Lusty (Examiner) v DEZ22

1. The respondent be imprisoned until further order.
2. A warrant for the respondent's committal to prison be issued.
3. The parties have liberty to apply on 48 hours' notice in the event that: (a) the respondent purges his contempt; or (b) the circumstances otherwise change, such as to warrant an application by the respondent to fix a determinate sentence to punish him for the contempt in question.
4. The respondent pay the applicant's costs of, and incidental to, the application. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

WIGNEY J: 1 The respondent to this proceeding, who has been given the pseudonym DEZ22, has admitted to being in contempt of the Australian Criminal Intelligence Commission, formerly the Australian Crime Commission (ACC). The particulars of the contempt are that on six occasions during an examination conducted by the applicant and examiner under s 46B of the Australian Crime Commission Act 2002 (Cth) (the ACC Act) the respondent refused to answer questions put to him by the examiner. The question for the Court is how the respondent should be dealt with in relation to that contempt. Statutory framework 2 Section 7 of the ACC Act establishes the ACC. One of the ACC's key functions is to undertake special ACC investigations, being investigations related to federally relevant criminal activity that the board of the ACC has authorised to occur: see s 7A(c) of the ACC Act and the definition of "special ACC investigation" in s 4(1) of the ACC Act. 3 Section 24A of the ACC Act provides that "an examiner may conduct an examination for the purposes of a special ACC operation/investigation". Section 28(1)(a) provides that "[a]n examiner may summon a person to appear before an examiner at an examination to", inter alia, "give evidence". 4 Section 34A of the ACC Act provides that a person is in contempt of the ACC if he or she, inter alia, "when appearing as a witness at an examination before an examiner … refuses or fails to answer a question that he or she is required to answer by the examiner": s 34A(a)(ii) of the ACC Act. Section 34B of the ACC Act provides as follows: 34B Federal Court or Supreme Court to deal with contempt (1) If an examiner is of the opinion that, during an examination before the examiner, a person is in contempt of the ACC, the examiner may apply to either of the following courts for the person to be dealt with in relation to the contempt: (a) the Federal Court; (b) the Supreme Court of the State or Territory in which the examination to which the contempt relates is being conducted. (2) Before making the application, the examiner must inform the person that the examiner proposes to make the application. (3) The application must be accompanied by a certificate that states: (a) the grounds for making the application; and (b) evidence in support of the application. (4) A copy of the certificate must be given to the person before, or at the same time as, the application is made. (5) If, after: (a) considering the matters specified in the certificate; and (b) hearing or receiving any evidence or statements by or in support of the ACC; and (c) hearing or receiving any evidence or statements by or in support of the person; the Court to which the application was made finds that the person was in contempt of the ACC, the Court may deal with the person as if the acts or omissions involved constituted a contempt of that Court. (6) For the purposes of determining whether a person is in contempt of the ACC under subsection (1), Chapter 2 of the Criminal Code applies as if: (a) contempt of the ACC were an offence; and (b) references to a person being criminally responsible for an offence were references to a person being responsible for contempt of the ACC. 5 A certificate under section 34B(3) is prima facie evidence of the matters specified in the certificate: s 34C(3) of the ACC Act. Facts 6 On 14 June 2022, the applicant issued a summons to the respondent pursuant to s 28 of the ACC Act. The summons was stated to be for the purposes of the special ACIC investigation being undertaken by the ACC pursuant to the Special Australian Criminal Intelligence Commission Investigation Determination (Targeting Criminal Wealth) 2020. The summons required the respondent to appear before an examiner in an examination on [redacted] to give evidence in relation to certain specific matters. Those matters included: "dealing with money or other property, especially large amounts of cash, that is [sic] proceeds or instruments of crime, especially drug trafficking"; "tax evasion"; "the use of encrypted communication devices and platforms to facilitate such activities"; "the ongoing involvement of members and associates of [redacted] in such activities"; and "the identities of other persons involved in such activities, including persons located overseas, and the nature and extent of their involvement". 7 The respondent attended the examination on [redacted] in compliance with the summons. Towards the commencement of the examination, the respondent advised the applicant that he did not wish to answer questions because of concerns about his safety. The applicant asked the respondent if he wanted to elaborate in respect of his safety concerns, to which the applicant replied: "No comment." The applicant then warned the respondent of the consequences of refusing to answer, including that he would be committing a contempt punishable by imprisonment. The respondent said that he understood. The respondent subsequently reiterated during the examination that he intended not to answer questions, that he was aware of the consequences, and that he had obtained legal advice. Despite the respondent's stated intention to refuse to answer questions during the examination, the applicant proceeded to ask the respondent questions. 