Mai & Ors v Commissioner of the Australian Federal Police [2025] VCC 1935

1. By Amended Notice of Contest of Application dated 3 December 2024,[8] the Commissioner of the Australian Federal Police provided the applicants notice of the grounds upon which he proposed to contest the exclusion applications. The Commissioner contends the applicants cannot show their interests in the restrained property were obtained without:

(a) Nguoth dishonestly causing a loss to the Commonwealth within the meaning of s135.1 of the Criminal Code (Schedule to the Criminal Code Act 1995 (Cth));

(b) Nguoth dishonestly using his position as a director of Sportscar Dealers Pty Ltd ("Sportscars") with the intention of gaining an advantage for himself in breach of s184(2) of the Corporations Act 2001 (Cth);

(c) the Minister dishonestly using his position as a shadow director of Sportscars within the meaning of s9AC(1)(b)(ii) of the Corporations Act, with the intention of gaining an advantage for himself in breach of s184(2) of the Corporations Act;

(d) dealing with money, the value of which is $100,000 or more, reasonably suspected to be proceeds of indictable crime, in breach of s400.9(1) of the Criminal Code.

1. The Commissioner's amended grounds delineate the offences which the exclusion applicants must disprove. More particularly, determination of the exclusion applications involves consideration of whether:

(a) Nguoth breached s135.1 of the Criminal Code by failing to declare and pay tax arising from the application of Division 7A of the Income Tax Assessment Act 1936 (Cth) ("ITAA 1936") to payments made by Sportscars for the purchase of the Narre Warren property and the Audi;

(b) Nguoth dishonestly used his position as a director of Sportscars, in breach of s184(2) of the Corporations Act by using money in Sportscars' bank accounts to purchase the Narre Warren property and the Audi without any intention of repaying that money;

(c) the Minister dishonestly used his position as a shadow director of Sportscars, in breach of s184(2) of the Corporations Act by using the bank accounts of Sportscars, first, to receive money, then, to purchase the Narre Warren property in the name of Nguoth, without any intention of directing Nguoth to repay that money; and

(d) when Nguoth and/or the Minister dealt with the money used to purchase the Narre Warren property and the Audi, it was reasonable to suspect that the money was proceeds of indictable crime, in breach of s400.9(1) of the Criminal Code.

1. In order to determine whether this offending is disproved, a number of factual questions arise:

(a) What was the source of the funds used to purchase the Narre Warren property and the Audi? This question may be answered by considering the following sub-issues:

(i) Did the Minister hold a legal interest in the property at House 873, Block 3K South, Juba, South Sudan ("Block K3K")?

(ii) Did the Minister hold a legal interest in the property at Plot 90, Block 9, Juba, South Sudan ("Khor William")?

(iii) Did the Minister lease Block K3K to the Republic of South Africa?

(iv) Did the Minister lease Khor William to the South Sudanese government?

(v) Did KK Coaches Ltd, Uganda, hold and disperse rental income on the Minister's behalf?

(vi) Did Belgravia Properties Ltd, Kenya, disperse money on the direction of KK Coaches, in satisfaction of a requirement for KK Coaches to pay out funds on the direction of the Minister?

(b) For the purposes of s400.9 of the Criminal Code:

(i) what is the "reasonable period" ending August 2015; and

(ii) what was the income and expenditure of Minister in that "reasonable period"?

(c) Did shareholders and directors of Sportscars agree to use of its bank account to complete the purchase of the Narre Warren property on 22 August 2014?

(d) What was the status of the money in the Sportscars' accounts?

(e) Does Nguoth hold the Narre Warren property on trust for the benefit of the Mai family?

(f) Did the purchase of the Narre Warren property and the Audi attract the provisions of Division 7A of the ITAA 1936?

(g) Was the Minister a "shadow director" of Sportscars within the meaning of s9AC(1)(b)(ii) of the Corporations Act?

(h) Did Nguoth, and/or the Minister, dishonestly use his position as a director of Sportscars with the intention of gaining an advantage for himself or others, or was reckless as to whether he did so, by using the bank accounts of Sportscars in relation to the purchase of the Narre Warren property?

(i) When Nguoth and/or the Minister dealt with the funds used to purchase the Narre Warren property and the Audi, was it reasonable to suspect that the money was proceeds of indictable crime?

