DPP (Cth) v Hunter & Milner

Court of Appeal (Vic)|2003-12-19|Before: WINNEKE, P., VINCENT and EAMES, JJ.A.

Criminal law - Successful Crown appeal in respect of offences against Commonwealth laws - Whether respondent entitled to indemnity certificate under s.15(1) of Appeal Costs Act 1998 (Vic.)

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On 15 April 2003 each of the respondents (Hunter and Milner) pleaded guilty in the County Court to a number of offences against Commonwealth laws, alleged upon an indictment filed by or on behalf of the Director of Public Prosecutions (Cth.). The offences so alleged arose out of a risk laden scheme conducted in 1997 and 1998 by the respondents, through which they secured millions of dollars from various people whom they knew or acquaintances of those people.

The sentencing judge imposed a total effective sentence of two years upon each of the respondents and directed that each respondent be released on his own recognizance after serving six months of that sentence.

The Director of Public Prosecutions (Commonwealth) appealed against the sentences imposed pursuant to the provisions of s.567A of the Crimes Act 1958 (Vic). That section empowers the Director of Public Prosecutions (Vic) to appeal to the Court of Appeal against a sentence or sentences passed on a person convicted on indictment if the Director considers that "a different sentence should have been passed and is satisfied that an appeal should be brought in the public interest ..." That right of appeal is exercisable by the Commonwealth Director of Public Prosecutions through the combined operation of s.68(2) of the Judiciary Act 1903 (Cth) and s.9(7) of the Director of Public Prosecutions Act 1983 (Cth)[1].

On 24 October 2003 this Court allowed the appeals brought by the Director of Public Prosecutions (Commonwealth) in respect of the sentences imposed upon each of the respondents. It, accordingly, set aside the sentences imposed by the sentencing judge and, in lieu, imposed upon each of the respondents a total effective sentence of two years and nine months; and ordered that each respondent be released after serving 12 months of the sentence imposed upon his own recognizance in the sum of $1,000 for a period of 21 months.

Following the pronouncement of the orders of the Court, Mr. Ross, who appeared with Mr. Mullaly for the respondent Hunter, applied to the Court pursuant to s.15(1) of the Appeal Costs Act 1998 (Vic) for an indemnity certificate in respect of the respondent's own costs of the appeal. Insofar as relevant, s.15 provides:

"(1) If an appeal is instituted under - (a) section 567A of the Crimes Act 1958; or (b) ... (c) ... the respondent to that appeal may apply to the Court of Appeal ... for, and the Court may grant, an indemnity certificate in respect of the respondent's own costs of the appeal. (2) A respondent granted an indemnity certificate under sub-s.(1) is entitled to be paid by the Board [i.e. the `Appeal Costs Board'], on an application made to it by the respondent in the approved form, an amount equal to the respondent's own costs of the appeal that the Board considers to have been reasonably incurred."

The grant or refusal of a certificate is in the discretion of the court; a discretion from which no appeal lies (s.37).

The Court queried whether it had the power to grant such an indemnity certificate in appeals brought by the Commonwealth Director of Public Prosecutions, and referred counsel to the decision of the High Court in Solomons v. District Court of New South Wales & Ors.[2]. The Court declined, for the time being, to grant such a certificate but reserved liberty to counsel for the respondent, Hunter, to make further submissions in writing as they may be advised. Such submissions have now been made on behalf of the respondent, Hunter.

The purpose of the Appeal Costs Act 1998 is to provide a scheme for indemnifying certain litigants, both in civil and criminal matters, against the costs of litigation in circumstances stipulated by the Act as warranting indemnification from a State administered fund. As we have noted, s.15 of the Act pursuant to which the respondent's application was made, is to be found in Part 3 of the Act, which is entitled "Entitlement to payment in criminal matters". Although the Court may, upon the respondent's application, grant a certificate, the certificate so granted provides only a provisional entitlement in the sense that the respondent can only recover the indemnity after making application to the Appeal Costs Board ("the Board") and receiving a certificate from the Board upon its satisfaction that payment is warranted. By s.21 of the Act the functions of the Board include:

(a) The assessment and determination of applications for payment made under the Act ...;

(c) The issuing of certificates in respect of applications for payment under the Act ...;

(f) The exercise and discharge of any other powers, authorities, duties, functions or obligations conferred or imposed upon it by or under the Act.

