Jackson v The Queen

(1) Any person who, or any company on whose behalf the public officer, or a director, servant or agent of the company, by any wilful act, default or neglect, or by any fraud, act or contrivance whatever, avoids or attempts to avoid assessment or taxation shall be guilty of an offence.

Penalty: Not less than Fifty dollars, or more than One thousand dollars and, in addition, the Court may order the person to pay to the Commissioner a sum not exceeding double the amount of tax that has been avoided or attempted to be avoided.

(2) A prosecution for an offence against this section may be commenced at any time within six years after the commission of the offence.

The trial judge decided to put special questions to the jury under s. 624 of the Code, and he framed those questions in relation to the first count as follows:

(1) That on the 26th January 1972 George Norman Jackson was the servant of Welch Brothers (Queensland) Pty. Limited;

(2) That on that date he made a false entry in order Form 0541 dated 26th January 1972;

(3) That the Order Form belonged to Welch Brothers (Queensland) Pty. Limited;

(4) That in making the false entry he had an intention thereby then to defraud;

(5) If the answer to question (4) is "Yes", was the intention to defraud -

(c) Welch Brothers (Queensland) Pty. Limited or the Taxation Commissioner, but unable to say which?

Similar questions were framed in relation to the second count.

The jury answered the questions as follows: Q. 1. Yes. Q. 2. Yes. Q. 3. Yes. Q. 4. Yes. Q. 5(c). Yes. The questions relating to the second count were similarly answered.

The trial judge then directed the jury as follows: "Well I direct you that the effect in law of your answers is that all the elements of the charge which have to be proved have been proved. I will now ask you how do you find George Norman Jackson on the first count? Do you find him Guilty or Not Guilty?" The foreman replied "Guilty" and the trial judge then said: "So says your foreman, so say you all?" The jurors replied "Yes". The jury answered similarly in respect of the second count.

The trial judge then reserved questions of law under s. 668B for the Court of Criminal Appeal, those questions being as follows:

1. In view of the finding of the jury to the questions asked of them, has this Court jurisdiction to proceed to judgment as for a breach of s. 441(b) of The Criminal Code having regard to the provisions of the Crimes Act 1914-1973 [sic] Cth s. 5 and the Income Tax Assessment Act 1936-1973 [sic] Cth s. 231?

2. Was I right in law in directing the jury that the effect in law of their answers to the questions asked of them was that all the elements of the charge which had to be proved had been proved?

3. Was I right in law in the procedure I adopted in obtaining the verdict of the jury on each count in the indictment?

4. Should I have directed the jury to return a verdict of Not Guilty on each count in the indictment?

He stated a case accordingly. The Court of Criminal Appeal answered the first three questions in the affirmative and the last question in the negative. Special leave to appeal is now sought.

I see no substance in the matter raised in the first question. I shall assume for present purposes that s. 441 on its true construction includes an intent to defraud the Commissioner of Taxation. The question is whether the Income Tax Assessment Act generally and s. 231 in particular disclose an intention to exclude other legislation comprehending, or other offences having as an ingredient, an intention to defraud the Commissioner of Taxation. Section 231 deals with avoidance and attempts to avoid tax by fraud. The falsification of a document without any presentation or attempted presentation thereof to the Commissioner of Taxation or his officers is neither an act nor an attempt within s. 231. That fraudulent intent is an ingredient of an offence of avoiding or attempting to avoid income tax discloses no intention to exclude legislation making such an intent an ingredient of the offence of making a false entry by a servant in a document belonging to his employer. As to s. 5 of the Crimes Act I cannot from the facts appearing in the case stated see what relation it has to the matter. It might be relevant if the defence raised was that there was an attempt to defraud the Commissioner in respect of the tax payable by the employer, but nothing of that appears in the case stated.