1. The trial was conducted over several days. In addition to a number of documents, the applicants tendered affidavits (together with exhibits) from the following persons, who were each cross-examined:

(a) James Hoth Mai (the Minister), sworn 7 May 2021 and 12 March 2025;

(b) Samson Syum Demissie, sworn 17 April 2018;

(c) Nguoth Hoth Mai, sworn 10 May 2021;

(d) Nyawarga Hoth Mai, sworn 20 May 2021; and

(e) Monyluak Alor Kuol, sworn 12 March 2025.

1. The Commissioner relied on the following evidence:

(a) affidavits (including exhibits) of -

(i) Thomas Rengers, affirmed 1 November 2024

(ii) Federal Agent Graham White, affirmed 14 December 2017, 28 June 2018 and 28 October 2024;

(iii) Neil Jeans, sworn 3 December 2024;

(iv) Christian Sutton, sworn 6 December 2024;

(v) Amanda Staier, Department of Home Affairs, affirmed 24 October 2024; and

(b) a number of documents tendered including a Statement of Agreed Facts.

1. Of those witnesses, only Mr Jeans and Mr Rengers were cross-examined.
2. Despite initial objections, the affidavits of Messrs Rengers, White and Jeans were ultimately tendered absolutely. While the Commissioner objected to certain parts of Mr Kuol's evidence on the basis he was not impartial, or not an "expert", I accept his evidence as being given in a forthright manner, predominantly factual in nature, and allow tender of his affidavits, including his reports.

1. After setting out the legislative framework and factual background, this judgment will then consider:

(a) the income and property of the Minister in Sudan;

(b) the incorporation of Sportscars and purchase of the restrained properties;

(c) transfer of funds to Australia from Sudan; and

(d) finally, my findings in relation to the exclusion applications.

1. The legislative framework is comprehensively set out in Mai at paragraphs 2 to 10 inclusive, including setting out the relevant sections of the text, and a summary of s184(2) of the Corporations Act and s135.1 of the Criminal Code.[9]
2. I adopt that framework and summary for the purposes of these reasons.
3. The Court of Appeal in Mai also considered the nature of the test whether reasonable grounds existed for suspicion of a matter or state of affairs. I adopt the reasoning in paragraphs 66 and 67:

"The question whether reasonable grounds exist for suspicion of a matter or state of affairs is not a novel one. In George v Rockett the High Court addressed the meaning of 'suspicion' and the notion of 'reason to suspect' in terms which apply readily to the identification of reasonable grounds for suspicion under ss 18 and 19. The Court adopted the meaning of 'suspicion' articulated by Lord Devlin in Hussien v Chong Fook Kam, namely 'a state of conjecture or surmise where proof is lacking: 'I suspect but I cannot prove''.

The Court went on to cite with approval the following observations of Kitto J in Queensland Bacon Pty Ltd v Rees, concerning whether a payee had reason to suspect that the payer was unable to pay its debts as they became due:

'A suspicion that something exists is more than a mere idle wondering whether it exists or not; it is a positive feeling of actual apprehension or mistrust, amounting to 'a slight opinion, but without sufficient evidence', as Chambers's Dictionary expresses it. Consequently, a reason to suspect that a fact exists is more than a reason to consider or look into the possibility of its existence. The notion which 'reason to suspect' expresses in sub-s (4) is, I think, of something which in all the circumstances would create in the mind of a reasonable person in the position of the payee an actual apprehension or fear that the situation of the payer is in actual fact that which the sub-section describes - a mistrust of the payer's ability to pay his debts as they become due and of the effect which acceptance of the payment would have as between the payee and the other creditors.'"[10]

1. In summary, a suspicion is more than idle wondering; it is a positive feeling of actual apprehension, amounting to a slight opinion with insufficient evidence.
2. Incidentally, the Court of Appeal in Mai found there were not reasonable grounds for the relevant officer, Mr White's suspicion, that money in the Sportscars' accounts belonged to Sportscars.
3. Section 400.9 of the Criminal Code relevantly provides as follows:

"400.9 Dealing with property reasonably suspected of being proceeds of crime etc.

(a) the person deals with money or other property; and

(b) it is reasonable to suspect that the money or property is proceeds of indictable crime; and

(c) at the time of the dealing, the value of the money and other property is $100,000 or more.

