Fosse v DPP & Anor [1999] NSWSC 367 | Case summary

1 HIS HONOUR: On 12 December 1997, the appellant was charged with goods in custody (S 527C of the Crimes Act 1900), following the execution of a search warrant, on the previous evening, at his home at 629 King Georges Road Penshurst, by officers of the National Crime Authority. That matter came before the Local Court at Sutherland for hearing before Jennifer Betts LCM, on 8 May, 26 June and 31 August 1998. On 1 September 1998, Betts LCM found that there was no prima facie case and dismissed the charge. 2 The plaintiff thereafter made an application for costs pursuant to S 81 of the Justices Act 1902, a section which is in the following terms: "Payment of costs by defendant, or by prosecutor or complainant (1)The Justice or Justices making any conviction or order may in and by such conviction or order adjudge that the defendant shall pay to the clerk of the court, to be by him paid to the prosecutor or complainant, or, in the case of an order of dismissal, that the prosecutor or complainant shall pay to the clerk of the court, to be by him paid to the defendant such costs as to such Justice or Justices seem just and reasonable. (2) The amount so allowed for costs shall in all cases be specified in the conviction or order. (3) (a)For the purpose of the exercise of the power conferred by subsection (1), any order made under subsection (1) of section 556A of the Crimes Act 1900, shall have the like effect as a conviction. (b)The amount allowed for costs under subsection (1) as extended by this subsection shall be specified in the order made under subsection (1) of the said section 556A and that order shall be deemed to be an order whereby a sum of money is adjudged to be paid within the meaning of this Act. (4)Costs are not to be awarded in favour of a defendant unless the Justice or Justices is or are satisfied as to any of the following: (a) that the investigation into the alleged offence was conducted in an unreasonable or improper manner; (b) that the proceedings were initiated without reasonable cause or in bad faith or were conducted by the prosecution in an improper manner; (c) that the prosecution unreasonably failed to investigate (or to investigate properly) any relevant matter of which it was aware or ought reasonably to have been aware and which suggested either that the defendant might not be guilty or that, for any other reason, the proceedings should not have been brought; (d) that, because of other exceptional circumstances relating to the conduct of the proceedings by the prosecution, it is just and reasonable to award costs. (5) Subsection (4) does not apply to the awarding of costs against an informant or complainant acting in a private capacity." 3 The application for costs was refused, and these proceedings have now been commenced for orders in the nature of certiorari and mandamus, to quash the order refusing to award costs to the plaintiff, and to remit the proceedings to the Local Court to be dealt with according to law. 4 The facts are set out in the reasons for dismissing the charge. They show that upon their arrival and before executing the search warrant, the police saw the plaintiff, his wife, one of his children and another person in the house. When police knocked on the door, each of these persons moved quickly from the loungeroom area towards the rear of the premises. During the search, a total of $10,835 in bank notes was found, made up of $8,000 in bundles of $50 notes located between two pairs of shorts on the top of a dressing table in the plaintiff's bedroom, $1,000 in a bundle of $50 notes located in a drawer of a tallboy in his bedroom, $1,345 in $5 notes located under the bottom drawer of the tallboy, and $490 in $5 notes located in a bedside table. The goods in custody the subject of the charge were those banknotes. 5 Additionally during the search, a plastic decor lunchbox containing two resealable bags of green vegetable matter, later found to be 5.3 gms of cannabis, was located in a chlorine drum at the rear of the premises. The plaintiff said that the drum was his, but that he had not seen its contents before. A fingerprint of someone other than the plaintiff was found on the lunchbox. A box of similar GLAD plastic sandwich bags was found in the kitchen area, as well as another lunchbox similar to the one found in the chlorine drum. 6 The plaintiff informed police, when the money was found, that it was his and represented his life savings as well as some gambling winnings. He was a pensioner and not working. He participated in an ERISP but declined to answer any questions other than to supply his name and address. 