On the second question argued, namely, the correctness of the answer given by the Court of Criminal Appeal to question 3 reserved by the trial judge, I am satisfied that the course adopted was correct. The answers given by the jury answered every issue of fact the determination of which lay within their province. Once it can be said that the jury has determined every such issue then a conclusion of law, and that alone, flows from their determination and the duty of the trial judge is to direct the jury on all matters of law. The argument on this point which has been presented on behalf of the applicant fails to distinguish between different kinds or classes of factual questions which a jury may be asked to find specially. There is a distinction between the ultimate issue of fact which is entrusted to the determination of a jury and any issue of fact in a case which falls short of being the ultimate issue of fact. Both in the case of a special verdict or answers to special questions and in the case of a judge's direction to the jury there is always a danger that the issues will be so left to the jury that an ultimate issue of fact is converted into an apparent issue of law. Particularly is this so if a view be taken that the meaning of an ordinary English word can be a question of law and that consequently, if all the factors or conditions contained within the definition of a word are found to exist, then the ultimate fact or notion expressed in the word is established in law. This is a dangerous and difficult view, especially in the field of criminal law. But there is nothing of this in the present case. The questions which the jury was asked specially to answer were questions which comprehended all the elements of the alleged offences as those elements are expressed in s. 441. None of the questions attempted to elicit facts from which the jury could be directed, and wrongly directed, that the elements of the offence were established, e.g. facts which would lead to a conclusion, supposed to be a legal conclusion, that the accused was a servant, or had made a false entry, or had an intent to defraud. It was not that kind of case at all. Once the questions on all the ultimate facts were answered by the jury, they had performed their function. They had found that the accused on 26th January 1972, being a servant of Welch Brothers (Queensland) Pty. Ltd. made a false entry in order form 0541 dated 26th January 1972 belonging to Welch Brothers (Queensland) Pty. Ltd. with intent to defraud. They had not said "Guilty"; but a proper direction in law at that stage was for the trial judge to direct them as he did. Whether he could have directed a verdict of guilty to be entered does not arise: see per Pollock B. in Reg. v. Farnborough [8] . In R. v. Brown and Brian [1] the Full Court of the Supreme Court of Victoria took the view that a verdict of guilty could not be entered but it is clear that they also took the view that the trial judge could direct the jury to return a verdict of guilty as was done in the present case [2] . See also in relation to a civil verdict per Dixon J. in McDonnell & East Ltd. v. McGregor [3] . The course taken by the trial judge was perfectly correct.

1. [1895] 2 Q.B. 484, at p. 486. 2. [1949] V.L.R. 177. 3. [1949] V.L.R., at p. 180. 4. (1936) 56 C.L.R. 50, at pp. 55-56.

Those were the two questions for consideration of this Court, which were referred to in the affidavit in support of the application for special leave to appeal. Upon neither of them does it appear to me that the Court of Criminal Appeal was in error. The reasons advanced in the affidavit why special leave should be granted were as follows:

(a) The decision of the Court of Criminal Appeal involves the question as to whether the Income Tax Assessment Act 1936-1973 Cth covers the field.

(b) The decision of the Court of Criminal Appeal involves the question as to how far, if at all, the criminal law of various states applies in circumstances where offences under the Income Tax Assessment Act 1936-1973 Cth are involved.

(c) The decision of the Court of Criminal Appeal involves the proper procedure to be applied by a trial judge in directing a jury after a jury has returned a special verdict and involves consideration of the principles discussed in R. v. Brown and Brian [1] .

In these circumstances special leave to appeal should be refused. However, I should not thereby be taken to endorse the interpretation of s. 441 which was accepted, indeed advanced, by counsel for the applicant throughout the trial and the proceedings before the Court of Criminal Appeal, namely, that the words "intent to defraud" embraced an intent to defraud the Commissioner of Taxation. 1. [1949] V.L.R. 177.

I would expressly reserve the question whether the words "intent to defraud" mean intent to defraud any person whatsoever or whether in their particular context they mean intent to defraud the employer or any person or persons acting on behalf of or in the interest of the employer. The answer to this question is not concluded by the presence in the Code of s. 643, a section which does not appear to affect the ingredients of any offence created by other sections of the Code. It may be that the words in s. 441 should be given an unrestricted meaning; yet it seems strange that a servant should be made criminally responsible even if he acts with the concurrence or at the instigation of his employer provided there was an intent to defraud some person or class of persons or the world generally whilst the employer, if he be a private individual, would not be criminally responsible.

This is an application for special leave to appeal from the decision of the Court of Criminal Appeal of the Supreme Court of Queensland on a case stated by a trial judge under s. 668B of the Criminal Code Q.. The trial judge reserved four questions of law for the Court of Criminal Appeal as follows:

1. In view of the findings of the jury to the questions asked of them, has this Court jurisdiction to proceed to judgment as for a breach of s. 441(b) of The Criminal Code having regard to the provisions of the Crimes Act 1914-1973 Cth, s. 5 and the Income Tax Assessment Act 1936-1973 Cth s. 231?

2. Was I right in law in directing the jury that the effect in law of their answers to the questions asked of them was that all the elements of the charge which had to be proved had been proved?