(2) For the purposes of this section, it is taken to be reasonable to suspect that money or other property is proceeds of indictable crime if:

(c) the value of the money and property involved in the conduct is, in the opinion of the trier of fact, grossly out of proportion to the defendant's income and expenditure over a reasonable period within which the conduct occurs; or

(5) This section does not apply if the defendant proves that he or she had no reasonable grounds for suspecting that the money or property was derived or realised, directly or indirectly, from some form of unlawful activity.

1. On 14 December 2017, the Commissioner sought restraining orders pursuant to s18 and s19 of the Act over the Narre Warren property and the Audi on an ex parte basis. The Court made the restraining order on 19 December 2017.
2. Three applications for revocation of the restraining order were made on 6 February 2018. The application of Titchiang was heard in November 2018 and was dismissed by this Court. An appeal from that decision to the Court of Appeal, and a later application for special leave to appeal to the High Court, were both dismissed in 2020.
3. On 24 November 2020, the Minister, Nyawarga, Titchiang and Nguoth filed applications for exclusion from the restraining order under s29 and s31 of the Act, and applications for compensation under s77 of the Act.
4. Each of the applicants have been examined under s180 of the Act.
5. To succeed on the exclusion applications, it is necessary for the applicants to show the interests that they claim in the Narre Warren property and the Audi are neither:

(a) the "proceeds of unlawful activity" or "an instrument of any serious offending" (s29(2)(c) of the Act); nor

(b) relevantly, the "proceeds of an indictable offence" or "an instrument of any serious offence" (s29(2)(d) of the Act).

1. It is not in dispute that contravention of s135.1 and s400.9(1) of the Criminal Code and s184(2) of the Corporations Act are "serious offences" within the meaning of s338 of the Act. It is also not in dispute that the offences fall within the meaning of "unlawful activity" in s338.

1. The Minister was born in 1959 in Sudan, a country situated in northeast Africa, and is the eldest of 35 children.
2. When the second Sudanese civil war broke out in Sudan in 1983, the Minister left his job as a teacher and volunteered as a soldier in the Sudan People's Liberation Army ("SPLA"), which was protesting the corruption in the government of Sudan in Khartoum.
3. The Minister married Nyawarga in 1989, and there are four children of that marriage, including Nguoth and Titchiang. The Minister also has two children from a previous marriage. His first wife passed away some time ago.
4. During the atrocities and violence of the civil war in Sudan in 1999, Nyawarga and the children fled. While the Minister remained on the front line, his family walked across Sudan and Uganda for several months to a refugee camp in Kenya, before being processed through various refugee camps in Egypt and Indonesia.
5. Life in the refugee camps was terrible for the family, with very poor health and education facilities, and never enough food.
6. The Mai family lost contact with the Minister in 1999, and had no direct contact with him until 2006, save that Nyawarga had been able to meet the Minister briefly in Nairobi in 2002 during peace negotiations.
7. On 7 November 2001, Nguoth arrived in Australia on a humanitarian visa. Nyawarga and Titchiang arrived in Australia on humanitarian visas two years later. The remaining children arrived in Australia subsequently. When Nyawarga and the children arrived in Australia, they were supported by family and friends. Nyawarga and the children are Australian citizens.
8. From the time they arrived in Australia until the purchase of the Narre Warren property in 2014, they lived together in government housing. From 2004, that accommodation was in Endeavour Hills, in a five-bedroom house. Ten people were living in the house, all members of the extended Mai family.
9. Nyawarga met the Minister in Nairobi in September 2006. The Minister told Nyawarga about his earnings, including that part of his salary and allowances were going to support his extended family in South Sudan. He started contributing money for the family's expenses in Australia from at or about this time.
10. The Minister was reunited with his family in Australia in April 2007, and discussions ensued about purchasing a home for the family in Australia.
11. At or around this time, the Minister told his family he was renting a house to the government of South Africa,[11] and that he would try and save enough money to buy the family a house.[12] He also told Nyawarga about rental income he received from Khor William.[13]
12. The Minister paid for the children's school fees from 2008,[14] and sent or brought money to Australia from time to time.
13. By March 2014, the Minister had saved over one million US dollars (USD) and told his family this was the budget to buy a home.[15]
14. Nguoth and a family friend, Samson Demissie, looked for a house in the Narre Warren and Chadstone area, and Nyawarga eventually signed a contract for the purchase of the Narre Warren property on 2 June 2014, with settlement to occur on 31 July 2014.[16] She later nominated Nguoth as the purchaser of the home on behalf of the family.
15. On 1 October 2014, Nguoth was registered as sole proprietor of the Narre Warren property.