7 Following his arrest, the plaintiff's solicitors sent a number of letters to the National Crime Authority and to the Police Prosecutor at Sutherland inviting dismissal of the charge. In the course of the correspondence the plaintiff's solicitor advised that he was a keen punter and kept his gambling winnings at home. It was asserted that on 12 August 1997, he had backed a winner with the TAB which had returned a dividend to him of $13,200. A letter from the TAB confirming that a dividend in that sum had in fact been paid out, on ticket number 6097151430, for an each way bet of $1000. The holder of the ticket was not identified, but it would appear from a letter dated 8 September 1998, annexed to an affidavit in support of the application, that documents inspected upon the return of a subpoena addressed to the TAB, showed that the dividend was paid out to one Norman Yates. 8 In relation to the sum of $1345, it was asserted by the plaintiff's solicitor that he had been saving $5 notes for his son for a considerable time. The other money was said to represent savings and winnings. 9 In relation to the cannabis found in the back yard, the possibility of it having been placed there at a recent party by friends of one of the plaintiff's teenage children, and then forgotten, was raised. The presence of plastic bags and similar items in the kitchen area were suggested to be innocent, such items being common place in most homes. 10 Upon the basis of that material it was submitted that the prosecution was bound to fail and that the proceedings should be discontinued. 11 On 9 April 1998, the National Crime Authority replied advising that the representations had been considered, but that the prosecution was to proceed. 12 The charge sheet as presented was in the following terms: "That John Leslie FOSSE between the 11th day of December 1997, and the 12th day of December 1997, at PENSHURST in the State of New South Wales, did have on premises $10,835 which may be reasonably suspected of being stolen, or otherwise unlawfully obtained." 13 In the course of the proceedings, the magistrate had, in the exercise of the discretion reserved under S 137 Evidence Act, excluded surveillance evidence that would have shown that another person, a Mr. Clarke, visited the home of the plaintiff that day and left those premises carrying something; as well as evidence showing that when his vehicle was stopped that night it contained, in the boot, a quantity of methylamphetamine. 14 After recording the matters led by the prosecution, and noting that the plaintiff had not denied the presence of money in the house, and had given an explanation that it represented his life savings, as well as some gambling winnings, Betts LCM said, in relation to the no case submission: "… the Court must take into account at this stage the prosecution case at its highest in determining whether the prosecution have established the elements to the requisite standard, at least at prima facie level. The counsel for the defendant indicates that the evidence is falling short in relation to satisfying the Court that money was reasonably suspected of being stolen or otherwise unlawfully obtained. Possession of large sums of money in itself is not unlawful and the prosecution are relying upon the other circumstances - namely, the so-called movement of the occupants of the house in the loungeroom towards the rear when the knock on the door occurred, the finding of the cannabis in the rear yard and the similar items found in the kitchen, though taking that into account, probably in just about every kitchen in New South Wales one would find similar items in any event, certainly in my kitchen and the items of money being found in the positions in which they were, being a number of circumstances which would suggest that the money found was unlawfully obtained with the inference being drawn and the only inference perhaps is that they were the proceeds of some drug dealing. The search warrant was executed and the information given to the issuing justice was to search items in relation to drug use and drug supply and the seizing of any items in relation to the use or supplying of prohibited substances and drugs. No prohibited items were located on the property and apart from the cannabis in the container in the chlorine drum in the rear yard and the prosecution asks that those circumstances be taken into account in assessing whether it has been able to establish that money seized by police may reasonably be suspected of being unlawfully obtained. In my view, the evidence falls short of establishing that the money was unlawfully or may reasonably be suspected of being unlawfully obtained. The factors themselves can be seen to be innocent enough, but even with the combined factors of the movement of the occupants of the premises, the Court also takes into account the time and one of those persons who moved was indeed one of the children of the defendant. The Court also takes into account the conversation had by the police with the defendant which was recorded on video and there's