Section 35 of the Act provides that:

"(1) No amount is to be paid under this Act otherwise than in accordance with the certificate of the Board. (2) The Board must not issue a certificate for the payment of any amount under this Act unless it is satisfied that the payment is authorised by this Act and the provisions of this Act and the regulations in relation to a claim for the payment have been complied with. (3) Any money that the Board is required to pay under this Act is to be paid out of money made available to the Board for the purpose."

Section 27 of the Act (insofar as relevant) provides that:

"(2) The Board may agree to pay to any applicant any amount in respect of the cost of making an application to it that it thinks fit; (3) Any amount that the Board agrees to pay to an applicant under sub-section (2), must be included in any certificate issued under section 35 to that applicant."

These provisions make it apparent that it is the certificate of the Board which is of primacy, and that a certificate granted by the Court under s.15 provides a prima facie entitlement to payment by the Board upon application made to it by the respondent in "an approved form". The Board is comprised of members appointed by the Attorney-General (s.22); and the payments which it authorizes are paid out of a fund which is made available to it for that purpose (s.35).

The question which arises in this application is whether the Court has the power to grant an indemnity certificate under s.15 of the Appeal Costs Act for the payment out of a State administered fund to the respondent to an appeal in which the Court has exercised federal jurisdiction invested by laws supported by s.77(iii) of the Constitution. There is a general rule of construction which would confine a State enactment such as the Appeal Costs Act to State proceedings and officers[3]. In the case of Solomons v. District Court of New South Wales, McHugh, J. (at 138) put the matter in this way:

"It is a long recognized rule of statutory construction that a reference to courts, matters, things and persons in the legislation of a State is a reference to courts, matters, things and persons in that State. ... Consequently the Costs Act [i.e. the Costs Act of New South Wales] applies of its own force only to offences against the laws of New South Wales."

In this respect, it can be noted that s.15(1) of the Appeal Costs Act 1998 (Vic) provides not only for the grant of an indemnity certificate by this Court, but also by the County Court in respect of appeals brought under s.84 of the Magistrates' Court Act 1989 and under s.197(3) of the Children and Young Persons Act 1989.

As previously noted, the issue which we have to determine is whether this Court, invested with federal jurisdiction, has the jurisdiction and power to grant an indemnity certificate under the Appeal Costs Act to a respondent who has defended an appeal brought by the Director of Public Prosecutions (Commonwealth) pursuant to s.567A of the Crimes Act (Vic) against the sentence imposed on the respondent by the County Court following his conviction for offences committed against Commonwealth laws. The respondent, by his counsel, contends that he is entitled to the grant of such a certificate. Counsel submits that there is little practical difference between proceedings for an offence against Victorian law and an offence against a Commonwealth law. Indeed it is put that charges against State and Commonwealth provisions are frequently joined on the same indictment; and that where a person pleads guilty in a Victorian court to an offence against a law of the Commonwealth, there is little difference in procedure from the plea of guilty to a presentment which contains only Victorian offences. It is conceded that, in sentencing for offences against a Commonwealth law, the judge must comply with the provisions of the Crimes Act 1914 (Cth) and that the Director of Public Prosecutions (Commonwealth) has a statutory right of appeal against sentence for the Commonwealth offences. Nevertheless, it is submitted that, for the purposes of granting an indemnity certificate, there is a difference between the exercise of federal jurisdiction in respect of a trial and the exercise of federal jurisdiction of a court upon an appeal. Thus, the respondent submitted:

"that a Commonwealth right of trial does not enliven State laws, but an appeal does. Otherwise there can be no appeal. An appeal is not in the nature of a procedure or of evidence such as is contemplated by s.79 of the Judiciary Act 1903. An appeal is a matter of substantial (sic) right and power."

