instructions from the applicant to swear the first affidavit as since his arrest on 9 October 2013 the applicant had difficulty accessing his personal records;

• the Cheque account statements numbered 44 and 45, to which I have already referred, provided documentary evidence of three withdrawals from the Cheque account on 17 September 2012 in the sum of $8500; on 19 September 2012 in the sum of $9800; and, on 25 September 2012, in the sum of $9840.[31] As my discussion of the conversion records produced with the Kilpatrick affidavit shows in due course, there was no apparent connection between the withdrawals from the Cheque account in September 2012 and the currency conversions recorded and, even if there had been, there was no documentary evidence to link the money exchanged in late 2012 to the USD currency found in the safe in October 2013.

• on 6 March 2015 Mr Cini collected the applicant's effects from Senior Constable Midgley;

• he alleged that in the course of discussions with Senior Constable Midgley he was told the applicant's former wife and girlfriend had collected his personal property and that the applicant's wallet had been returned to the applicant. According to his brother the applicant denied return of his wallet;

• he had collected 6 to 7 clear plastic bags containing the applicant's belongings as well as 4 to 5 cardboard boxes which he took home;

• one plastic bag, which was empty, had written on the front words which indicated it contained an Oroton leather wallet found on the front seat of the Jeep;

• he telephoned Senior Constable Midgley on 10 March 2015 and was advised he would look into what happened to the wallet and get back to him;

• on 16 March 2015 he telephoned Senior Constable Midgley. He was advised there was no new information about the whereabouts of the applicant's wallet. During the same conversation, he allegedly asked Senior Constable Midgley about the whereabouts of receipts attached to the USD cash confiscated by the AFP. Senior Constable Midgley apparently indicated he would look into "both" matters that day;

• on 17 March 2015 he attempted to contact Senior Constable Midgley twice. Despite being advised his call would be returned, Mr Cini had not since heard from Senior Constable Midgley regarding the whereabouts of the wallet or the receipts;

• "prior to" his arrest the applicant's former wife had provided Mr Cini with a bundle of Bendigo Bank statements. Notably, the only statements exhibited to the second affidavit were the two Cheque account statements comprising Exhibit A2;

• the applicant told Mr Cini that the sums withdrawn from the Bendigo Bank namely the transactions on 17 September 2012 in the sum of $8500, on 19 September 2012 in the sum of $9800 and on 25 September 2012 in the sum of $9840 were converted into USD by the business, Travel Money Oz at Highpoint Shopping Centre, Maribyrnong. As my discussion of the applicant's evidence reveals shortly his evidence of the amounts withdrawn and converted did not accord with his brother's evidence;

• on 1 October 2013 he attended Travel Money Oz and following discussions and email exchanges with representatives of this business, on 8 October 2015 Travel Money Oz supplied him with copies of receipts for foreign cash sales. The transaction records attached to the second affidavit indicated foreign cash sales to the applicant on 21 September 2012, 26 September 2012 and 4 October 2012 converting AUD $9561 to USD $9800, AUD $7403.75 to USD $7500 and AUD $6611.15 to USD $6750.

107 Senior Constable Midgley was not cross-examined about the return of the wallet as part of property seized under search warrant. His evidence about return of property seized was to the following effect:

• without inspecting these items, on 6 March 2015 at AFP headquarters, he had returned to Henry Cini all the documents seized from the Ayr Street property and itemised in the Property Seizure Record, Exhibit A5;

• the amount of seized documents returned had been substantial;

• the Property Seizure Record, Exhibit A5, listed the outstanding items returned to Henry Cini. Senior Constable Midgley could not say whether the list represented a complete list of the items seized from the Ayr Street property and, unless this had been entered by the person preparing the items report, Senior Constable Midgley could not say how many of each item listed was seized. However, as explained by him during re-examination a number of the documents seized and returned to Henry Cini had not been relevant to the police case against the applicant and, as a result, had not been not copied by police. I understood from this evidence only the copies made by police of documents seized were retained by them.

108 Much was said by the applicant's counsel during the course of the hearing about difficulties his client encountered in accessing personal records for the purpose of the Exclusion Application following his arrest. Counsel complained he had not had an opportunity to peruse Exhibit A5, until he called for this document and it was produced at hearing.

109 I was not, however, persuaded by the submissions made on his behalf that the applicant had suffered specific disadvantage in preparing this application by reason of his arrest and incarceration.