really no dispute in relation to that. There's been no denials of having money in the premises by the defendant and the money itself, whilst unusual being not in a banking institution, I do not feel that the evidence, taken at its highest, is capable of satisfying beyond reasonable doubt that the money was reasonably suspected of being stolen or otherwise unlawfully obtained. Accordingly, the charge will be dismissed, there being no prima facie case." 15 In dealing with the application for costs, Betts LCM said: "…at the close of the prosecution case, application to have the matter dismissed indicating no prima facie case was successful. It has now been submitted on behalf of the defendant application made under Section 81 of the Justices Act for costs. Principally, the defendant's relying upon ss (4c) that the prosecution unreasonably failed to investigate or to investigate properly any relevant matter which it was aware or reasonably ought to have been aware that suggested either the defendant might not be guilty or that for any other reason, the proceedings should not have been brought and also relying upon ss(d) that because of other exceptional circumstances relating to the conduct of the proceedings by the prosecution, it is just and reasonable to award costs. The facts have already been outlined by me and there were representations made on the defendant's behalf to the National Crime Authority who brought the proceedings and also to the prosecution or the police prosecutors. A decision was made to proceed with the charge under Section 527(c) of the Crimes Act against the defendant and evidence sought to be adduced at the outset also involved evidence of police stopping and arresting a person by the name of Clark. That person was found with a large amount of amphetamine in the boot of his car and due to reasons previously given that the prejudicial effect far outweighs the probative value of that evidence, the evidence in relation to surveillance of the premises and subsequent arrest of the person Clark was not admitted by me. The prosecution suggests that there's been sufficient evidence for the case to be brought. It really was a matter for the Court to decide and is asking the Court not to exercise its discretion in allowing costs and if the matter went into defence evidence, it's also been suggested that the person who subsequently obtained the TAB winnings, his credibility would have been put at issue. That may well have been the case. In any event, taking into account the facts as I found them and also the nature of the evidence against the defendant on the question of costs, I must be satisfied that the prosecution unreasonably failed to investigate any relevant matter of which it was aware or ought reasonably to have been aware that might suggest that the defendant was not guilty and due to that, the proceedings should not have been brought. On the matters put to the Court at this stage on the question of costs, I can't be satisfied that the prosecution unreasonably did fail to investigate, that if they did investigate, the proceedings would not have been brought. In relation to the application under Section 81ss(4c) I do not find anything in relation to that subsection. Also in relation to (d), that because of other exceptional circumstances relating to the conduct of the proceedings by the prosecution, it is just and reasonable to award costs. There has been nothing in relation to the conduct of the proceedings the Court has found makes it sufficient to be just and reasonable to award costs against the informant. Accordingly, I will exercise my discretion in not making an order for costs." 16 As appears from the reasons given for refusing the cost application, the plaintiff relied principally on s81(4)(c) and (d) of the Justices Act. The onus rested upon him to bring the case within an exception to the general rule laid down by the Section that costs are not to be awarded in favour of a defendant to proceedings in the Local Court. 17 In substance, the plaintiff asserts that because the NCA could not prove that the moneys were stolen or were otherwise unlawfully obtained, and did not investigate into, and was not in a position to disprove, the source of the moneys that had been suggested by him, the case was always bound to fail. As a consequence, it was submitted, the preconditions for a costs order specified in S 81(4)(c) and/or (d) were made out. 18 The present application falls to be determined by reference to the special principles applicable where relief is sought in the nature of certiorari or mandamus and not as an appeal simpliciter. Even so, the basis proposition on which the application was brought, appears to me to be questionable. In particular it overlooks the circumstance that for the offence charged it is sufficient if the thing in custody may be reasonably suspected of being unlawfully obtained. The word "may" falls short of "is", and the word "suspected" falls short of "known" or even "convinced" or "shown": Anderson v Judges of the District Court of New South Wales (1992) 27 NSWLR 701 at 714 and Haken v Johnson (Supreme Court of New South Wales, Wood J, 15 October 1993). 