The respondent submits that the decision of the High Court in Solomons (supra) can be distinguished. The essence of the High Court judgment in that case, it was contended, was that "a Commonwealth prosecution was founded on the statutory provisions already referred to and that no State legislation was `picked up'." It was further submitted that "an argument parallel to the basis of our submission found favour in the High Court in R. v. Gee[4]". Thus, so it was submitted, this Court "truly has the jurisdiction to hear the instant appeal. The Commonwealth Director of Public Prosecutions has keyed into State legislation to bring the appeal", and that, therefore, this Court has jurisdiction to grant the certificate sought.

We regret to say that these submissions, in our view, cannot be accepted because none of the relevant provisions of the Judiciary Act 1903 (Cth) picked up, or are capable of picking up, the provisions of the Appeal Costs Act, including s.15. We say that we regret this consequence because it is a pity that, in this day and age when State courts are exercising so much invested federal jurisdiction, there is no counterpart Commonwealth legislation providing for indemnity against costs incurred in circumstances similar to that provided for by State legislation[5].

There is, in our view, no relevant distinction to be drawn between the indemnity certificates granted in respect of costs of trials, and indemnity certificates given in respect of costs of appeals. The relevant question is whether the provisions of s.68(2) and s.79 of the Judiciary Act 1903 are capable of "picking up" the provisions of the Appeal Costs Act 1998 (Vic), including s.15, so as to enable a court exercising federal jurisdiction to issue a costs certificate under that Act or section. As we see it, that question is not answered by the High Court decision in R. v. Gee (supra). The issue in that case was whether s.68(2) of the Judiciary Act picked up and applied the "case stated" procedure in s.350 of the Criminal Law Consolidation Act (1935) (SA), pursuant to which a District Court judge, exercising federal jurisdiction in a trial involving offences against the Crimes Act 1914 (Cth.), had reserved questions of law for the opinion of the Full Court. The High Court held that s.68(2) gave the necessary jurisdiction to the Full Court to determine the questions so reserved, first because its determination was the exercise of jurisdiction with respect to the trial of the respondents; and secondly the proceeding in the Full Court was, relevantly, an "appeal" for the purposes of s.68(2). The issues in that case are significantly different from those which arise in this application. In our opinion, a court exercising federal jurisdiction has no jurisdiction to grant a costs certificate under the Appeal Costs Act because, on its proper construction, that Act applies only to State offences and no provision of the Judiciary Act picks up and applies it in the exercise of federal jurisdiction.

It seems to us that the principles which the High Court applied in the Solomons' case in respect to the provisions of the Costs Act (NSW) are equally applicable to this application. True it is that the provisions of the Costs Act (NSW) are discretely different from the provisions of the Appeal Costs Act (Vic.); but the scheme of costs indemnity provided by each Act is essentially the same. Section 2 of the Costs Act (NSW) provides that (inter alia) the Court or a Judge in proceedings relating to an offence punishable upon indictment may:

"(a) where a defendant, after a hearing on the merits, is acquitted or discharged as to the information then under inquiry; or (b) where, on appeal, the conviction of the defendant is quashed and - (i) the defendant is discharged as to the indictment upon which he or she was convicted; or (ii) the information or complaint upon which the defendant was convicted is dismissed, grant to that defendant a certificate under this Act, specifying the matters referred to in s.3 and relating to those proceedings."

Provision for payment under such a certificate is made by s.4 of the Act which provides that a person to whom a certificate is granted may apply to the Under Secretary of the Attorney-General's Department for payment from the Consolidated

Revenue Fund of the costs incurred. The making of the payment is conditional upon the formation by the Treasurer of the opinion that, in the circumstances of the case, the making of the payment is justified and upon the consequent determination by the Treasurer of the amount of costs that should be paid.

