• Lawyers in Sydney
• Lawyers in Melbourne
• Lawyers in Brisbane
• Lawyers in Perth
• Family lawyers
• Employment lawyers
• Criminal lawyers
• Wills and estates lawyers
• Find a lawyer

Judgment

1. THE COURT: On 14 February 2023 the Court, constituted by Macfarlan and Brereton JJA, [1] refused the applicant Mr Dickson's application for leave to appeal from orders of Ierace J [2] in which his Honour dismissed his motion seeking to stay or dismiss an application by the respondent Commissioner for a pecuniary penalty order ("PPO") under the Proceeds of Crime Act 2002 (Cth) ("POCA") against Mr Dickson, and dismissed a cross-summons filed by Mr Dickson by which he challenged the constitutional validity of certain provisions of the POCA. By motion filed on 27 February 2023, Mr Dickson applies to have the previous judgment of 14 February 2023 refusing leave to appeal set aside pursuant to Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), r 36.16(1) and (3A), the grant of leave to appeal, directions for the hearing of the appeal, and the recusal of Macfarlan JA from the hearing of the appeal based on his Honour's participation in the judgment of the Court of Criminal Appeal in Dickson v R. [3] As Macfarlan JA has retired from the Court, it is unnecessary to consider that aspect of the motion any further.
2. UCPR r 36.16 relevantly provides: "(1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order. … (3A) If notice of motion for the setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may determine the matter, and (if appropriate) set aside or vary the judgment or order under subrule (1), as if the judgment or order had not been entered.
3. Sub-rule (3A) has the effect of extending r 36.16(1) by providing that where a notice of motion is filed within 14 days of the entry of judgment, the Court may set aside or vary the judgment or order "as if the judgment or order had not been entered". As the applicant's notice of motion was filed within 14 days of the entry of orders, the question is whether there is a proper basis on which to do so.
4. The relevant principles are well established. [4] The power conferred by UCPR r 36.16 is to be exercised "sparingly and with caution" and "does not give a licence to disgruntled litigants to re-agitate, in the hope of obtaining a more favourable outcome, issues that have been determined against them". [5] The purpose of the power is "to permit readily identifiable, readily rectifiable, inadvertent errors to be corrected without the complication and expense of an appeal". [6] "Generally speaking, it will not be exercised unless the applicant can show that by accident without fault on his part he has not been heard". [7] It is true that it may also be exercised where "the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and ... this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing". [8] However, the reference to misapprehension in this context is concerned with matters of oversight and inadvertence, and not with deliberate decisions which are said to be incorrect.
5. On the present application, Mr Dickson first submits that this Court failed to exercise its jurisdiction, by reason that it did not deal with all important matters argued, and did not demonstrate that it had "grappled with the applicant's arguments providing cogent and complete written reasons for the rejection of all material arguments". [9] The cases which Mr Dickson cites as authority [10] do not provide any support for the proposition that the requirement for reasons is so extensive, let alone on an application for leave to appeal. The elaboration and detail with which untenable arguments are presented, and the number of authorities which they cite, do not oblige a Court to respond in similar length and detail. Reasons that are concise rather than expansive are in many ways to be preferred.
