Criminal law - Confiscation of property - Matters relating to setting aside freezing order - Application for joinder of party - Crime-used property substitution declaration - Whether ameliorating provisions concerning innocent parties apply in such a case - Order allowing joinder of proposed party

Criminal Property Confiscation Act 2000 (WA), s 4, s 22(2)(a), s 22(6), s 79, s 81(2), s 82, s 102

Rules of the Supreme Court 1971 (WA), O 18 r 4(1)

Respondent to Objectors : Director of Public Prosecutions (WA)

1 These proceedings concern property allegedly owned or controlled by the person named as respondent, being the person I will call A. He is also named as the first objector.

2 It appears from the evidentiary materials before me that the property in question is occupied by A's partner, who is arguably his de facto spouse, and a daughter of the lady in question who is under 18 years of age. For ease of reference I will refer to the mother as T and to the daughter as H, being a term used in written submissions before me. T is named as the second objector.

3 I have before me an application by the daughter H to be joined as a party to the proceedings. The applicant seeks to rely upon certain ameliorating provisions in s 82 of the Criminal Property Confiscation Act 2000 (WA), concerning the setting aside of a freezing notice or freezing order. The subject application is reflected in a chamber summons for joinder of a party, date stamped 15 August 2008.

4 The summons refers to the hearing of an application on the part of H by her next friend T for orders that, first, H by her next friend T be joined as third objector in these proceedings; second the costs of and incidental to this application be H's costs to be taxed or agreed.

5 The application is supported by the affidavit of the second objector T, sworn 20 August 2008. I understand that the affidavit comes before me pursuant to programming orders previously made.

6 The supporting affidavit says in summary that H has just turned 17 years of age. She is currently in her final year at a school in the metropolitan area which is close to where the second objector lives.

7 It is said that the first objector; that is A, and the second objector T have been involved in a de facto relationship since 1993. It is said that, for the past six years until A was imprisoned on 18 June 2008, they have lived together at the subject property in Connolly, except for a period of eight months, from December 2006, when the Department of Child Protection made certain alternative arrangements. There is no need for me to describe these arrangements in detail for present purposes.

8 It is said further that what I will henceforth refer to as the Connolly property was purchased by A and the second objector T in equal shares. It is said that at all times during the de facto relationship H has been dependant on A as well as on the second objector, and that H and the second objector continue to reside at the Connolly property.

9 It is said further that the second objector is aware from a freezing order served upon her in these proceedings that on 30 March 2007 the Court froze A's interest in the Connolly property on the grounds that an application was likely to be made against A for a crime-used property substitution declaration. Some reference is then made to the basis for the application. However, it is said further that H has no other residence at the time of hearing this objection. She has had no involvement with her father since 1992. She has no residence other than the Connolly property.

10 The second objector refers to her belief that H would suffer undue hardship if A's interest in the Connolly property was confiscated. T would not be able to purchase A's interest in the property if the half interest were confiscated and she and her daughter would, therefore, be displaced from their home of six years if the state requires the property to be sold. The affidavit then makes further reference to the circumstances of the second objector and H. It is said that the affidavit is sworn in support of an application for the joinder of H as an objector in these proceedings.

11 I turn now to submissions made on behalf of the Director of Public Prosecutions. It is said that on 30 March 2007, pursuant to s 43 of the Act, a freezing order was made in respect of all property owned or effectively controlled by A, including, inter alia, the interest only of A in the property I have called the Connolly property.

12 The freezing order was made on the basis that an application was likely to be made by the DPP against A for a crime-used property substitution declaration within 21 days of the making of the freezing order. It seems that on 2 April 2007 a notice of motion for a crime-used property substitution declaration was filed by the DPP seeking (pursuant to s 21 and s 22 of the Act) a declaration first that property owned by A is available for confiscation instead of crime-used property, on the grounds that crime-used property, namely, land at a certain address in Hocking, which I will call the Hocking property, is not available for confiscation by reason that A does not own or effectively control the Hocking property; second, it is more likely than not that A made criminal use of the Hocking property.