110 As my discussion of the sequence of events shows in due course, no evidence was given to explain why following sentencing collection by the applicant's brother of the personal records seized on 9 October 2013, was delayed until 6 March 2015. Furthermore, had the content of Exhibit A5 been an issue, I infer a copy of the Property Seizure Record had been available to the applicant and his advisers prior to the making of the Exclusion Application on 13 February 2015. This document is one of a number of exhibits to the Green affidavit sworn on 14 October 2013 in support of the application to restrain the property under the Act. Moreover, the affidavit evidence filed by the Commissioner in reply, which exhibits and explains further copy documentary evidence, was sworn in June this year.

111 The Kilpatrick affidavit was unchallenged.[32] The only foreign currency transactions evidenced by the conversion records kept by Travel Money Oz Highpoint showed the three conversions mentioned in Henry Cini's second affidavit. I infer from this evidence there were no further foreign currency conversions by Travel Money Oz for the applicant before his arrest on 9 October 2013.

The material filed in opposition to the exclusion application

112 I have already mentioned the material tendered by the Commissioner. This included the Midgley affidavit to which various statements were exhibited as well as a number of other affidavits. Statements exhibited to the Midgley affidavit in addition to those tendered separately included:

• statement of Federal Agent Derek Schwarz taken on 10 October 2013, relating to the seizure of the substituted drugs from the factory on 9 October 2013;[33]

• statement of Corey Warren White, National manager, Car Carrier Services, "K" Line (Australia) Pty Ltd taken on 4 November 2013. This statement confirmed shipping of the second truck had been arranged by MCC World International Pty Ltd with that company's office on 2 May 2013;[34]

• statement of Detective Sergeant Ashley Carlin-Smith taken on 6 November 2013. He was present at the arrest of the applicant and, later, in the company of another officer attended the factory where they executed a further search warrant;[35]

• statement of Federal Agent Wayne Ivan Ardley taken on 17 November 2015 relating to his attendance to assist in the execution of the search of the Ayr Street property. His statement identifies items seized from the Ayr Street property as itemised in the Property Seizure Record;[36]

• Statement of Detective Sergeant Anthony James Sinn taken on 25 October 2013 relating to seizure of cash from the safe at the Ayr Street property(the Sinn statement);[37]

• Statement of Christine Zhao, Business Manager, National Manager at MCC World International Pty Ltd taken on 6 November 2013 relating to shipping and importation of freight for the applicant (the Zhao statement);[38]

• Statement of Detective Senior Constable Nathan James Woolard taken on 13 December 2013 providing evidence of the counting of cash seized from the safe (the Woolard statement); [39]

• Statement of Senior Constable James Paul Midgley taken on 4 December 2013 relating to boarding the ship on 27 September 2013 and arresting the applicant on 9 October 2013.[40]

113 In the Green affidavit Philip Green, a member of the Criminal Assets Confiscation Taskforce, set out information and documentary evidence to support suspicion of commission of serious offences under the Act, the Importation Offence on 27 September 2013 and an Attempted Possession Offence on 3 October 2013. In addition to reciting the history of surveillance, arrest and charging of the applicant, the results of the execution of search warrants and matters relating to ownership of the property to be restrained, he deposed to matters relevant to the assertion that the first truck was an instrument of the Importation Offence as follows:[41]

• information from Customs confirmed the first truck, exactly the same model truck as the second truck, had been imported by Motek and arrived on 16 January 2013. The first truck was ordered from the same company with the Bill of Lading listing the same notifying party, delivery address and importer name;

• AUSTRAC information disclosed international transfers of funds from the Motek bank account to the Chinese company corresponding with the importation of both trucks. On 24 August 2012 and 24 October 2012, sums of $17,588 and $44,836.30 respectively were transferred to the Chinese company from the Bendigo Bank account of Motek to which the applicant was the sole signatory;

• the payment pattern matched that used for importation of the second truck on 27 September 2013. On 7 May 2013 and 11 July 2013 payments of $18,345.85 and $48,173.54 respectively were made from the Bendigo Bank account of Motek to the Chinese company;

• it was alleged that the purchase of two identical trucks in the same year was inconsistent with the financial position of Motek. For taxation purposes Motek had declared an overall loss in the financial years ending 2008 to 2012, with declared losses of $105,628 in the year ending 30 June 2011 and $88,615 in the year ending 30 June 2012;

• for the financial year ending 30 June 2011 the applicant had declared a total income of $808. He had not lodged a personal income tax return for the financial year ending 30 June 2012;

• based on the proximity of the identical purchases and the poor financial position of Motek, it was asserted the importation of the first truck was a practice run and, as such, the first truck had been used in connection with the Importation Offence as an instrument of this offence.