3. Was I right in law in the procedure I adopted in obtaining the verdict of the jury on each count in the indictment?

4. Should I have directed the jury to return a verdict of Not Guilty on each count in the indictment?

The Court of Criminal Appeal answered "Yes" to the first three questions and "No" to the fourth question.

The application for special leave was based on the following grounds:

(a) The decision of the Court of Criminal Appeal involves the question as to whether the Income Tax Assessment Act 1936-1973 Cth covers the field.

(b) The decision of the Court of Criminal Appeal involves the question as to how far, if at all, the criminal law of various states applies in circumstances where offences under the Income Tax Assessment Act 1936-1973 Cth are involved.

(c) The decision of the Court of Criminal Appeal involves the proper procedure to be applied by a trial judge in directing a jury after a jury has returned a special verdict and involves consideration of the principles discussed in R. v. Brown and Brian [4] .

The first two grounds arise from the contention that s. 441 of the Criminal Code, under which the applicant was charged, is invalid (see s. 109 of the Constitution) because it is inconsistent with s. 231 of the Income Tax Assessment Act 1936, as amended Cth (either alone or together with s. 5 of the Crimes Act 1914-1973 Cth). Section 441 of the Criminal Code states:

Any person who, being a clerk or servant, or being employed or acting in the capacity of a clerk or servant, does any of the acts following with intent to defraud, that is to say, -

(a) Destroys, alters, mutilates, or falsifies, any book, document, valuable security, or account, which belongs to or is in the possession of his employer, or has been received by him on account of his employer, or any entry in any such book, document, or account, or is privy to any such act; or

(b) Makes or is privy to making any false entry in any such book, document, or account; or

(c) Omits or is privy to omitting any material particular from any such book, document, or account;

is guilty of a crime, and is liable to imprisonment with hard labour for seven years. Section 231(1) of the Income Tax Assessment Act states: Any person who, or any company on whose behalf the public office, or a director, servant or agent of the company, by any wilful act, default or neglect, or by any fraud, act or contrivance whatever, avoids or attempts to avoid assessment of taxation shall be guilty of an offence. Penalty: Not less than Fifty dollars, or more than One thousand dollars and, in addition, the Court may order the person to pay to the Commissioner a sum not exceeding double the amount of tax that has been avoided or attempted to be avoided. Section 5 of the Crimes Act states: Any person who aids, abets, counsels, or procures, or by act or omission is in any way directly or indirectly knowingly concerned in, or party to, the commission of any offence against any law of the Commonwealth or of a Territory, whether passed before or after the commencement of this Act, shall be deemed to have committed that offence and shall be punishable accordingly.

In my opinion, there is no inconsistency between these three sections. There are indications in s. 441 of the Criminal Code, read in its context, that the section is restricted to conduct committed with intent to defraud the employer. Even if s. 441 is not read in this restricted way, there is no inconsistency with the provisions of s. 231 of the Income Tax Assessment Act. On this aspect, I agree with the reasons of Jacobs J.

The third ground for special leave concerns the procedure adopted by the trial judge in his directions relating to the verdict. He asked the jury to answer the following questions:

(1) That on the 26th January 1972 George Norman Jackson was the servant of Welch Brothers (Queensland) Pty. Limited;

(2) That on that date he made a false entry in order Form 0541 dated 26th January 1972;

(3) That that Order Form belonged to Welch Brothers (Queensland) Pty. Limited;

(4) That in making the false entry he had an intention thereby then to defraud;

(5) If the answer to question (4) is "Yes", was the intention to defraud -

(c) Welch Brothers (Queensland) Pty. Limited or the Taxation Commissioner, but unable to say which?

The jury answered "Yes" to the first four questions and to 5(c). The trial judge then directed them in these terms: "Well I direct you that the effect in law of your answers is that all the elements of the charge which have to be proved have been proved. I will now ask you how do you find George Norman Jackson on the first count? Do you find him Guilty or Not Guilty?"

The questions were put to the jury in accordance with s. 624 of the Criminal Code which provides:

Special verdict. - In any case in which it appears to the Court that the question whether an accused person ought or ought not to be convicted of an offence may depend upon some specific fact, or that the proper punishment to be awarded upon conviction may depend upon some specific fact, the Court may require the jury to find that fact specially.