1. Certain facts were formally agreed between the parties, as follows:

(a) Titchiang is the only applicant asserting interest in the Audi;

(b) Nguoth is the registered proprietor of the Narre Warren property;[17]

(c) Sportscars was registered on 12 June 2014 and deregistered on 15 September 2016. It is not in dispute that its directors and shareholders were Nguoth (80 of 100 ordinary shares) and Samson Demissie (20 of 100 ordinary shares);[19]

(d) Sportscars never traded, never declared any income, and never had creditors;

(e) funds used to purchase the Narre Warren property ($1.5 million, save for a $1,000 deposit paid by Nyawarga) and the Audi ($35,274.74) were provided by the Minister;

(f) Nguoth did not pay tax on a deemed dividend under Division 7A of the ITAA 1936, when the money was paid out of Sportscars' bank account for the Narre Warren property or the Audi;

(g) Nguoth has never been assessed as liable to pay any tax on that money; and

(h) between April 2007 and January 2020, the Minister visited his family in Australia 16 times. He has not entered Australia since 20 January 2020.

1. It is not in dispute that ss400.9(1)(a) and (c) of the Criminal Code - which set out elements of the offence in relation to dealing with money to the value of $100,000 or more - are satisfied.
2. The controversy relates to whether it was reasonable for the Minister or Nguoth to suspect that the money used to purchase the Narre Warren property and the Audi was proceeds of indictable crime (s400.9(1)(b)).[20] There are subsidiary disputes as to the application of a "deeming" provision (s400.9(2)(c)), and s400.9(5) which provides an exclusion.
3. Further, it is not in dispute that funds standing to the credit of an account holder are subject to a "chose in action" in favour of the account holder, allowing the account holder to call upon the bank to divulge the funds.[21]

1. The Minister gave evidence concerning the sources of his income and his financial management during his time from 2007 as a military official and later, as the Minister of Labour of South Sudan, which became an independent state in 2011. His account was framed by reference to the country's banking industry and the differing governmental and societal frameworks that operated in place of formal banking and record keeping systems. His evidence included that the financial and governmental environment at the time was one where formal documentation was rare, with institutional banking and other systems unreliable or non-existent.
2. According to the Minister, South Sudan functioned in large part as a cash-based economy, reflecting its status as a new nation emerging from decades of conflict that hindered the development of stable institutions and financial systems.
3. The Minister's business arrangements and day-to-day expenditure were conducted in cash, rather than through formal bank transfers.
4. The Minister's reliance on cash also extended to the way he managed his government payments. Both his government salary and per diem allowances were received in cash. He explained:

"... I do not use banks in South Sudan to receive my pay, rental income or to hold my savings as I do not trust the banks. By that I mean that there is a real risk that if I want to withdraw money from the bank, the bank will not have the funds available to give me that money."[22]

5. The Minister's evidence included an absence of functioning institutional systems in South Sudan during the relevant period. Although the Minister's salary was subject to deductions for pension and personal income tax,[23] no official tax statements or records were ever issued to him.[24] When cross-examined about this, the Minister explained that income tax returns and official records of salary deductions did not exist in South Sudan during the relevant period and no tax office operated between 2005 and 2016.[25]
6. Much of the Minister's evidence in relation to the conditions in Sudan/South Sudan, the banking industry and the different cultural and legal frameworks, was corroborated by an expert called by the Commissioner, Neil Jeans, and also by the Minister's lawyer in Juba, South Sudan, Monyluak Alor Kuol.