6. Mr Dickson submits that the Court ignored or misapprehended various material facts and legal arguments. One important matter of context is that the Court was simply concluding that this was not a case in which a refusal summarily to dismiss the Commissioner's claim should be revisited on appeal. An important aspect of the context is that the consequence of the judgment at first instance, and of the refusal of leave to appeal, is that the Commissioner's claim will proceed, in due course, to a final hearing. In other words, it was not summarily dismissed. Mr Dickson will be entitled to oppose the relief sought on such grounds as he wishes at the final hearing, and to appeal from the final orders made (including on the grounds which he presently seeks to agitate, notwithstanding that on the leave application this Court did not consider any of them reasonably arguable). Indeed, Mr Dickson acknowledges that the Court may refuse leave to appeal from a refusal to dismiss proceedings summarily on the basis that the issues raised can be agitated in the final hearing and/or on appeal from the final judgment. [11]
7. A second important matter of context is that that decision was reached on the basis of the assessed unarguability of Mr Dickson's four proposed grounds of appeal, which were in substance: 1. a challenge to the primary judge's finding that the Commissioner's original summons constituted an application by the Commissioner under s 134 of the POCA for a PPO and also constituted a "written notice of the application" for the purposes of s 136; 2. that the primary judge erred in granting leave to the Commissioner to make an application for a PPO out of time. However, this ground was misconceived as his Honour found that the application was made within time (by means of the filing of the summons). It therefore did not and does not require any further attention; 3. that relevant provisions of the POCA are constitutionally invalid because to give effect to them the Court hearing the application for a PPO would have to determine the amount of income tax avoided as a result of the offences of which Mr Dickson was convicted, which determination "can only be made by the Federal Commissioner of Taxation ("FCT"), pursuant to the federal income tax legislation"; and 4. in relation to the dismissal of his cross-claim, that the primary judge ignored his 80 pages of submissions; misapprehended his "cardinal argument" that the operation of the impugned provisions of the POCA was not within the "judicial power" of the Commonwealth, and misunderstood the inconsistency of NSW laws with the federal income tax legislation for the purposes of s 109 of the Constitution; misunderstood the decisions of the High Court in Kable v Director of Public Prosecutions (NSW) [12] and NSW v Kable, [13] and of this Court in AD v Commissioner of the Australian Federal Police [14] ; failed to consider more than 40 High Court decisions referred to in his submissions; misunderstood the legal effect of Part 2-2 of POCA; failed to understand the relevance of Pratten v R, [15] and failed to afford him an opportunity to make written submissions concerning the case which was decided after the hearing.
8. As to the material facts said to have been misapprehended by the Court, the Court did not ignore or overlook the circumstance that Mr Dickson's offences which found his exposure to forfeitures and PPOs under the POCA are conspiracy offences; however, that they are is not relevant to the arguability of his proposed grounds of appeal. Nor is the circumstance, if it be so, that in his criminal trial the only evidence that tax would be underpaid was provided by amended assessments of income tax.
9. Nor did the Court misapprehend (in the relevant sense) the nature of PPO proceedings, nor the function of s 136(2). It has taken the considered view, rightly or wrongly, that the primary judge was right to hold that A summons instituting such proceedings could also serve as the notice required by s 136. Mr Dickson's submissions do not identify any relevant misapprehension, but simply seek to reargue this issue which was decided against him. Moreover, Mr Dickson's suggestion that he is thereby denied procedural fairness is without foundation. The proceedings having been instituted by summons, it would be expected that in due course the Commissioner would adduce affidavit evidence. It would be open for a defendant to seek in an appropriate case that the proceedings continue on pleadings, or that the plaintiff provide a statement of the nature of the case on which it relies, [16] but generally the issues will be apparent from the terms of the legislation and the affidavit evidence. That this is so, is apparent from Mr Dickson's identification of the material elements in his written submissions. [17]
10. As to the submission that the Court has misapprehended Mr Dickson's legal arguments, it is necessary to understand that the fact that an argument is rejected as untenable does not mean that the argument was not understood. Mr Dickson's present submissions focus on the proposition that an estimate of the amount of tax avoided cannot be undertaken by anyone other than the FCT and is not justiciable. This is his "cardinal argument" referred to above. However, the Court directly addressed this argument, as follows: [18] "In our view there is no merit in this argument. For the purposes of determining the amount of a pecuniary penalty to be imposed in such a case the Court would, by reason of the terms of s 121 of the POC Act (see [4] above), be required to value the benefits he received from the commission of the offences. In circumstances where the tax evaded was payable not by him personally but by a company of which he was a director, that benefit is not necessarily equivalent to the unpaid tax liability. But assuming that the process would involve an estimation of the amount of the tax avoided, Mr Dickson has not been able to point to any legislative or other prohibition on the Court doing that. A similar exercise is undertaken, for example, when a court assesses damages to be awarded against professionals. If a solicitor or accountant negligently fails to advise a client about the client's ability to claim a particular tax deduction, there is no reason why the Court should not, for the purposes of assessing damages, estimate the tax that would have been saved if the negligence had not occurred."