114 The Kubale affidavit sworn on 16 June 2015, confirmed the importation information in respect to both trucks.[42] Notably, the affidavit confirmed the delivery address for both trucks was the Ayr Street property.

115 Federal Agent, Malcom Scott apparently swore two affidavits. Only the first of these, the Scott affidavit sworn on 19 June 2015, was tendered.[43] The Scott affidavit established that Federal Agent Scott had reviewed both the film footage and a surveillance log of activity at both the Ayr Street property and the factory between 5 October and 8 October 2013. The surveillance log exhibited to the affidavit, however, commenced from 4 October and concluded on 9 October 2013.

116 A second affidavit of Federal Agent Scott was not tendered. However, in her submissions counsel for the Commissioner referred to the further affidavit of Federal Agent Scott sworn on 26 June 2015 and, as a result, conceded evidence that on 10 July 2013 a cheque for $60,000 was deposited in the Motek account with the Bendigo Bank.[44] This cheque transaction linked the transfer of funds to the Motek account. As mentioned, on the assumption the funds were those redeemed from the MESF account this transaction appeared to link the redeemed funds from the MESF to the second of the payments made on 11 July 2013 to the Chinese company for the purchase of the second truck. This evidence was, nonetheless, inconsistent with any claim by the applicant that any of the cash found in the safe was derived from the balance of the applicant's superannuation funds redeemed from the fixed term deposit on 9 July 2013.

117 The Glover affidavit sworn on 24 June 2015 confirmed that the total income declared by the applicant for the financial years between 30 June 2007 and 30 June 2011 was $13,800, $13,348, $42,955, $130,148 and $977 respectively.[45] The profit or loss declared for Motek for the financial years ending 30 June 2007 to 30 June 2014 respectively initially involved $30,727 profit and thereafter losses of $488, $9468, $2835, $105,628, $88,615, $45,598 and $51,781 respectively. Review of the tax returns lodged for the MESF apparently showed that for the financial years ending 30 June 2007 to 30 June 2013 inclusive the MESF declared income of $0, $1647, $95,893, $58,279, $50,002, $4 and $4581. In each of those years income tax was paid by or refunded to the MESF in the following sequence: $0, $363.45, $14,533.80, $8232, $7671.70,-$3539 and $66.

118 As my summary of the affidavit evidence filed on behalf of the applicant shows, the evidence led to establish the applicant's financial position and that of Motek was limited. The unchallenged evidence in the Scott and Glover affidavits helped establish the poor financial position of Motek and the extent of the income stream available to the applicant and the MESF during the relevant period. This evidence made it less likely that during late 2012 income was used to cover the cost of purchasing and shipping the first truck.

The arrest of the applicant and execution of the search warrant at the Ayr Street property - 9 October 2013

119 In September 2013, Senior Constable Midgley and Detective Sergeant Carlin-Smith were among the officers who boarded the ship transporting the second truck. They assisted in substituting another substance for the drugs in the tyres. Senior Constable Midgley was also responsible for arresting the applicant outside the Ayr Street property on 9 October 2013.

120 The designated search warrant holder was Detective Sergeant Anthony James Sinn. His team included Sergeant Donaldson, who, as informant, accompanied the applicant during the search conducted by Federal Agents acting either as property officer or searchers. At hearing, Senior Constable Midgley explained he had not been present at the search of the Ayr Street property.

121 Sergeant Donaldson was present. He conversed with the applicant during execution of the search warrant at the Ayr Street property. A copy of a transcribed record of search warrant and field interview relating to the arrest and execution of the search warrant was produced with the Donaldson statement. Among other things, this recorded the following matters: [46]

• shortly after his arrest outside the Ayr Street property the applicant indicated he probably had $800 in his pocket;

• discussion with the applicant about papers for importing trailers. The applicant said he funded the purchase of two machines in the last year to 14 months from his 'super money'. Together with an inheritance from his mother this had amounted to close to half a million dollars on retirement. The applicant further indicated that what was left of his super was in a safe.