1. The Minister, at relevant times, earned a salary in USD as an army officer, and as a member of the Joint Advisory Board, advising on the peace process between South Sudan and Sudan, and received significant per diem travel allowances in respect of his official duties.
2. A brief chronology of the Minister's employment and income is set out below:

(a) in 2005, the Minister was appointed Major General in the South Sudan Army, responsible for Logistics;

(b) in 2007, he was appointed a two-star Major General which was two levels below a four-star Full General who is and was deployed from Logistics to Operations;

(c) in 2009, he was promoted to a three-star Lieutenant General and Chief of General Staff;

(d) in 2010, he was promoted to a four-star full General, the head of the South Sudanese Armed Forces, and remained Chief of Staff;

(e) during 2005 to 2011, he received a salary as a member of the Joint Defence Board of USD 3,000 per month, plus per diem allowances;

(f) during 2005 to 2014, he received a salary as a member of the South Sudanese Armed Forces of USD 4,000 per month, plus benefits; and

(g) each year from 2005 to 2011, the Minister received USD 120,000 in travel and per diem allowances for monthly meetings of the Joint Defence Board in Khartoum, and a USD 36,000 salary from the Joint Defence Board.[26] He also received similar travel allowances and per diems for official travel to foreign countries on 20 to 30 occasions while he was in the Army.

1. No documents tendered record amounts of the Minister's allowances, but I accept that as a senior member of the Armed Forces and the South Sudanese government - which is not in dispute - he is likely to have been entitled to some such allowances.
2. The Minister's income allowed him to support both his significant extended family in South Sudan, and also his family in Australia. I accept the Minister's evidence that he was able to bring cash to Australia on the occasions he visited his family between 2007 and 2014.[27] He also paid for school fees and travel expenses out of his salary, per diem allowances and/or income from his farm, and wired money from time to time using Dahabshiil, an international cash transfer service.
3. He also received income from two rental properties in Juba, Block K3K and Khor William.

1. In May 2007, Brigadier Martin Kenyi, on behalf of the Office of the Deputy Director for Procurement branch of the Sudan People's Liberation Army, gifted Block K3K to the Minister in recognition of his contribution to his country.
2. The transfer was by way of a letter expressed in these terms:

"I, Brig-Gen Martin Terensio Kenyi has Consciously Consented to Transfer of the Land Title (Plot No: 873, Block 3.K South 1st Class) to Maj-Gen James Hoth Mai. > > Advise that all the process of the Transfer of the above Land Title be effected without hindrance."[28]

3. The Minister engaged contractors to build a five-bedroom house on Block K3K, which was completed during the years 2007 to 2009. He then appointed Mr Reath Thon Wako to act as his attorney in relation to leasing and managing the property. Mr Wako died in 2013.
4. On 19 May 2009, the Minister leased Block K3K to the Government of the Republic of South Africa for its consular facilities for the sum of USD 14,250 per month for the first period in advance and USD 12,000 per month for the subsequent two years. The Lease Agreement was signed by Mr Wako, on behalf of the Minister [29]
5. On 8 June 2015, Dr Gai Thurbil Yat, in his capacity as legal proxy for the Minister, renegotiated the lease with the Government of South Africa at USD 15,972 per month, annually revised by 10 per cent.[30] Dr Yat died in 2017.
6. Between May 2009 to 2016, the Minister received total rental income of USD 1,414,656 from Block K3K.
7. On 5 May 2017, by agreement between the Minister and the Government of the Republic of South Africa, the lease was extended for a further period of twelve months at the same rent.[31]
8. The lease with South Africa was not renewed further, and the embassy was vacant for a period.
9. The Minister has not paid income tax on his rental income.[32] South Sudan has only recently had a revenue office for collecting taxes.[33] According to Mr Kuol's evidence, the tax collection institutions or authorities are not effective and still "in a very rudimentary level", which meant taxes were not being collected.[34] Mr Kuol also gave evidence that senior military officers were given preferential treatment in terms of tax, if not exemptions.[35]
10. On 28 January 2019, as part of a South Sudanese court process to transfer ownership, Brigadier Kenyi's executor[36] signed the Assignment of Lease of Block K3K between the Sudanese Government and Martin Terensio Kenyi to the Minister.[37]
11. A search certificate dated 30 January 2019, serial number 028433, issued by the Republic of Sudan Judiciary Registrar of Lands under the Land Act 2009, confirms the Minister as the beneficial owner of Block K3K.[38]
12. On 7 February 2019, the Republic of South Sudan Ministry of Infrastructure's Director of Survey issued a sketch map of Block K3K, noting it was the "property of Mr James Hoth Mai".[39]
13. The transfer of ownership to the Minister was effected in or about February 2019, when the Land Office issued him legal title,[40] evidenced by the sketch map.[41]
14. Block K3K is presently leased by the Minister to the United States of America, Department of State.[42]
15. The Minister was able to describe the house on Block K3K and its location in Juba in detail, and identify Block K3K from an aerial photograph from Google Maps.[43]
16. The Minister also paid historical[44] town rates for Block K3K in 2016 and 2024.[45]
17. The evidence of the Minister's lawyer, Mr Kuol, supports a finding that he was the beneficial owner of Block K3K since at least 2009. Mr Kuol resides in Juba, South Sudan, and gave evidence remotely.
18. Mr Kuol is an experienced lawyer and an acquaintance of the Minister. I accept him as an honest and forthright witness whose evidence was not challenged. Although briefly cross-examined about his independence, no part of his evidence was challenged as being incorrect or influenced by his relationship with the Minister. He has no interest in the litigation and I accept his evidence as impartial and independent.
19. Among other things, Mr Kuol corroborated the Minister's evidence that in recognition of their contributions in liberating South Sudan, senior military officers in the SPLA who participated in the liberation struggle were rewarded with land allotments. The government and local communities gifted these parcels of land.[46] As part of that arrangement, the Minister was gifted land by a senior army officer in the capital, Juba, from which he also derived income.
20. Mr Kuol prepared and sent a letter of demand on behalf of the Minister to the South African Embassy in the period 2012 to 2013 for the late payment of rent. The South African embassy paid the demand issued in the Minister's name.
21. Mr Kuol has seen the property; a title deed which he referred to as "the lease"; the 2019 search certificate confirming ownership; and the sketch map when preparing one of the lease extensions.[47]
22. Mr Kuol's evidence supports a finding that the Minister was entitled to, and did, receive rent from the block K3K property since at least 2009.
23. The Minister also told Nyawarga that he had a house in South Sudan rented to the Republic of South Africa.[48] I find this conversation must have occurred prior to the Minister providing money for the purchase of the Narre Warren property in 2014.
24. I accept the Minister's evidence of expenditure to maintain Block K3K.