19 In the circumstances outlined where considerable sums of money (a large proportion being banknotes of a large denomination) were found in various parts of the plaintiff's home, where cannabis was also found in that home, and where the plaintiff was a pensioner, I am not persuaded that the proceedings were always bound to fail. Moreover, when the plaintiff had declined, as was his right, to be interviewed in relation to the source of his moneys, and where the only document offered in support of his claim was one provided by the TAB showing a payment out to a third party, I am not persuaded that the NCA unreasonably failed to investigate or failed to investigate properly, any relevant matter which suggested either that the plaintiff was not guilty or that the prosecution should not have been brought. 20 There is no entitlement to costs as of right in criminal proceedings, the common law principle historically being that the Crown neither pays nor receives costs: Latoudis v Casey (1990) 170 CLR 534 and Le Boursicot (1994) 79 A Crim R 549. 21 In Latoudis Mason CJ said that this rule could not survive once courts of summary jurisdiction were given a statutory discretion to award costs in criminal proceedings. That discretion, however, is exercisable only within the limits provided by the relevant statutory provision, in this case S 81(4) which provides that costs are not to be awarded in favour of a defendant unless one of the four circumstances specified is shown to exist. Subsection (4) was added after Latoudis and it negatives the majority view, in that case, that generally when a prosecution fails an order should be made that the defendant's costs be paid by the prosecution. 22 The decisions upon which the plaintiff placed reliance in support of his application, in which it has been held that the discretion of Courts of summary jurisdiction should, in a general way, be exercised in criminal proceedings in the same way as it is exercised in civil proceedings, are distinguishable in that the relevant statutory provisions conferring a discretion to award costs there involved were expressed in unfettered terms, without the condition that S 81 (4) attaches to its exercise: Walters v Owens (1973) 21 FLR 138; Cilli v Abbott (1981) 53 FLR 108; Denise Maria Scappaticci (1989) 41 A Crim R 379 and Turner v Randall (1988) 1 Qd R 726. 23 In relation to the claim for relief in the nature of certiorari, the face of the record is limited to the charge sheet and the magistrate's reasons for declining to make the order for costs: S 69(4) Supreme Court Act and Craig v The State of South Australia (1994-5) 184 CLR 163 at 182. 24 Jurisdictional error by the Local Court would be shown if it had mistakenly asserted or denied the existence of jurisdiction, or if it misapprehended or disregarded the nature or limits of its functions or powers in a case where it correctly recognised that jurisdiction did exist: Craig at 177. As the Court there said: "Since certiorari goes only to quash a decision or order, an inferior court will fall into jurisdictional error for the purposes of the writ where it makes an order or decision (including an order or decision to the effect that it lacks, or refuses to exercise, jurisdiction) which is based upon a mistaken assumption or denial of jurisdiction or a misconception or disregard of the nature or limits of jurisdiction." It continued: "Jurisdictional error is at its most obvious where the inferior court purports to act wholly or partly outside the general area of its jurisdiction in the sense of entertaining a matter or making a decision or order of a kind which wholly or partly lies outside the theoretical limits of its functions and powers." … "Less obviously, an inferior court can, while acting wholly within the general area of its jurisdiction, fall into jurisdictional error by doing something which it lacks authority to do." … "Similarly, jurisdictional error will occur where an inferior court disregards or takes account of some matter in circumstances where the statute or other instrument establishing it and conferring its jurisdiction requires that that particular matter be taken into account or ignored as a pre-condition of the existence of any authority to make an order or decision in the circumstances of the particular case. Again, an inferior court will exceed its authority and fall into jurisdictional error if it misconstrues that statute or other instrument and thereby misconceives the nature of the function which it is performing or the extent of its powers in the circumstances of the particular case. In the last-mentioned category of case, the line between jurisdictional error and mere error in the exercise of jurisdiction may be particularly difficult to discern." 