11. There is no obstacle to this Court - potentially aided by expert evidence - estimating for the purpose of the POC proceedings the amount of tax avoided, if that be necessary - just as there is no objection in a criminal trial to the Court determining whether an accused had obtained a financial advantage through a reduction in income tax consequent on a failure to disclose assessable income. [19] In neither case would the Court's decision determine the taxpayer's civil liability to pay tax; in POC proceedings it would determine only the value of the benefits he received from the commission of the offences, for the purpose of the PPO. The Court took the view that that analysis was supported by what Gageler J said in Pratten. [20] If that view be incorrect, it is not a result of any such misapprehension as would engage UCPR, r 36.16; it was a considered conclusion.
12. Mr Dickson complains that in the previous judgment the Court misapprehended its jurisdiction in "autocratically summarily ignoring more than 80 pages of detailed arguments, supported by more than 40 cases as to the constitutional repugnancy of the POCA provisions in the context of criminal offences involving underpaid income tax". [21] But the Court did not ignore those arguments; it addressed them, albeit compendiously: [22] "Mr Dickson's fourth proposed appeal ground contains a number of sub-grounds. None of them raises a point that is arguably supportive of his application. It is unnecessary therefore to address them in any detail. We simply note, contrary to propositions forming part of those sub-grounds, that Mr Dickson did not demonstrate before this Court that the primary judge overlooked any material submissions or evidence of Mr Dickson, did not understand Mr Dickson's "cardinal argument", failed to refer to any High Court decision that ought to have been referred to or otherwise erred in making his dismissal orders."
13. Mr Dickson's carefully prepared and comprehensive 80-page submission replete with reference to case law, some of it relevant and some of it not, some of it supporting basic and undoubted constitutional principles (such as Re Judiciary and Navigation Acts [23] and the Boilermakers' Case [24] ) did not in the Court's then view, and does not now in ours, raise an arguable case that the relevant POCA provisions are unconstitutional - essentially for the reasons summarised above at [11]. It does not require an 80-page judgment to articulate that conclusion, especially in the context of refusing leave to appeal.
14. Finally, Mr Dickson argued that the Court ignored his arguments (1) that prosecution of an application for a PPO after he was sentenced is repugnant to principles that a convicted person is to be sentenced only once, and (2) that the Commissioner should be estopped from prosecuting now an application which should have been prosecuted when he was sentenced. The first of these arguments was raised by Mr Dickson only in passing on the application for leave: "That's the background. So we have ‑ I'm sure the question that springs to your Honour's mind is the constitutionality of having a second punishment for a crime eight years after the sentencing for crime. Legislation seems to allow it. Is it constitutional, is it not? That issue has never been argued in an Australian court. But I'd just like to put a pin in that concept at the moment, that concern, that overriding concern about a second punishment for a crime that I was convicted of and sentenced for eight years ago. I would like to look at some fundamental questions."
15. It is true that counsel for the Commissioner did not provide a convincing answer to the point: "BRERETON JA: I'm not sure that the complaint about double punishment was addressed to forfeiture orders; I thought it was addressed to the fact that years after having been sentenced to a lengthy term of imprisonment, he was going to be visited with a further pecuniary sanction. CONDE: Yes, your Honour, the pecuniary sanction accounts for forfeiture; in other words if all proceeds of crime have already been forfeited, then the pecuniary sanction will be zero. BRERETON JA: Yes, I appreciate that. I don't think that's the complaint; I think the complaint is that the pecuniary sanction on top of a sentence of imprisonment visited on him some years ago is itself a second punishment. CONDE: Yes. If I might then address on the time having addressed on the constitutional arguments. …"
16. However that is unsurprising, in circumstances where this argument was not raised in Mr Dickson's 80 pages of submissions to the primary judge, nor in his draft notice of appeal, nor in his written submissions on the leave application, and at the hearing only in the incidental manner set out above. The second (estoppel) argument does not appear to have been agitated at first instance, and it was not referred to in the draft notice of appeal, the written submissions on the application for leave to appeal, or in the oral argument; in any event, the POCA application was already on foot when he was sentenced. In circumstances where the points had not been argued and considered at first instance, and would remain available for Mr Dickson to argue at the final hearing, they did not warrant a grant of leave to appeal, even if they had any merit.
17. The present application identifies no such oversight or misconception as would engage UCPR, r 36.16(3A). Mr Dickson's complaint is really that the Court was wrong to reject his arguments, and in not providing more elaborate reasons for doing so. If those contentions be correct, his only remedy is an appeal by special leave to the High Court.
18. The motion should be dismissed with costs.