1. The Minister also asserts he is the owner of Khor William.
2. The land on which the Minister built the Khor William property was previously owned by the Army. The Minister's Lease from the government for the Khor William property dated 1 August 2008[50] served as a form of land title document in South Sudan.[51]
3. Like other senior officers at the time, the Minister was given this land,[52] and borrowed money to construct a five-bedroom prefabricated house on the land. It was completed by contractors in 2011.
4. On 9 March 2012, the Minister appointed Wal Gordon Tong to act as his attorney in relation to leasing and management of Khor William, including receipt of rent.[53]
5. On 1 June 2012, Mr Tong, on behalf of the Minister, leased Khor William to William Mac Mamer, of the South Sudan Ministry of Defence, for a period of three years at USD 12,000 per month.[54]
6. The Lease for Khor William was not renewed in 2015 due to civil war within South Sudan, as a result of disagreement between different political factions within South Sudan, predominantly between the Dinka and Nuer tribes.
7. In support of his claim of beneficial ownership, the Minister tendered receipts for land fees issued by a Sudanese Government Authority, town rates, a building application and permit, issued by South Sudan, and survey fees issued by a Sudanese Government authority.[55]
8. Mr Kuol's unchallenged evidence included that the Minister owns Khor William.[56]

1. I am satisfied, having regard to the appearance, quality and content, including what appear to be official stamps or seals, that the documents relied upon by the Minister are authentic;[57] alternatively, are admissible as business records under s69 of the Evidence Act 2008 (Vic). The Commissioner does not dispute the authenticity of the Lease Agreements.[58]
2. The Minister:

(a) has had, in the alternative, exercised rights consistent with, beneficial ownership of Block K3K since 2007, including receipt of rental income;

(b) enjoyed beneficial ownership of their land, known as Khor William from 2008 until at least 2015, including receipt of rental income from 2012 to 2015.

1. No receipts were produced for this income in the period 2007 to 2015,[59] although the Leases - not disputed - evidence considerable monthly income.
2. I find the evidence available in relation to the Minister's income and expenditure establishes:

(a) the Minister's earnings from 2007 to 2014 allowed him to develop the two blocks of land in Juba, provide for himself and his family, and support his extended family;

(b) Block K3K, together with a five-bedroom home with an outhouse and garage, was leased to the government of the Republic of South Africa for its consular building in Juba;

(c) Khor William was likewise developed, and then rented to the South Sudanese Ministry; and

(d) the rental income from these properties was applied to the purchase of the Narre Warren property and the Audi in Australia.