The High Court in Solomons (supra) determined that these provisions were incapable of being picked up by either s.68(2) or s.79 of the Judiciary Act 1903.

So far as relevant, s.68(2) of the Judiciary Act provides:

"The several courts of a State or Territory exercising jurisdiction with respect to: ... (c) the trial and conviction on indictment; of offenders or persons charged with offences against the laws of the State ..., and with respect to the hearing and determination of appeals arising out of any such trial or conviction or out of any proceedings connected therewith, shall, subject to this section and to s.80 of the Constitution, have the like jurisdiction with respect to persons who are charged with offences against the laws of the Commonwealth." (our emphasis).

This section had been amended, following the decision in Seaegg v. The King (supra), to include the words which we have emphasized. It, thus, seems to us to be apparent that the principles expounded in the case of Solomons would apply with as much force to an indemnity certificate granted in respect of an appeal as they do to the grant of a certificate in respect of the trial.

Assuming that the words of s.68(2) of the Judiciary Act, namely "that the several courts of a State exercising jurisdiction ... with respect to the hearing and determination of appeals arising out of any such ... conviction or out of any proceedings connected therewith" are wide enough to embrace the Court's jurisdiction or power to grant indemnity certificates, that does not mean that such courts have the "like jurisdiction" with respect to persons who have been charged with offences against the laws of the Commonwealth. The majority in Solomons (Gleeson, C.J., Gaudron, Gummow, Hayne and Callinan, JJ.) took the view that the Costs Act (NSW) conferred a power on the judges of the State court to grant a certificate. Likewise, it seems to us that s.15 of the Appeal Costs Act (Vic) confers a power on this Court to grant a certificate to a respondent to a "Director's Appeal". The exercise of that power is a necessary pre-condition to the exercise by the State appointed Appeal Costs Board to grant its own certificate authorising payment out of a State administered fund.

In Solomons' case, the majority judges noted that the Costs Act (NSW) was not drafted "with a close eye to the distinctions between jurisdiction and power which are required by Ch. III of the Constitution for the laws of the Commonwealth". However, they concluded (at 132):

"The better view is that the statute confers on New South Wales courts a power which is exercisable after (i) acquittal or discharge as described in par. (a) of s.2 or (ii) allowance of an appeal as described in par. (b) of s.2."

Their Honours went on to observe that s.2 of the Costs Act (NSW) was not to be construed in isolation from the balance of the legislative scheme of which it forms part, and they noted that:

"The grant of a certificate under s.2 ... has no purpose but the satisfaction of a necessary precondition for the exercise by a State officer of the discretions conferred by s.4 ...".

Because s.2 of the Act was but part of a "scheme" their Honours were of the view that what was involved in the appellant's case was:

"the translation of the whole of the State legislative scheme and its transformation, by force of federal law, to a scheme for payments out of the State Consolidated Fund in respect of certain concluded prosecutions in State Courts determined in the exercise of federal jurisdiction ...". (pp. 132-3)

A similar "translation" and "transformation" of this State's legislative scheme pursuant to the Appeal Costs Act (Vic.) underlies the respondent's application in this case. This State's legislative scheme, like that of New South Wales, regards the Court's grant of a certificate as a necessary pre-condition to an application to the Board for the exercise of its discretion to grant its own certificate which is the only basis upon which payment can be secured from the fund provided to the Board for that purpose.