13 It is said that pursuant to s 22 of the Act a Court must declare the property owned by a respondent is available for confiscation instead of crime-used property if the crime-used property is not available for confiscation within the meaning of s 22(2) of the Act, and it is more likely than not that the respondent made criminal use of the crime-used property.

14 The affidavit of Edward Russell Phillips sworn 29 March 2007 and the affidavit of Tiffany Danutas-Nojunas, sworn 29 March 2007, filed in support of the freezing order application, outline the factual basis of the application for a crime-used property substitution declaration. I pause to say that I do not intend to traverse the contents of those affidavits in detail but I do take account of their contents.

15 In essence A had at the time of the freezing order application been charged with numerous sex offences against a 14-year-old child, including a series of offences contrary to s 321 of the Criminal Code, alleged to have been committed at the Hocking property. A subsequently pleaded guilty and has been convicted and sentenced in respect of the offences. The commission of the offences brings the Hocking property within the definition of 'crime-used property'. The evidentiary materials demonstrate that A did not own or effectively control the Hocking property. As a result the Hocking property is unavailable for confiscation within the meaning of s 22(2)(a) of the Act and it has not been frozen.

16 On 11 April 2007 A filed a notice of objection to the freezing order referred to earlier. On 10 May 2007, pursuant to the order of Justice Jenkins, T was joined as a second objector. Subsequently, as I have indicated, H by her mother and next friend T, the second objector, seeks to be joined as an objector to these proceedings in order to seek release of the frozen Connolly property pursuant to s 82(3) of the Act.

17 I pause here to say in general terms that s 82 of the Act contains provisions bearing upon the release of crime-used property; that is, an application can be made to set aside a freezing notice or order relating to such a property on various grounds. They include circumstances in which the objector establishes that he or she is a spouse or less than 18 years of age, and thus effectively someone with an interest in the property in practical terms. The intention of these provisions arguably is to provide amelioration or relief to dependants who may suffer undue hardship if deprived of premises in which they are living.

18 The difficulty in the present case is that the Hocking property, which was the property allegedly used for the criminal offence in question, is not the property the subject of the freezing notice. It is the Connolly property which is affected by the freezing notice. Thus the question is whether the ameliorating provisions in s 82 apply not only to a crime-used property but also to a property such as the Connolly property in the circumstances of the present case, being the property the subject of an application pursuant to s 22 of the Act for a crime substitution declaration.

19 If the infant in the present case, namely, H, be thought or be found arguably to have some entitlement as a person entitled to relief pursuant to the ameliorating provisions in s 82(3) of the Act, then a question arises whether she should be joined as a party, so as to be afforded an opportunity to be heard in the proceedings in respect of any orders which might ultimately be made affecting the interest she claims to have. On the other hand, if it is clear as a matter of law that no entitlement of the kind contended for can be or will be found to exist then a joinder may not be appropriate.

20 Let me turn now to the principles bearing upon the issue before me.

21 I begin by noting that these proceedings are civil proceedings. Section 102 of the Act is explicit in that regard in saying that proceedings on an application under the Act are taken to be civil proceedings for all purposes. That view was approved in Centurion Trust Co Ltd v DPP (2008) 35 WAR 463; [2008] WASCA 6 at [86] and following. Hence one must turn to the Rules of the Supreme Court in considering the joinder issue.

22 Order 18 r 4(1) of the Rules of the Supreme Court provides that two or more persons may be joined together in one action as plaintiffs or defendants with the leave of the Court or where if separate actions were brought by or against each of them, as the case may be, some common question in law or fact would arise in the action and also where all rights to relief claimed in the action, whether they are joint, several or alternative, are in respect of or arise out of the same transaction or a series of transactions.

23 It has been said in decided cases that the test for joinder pursuant to O 18 r 6(2)(b) is whether the prospective parties' rights against or liabilities to a party to the action in respect of the subject matter of the litigation will be directly affected by any order made in the proceedings: Homestyle Pty Ltd v City of Belmont [1999] WASCA 59 at [30]. The rule does not give power to join a party whenever it is just or convenient to do so but only where the party ought to have been joined or the party's presence is necessary to ensure that all the questions between the original parties are effectually and completely disposed of.