The Minister saves the rental income from 2007 to 2014

1. I accept the evidence of the Minister and Mr Kuol, which in substance was corroborated by Mr Jeans, that as a consequence of the civil war in South Sudan, there was a high level of distrust of banks.[60] The history included a mutualised national bank which collapsed, leaving many South Sudanese without their savings, and frequent fluctuations in the value of currency.
2. It is in this context that the Minister entered into a Memorandum of Understanding with KK Coaches Ltd (incorporated in Uganda), a company owned by a Mr ldro Taban, on 4 March 2010.[61] The Memorandum was prepared by Mr Taban's lawyers, Okecha Baranyanga & Co.
3. The agreement provided for the Minister to loan money, without interest, for use by KK Coaches as it saw fit, to be returned or repaid at the Minister's direction from Uganda, where Mr Tabal operated a number of companies. By clause 2, KK Coaches undertook to pay the Minister the equivalent of monies advanced by him to KK Coaches in Ugandan or other currency upon demand. The repayments "shall be made by ... [KK Coaches] by way of cash or by bank to the account provided by ... [the Minister]". The Memorandum was expressed to be at-will, for review within three years.
4. In practice, the Minister provided the cash to Mr Taban's agent in Juba, for Mr Taban to hold the funds on his behalf.[62]
5. He described the funds held by Mr Taban as his "nest egg" and said that the arrangement was based entirely on trust rather than formal accounting. No written records were kept of the deposits or withdrawals.
6. The only document relating to the arrangement was the Memorandum of Understanding prepared in March 2010. The Memorandum was prepared so that the Minister's family were aware of funds held by Mr Taban, rather than as a record of financial transactions.[63]
7. The Minister's wife and children knew of Mr Taban, but had not seen the Memorandum of Understanding.
8. In 2010, the Minister told his wife about the existence of the Memorandum of Understanding with Mr Taban, and later, his children, that Mr Taban was keeping money for him from the two properties in South Sudan.[64] The Minister told Nyawarga he was receiving rental income.[65] Nyawarga's evidence included that the Minister had told her he was giving the money to Mr Taban, but that he never told her about written agreement or where she could find a copy of it.[66] Nguoth did not recall his father ever telling him about any agreement with Mr Taban.[67]
9. On balance, I find it is likely that the Minister informed his wife and Ngouth about an arrangement with Mr Taban to hold money, which arrangement is corroborated by the written agreement with KK Coaches.
10. I also accept the Minister's evidence that he provided money to Mr Taban during the relevant period.
11. While the Minister's remuneration, business dealings and general expenditure were ordinarily conducted entirely in cash, from 2012 to 2017, the rental income for Block K3K was paid to a bank account that he opened at Stanbic Bank in Juba at the request of his tenant.[68] In cross-examination, he explained this occurred because the transaction involved a foreign embassy, and the Government of the Republic of South Africa required payment of rent to be made through formal banking channels. The cash was then withdrawn by an agent of the Minister's, and provided to Mr Taban.
12. The Minister closed this account in March 2018, and when he sought records from the bank in November 2024, he was informed that no statements could be located because the bank does not retain records beyond six years.[69]
13. The Minister conceded, and there is no doubt that there are gaps in the records which might otherwise support his evidence, including bank statements or forms recording movements of cash; records of the development of Block K3K and Khor William, including loans; and personal expenses of the Minister, including support provided to extended family.
14. The Minister's evidence included:

"That's right, there's no document. As I say last time, you know South Sudan is not like Australia so I cash my money when I go to Khartoum, I cash my money cash and then when I come back, so I use it ... ."[70] > > ... > > "... the government is not there. The government is not there. When we go to Khartoum, we just receive our money as a per diem. There is no government and we go to Khartoum and they just gave us. There is no document that I can give and even then the document, it was a very long time ago, you could not even find those documents, so there's no document that I have, but I received that money. Whether you believe it not but I received that money because there's way that I can sustain this family only through this."[71] > > ... > > "I trust Taban. One reason is that I don't trust the bank, in the republic of South Sudan. Up to today, we are still having problems, number one. Number two, I don't want to have access to my money because as I said, I was taking care of my extended family, all right? I don't want anyone to have access to that money, all right? ... If I have access, anybody will come, 'He's sick, I have a problem', I will just give. I want to avoid that one and then also that I don't trust the bank."[72]