122 Among other things, the Sinn statement established that before the search commenced the applicant informed Detective Sergeant Sinn he had several long arm rifles in a locked cabinet and a large sum of money in a safe in the rear of the premises (the safe). A transcribed record of execution of the search warrant was produced with the Sinn statement (the ROSW). As to opening the safe with the key in the presence of the applicant, the following matters were recorded:

• inside the safe Detective Sergeant Sinn observed two cotton bags with the words: 'Bendigo Bank' printed on the outside;

• the bags contain sums of AUD banknotes. One bag contained both AUD and USD banknotes;

• the applicant informed Detective Sergeant Sinn he thought the bags contained about $70,000-$80,000 in total;

• without counting the money, Detective Sergeant Sinn removed the cash from each bag to separate audit bags which were signed and sealed. This activity was also videoed;

• other items seized from the rear room of the Ayr Street property and placed in separate audit bags included a document relating to the importation of a Sinotruck tractor, a Bendigo Bank document for payment for a Sinotruck, a hard drive, Australian passports for the applicant and his son, an envelope containing a number of currency exchange receipts in the name of Rhys Cini and a document with handwritten notes consisting of amounts of money and other details;

• all items seized were conveyed to the AFP Melbourne Office and secured.

123 The ROSW also established a number of further matters. Firstly, prior to opening the safe an unidentified male officer indicated the applicant had money in his pockets. At this point the applicant essentially confirmed his earlier comments: he had $800 or $900 (in $50 and $100 notes); he was retired; and this money was from superannuation money. The $800 was counted in his presence.

124 During the course of cross-examination Sergeant Donaldson confirmed he held conversations with the applicant during the execution of the search warrant and had probably been one of the unidentified male officers recorded in the ROSW, but not on every occasion. He accepted that he probably was the unidentified male officer recorded during this particular exchange.

125 Secondly, prior to counting the money in the applicant's pockets the applicant had again indicated that the money in the safe was his superannuation (probably $40,000 or $50,000 in cash) from a fixed term deposit 'cashed ... out' by him.

126 Thirdly, when questioned about the sort of business he was involved in, the applicant indicated he did a little bit of refrigeration work on the side for cash as well as importing the trucks at the factory ("Like, the, um - I've got a - an order for three trucks. I've got to supply three ITV's by Christmas"[47]).

127 Fourthly, when asked again how much he expected to be in the safe the applicant replied: "All me super money. - - - I just cashed in another sixty". He gave varying estimates of the amount: "Ah - thirty. I think, eighty grand... Seventy ...".[48]

128 Fifthly, there was further discussion, in the main with Detective Sergeant Sinn, whilst the cash was removed from the safe. Unlike his earlier explanation, at this point the applicant provided a mixed and contradictory response by indicated the following:

• part of this money had been converted into USD currency at a shop at Highpoint with a view to making money on the exchange rate;

• in response to a question about how much USD currency was in the safe, the applicant said: "I think... (Indistinct)... about forty. Thirty eight, forty, something like that, I swapped over. And - it was about eighty, eighty five, I think I had all up"[49];

• he had taken money out of super over the past two years ("I cashed out the last fixed term deposit from the Bank probably... two months ago. There was about sixty five thousand dollars and part of that are used for payment was overseas when I bought - when I bought the trucks (sic)."[50]).

129 To the extent that these responses appeared to convey the message that all or some of the cash in the safe was from superannuation funds following redemption of a fixed term deposit and/or the further message that some part of the redeemed monies had been converted to the USD found in the safe, they were misleading. Firstly, the money redeemed on 9 July 2013 was likely deposited in the Motek account on 10 July 2013. Secondly, as my discussion of the evidence at hearing shows shortly, the applicant's case was that sums of money had been drawn from his Cheque account during September 2012 and converted to the USD subsequently found in the safe. There was, however, no independent evidence linking each of the amounts the applicant said were withdrawn from the Cheque account to the redeemed superannuation monies or, for that matter, to other superannuation monies.

130 It appears that Detective Sergeant Sinn as warrant holder and another Federal Agent, Federal Agent Saliba, as Property Officer completed the Property Seizure Record tendered.[51]

131 The Property Seizure Record relevantly established that currency exchange receipts in the name of Rhys Cini were itemised separately.

132 The Woolard statement confirmed, among other things, that on 11 October 2013 Federal Agent Woolard retrieved the sealed audit bags identified in the Property Seizure Record containing either AUD or AUD and USD.[52] The sealed audit bags were taken to an interview room where another Federal Agent videoed Federal Agent Woolard retrieving the USD currency from one audit bag and placing it into a new audit bag without counting the cash. On the same day, accompanied by another Federal Agent, Federal Agent Woolard took the three sealed audit bags to the bank. The money was counted and banked in the AFP Trust account where it has since remained. Relevantly, this statement made no mention of any receipts for foreign currency in either of the original audit bags into which the cash seized from the safe had been placed in the presence of the applicant.