Special findings by the jury in answer to questions propounded by the judge do not amount to a special verdict at common law although the heading of s. 624 is "Special verdict". "A special verdict", as defined by Barry J. in R. v. Brown and Brian [5] is: "a finding by the jury of particular facts which raise a question of law, accompanied by a statement by the jury of their verdict in the light of the determination by the Court of the question of law." A verdict returned by a jury, whether general or special, incorporates the jury's conclusion on guilt (although in the case of a special verdict it is conditional upon the court's opinion on a question which it has been requested by the jury to determine).

The applicant contended that the procedure was irregular because the trial judge had directed the jury to convict.

The Crown submitted that the trial judge did not in fact direct the jury to return a verdict of guilty, but that a judge was entitled to direct a jury to return a verdict of guilty even where the jury had not found any facts or issues specially, as it did in this case. The Crown relied upon the cases of Reg. v. Eastwood [6] ; R. v. Larkin [7] ; Reg. v. Healey [8] ; Reg. v. Draper [9] and Gorman v. The King [10] .

1. [1961] Crim. L.R. 414. 2. [1943] 1 All E.R. 217. 3. [1965] 1 All E.R. 365. 4. [1962] Crim. L.R. 107. 5. (1944) 45 W.A.L.R. 80.

This submission bears out the prediction of Lord Devlin: "[T]here has begun the slow unfolding of a doctrine which might blossom into what to defenders of trial by jury would be a noxious flower." (Trial by Jury (1966), Preface).

This doctrine, "the genesis [of which] will be found in R. v. Larkin [7] ", is that "a judge, who is taking a general verdict, can in any circumstances direct a jury that as a matter of law they must return a verdict of guilty" (Trial by Jury, p. 186). The extent to which judges in England are now interfering by withdrawing issues from juries and directing them on findings of fact or issues of guilt may be seen in "Directions to Convict - a Reply" by M. J. McConville, Criminal Law Review (1973), p. 164.

In my opinion, the trial judge did not direct the jury to return a verdict of guilty. He left them the option of acquitting the accused. If this option were merely formal and if there were a possibility that the jury were left with the impression (by this or a previous direction) that they must convict, this would have been an irregularity so great that the trial would have miscarried.

A judge is never entitled to direct a jury to return a verdict of guilty. This is so, whether or not facts have been found specially. If the judge does so direct, the jury are entitled to refuse to follow his direction. The jury system is the means by which the people participate in the administration of justice. Its history shows that the task of a jury is not a mechanical one of fitting the law (as the judge states it) to the facts (as the jury find them). Here and in England, juries have often refused to convict where there was oppression in the law or its administration, despite overwhelming evidence of guilt. A famous example is the consistent refusal of juries over many years to convict of treason, whatever the evidence, when the penalty was hanging, drawing and quartering. When the law was altered to reduce the barbarities, juries began to convict again.

Another example concerns the early history of Australia. Juries in England consistently refused to return a verdict carrying the death penalty when imprisonment was the penalty for stealing to the value of less than forty shillings (this was often converted later to transportation to the colonies) and death was the penalty for stealing to the value of forty shillings or more. Verdicts such as "guilty of stealing one hundred gold sovereigns to the value of thirty-nine shillings" became a passport to the penal colonies of Australia.

The common practice of the juries of eliminating capital charges by understating the value of stolen property was largely responsible for the virtual suspension of the operation of many capital statutes. (L. Radzinowicz, A History of English Criminal Law, vol. 1 (1948), p. 95). This was followed after a time by judges, even the more severe ones, such as Lord Mansfield who, according to Campbell (Lives of the Chief Justices of England, 3rd ed. (1874), vol. 3, p. 320), "did not allow the guilty much chance of escaping, and, for the sake of examples was somewhat severe in the punishments he inflicted". Lord Mansfield advised a jury to find a gold trinket, the subject of a charge of stealing in a dwelling-house to the value of forty shillings, to be of less value. The prosecutor exclaimed, with indignation, "Under forty shillings, my Lord! Why the fashion, alone, cost me more than double the sum." Lord Mansfield calmly observed, "God, forbid, gentlemen, we should hang a man for fashion's sake!" (Campbell, op. cit., vol. 4, pp. 21-22). (See Radzinowicz, op. cit., p. 94).

Anyone acquainted with the modern operation of the system of criminal justice will be aware that juries do invoke their traditional power to acquit for reasons which are extraneous to the strict legal issues, for example, where the charge is trivial or stale or there has been serious misconduct by the prosecution. The independence of juries must not be eroded by judges directing them to convict.

The grounds advanced do not justify the granting of special leave to appeal. I express no view on whether the answers given by the Full Court to questions 2 and 4 were incorrect for other reasons than the suggested inconsistency.