8 The statement of charge identifies the following six questions that were put to the respondent during the course of the examination: 1. Are you the commander of the … chapter of the [redacted] Motorcycle Club? 2. Are members of the [redacted] Motorcycle Club involved in drug trafficking? 3. Are members of the [redacted] Motorcycle Club involved in dealing with the proceeds of crime, including cash derived from drug trafficking? 4. Do members of the [redacted] Motorcycle Club use encrypted communications devices to communicate about illegal activities, including drug trafficking? 5. What types of illegal activities is the [redacted] Motorcycle Club involved in? 6. Has someone else from the [redacted] Motorcycle Club directed you to not answer questions at this Examination? 9 The respondent's response to each of those six questions was: "No comment". In each instance, the application then told the respondent that he, the applicant, regarded the questions as highly relevant to the special investigation and the respondent was directed to answer the question. The respondent confirmed or maintained his refusal to answer each of the six questions. The examination was subsequently adjourned to a date yet to be fixed. The respondent was invited to contact the ACC if he changed his mind and decided to answer the ACC's questions. The applicant's solicitor subsequently wrote to the applicant and invited him to purge his contempt. The respondent did not reply to that letter. 10 The applicant relied on the evidence of a senior officer of the ACC, Mr [redacted] Halls, concerning the investigation in respect of the applicant and the consequences to the investigation of the respondent's ongoing refusal to purge his contempt and answer the ACC's questions. In short summary, a relevant part or aspect of the investigation focuses on "criminal wealth activity" and linked offences committed by the [redacted] Motorcycle Club. The [redacted] Motorcycle Club has been assessed by the ACC as being involved in serious and organised crime. The ACC believed the respondent to be a long-standing and senior member of the [redacted] Motorcycle Club. 11 Mr Halls' unchallenged evidence (at [24]-[26] of his affidavit) was as follows: The ACIC believes that DEZ22 is a highly significant witness who can provide invaluable information about past, present and future-planned criminal wealth activity involving the [redacted] that would greatly assist in progressing the TCW 2020 SI and achieving its purposes, as set out in paragraph 9 of the TCW 2020 SI Determination. DEZ22's contempt of the ACIC prevented the ACIC from obtaining answers from him about his expected knowledge of matters such as: a. the criminal wealth activity of the [redacted] … and its leadership and members, including evidence of criminal wealth activity that is sanctioned by or undertaken on behalf of individual members or associated criminal networks separate to the COMCG; b. methods used by the [redacted] … and individual members to increase, protect and move their criminal wealth, and to avoid law enforcement scrutiny of their activities; c. methodologies that are being employed by members of the relevant criminal groups to avoid law enforcement scrutiny of their activities; d. how the [redacted] … use professional facilitators to obfuscate/increase their capacity to undertake criminal wealth activity; e. how the [redacted] … uses transport industries to facilitate criminal wealth activity, and the trafficking of illicit substances to generate criminal wealth; f. how the [redacted] … has responded to recent events and law enforcement activity, including shootings in Sydney since mid-2021; and g. how the [redacted] … interacts with other organised crime groups and OMCGs. Notwithstanding the passage of time since the examination of DEZ22 held on [redacted], DEZ22 is expected to be in possession of information which is as relevant now to the ACIC's current and ongoing investigation as at the time of the examination. The answers to the questions which DEZ22 refused to answer in the examination, for which he has pleaded guilty to contempt of the ACIC, continue to be material to the work of the ACIC. I am advised that DEZ22 can still provide valuable information about all of the matters listed in paragraphs 21-25. 12 Mr Halls also noted that the six questions that the respondent refused to answer were essentially "introductory or opening" questions which were "intended to be followed by a series of additional questions seeking to elicit further relevant information about each particular matter and other related matters". Relevant principles 13 There are, broadly speaking, two main ways in which the Court may deal with a contemnor in respect of a contempt of the ACC arising from the contemnor's refusal to answer questions in the ACC examination. The first is to commit the contemnor to prison until he or she purges the contempt. The second is to punish the contemnor for the contempt by imposing a sentence, usually one involving a determinate sentence of imprisonment. 