24 I pause here to observe that the relevant principles are conveniently drawn together in the decision of the High Court in State of Victoria v Sutton [1998] HCA 56; (1998) 195 CLR 291 being a decided case referred to me in the course of argument by counsel for the applicant.

25 It was said in that case by McHugh J at 316 that the rules of natural justice require that before a court makes an order that may affect the rights or interests of a person, that person should be given an opportunity to contest the making of that order. Because that is so, it is the invariable practice of the courts to require such a person to be joined as a party if there is an arguable possibility that he or she may be affected by the making of the order. That practice also assists in avoiding duplication of hearings on the same issues and in avoiding the spectre of inconsistent decisions by courts or judges of the same court.

26 Counsel for the DPP has argued that H ought not be joined as an objector in these proceedings because the basis upon which she seeks to have the freezing order over the Connolly property set aside, namely, satisfaction of criteria in s 82(3) of the Act, does not apply to property frozen on crime-used property substitution grounds. Reference is made to the scheme of the Act. Section 79 provides:

A person may file an objection to the confiscation of frozen property.

27 By s 81 the Court may upon hearing an objection to the confiscation of frozen property, set aside the freezing notice or order but only to the extent permitted under s 82, s 83 or s 84 of the Act. Moreover, it is said if property is frozen on two or more grounds but the Court does not set aside the freezing notice or order in relation to both or all of the grounds, the freezing notice or order continues in force as if it had been made on the remaining ground. This is referred to in s 81(2) of the Act.

28 It is said on behalf of the DPP that the Act contemplates different grounds or criteria for the release of frozen property depending on the basis upon which the property was initially frozen. More particularly it is said that s 82 in its terms applies only to property frozen on crime-used grounds. Counsel submits that this is clear from various considerations, including that the heading to the section, although not a part of the Act, gives a clear indication that the section applies only to crime-used property. Section 82(1) can only relate to property frozen on crime used grounds. Section 82(1) refers initially to 'property that was frozen on the ground that it is crime used'. It is said that thereafter, every subsequent reference in s 82 is to 'the property', making it clear that the section is concerned only with property frozen on crime-used grounds.

29 Counsel in her written submissions goes on to refer to various other considerations, all of what are said to establish that s 82, plus the ameliorating provisions to be found in s 82(3), are explicitly confined to property which can be characterised as 'crime-used property'. Thus, it is said, the Connolly property not being crime-used property cannot be the subject of the ameliorating provisions.

30 I will not traverse all of the considerations referred to at length in counsel's written submissions but I do take account of them. The thread of argument that I have just outlined underlies them.

31 I digress briefly to note (as counsel for H quite properly acknowledged) that the Full Court in Bennett & Co (a firm) v Director of Public Prosecutions (WA) [2005] WASCA 141 [61] made certain observations which might arguably be taken to suggest that the position in the present case is as contended for in the proceedings before me by counsel for the DPP. It was said by the Full Court at [61], in referring to s 83 (which relates to the release of crime-derived property), that an objector is only able to establish that they fall within the definition of 'innocent party' where the property is either crime-used or crime-derived.

32 I take account of those observations. However, I feel obliged to take account also of what has been put to me by counsel for H at today's hearing in his written submissions in reply, namely, that the observations in the Bennett case are obiter dicta. They were not directed to the specific question of whether s 82(3) might apply to crime-used property within the broader characterisation of such property in the synopsis to the Act set out in s 4. Accordingly, although I give weight to what was said in the Bennett case, I do not see it as being necessarily decisive of the issue before me today.