Having made the observations to which we have referred in the preceding paragraph, the majority Judges in Solomons' case (at 133) concluded that the appeal "should be determined on the footing that no federal law rendered applicable to the appellant the power ... created by s.2 of the Costs Act." In so concluding, they held that two steps were involved. The first was the identification of the law enacted pursuant to s.77(iii) of the Constitution relevantly conferring federal jurisdiction with respect to any of the matters specified in ss. 75 and 76 of the Constitution. The law so identified was s.68(2) of the Judiciary Act. So it is, in our opinion, in respect of this application. For that purpose, the majority of the High Court assumed in the appellant's favour that application made under s.2 of the Costs Act (NSW) (after verdict) was made when the jurisdiction with respect to the prosecution was not exhausted. Likewise, we are prepared to make the assumption that our jurisdiction in respect of the Director's appeal was not exhausted at the time when the application was made for a certificate. As the judges said in Solomon's case (at page 134):

"The difficulties for the appellant's submissions then begin with the phrase in section 68(2) `the like jurisdiction'. Section 68 itself distinguishes between jurisdiction on the one hand and powers and procedures on the other. Sub-section (1) provides for State laws with respect to procedure to apply `so far as they are applicable'. Sub-sections (4) and (5A) confer powers respectively to amend informations and, in appropriate circumstances, to decline to exercise jurisdiction. Sub-section (2) is concerned with the ambit of the jurisdiction rather than the content of the powers to be exercised under it."

If, as we have hypothesised, the exercise of federal jurisdiction had not been spent with the determination of the Director's appeal, the applicant then has to take the second of the steps which were referred to by the High Court in Solomon's case; i.e. to show that s.79 of the Judiciary Act renders the Appeal Costs Act (Vic) a surrogate federal law, the powers in which then were applicable in the exercise of the federal jurisdiction. Section 79 provides as follows:

"The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all courts exercising Federal jurisdiction in that State or Territory and all cases to which they are applicable."

As was pointed out in Solomon's case by the majority judges (at 134) there are four limitations in the text of s.79. First, the section operates only when there is already a court "exercising federal jurisdiction", "exercising" being used in the present continuous sense. Secondly, s.79 is addressed to those courts; the laws in question "shall ... be binding" upon them. The section is not, for example, directed to the rights and liabilities of those engaged in non-curial procedures under State laws. Thirdly, the compulsive effect of the laws in question is limited to those "cases to which they are applicable". To that it may be added, fourthly, the binding operation of the State laws is "except as otherwise provided by the Constitution". The majority judges concluded (at 334-5) that:

"The first limitation may ... be conceded as satisfied, but a combination of the second, third and fourth is fatal to the appellant's submissions. It was pointed out in The Commonwealth v. Mewett (1997) 191 C.L.R. 471 at 556 that, where a particular provision of a State law is an integral part of a State legislative scheme, section 79 could not operate to pick up some but not all of it, if to do so would be to give an altered meaning to the severed part of the State legislation."

The Court then referred to Australian Securities and Investments Commission v. Edensor Nominees Pty. Ltd.[6] where Gleeson, C.J., Gaudron and Gummow, JJ. said:

"Section 79 of the Judiciary Act renders State and Territory law binding only in cases to which they are applicable. As to State law this may be taken to reflect what otherwise would be the operation of Ch. III. In Kruger v. The Commonwealth [1997] HCA 27; (1997) 190 C.L.R. 1 at 140, Gaudron, J. said: `There may be statutory provisions couched in terms which make it impossible for them to be "picked up" by Section 79 of the Judiciary Act. Similarly, there may be provisions which impose functions which are beyond the reach of Section 79. ...' An example of the second category of provisions imposing functions beyond the reach of Section 79 would be those insusceptible of exercise as part of the judicial power of the Commonwealth. ..."