133 The Green affidavit and the Property Seizure Record exhibited to this affidavit (also tendered separately as Exhibit A5 at hearing), among other things, established the total amount of cash seized from the safe at the Ayr Street property excluding an $8 fee for conversion of the USD currency to AUD had been $107,203.70.[53] This sum comprised AUD $3000 in the bag containing only AUD banknotes and AUD $64,830 plus USD $39,000 in the second bag. The USD conversion amounted to AUD $39,453.70.

134 Under cross-examination Senior Constable Midgley indicated, among other things, that:

• he had not been involved in transferring the cash from the safe in the audit bags or depositing it at a later date in the AFP trust fund;

• the focus of the police investigation had been on the Importation Offence. He had not investigated the origin of the cash seized;

• he was not aware of anyone having investigated the currency exchange receipts seized and, unless this was also recorded in the Property Seizure Record, he could not say how many currency exchange receipts in the name of Rhys Cini had been seized.

135 In the Carrigan statement taken on 3 December 2013 Detective Senior Constable Carrigan, among other things, explained the circumstances of the arrest of the applicant and the execution of the search warrant at the Ayr Street property.[54] Cross-examination of Detective Senior Constable Carrigan was principally directed to, firstly, testing whether he recalled seeing currency being placed in two audit bags during execution of the search warrant at the Ayr Street property and, secondly, to his description of the six packages as being between 15 centimetres and 20 centimetres long and about 4 to 5 centimetres deep and wrapped in brown tape inside the esky. I was satisfied from the evidence given that the cash taken from the safe had not been amongst the items located by Detective Senior Constable Carrigan in his role as one of a number of searchers. His evidence did not advance the applicant's case because, Detective Senior Constable Carrigan probably had not, as claimed, witnessed the transfer of the cash from the safe into audit bags.

136 When initially cross-examined about this, Sergeant Donaldson could not recall seeing amounts of cash in the safe ("I can't recall whether it was the photographs afterwards or at that time that I saw the cash, but I believe I did have a conversation about the cash at the time"[55]).

137 Later, however, when taken to various parts of the Sinn statement, Sergeant Donaldson recalled cash in the safe in calico bags which had been placed in audit bags. He was not, however, able to provide details of how the cash had been packaged or the denomination of the notes ("No and the provisions with the Federal warrants is when there's large quantities of cash located in a warrant they're placed directly into an audit bag and sealed. That's videotaped and photographed. Then that money would be counted later on video so there's no discrepancies between that"[56]).

138 Sergeant Donaldson presented as a straightforward witness. Having heard his evidence, the attack made on Sergeant Donaldson's credit, mostly due to his initial failure to recall seeing amounts of cash in the safe was, to my mind, unjustified.

139 Of the officers involved in the execution of the search warrant at the Ayr Street property and seizing of the cash or in the later banking of this cash, including those mentioned above or those whose statements were exhibited to the Midgley affidavit, only Sergeant Donaldson and Detective Senior Constable Carrigan, were required for cross-examination. Neither their evidence nor the evidence of the witnesses, whose statements were unchallenged, provided independent corroboration of the claim that currency conversion receipts were in the safe or with the cash in the calico bags placed in audit bags, which were then sealed and later opened and banked.

140 Based on the evidence summarised so far, any relationship between conversion of AUD $23,575.92 and large cash withdrawals totalling $28,140 from the applicant's Cheque account in mid-late September 2012 (on 17 September 2012 ($8,500), on 19 September 2012 ($9,800) and on 25 September 2012 ($9,840)) or, between the USD $39,000 found in the safe more than a year later, was not self-evident.[57]

141 At hearing, in evidence-in-chief the applicant claimed he had a large sum of money in his bank account comprising his superannuation and his inheritance from his mother's estate. He had decided to buy some USD currency to play the market as, at the time, the AUD currency was quite high.

142 As mentioned, the inheritance had been deposited in the applicant's Cheque account in November 2010. As at 19 August 2012, the date from which the first of the Cheque account statements tendered commenced, the balance was $122,409.57.

143 According to the applicant he attended the Bendigo Bank branch in Seddon on several occasions and withdrew money in lots of around $8000 to $9000 over a six-week period. As already noted the statements for the Cheque account show cash withdrawals from this account on 17, 19 and 26 September 2012.

144 Notably, when at first he was asked to identify the cash withdrawals from the Cheque account statements tendered, the applicant identified a withdrawal of $9800 on 17 September 2012 and a transfer of $12,000 on 1 October 2012. However, with prompting from his counsel, the applicant eventually identified cash withdrawals on 25 September 2012 for $9840 and on 17 September 2012 for $8500 as monies he withdrew and exchanged at the Highpoint Shopping Centre.

