DPP (Cth) v West

THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

12959/00 - DIRECTOR OF PUBLIC PROSECUTIONS (CTH) v CAMERON NOEL WEST

1 HIS HONOUR: This is an application for costs against the Director of Public Prosecutions (Cth) ("the DPP (Cth)") arising out of proceedings under the Proceeds of Crime Act, 1987.

The Commencement of Proceedings 2 In October 2000, the Australian Federal Police gathered information suggesting that Mr Cameron West was procuring and supplying cocaine. On 1 November 2000 a vehicle driven by Mr West was stopped and searched. Cocaine and cash were found. A search warrant was later executed upon premises in Drummoyne. Cocaine, cash, a semi-automatic pistol and ammunition, were found. A further search warrant was executed upon premises at Mascot. Resealable plastic bags were discovered, together with approximately 1,000 grams of cocaine and almost $20,000 in cash. 3 Mr West was charged with a number of offences, both Federal and State. The Statement of Agreed Facts identified the charges as follows: · "Two charges of possessing, on 29 October and 1 November 2000, a prohibited import contrary to s233B Customs Act, 1901 (Cth) (the 'Customs Act') … (Collectively the 'Commonwealth drug charges'); · One charge of possessing monies reasonably suspected of being the proceeds of crime contrary to s82(1) Proceeds of Crime Act, 1987 (Cth) …; · Two charges of supplying, on 29 October and 1 November 2000, a prohibited drug contrary to s25(1) Drug Misuse and Trafficking Act, 1985 (NSW) … (collectively the 'State drug charges'); · One charge of possessing, on 1 November 2000, a firearm contrary to s36 Firearms Act, 1996 (NSW) (collectively with the State drug charges the 'State charges')." 4 The agreed facts also included the following: "As cocaine is not manufactured in Australia, police believe that the cocaine seized in this matter is imported." 5 On 8 November 2000, the DPP (Cth) filed a Summons in the Supreme Court ("the First Summons") seeking the following, amongst other, orders: · A restraining order under s42(2)(a) of the Proceeds of Crime Act, 1987 ("the Commonwealth Act") in respect of the property of Mr Cameron West (with certain exclusions). · An order under s48(1) of the Commonwealth Act that Mr West submit to an examination on oath before the Registrar as to his affairs. · An order under s48(1) of the Commonwealth Act that Mr West provide, within 28 days, a sworn statement setting out particulars of his property and dealings in property. 6 At the same time application was made, ex parte, before Dowd J, for an interim order under s43(2)(a) of the Commonwealth Act, freezing the assets of Mr West (subject to the exemptions). 7 On 20 November 2000, a further order was made under s45A of the Commonwealth Act extending the operation of the restraining order for a further six months. 8 The scheme of the Act is, that upon conviction of a "serious offence" (s7), property which is the subject of a restraining order shall, after six months, be forfeited to the Commonwealth (s30). However, forfeiture is subject to an exception. The defendant may seek a declaration under s48(4) of the Commonwealth Act that property, which may otherwise be caught by the restraining order, was not used in connection with any unlawful activity or derived (directly or indirectly) from an unlawful activity, and was lawfully acquired. 9 Mr West, through a company, Pont Holdings Pty Limited, was in the process of acquiring a property at Drummoyne at the time these orders were made. A variation of the restraining order was made, with the consent of the DPP (Cth), permitting access to funds in order to complete that acquisition. At the same time an Amended Summons was filed, naming Pont Holdings Pty Limited as a further defendant, and seeking to restrain that company from disposing of, or dealing with, the Drummoyne property. Windeyer J on 3 January 2001, by consent, made orders pursuant to the Amended Summons. Thereafter the restraining orders against Mr West and the company were extended from time to time, as required by the Act. 10 On 18 June 2001, the DPP (Cth) wrote to the solicitors for Mr West and the company, indicating that the criminal charges against Mr West under the Customs Act would be withdrawn. The State charges would, however, proceed, conducted by the DPP (NSW). On 25 June 2001, the New South Wales Crime Commission by summons ("the Second Summons") sought a restraining order under the Criminal Assets Recovery Act, 1990 (NSW) ("the New South Wales Act") against Mr West and the company, in respect of the same property which had been the subject of the orders made under the Commonwealth Act. 11 On 3 July 2001 the Commonwealth charges were withdrawn. That removed the foundation upon which the DPP (Cth) could seek forfeiture of the restrained property. Forfeiture, under s30 of the Commonwealth Act, is dependant upon conviction. When informing the solicitors for Mr West and the company that the Federal charges would be withdrawn, the DPP (Cth) suggested that the Amended Summons (the First Summons) should be dismissed, and that each party should pay its own costs. The solicitors for Mr West were content that the Summons should be dismissed. However, they insisted that the DPP (Cth) should pay the defendants' costs.