These principles were applied by the majority judges in Solomon's case to conclude that the provisions of s.79 of the Judiciary Act could not "pick up" the provisions of the Costs Act (NSW) because those provisions emphasized that the grant of a certificate supplied a pre-condition for the making of an application to an officer of the Executive Government of the State. Section 79 of the Judiciary Act, their Honours said, is not addressed to officers of the Executive Governments of the States. It is directed to courts. Those principles appear to us to apply with equal force to the provisions of the Appeal Costs Act (Vic). Although the provisions of the Victorian Act are different in form from those of the New South Wales Act being considered in that case, the grant of a certificate under s.15 of the Appeal Costs Act provides, as we have said, only a "provisional entitlement" to be paid from the State administered fund. It is a precursor to the application which the respondent must make to the Board, which Board must grant its own certificate before any amount can be paid out of the Fund which it administers. In that sense, the provisions of the Appeal Costs Act (Vic) have a similar effect to the grant of a certificate under the Costs Act (NSW) which, by s.4, provided that the grantee of a certificate, may make application to the Under Secretary for payment from the Consolidated Revenue Fund of the costs incurred. Just as the operation of s.79 of the Judiciary Act would not reach the State officials specified in s.4 of the Costs Act (NSW) in the performance of their functions under that section, so its operation would not reach the State appointed officials under the Appeal Costs Act 1998 (Vic) who alone were entrusted with the authority to make payments out of the State administered fund.

The reasoning of McHugh, J. in Solomon's case, although different from that of the majority, would also, we think, support the conclusion to which we have come that the provisions of the Judiciary Act would not "pick up" the provisions of the Appeal Costs Act, including s.15. It was his Honour's view that s.68(2) of the Judiciary Act does not invest a court exercising federal jurisdiction with jurisdiction to grant a Costs Certificate of a type which the New South Wales judges were authorized to grant under s.2 of the New South Wales Costs Act. That was because such a jurisdiction would not be "like jurisdiction" within the meaning of sub-s.(2) of s.68. There could be no "like jurisdiction", in his Honour's view, because the State jurisdiction under the Costs Act (NSW) gives the judge authority to determine the applicant's right to a certificate which is a condition for compensatory payment out of the State Fund; but ultimately the grant requires State officials to give consideration to the application which is made, on the basis of the certificate, as to whether the applicant should receive the payment. There can, therefore, be no "like jurisdiction" unless the applicant for the certificate has been acquitted of a federal offence, and a federal law requires some official to consider whether the costs specified in the certificate should be paid. There is no federal law which authorises the reimbursement of costs and the grant of a certificate in federally invested criminal jurisdiction, in the manner in which the New South Wales Costs Act does. Likewise, McHugh, J. expressed similar views to those expressed by the majority as to the inability of s.79 of the Judiciary Act to "pick up" the costs of litigation in New South Wales. This was because, to do so, would give a meaning different from that which it had in State jurisdiction. The nature of the New South Wales Costs Act was such that it could not be "picked up" and applied in the exercise of federal jurisdiction because, in federal jurisdiction, it would have no legal effect. That was because the grant of a certificate in the federal jurisdiction would impose no duty of any kind on the State officials who would be free to disregard it. Thus, the grant of a certificate in the exercise of invested federal jurisdiction, would be a futility[7].

As we have already noted, it is our view that the reasoning adopted by the majority judges in Solomon's case applies with equal force to the application which has been made for a certificate under s.15 of the Appeal Costs Act. Having regard to the nature of the scheme to which we have previously referred, we are of the view that the provisions of the Act which implement it, are not "picked up" by ss.68 or 79 of the Judiciary Act because those provisions do not, and cannot, bind the State officials who alone have the ultimate authority to make payments out of the funds provided and administered by the State. The grant of a certificate in the exercise of federally invested jurisdiction would be a futility. The application, therefore, must be refused.

[1] See Rohde & Ors. v. Director of Public Prosecutions [1986] HCA 50; (1986) 161 C.L.R. 119.

[3] See Seaegg v. The King [1932] HCA 47; (1932) 48 C.L.R. 251 at 255; Solomons v. District Court of New South Wales (supra) at 130.

[4] [2003] H.C.A.12; (2003) 77 A.L.J.R. 812.

[5] cf. per Kirby, J. in Solomons v. District Court (N.S.W.) (supra) at page 151.

[7] See Solomon's case, per McHugh, J. at pages 344-6.

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