14 An order committing the contemnor to prison for an indefinite period is ordinarily appropriate where the contemnor has not purged the contempt, or there is a need for, or some utility in, obtaining answers to the questions, and there is at least a prospect that the imprisonment may coerce the contemnor to answer the relevant questions: see generally Wood v Galea (1995) 79 A Crim R 567 at 572-573; Von Doussa v Owens (No 3) (1982) 31 SASR 116 at 117-118; Royal Commissioner v Staunton [1995] NSWSC 45 at [26]-[30]; Anderson v XLVII (2015) 319 ALR 139; [2015] FCA 19 at [49]; Anderson v EVA20 [2022] FCA 1165 at [39]-[44]. 15 If such an order is made, the contemnor is generally to be released from prison if he or she purges the contempt and answers the questions, or there is no longer any need or requirement to elicit the answers, or the contemnor has been imprisoned for a period which would, in any event, be an appropriate punishment for the contempt without regard to coercion: see Wood v Galea (1997) 92 A Crim R 287 at 288-289; DTO21 v Australian Crime Commission [2022] FCAFC 190 at [17]. 16 An order imposing a sentence on the contemnor as punishment for the contempt is ordinarily appropriate where the contemnor has purged the contempt, or where there is no longer any need or point in requiring the contemnor to answer the questions, or where there is no longer any utility in endeavouring to coerce the contemnor to answer the questions because, for example, it is readily apparent that the contemnor will not change his or her attitude even in the face of continuing incarceration: see Wood v Galea at 573; Anderson v XLVII at [49]; Wood v Galea (1996) 84 A Crim R 274 at 283-284; Anderson v EVA20 at [39]-[44]. 17 That is not to say that the fixing of a determinate sentence to punish for the contempt is only ever appropriate in those particular circumstances. There may be some cases where it is appropriate to fix a sentence to punish a contemnor for the contempt where there remains a prospect that the contemnor may purge his or her contempt. Each case must be considered on its own facts. 18 When a sentence is imposed on the contemnor to punish for the contempt, the general law principles applicable to fixing a sentence for a criminal offence apply. The relevant considerations generally include: whether the contempt has been purged; the seriousness of the contempt; the consequences of the contempt; the reason for the contempt; whether there has been an apology or expression of contrition; the character and antecedents of the contemnor; denunciation of the contempt; and general and personal deterrence: see Wood v Staunton (No 5) (1996) 86 A Crim R 183 at 185; Lusty v CRA20 [2020] FCA 1737 at [36]. 19 The imposition of a penalty, however, should not be approached on the basis that there is a checklist of considerations that needs to be ticked off. Each case must be considered on its own merits and having regard to its own unique facts and circumstances: see Anderson v EVA20 at [57]. A sentence to punish for a contempt of the ACC of the type in question in this case need not necessarily involve a custodial sentence. In reality, however, it would rarely be appropriate to impose a sentence which does not involve at least some period of imprisonment for a contempt of the sort committed by the respondent in this case. That is particularly because of the need for general and specific deterrence in such cases: see Anderson v EVA20 at [65]. The respondent's circumstances 20 The respondent did not give evidence. He did, however, tender a letter to the Court and a report prepared by a psychologist. In his letter, the respondent sought to explain why he had not purged his contempt and also sought to express his remorse for his contempt. It is appropriate to set out the body of the letter in full: I am the respondent in these proceedings and write to try to provide an explanation for, and convey my remorse for, my contempt and for not purging my contempt, after being called to answer questions for an Australian Crime Commission related enquiry. I was exposed to violence and drug and alcohol abuse as a child, directly and within my immediate environment. My father, [redacted], struggled with substance abuse and alcoholism his entire life, ultimately dying at around age 50 from a suspected overdose. I was exposed to members of OMCG from a young age. I have been familiar with the consequences that can occur for an OMCG member, in the instance of providing information about other members, or being perceived to provide information about other members. I am terrified of these consequences. Prior to being called to answer questions at the Australian Commission enquiry, where I engaged I [sic] contempt, I had read articles in the paper of wives and members being called to proceedings. This alerted my anxiety to any discovery of me being required to answer questions, if in this position. My anxiety peaked when I was called to answer questions. I attended with a solicitor, and we met investigating officers of the ACC. One of the officers said to my solicitor "I saw you at an enquiry in Sydney recently, didn't I?". My solicitor did not respond to this question, however this further escalated my anciety that my attendance and information related to it was not secure. I lost further trust in the investigator and the process. I have a history of extreme anxiety, depression and I believed PTSD as a result of traumatic upbringing. I easily become emotionally overwhelmed. I am sorry for not purging my contempt, however I am too afraid for the alternative. I am a committed father [redacted], who I love more than anything in the world, [redacted], and with whom I provide financial and emotional support. I am devastated at the consequence to my family and the loss my children now face as a result of my decision, and this speaks to the gravity of my fear at complying with my obligation. I appreciate the court considering this letter. 