33 By s 146 of the Act property is said to be crime-used if it is or was used or intended for use in connection with the commission of a confiscation offence. I note in passing, as a matter I will come back to later, that in s 4 of the Act one finds a synopsis concerning what is 'confiscable property'. It is said that property (of the categories then described) is confiscable to the extent provided by this Act. More particularly for present purposes, it is said in s 4(c) that property used in or in connection with the commission of a confiscation offence, or property of equal value can bear the description 'crime-used property'. When one ponders the words 'property of equal value', that arguably raises a question as to whether property being in substitution or related in some way to the crime-used property, that is to say, to the place where an offence is committed, may arguably be embraced by or lie within the concept of crime-used property.

34 I note also in passing that when one looks at s 82(2) it is put this way:

If the Court finds that the property is crime-used or is not required to decide whether the property is crime-used, the Court may make an order under subsection (3) or (4).

35 I note that in the immediately following subparagraph, that is, s 82(3), one finds the provisions I have described as ameliorating provisions. These permit objections to be raised by a spouse or innocent party or one who is less than 18 years of age. On the face of it there does appear to be some room for argument as to whether in s 82(2) the legislation is contemplating that some category of property other than property actually used for the commission of the offence lies within the reach of the ameliorating provisions.

36 Those two provisions I have mentioned, s 4 and s 82(2), are provisions to which I am invited by counsel for H in the present case to give particular weight.

37 It is against that background that I come to the submissions advanced on behalf of the applicant objector and proposed party to the proceedings. Those submissions are set out in written form as an outline dated 25 August 2008 and they are supplemented by submissions in reply dated 16 October 2008. I do not intend to traverse everything that is said there in detail on behalf of H but will endeavour to draw out of them the main thrust of the applicant's argument.

38 Essentially, the applicant H seeks to be joined in order to object to the confiscation of her home of the past six years under, inter alia, the provisions of s 82(3) of the Act or other provisions which can arguably be relied upon, she contends, in support of her basic contention.

39 It is said that the proposed objector satisfies each of the criteria in s 82(3)(a) to (d). It is said that whether she satisfies s 82(3)(e) is a matter which can only be determined at the time of the hearing. Whether she satisfies the criteria of undue hardship in s 82(3)(f) is a matter to be determined on all the evidence at the hearing of her objection; that is, whether she will obviously suffer hardship. It is said the matters in s 82(3)(g) are also matters to be determined at the time of the hearing.

40 I pause there to say that if the only issue before me was the question of whether as a matter of fact she falls within the criteria I have just mentioned, I would consider that a joinder ought to be effected. There is some affidavit evidence before me of the kind I have mentioned which provides a sufficient factual basis for her contention. In other words, there is an arguable basis in respect of the matters in question. So if that were the only issue before me, I would be persuaded that the joinder should be effected.

41 The fact remains, however, that the controversy between the parties has not really been concerned with that aspect of the matter. The crucial question at this stage is that which I have endeavoured to describe in my previous observations, namely, whether the ameliorating provisions to be found in s 82(3) can be said to have arguably some application to a form of property which arguably does not fall within the narrowly defined meaning of 'crime-used property' contended for by counsel for the DPP.

42 As I have indicated, the application for joinder is opposed upon the basis that s 82(3) does not apply to property frozen on the basis that a crime-used property substitution declaration has been made in respect of the property.

43 A central contention of counsel for the applicant H is based upon observations of the kind made by McHugh J in the Victoria v Sutton case. It is said, in effect, that where doubt might exist as to the proper interpretation of a statutory remedy such as s 82(3), it is not a matter to be determined on an application for joinder but at the substantive hearing of the matter. It is submitted that on its proper interpretation s 82(3) must apply to property frozen on the basis that it is owned or effectively controlled by the respondent to a crime-used property substitution declaration.

44 Reference is made to the principle that in the case of penal statutes they are to be construed in accordance with the ordinary rules of construction but if the language of the statute is ambiguous or doubtful, the ambiguity or doubt may be resolved in favour of the owner or the property or, by analogy, in favour of the claimant to the remedy against forfeiture. Reference is made to the principle that there is a presumption that legislation must not interfere with vested property interests.