145 The applicant said he withdrew money on several occasions, he exchanged this money, packaged and banded the money in four bundles comprising 10 USD $100 notes (a large number of which had sequential numbers), placed the exchange receipt on the package and placed the currency in his safe. The applicant alleged the receipts were with the money stored in the safe, which he had seen two AFP officers take from the safe on the day of his arrest.

146 As is apparent from my discussion of the evidence of police witnesses to the removal of the cash from the safe and its deposit in the AFP Trust fund, the basis for inferring that the USD currency in the safe had been packaged, banded or receipted as claimed, or that it even comprised four bundles of 10 USD $100 notes was not made out.

147 In short, the applicant's oral evidence alone did not justify the drawing of an inference that currency receipts were with any of the cash seized from the safe on 9 October 2013 and later transferred to the AFP trust fund.

148 Under cross-examination the applicant initially claimed to be confused by the statement in his affidavit that the USD cash had been payment for the truck. As I understood the applicant's evidence on this issue, without actually recalling this, he thought withdrawal of large sums of money from the Cheque account within two days of each other, had been his response to fluctuations in the currency market.

149 The evidence in this regard was implausible. Firstly, if receipts from Travel Money Oz had been with the money in the safe, the transaction record with the Kilpatrick affidavit only showed conversion to USD $24,050. Secondly, there was no correlation between the amounts or the dates on which these sums were withdrawn from the Cheque account and the currency conversion records produced under the Kilpatrick affidavit and Henry Cini's second affidavit. Lastly, if as claimed, the applicant sought to take advantage of fluctuations in currency traded, no plausible explanation was advanced for withdrawing $8500 on 17 September 2012 and waiting until 21 September 2012 to convert this sum or for withdrawing two large sums of money two days apart totalling $18,300 and converting only $9561 of this sum on 21 September 2012.

The importation of the first truck as a practice run

150 I have already summarised the matters to which the Green affidavit deposed.

151 Under cross-examination the applicant alleged he sent brochures to transport companies in the Altona area within a couple of months of delivery of the first truck, presumably in early 2013. According to the applicant several people inspected the first truck and had shown interest. He named various other individuals/entities. However, for the first time, the applicant also indicated he had not been keen to sell the truck because it was his "demonstration model".[58] He planned, the applicant said, to sell the first truck "eventually".

152 When cross-examined, among other things, Sergeant Donaldson told the Court police had identified an online truck sales website with "the Sinotruks" advertised for sale. The advertisement contained a mobile telephone number belonging to the applicant's son with a photograph of the Sinotruk outside the factory. Essentially, Sergeant Donaldson agreed with the proposition there had been no impediment to the applicant selling the first truck.

153 This evidence aside, the applicant could not say when he planned to sell the first truck. In the years preceding the purchase of the first truck, Motek operated at a loss. Between August and October 2012, Motek paid $62,424.30 for the purchase of the first truck and before delivery in January had incurred further expenditure for the cost of shipping the first truck to Australia. The applicant offered no plausible explanation for Motek retaining this costly piece of equipment in the factory for nearly 9 months after delivery in mid-January 2013.

154 As to the removal of the drugs to the Ayr Street property, according to the applicant, he never wanted the drugs at the Ayr Street property. The explanation given was that the applicant only moved the drugs there because his son had been told by people to whom his son was speaking, the factory would be robbed.

155 Under cross-examination the applicant said he had been prompted by the threat of robbery at the factory to move the drugs to the Ayr Street property. His son, he added, had not also explained by whom the factory might be robbed.

156 Notably, the applicant accepted the proposition that he had moved the drugs to the Ayr Street property because he believed they might be safer at this location with its large fence and the alarm and CCTV systems.

157 The applicant denied he had been involved in placing the quantity of drugs found in the esky in the garage at the Ayr Street property. He, nonetheless, confirmed he and his son transported the plastic tubs containing the drugs to the house; put these tubs in the garage; later returned the tubs to his car and to the factory; and, only he and his son had access to the garage.

158 The surveillance footage exhibited to the Scott affidavit captured the activities of the applicant and his son at both locations during this period, including their activities in moving the plastic tubs containing the substituted drugs to and from the Ayr Street property. It also helped establish various security features of the Ayr Street property on which the Commissioner relied to contest the applicant's claim that the Ayr Street property was not an instrument of unlawful activity.