21 The psychologist report contains a very detailed description of the respondent's life, including: his difficult childhood; his "significant relationships"; his educational and vocational history; his attitude to alcohol, drugs and gambling; his health and mental health; and his "previous criminality". It is unnecessary to recount the contents of the psychologist's report in any great detail. It may be accepted that the respondent had an extremely deprived and traumatic upbringing and has certainly not had an easy life. That has predisposed the respondent to be "extremely mistrustful of others" as well as an anxious predisposition. 22 What is perhaps more significant for present purposes is that the psychologist report contains an account and explanation, albeit a fairly limited somewhat unpersuasive one, for why the respondent refused to answer the questions put to him during the examination. The psychologist noted that the respondent gave her the following account of his attendance at the examination: [The respondent] recalled 'when going into that day, the big fella at the door, the investigator said something to my solicitor, something like 'I saw you last week'. [The respondent] recalled 'I wanted to shut down. I didn't feel safe. That spun me out…I don't trust this (process), I don't feel safe. What's going on? How do I know things aren't going to be disclosed? I had these irrational thoughts. Why's he (investigator) seeing her (solicitor)? My anxiety was through the roof and so I closed down' emotionally thereby refusing to answer any of the six (6) questions put to him. 23 That hearsay account of the respondent's state of mind is broadly consistent with the account contained in the respondent's letter to the Court. The psychologist offered the following analysis based on the respondent's account: [The respondent] asserts, and there are (trauma-based) grounds to believe, that the context in which he was brought in to respond to questions triggered a sense of unpredictability and mistrust, which in turn produced anxiety, fear and suspicion. He maintained that this fight-or-flight response, in part, hindered his capacity to respond to the questions asked of him. As identified above, [the respondent] would have typically responded to such emotions by fleeing, however when this was not possible, he reportedly 'shut down'. His involuntary response therefore denotes that his traumatic background has directly contributed to the index offence. 24 It should also be noted in the context of the psychologist's report that the respondent apparently disclosed to the psychologist that he had been a "[redacted] for a few years" and is now "[redacted]" in the [redacted] Motorcycle Club. He also reportedly told the psychologist that the club comprises approximately [redacted] and that he had no current intention to cease affiliation with them. It is equally important to note that the report reveals that, while the respondent has committed various criminal offences in the past, he has not yet spent any time in prison. Submissions 25 It is unnecessary to detail the parties' submissions. It suffices to note the following. 26 The applicant submitted that an immediate sentence of imprisonment was appropriate in all the circumstances. In the applicant's submission, an indefinite custodial sentence would be appropriate because a fixed term was unlikely to have the same coercive effect. An indeterminate sentence was also said to be likely to "send an appropriate message to persons who may find themselves in a position similar to the respondent that their obligation to answer questions that they are required to answer before an ACIC examiner cannot be avoided by mere payment of a tariff by way of imprisonment for fine". 27 The applicant also submitted that the Court would not accept unreservedly the respondent's evidence concerning his fear arising from answering the questions put to him by the examiner and would not accept that there is no prospect at all of the respondent purging his contempt at some point in the future. 28 The respondent submitted that the Court should approach the sentencing exercise from the perspective that the respondent has "remained consistent that he has no intention of purging his contempt". He submitted that, in those circumstances, coercion had limited utility and an indefinite sentence was not required. The respondent effectively accepted that a custodial sentence was warranted, but submitted that the sentence should be wholly or partially suspended. The respondent pointed to a number of significant aspects of his background and upbringing that would compel the Court to extend some leniency in respect of the penalty to be imposed. The appropriate orders 29 The circumstances of this case are such as to warrant an order committing the respondent to prison until further order. That is so for a number of reasons. 30 First, I am satisfied that there is an ongoing need on the part of the ACC to obtain answers from the respondent to the questions that were put to him during the examination. I accept Mr Halls' unchallenged evidence that the respondent is a highly significant witness who can provide invaluable information about past, present and future planned criminal wealth activities involving the [redacted] Motorcycle Club and that information that the respondent can provide in respect of those matters is likely to assist the ACC's ongoing special investigation. 