45 The applicant relies also upon another precept that, where competing interpretations are open, the Court should have regard to the consequences of the competing interpretations. Interpretation by reference to consequences is essentially a shorthand version of the purposive approach to interpretation. Where an interpretation advanced by a party would lead to extraordinary and draconian results, it is unlikely that the legislature would have intended the act to operate in that way: Palfrey v MacPhail [2004] WASCA 257; (2004) 149 A Crim R 542 at [33].

46 It is said further that s 82(3) does not expressly limit itself to freezing notices or freezing orders on the grounds that the subject property was used in or in connection with the commission of a crime. Section 82(2), being the provision I mentioned earlier, provides that a court may make an order under s 82(3) if it finds that the property is crime-used or is not required to decide whether the property is crime-used.

47 It is said that the words 'or is not required to decide whether the property is crime-used' indicates that s 82(3) and s 82(4) are intended to apply to confiscations other than those based on the property being crime-used because if property is frozen on the ground that it is crime-used, a court would always be required to decide whether it is crime-used.

48 Reference is made also to the synopsis to the Act, being the provision in s 4(c) of the Act mentioned earlier. It is said on behalf of the applicant H that the synopsis does not distinguish between property used in connection with the commission of an offence and property of equal value (that is, arguably, property substituted for crime-used property under a crime-used property substitution declaration).

49 I feel obliged to observe that in these reasons I do not purport to make any final ruling or determination as to whether the applicant H can obtain relief via the ameliorating provisions in s 82(3) in respect of the Connolly property, that is, the property affected by the substitution declaration. In my view, it follows from the principles concerning joinder mentioned earlier, that I need only determine whether there is an arguable case to the effect that the applicant H is able to draw upon and pray in aid the ameliorating provisions in s 82(3) with the result that, as a party potentially affected by any order made in the proceedings as a whole, she should be before the Court, so as to be heard and so as to be bound by any ruling made.

50 In the end I consider that an order for joinder should be made. In arriving at that conclusion, I give weight to what was said by McHugh J in Victoria v Sutton. My reasons for arriving at the conclusion are essentially these.

51 First, in my view although s 82 of the Act is ostensibly concerned with and possibly confined to the release of crime-used property only, the scheme of the Act arguably suggests that it might have a wider application. In reviewing the scheme of the Act, I give particular weight to the point mentioned earlier, that the synopsis provision in s 4(c) appears to contemplate that crime-used property may involve property of equal value or some category of property beyond the property where the offence was actually committed.

52 Second, the terms of s 82 might arguably be said to extend to categories of property beyond crime-used property. That is because weight may arguably be given to s 82(2), being the provision I mentioned earlier, which allows for a finding if the Court finds the property is crime-used or is not required to decide whether the property is crime-used.

53 I note also in passing that in s 82(8) there is reference back to s 22(6), being a provision forming part of the powers and considerations concerning crime-used property substitution declaration.

54 It follows from all of this that in certain respects s 82 appears to be contemplating that there may be a relationship between the provisions in s 82 and other categories of property. To my mind, the matters I have mentioned to this point arguably give rise to a degree of ambiguity as to whether the ameliorating provisions can be drawn upon by a party such as the applicant H. I am of the view that where there is an ambiguity of that kind, the principles of statutory construction I referred to earlier, which allow for a purposive reading of the provisions, weigh in favour of the application for joinder.

55 It might be said that the purpose of the ameliorating provisions is to allow a facility for relief to occupants of a property affected by a freezing notice or order. I therefore consider that it is arguable that the ambiguities I have referred to should be resolved by adopting a broad interpretation of the relevant provisions which would support a form of relief of the kind contended for by the proposed objector, that is, the applicant H.

56 It, therefore, seems to me, as I draw back and look at the situation as a whole, that, without purporting to make any final ruling or determination upon the issues of construction presently before me, it is appropriate that the joinder applied for be effected, so that all parties who may wish to be heard or may be affected by orders made in these proceedings are before the Court. For that reason I do propose to allow the application for joinder and will make orders accordingly.