159 Having regard to the CCTV footage tendered with the Scott affidavit which generally confirmed the sequence of activities conceded by the applicant at hearing, agreement by Senior Constable Midgley under cross-examination with the proposition that there was no evidence of the applicant unloading the drugs at the Ayr Street property did not advance the applicant's case.

160 Importantly, if true the further claim made during cross-examination to the effect that the applicant left the drugs in the back of the Jeep for his son to deal with could not forestall forfeiture of the Ayr Street property if the applicant failed to prove the property had not been an instrument of the unlawful activity of which the son had been convicted.

161 Cross-examination of Senior Constable Midgley revealed that, whilst he had not been present at the search of the Ayr Street property, he was aware that six packages had been found in the esky in the garage. He agreed there was no evidence the esky containing drugs had been in the applicant's car at any stage or telephone intercept evidence that the applicant had been dealing in these drugs.

162 Detective Senior Constable Carrigan's evidence, as earlier summarised, established the presence of the drugs found in the esky and helped explain the size and packaging of the drugs.

163 The applicant denied having switched off the closed-circuit CCTV cameras at both the factory and the Ayr Street property for certain periods.

164 The evidence summarised so far has identified unlawful activity for the purposes of the Act additional to the Importation Offence.

165 The Code provides that a person commits an offence if:

b) the substance was unlawfully imported; and the substance is a border controlled drug or border controlled plants; and

c) the quantity possessed is a commercial quantity.

166 Section 300.2 of the Code defines possession to include:

b) having control over the disposition of the thing (whether or not the thing is in the custody of the person); and

167 Allowing for the facts as found, in addition to the son's Attempted Possession Offence, I was affirmatively satisfied that the acts of the applicant (that is having possession of and control over the disposition of the substance in the sense contemplated by the Code) also amounted to possession of a commercial quantity of the border controlled drug for the purposes of the Act, namely an Attempted Possession offence.

168 Section 302.4(1) of the Code relevantly provides that a person commits an offence if:

169 Section 302.1 relevantly defines the term "traffics" to mean:

1. For the purposes of this Part, a person traffics in a substance if:

c) the person transports a substance with the intention of selling any of it or believing that another person intends to sell any of it; or

d) the person guards or conceals the substance with the intention of selling any of it or assisting another person to sell it any of it; or

e) the person possesses the substance with the intention of selling any of it.

170 Section 302.5 of the Code presumes the necessary intent or belief concerning the sale of a controlled substance where a person has transported or guarded or concealed a trafficable quantity of the substance, in this case methamphetamine.

171 When searches warrants were executed on 9 October 2013, in addition to the substituted drugs distributed to other locations, police seized the six packages in the esky at the Ayr Street property. Three remaining packages were found in the roof of the son's home. The quantity of controlled drug seized from the Ayr Street property constituted a trafficable quantity under section 301.12 of the Code and Schedule 3 of the applicable Criminal Code Regulations 2002 (Cth).

172 The evidence adduced by the applicant was insufficient to justify the drawing of an inference that it was more likely than not that his son had been left to deal with the drugs after they both transported the drugs in the applicant's Jeep to the garage at the Ayr Street property or of the further assertion that the applicant had been ignorant of the presence of drugs stored in the esky in the garage. In this regard, there was clear evidence of guarding or concealment of a trafficable quantity of the drugs.

173 I was affirmatively satisfied that the applicant's acts constituted an offence, an Attempted Trafficking Offence for the purposes of the Act.

174 The Commissioner submitted the applicant had failed to lead cogent and admissible evidence to satisfy the Court of the matters required under paragraphs 94(1)(e) and (f).

175 As mentioned, it was incumbent on the applicant to adduce evidence of some fact or facts the existence of which in the absence of further evidence was sufficient to justify the drawing of inferences that it was more likely than not the restrained property was neither proceeds nor an instrument of unlawful activity and was lawfully acquired.

The USD $39,000 cash in the safe as proceeds of or instrument of unlawful activity

176 As my discussion of the evidence has so far shown, reconciliation of the bank and money transactions as documented had not established a coherent money trail. Unlike the evidence of lawful acquisition of the Ayr Street property, the evidence led by the applicant to corroborate the claim that his interest in the USD cash found in the safe had been lawfully acquired fell far short of justifying the drawing of inferences that the USD was more likely than not neither proceeds (not wholly or partly derived whether directly or indirectly) nor an instrument (not used in, or in connection with) of unlawful activity (in this instance the Importation offence) and had been lawfully acquired.