31 Second, I am not persuaded that there is no prospect the respondent will not, or may not, change his attitude and will not purge his contempt and answer questions if he is committed to prison for an indefinite period. As already noted, the respondent did not give evidence. Nor did the applicant otherwise unequivocally assert that he would never purge his contempt. The respondent did not directly state, either in his letter or in the account he gave to the psychologist, that he would never purge his contempt at any point in the future. Even if he did, I would not, at this early stage at least, accept any such bare assertion as having any real credibility or reliability. 32 The only reason given by the respondent for refusing to answer the examiner's questions is that he was afraid to do so. He has, however, steadfastly refused to elaborate on the basis of that fear beyond referring to a fairly anodyne remark made by an ACC officer to his solicitor shortly prior to the examination. I am presently unpersuaded about the credibility or reliability of the respondent's assertion that he is afraid to answer the ACC's questions. 33 It was submitted on the respondent's behalf that his fear arises from the nature of the organisation of which he is a member. In particular, it was submitted that it may be inferred that he fears that members or associates of the [redacted] Motorcycle Club may seek to harm him if he is seen to provide information to the authorities. The difficulty in drawing that inference, however, is that the respondent is a very senior member of the [redacted] Motorcycle Club. It would also appear that [redacted]. The respondent has given no evidence of any specific threat that he has received, or any demand that has been made of him not to answer questions, or that anyone even knows he has been summonsed. It may be noted in that context that the ACC Act contains extensive secrecy provisions which are intended to ensure that the fact that someone has been summonsed to appear at examination is not publicly disclosed. 34 In light of the very limited evidence concerning the basis of the applicant's asserted fear, I am unwilling at this stage to infer that the respondent is in fact fearful of answering the ACC's questions, or that there is any objectively reasonable basis for any such fear. 35 I am also unpersuaded that the evidence or opinions expressed by the psychologist provides any objectively reasonable basis for inferring that the respondent's fears. 36 I accept that the respondent has had the misfortune of an extremely deprived childhood and that has given rise to some significant mental health issues, in particular, post-traumatic stress, depression and anxiety. I am, however, unpersuaded by the psychologist's opinion that the respondent's mental health issues somehow hindered his capacity to respond to the questions put to him, or caused what the psychologist characterised as an involuntary response to the questioning. The psychologist's opinion in that regard was based on the respondent's account of his reaction to the questioning, which I am not persuaded is an entirely accurate account. 37 The respondent's account of his response to the questioning is not supported by the objective evidence of what occurred at the examination. The transcript of the examination does not suggest that the respondent was stressed or anxious during the examination. Nor does it suggest that the respondent "closed down emotionally" or that his anxiety hindered his capacity to respond. 38 Perhaps more importantly, while the respondent has maintained since the time of the examination that he does not propose to purge his contempt, he has not been imprisoned before. It is difficult to accept that a period in prison would not have a salutary effect on him. He would no doubt have time in prison to reflect on whether it would be preferable in all the circumstances to purge his contempt and answer the ACCs questions as he is legally obliged to do so. 39 While I will in due course make an order committing the respondent to prison until further order, I will grant the respondent leave to have the matter relisted before me, or if necessary, the duty judge, should he choose to purge his contempt at some point in the future, or if the circumstances change sufficiently to justify a reconsideration of the ongoing need for, or the utility of, coercion. There may also come a time when the respondent has spent a period in custody that, at least arguably, may exceed the period that would be an appropriate punishment for the contempt without regard to coercion. The applicant or those that advise or represent him may exercise the leave to have the matter relisted at that point in time. 40 If it comes to pass that I am required at some point in the future to fix a determinate sentence to punish the respondent for contempt, I will at that stage give further and more detailed consideration to the respondent's subjective circumstances. As noted earlier, I accept that there is compelling evidence concerning the respondent's subjective circumstances which would, to some extent at least, compel a degree of leniency when it comes to imposing a determinate sentence. I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wigney.