25 The record in the present case does not disclose jurisdictional error in any of these respects. The learned magistrate did not misconceive the nature and extent of her jurisdiction to order costs. No matter was taken into account or ignored as a precondition of the existence of the authority to make or refuse a costs order, and there is no basis for assuming that the provision was misconstrued. On the contrary, Betts LCM correctly stated the power and its limits, as well as the effect of S 81(4)(c) and (d). 26 In these circumstances any error in the exercise of the power conferred under S 81(4) even if there was one, would not constitute jurisdictional error. 27 Inability to grant certiorari does not stand in the way of a grant of mandamus: Ex Parte New South Wales Rutile Mining Co Ltd re: Burns (1967) 85 WN (Pt1) (NSW) 494 at 504-505; and Ex Parte Donald re McMurray (1969) 89 WN (Pt1) (NSW) 462 at 467-468. 28 Relief in the nature of mandamus pursuant to S 134 of the Justices Act is not available as a form of general appeal. The mistake attracting this jurisdiction must be one which shows that the ostensible determination was not a real performance of the duty imposed by law upon the magistrate: Waterhouse v Gilmore (1988) 12 NSWLR 270 at 276, where Hunt J said: "It must be shown that the magistrate misunderstood the nature of the jurisdiction which he purported to exercise in the matter before him: Ex parte Hebburn Ltd; Re Kearsley Shire Council (1947) 47 SR (NSW) 416 at 420; 64 WN 107 at 109. Jordan CJ in that case included within the scope of mandamus the application of "a wrong and inadmissible test" ( Estate and Trust Agencies (1927) Ltd v Singapore Improvement Trust (1937) AC 898 at 917) and a misunderstanding by the magistrate as "the nature of the opinion which [he] is to form": R v Connell (1994) 69 CLR 407 at 432. There is a difference between real, although possibly mistaken performance by a magistrate of the jurisdiction vested in that office and the performance of the jurisdiction in a way that amounts to a constructive failure to exercise it: Saffron v Director of Public Prosecutions (1989) 16 NSWLR 397 at 418, where Priestly JA said: "In a decision which has been many times followed in this Court, Ex Parte Hebburn Ltd; Re Kearsley Shire Council (1947) 47 SR (NSW) 4156; 64 WN (NSW) 107, Jordan CJ illustrated the difference between a real, although possibly mistaken, performance by a magistrate of the duty imposed on him and a performance of that duty which was not relevantly real, called by him a constructive failure to exercise jurisdiction. He made two principal points (at 420; 109). 1. A magistrate may make a mistake of law, even as to the proper construction of a statute without constructively failing to exercise jurisdiction. 2. A mistake of law as to the proper construction of the statute investing a magistrate with jurisdiction which leads the magistrate to misunderstand the nature of the jurisdiction so that (i) he applies a wrong and inadmissible test or (ii) misconceives is duty or (iii) does not apply himself to the question which the law prescribes or (iv) misunderstands the nature of the opinion he must form, will make the magistrate's decision one given in a purported and not a real exercise of jurisdiction." 29 The decision reached by the magistrate in relation to S 81(4)(c) essentially turned upon her finding that she could not be satisfied that the NCA unreasonably failed to investigate the matter, or if they had made further investigations, the proceedings would not have been brought. In reaching that conclusion she made reference to all of the relevant circumstances and correctly stated the matter that the defence had to establish. 30 Similarly in relation to S 81(4)(d) she correctly identified that the defence had to establish something about the conduct of the proceedings being an "exceptional circumstance" other than some matter mentioned in subsections (a)(b) or (c) of S 81(4), to make it just and reasonable for the plaintiff to have his costs. In that regard the mere fact that the proceedings were resolved in his favour was not enough. There had to be something in relation to the manner in which the proceedings were conducted that had led to it being just and reasonable for a costs order to be made. 31 In these circumstances the matter does not fall into the category of cases where there was not a real exercise of jurisdiction. 32 For these reasons, the plaintiff's claim must fail, and the summons should be dismissed. I order accordingly. I will hear the parties in relation to costs of the summons. **********

Fosse v DPP & Anor

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