177 Accordingly, the applicant has not met the requirements section 94(1)(e) and (f) under the Act.

178 It is unnecessary to repeat the earlier summary of the authoritative analysis in Chalmers of the expression 'used in or in connection with' unlawful activity. The task in the present case was to determine whether the other restrained property for which exclusion was sought (either the first truck or the Ayr Street property), was not used in the way contemplated by the Act (not employed or made use of for a particular purpose) or not used in connection (the determination of the latter involved questions of fact and degree) with any of the identified unlawful activity.

The first truck as an instrument of unlawful activity

179 The assertion that the first truck was purchased as part of a bona fides commercial venture to import and resell these trucks was not made out. In short, the evidence adduced by the applicant was insufficient to justify the drawing of an inference that the first truck was not used as a 'dry run' in or not used in connection with the Importation offence.

180 Accordingly, the applicant has not met the requirements of section 94(1)(e) and (f) under the Act.

The Ayr Street property as an instrument of unlawful activity

181 In Chalmers and Moran forfeiture of real estate had been denied as the Director of Public Prosecutions had failed to establish that each property was tainted property under the Victorian Act.

182 As the Court of Appeal explained in Chalmers, conduct after an offence is completed may also constitute a use of property in connection with the commission of the offence. In the present application, due to the direct temporal connection, the Commissioner focussed attention on acts (of either the applicant or his co-offender, his son) constituting an Attempted Possession offence and/or acts constituting an Attempted Trafficking offence.

183 As distinct from the facts found in Chalmers and Moran, the Ayr Street property was not, the Commissioner submitted, a passive location vis-a-vis the unlawful activity. I agree. A combination of factors peculiar to this case were indicative of use or use in connection with the commission of unlawful activity in the sense required by the Act.

184 In summary, the drugs were transported by the applicant and his son in plastic tubs to the Ayr Street property and kept at this location for some days from 4 October 2013 when all but six packages were distributed to other locations.

185 The mere fact that the drugs were stored at the Ayr Street property would probably not have sufficed to indicate use or use in connection with unlawful activity under the Act. This much was apparent from the discussion of these expressions in Chalmers and Moran.

186 In the present case, the reason for relocating the drugs from the factory to the applicant's residential address had been to safeguard the imported drugs against what the applicant was persuaded by his son was a threat of robbery. Logically the various features of the property which made the Ayr Street a preferred location and facilitated safeguarding the drugs from a perceived threat of robbery and from detection by the authorities are germane to finding use or use in connection with unlawful activity.

187 The Ayr Street property had secure fencing (a locked, colour bond gate which the film confirmed was closed other than when the Jeep entered or exited); alarm and CCTV security; and, a garage into which the tubs of drugs were unloaded. The garage was secured by a roller door and setback from the gate. The firearms kept at the property, no doubt, added to the security of this location and to the applicant's ability to control and monitor access to the drugs at the property.

188 As to attempted possession by the applicant, the facts of this case establish that he had possession of the unlawfully imported substitute drugs and/or control over the disposition of these as contemplated by the definition of possession in the Code. Furthermore, on the facts of this case the co-offender was convicted of an Attempted Possession offence in respect to the drugs. He was similarly involved in transporting and safeguarding the drugs at the Ayr Street property ostensibly for the same reason his father gave.

189 Both the applicant and his son made use of the property for a purpose associated with an Attempted possession offence. The use of the Ayr Street property in, or in connection with the co-offender's commission of and conviction for an Attempted Possession offence was fatal to the Exclusion Application in respect to the Ayr Street property. On this evidence alone, the applicant had not established the Ayr Street property was not used in, or in connection with this unlawful activity.

190 Alternatively, consistent with the submission made by the Commissioner, the facts of this case also indicate that the Ayr Street property was used to guard, conceal and possess the substituted narcotics over a period of some days and, save for the six packages found in the esky, it was the location from which the drugs were distributed to the other locations.

191 In summary the applicant has failed to establish on the balance of probabilities that the Ayr Street property was not an instrument of his co-offender's unlawful activity. Alternatively, he has failed to establish, as required, that the same property was not an instrument of acts constituting unlawful activity, either an Attempted Possession offence or an Attempted Trafficking office.

192 For the reasons stated I propose to dismiss the Exclusion Application.

[15] [1938] HCA 34; (1930) 60 CLR 336

[16] [2014] HCA 52, [89]-[90]

[17] (1989) 45 A Crim R 109, 112-113

[18] [2015] WASC 101

[20] (1995) 79 A Crim R 514 and [2007] NSWCA 285

[22] [2011] VSCA 436

[26] [2012] VSCA 154

[44] See paragraph 61 of the revised 'Outline of Argument in Reply'