The Source of Power 12 The Commonwealth Act does not contain a general provision in respect of the award of costs. It appears, nonetheless, to contemplate that costs (and, indeed, damages) may be awarded. Section 44 of the Commonwealth Act contains the following provisions in context of a restraining order: "s44(10) A court may refuse to make a restraining order if the Commonwealth refuses or fails to give to the court such undertakings as the court considers appropriate with respect to the payment of damages or costs, or both, in relation to the making and operation of the order. (11) For the purposes of an application under s43, the DPP may, on behalf of the Commonwealth, give to the court such undertakings with respect to the payment of damages or costs, or both, as are required by the court." 13 Specific provision is made in respect of costs where a party, subject to a restraining order, is successful in an application to exclude property under s48(4) of the Commonwealth Act. Costs, in such circumstances, may only be awarded where the following conditions are satisfied: "s101(1) Where: (a) a person brings, or appears at, proceedings under this Act before a court in order: (i) to prevent a forfeiture order or restraining order from being made against property of the person; or (ii) to have property of the person excluded from a forfeiture order or restraining order; (b) the person is successful in those proceedings; and (c) the court is satisfied that the person was not involved in any way in the commission of the offence in respect of which the forfeiture order or restraining order was sought or made; the court may order the Commonwealth to pay all costs incurred by the person in connection with the proceedings or such part of those costs as is determined by the court. (2) The costs referred to in subsection (1) are not limited to costs of a kind that are normally recoverable by the successful party to civil proceedings." 14 The power to award costs under the Commonwealth Act was considered by Hayne J, when sitting in the Supreme Court of Victoria, in Bissett v DPP (Cth) (unreported, 24.02.93). His Honour said this: "It may be doubted that the Court has no power to make an order for costs in cases not dealt with by s101. Leaving on one side cases in which an undertaking as to costs is given pursuant to s44(10) (and no such undertaking was given here) it may be that the proceeding is properly to be seen as a suit to which the Commonwealth is a party and in that event s64 of the Judiciary Act 1903 would require that 'the rights of parties shall as nearly as possible be the same, and judgment may be given and costs awarded on either side, as in a suit between subject and subject' (emphases added). If that is so there may be power to award costs in the same way as if the matter were governed directly by s24(1) of the Supreme Court Act. However I do not find it necessary to reach any concluded view on this question and I am prepared to assume (without deciding) that the Court has a general power of the kind asserted on behalf of the applicant albeit one deriving ultimately from Judiciary Act s64 rather than immediately from Supreme Court Act s24." 15 I will determine the present application upon the basis that the Court has a general discretion to award costs (whether arising under s64 of the Judiciary Act or s76 of the Supreme Court Act) (cf Commonwealth Director of Public Prosecutions v Chan (Greg James J, unreported, 13 March 2001) para 74; Commonwealth Director of Public Prosecutions v Adorjany (Simpson J [2000] NSWSC 76); Director of Public Prosecutions (Cth) v Geraghty (Simpson J [2000] NSWSC 911).

The Submissions of the Parties 16 The DPP (Cth) opposed an award of costs to the defendants upon a number of bases. First, the DPP (Cth) had sought a variety of orders, not simply the forfeiture of the property of Mr West and the company. Those orders were made, and were reaffirmed from time to time. The dismissal of the Summons simply means that no order of forfeiture can be made. 17 Secondly, the Director asks, rhetorically: "How is the company worse off as a consequence of what occurred?" Mr West was charged with both State and Federal offences. Had the prosecuting authorities, at the outset, taken the view which they now hold, then it would have been the State Crime Commission, rather than the Commonwealth Director, who would have sought to restrain Mr West's assets (and those of the company). The effect would have been the same. His assets (and those of the company) would have been frozen until the criminal proceedings had been determined. Mr West would have been required to provide a sworn Statement of Affairs (s12(1)C1 of the New South Wales Act). He would have been examinable upon oath (s12(1)b of the New South Wales Act). 18 Thirdly, no adverse inference should be drawn from the withdrawal of the Federal charges. A police officer swore an affidavit that he believed Mr West had committed Federal offences. The restraining order of the DPP (Cth) was made upon that basis. It should not be inferred from the fact that the charges had been withdrawn that the police officer's belief was misconceived. All that can be inferred is that the prosecuting authorities had ultimately taken the view that it is more appropriate to proceed upon the State charges where, obviously, there was substantial overlap between the charges. 19 Dealing with the last matter first, I accept that it is not open on the material before me to conclude that the Commonwealth charges would have failed or were misconceived. The charge against Mr West was under s233B(1)(ca) of the Customs Act. A charge under that section, on the facts asserted by the Crown, may have succeeded. 20 I believe, nonetheless, that it is appropriate to award costs. First, the relief sought by the DPP (Cth) was the forfeiture of Mr West's assets and those of the company. The withdrawal of the Federal charges now makes that impossible. It is appropriate that the Summons should be dismissed. Orders made from time to time at the request of the DPP (Cth) should not be regarded as successful applications, independent of the ultimate relief sought, namely forfeiture. The preservation of assets (by restraining order) simply recognised that investigation and adjudication of the Director's claim to forfeiture would take time. It was necessary, for the remedy to be effective, that the assets should be preserved in the meantime. The examination of Mr West, and the Statement of Affairs, were also linked to the ultimate remedy, forfeiture. They furnished the DPP (Cth), and by this means the Court, with information relevant to the adjudication of the Director's claim. 21 Secondly, in answering the Director's rhetorical question: "Is Mr West, or the company, worse off?", I believe that they are. Assuming Mr West is not convicted on the State charges, and the Court is not satisfied in respect to the matters which may otherwise justify forfeiture under the New South Wales Act (s22), so that the Crime Commission's Summons is dismissed, what costs might the company or Mr West recover? The New South Wales Crime Commission's liability to pay costs can only begin with the restraining order which it sought under the New South Wales Act. The costs incurred in meeting (and defeating) the DPP (Cth)'s Amended Summons would not be recoverable. That appears to me to be unfair. 22 Further, it was assumed by the DDP (Cth), in argument, that the procedural steps taken by the Director in requiring Mr West to provide a Statement of Affairs, and to submit to examination, will be useful to the State authorities in their investigation. No doubt they will. However, the Crime Commission's rights are determined by the New South Wales Act. It may, or may not, see the need to seek orders for a further Statement of Affairs from Mr West, or a further examination of him. That, to my mind, simply underlines the independent nature of the Summons issued by the Commonwealth in respect of the Federal offences from that issued by the State Crime Commission in respect of State offences.

Order 23 I therefore believe the following orders are appropriate:

1. The Amended Summons, number 12959/00, is dismissed.

2. The plaintiff should pay the defendant's costs. *******

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