1. The absence of a complete record of documents from South Sudanese transactions dating back to 2007 is to be expected, and the Court accepts this explanation. There is no allegation in the Commissioner's amended Notice of Grounds, or otherwise put to the Minister in cross-examination, that he had destroyed, concealed, altered or fabricated documents; and it was ultimately conceded that most documents were authentic. The Commissioner withdrew its improper allegation that Block K3K and Khor William "did not exist".[73]

Incorporation of Sportscars and the purchase of the Narre Warren property

1. Mr Demissie is a family friend of the Mai family. In early 2013, the Minister and Mr Demissie commenced discussions in relation to a business of importing and selling secondhand cars. The Minister was interested in Mr Demissie's idea, because he wanted to establish or buy a business for his family in Australia. The Minister discussed the idea with his son, Nguoth, who also said he was interested in working with Mr Demissie to develop and operate a business.
2. In around March or April 2014, the Minister agreed to source funding for the business. Although Mr Demissie had not informed him of the amount of capital, the Minister was anticipating the Sportscars' business would require no more than approximately USD 500,000.[74]
3. By this time, the Minister had saved approximately USD 1 million to buy his family a house, and told his family this was the budget.[75]
4. In May 2014, Mr Demissie and the Minister agreed Sportscars would be incorporated. Mr Demissie and Nguoth would be the two directors, owning 20 per cent and 80 per cent of the shares respectively.[76] The Minister also discussed lending the company seed funds.
5. Nyawarga made a cash deposit of $500 on 2 June 2014 directly into Harcourts Berwick Real Estate's trust account for the Narre Warren property. It is not in dispute that on 3 June 2014, Nyawarga transferred a further $500 to Harcourts Berwick trust account via EFT.[77]
6. On 5 June 2014, the balance of the deposit for the Narre Warren property of $155,171.77 was paid via an overseas funds transfer into Harcourts Berwick trust account.[78]
7. Sportscars was registered on 12 June 2014, and opened its bank accounts later that month.
8. At the time of registering Sportscars, the Minister knew it required seed capital, but he did not discuss with Nguoth where the money was coming from, or the amount.[79]
9. In around July 2014, after Sportscars was registered, Mr Demissie informed the Minister that Sportcars needed approximately $2.9 million in funds to establish operations, and that Sportscars could not start the business with a lesser amount.[80] The Minister informed Mr Demissie this was too much money, but that nevertheless he would endeavour to source some funds. Nguoth corroborates the Minister's evidence in this regard.[81]
10. Mr Demissie was aware the Minister had already committed to the purchase of the Narre Warren property, and that due to civil unrest, was not able to source the required funds for the company at the time.
11. On 22 August 2014, Nguoth paid $1,343,828.23 to or at direction of the vendor at settlement of the Narre Warren property via Sportscars' bank account.[82]
12. Mr Demissie agreed that prior to the settlement of the Narre Warren property in August 2014, the Minister had told him he could not find the funds for the Narre Warren property as well as the funds required to start up Sportcars.[83]
13. In late August 2014, the Minister informed Mr Demissie he was no longer confident about securing the funds for Sportscars, but again stated he would continue to try.
14. On or about 19 September 2014, Nguoth paid $82,500 in stamp duty on the purchase of the Narre Warren property, also by way of bank cheque drawn from funds standing to the credit of Sportscars' bank account.
15. Until at least late 2014, Mr Demissie believed that Sportscars would go ahead.

The Minister's money is transferred from Uganda to Australia

1. Save for a holding deposit of $1,000 paid by Nyawarga, all of the money for the Narre Warren property was provided out of the Minister's savings deposited with Mr Taban. Because neither the Mai family's bank, Commonwealth Bank of Australia, nor the vendor, would accept monies transferred directly from Africa, $151,477 for the deposit was paid into the real estate agent's trust account by Hoid Establishments Ltd[84] on behalf of KK Coaches.[85] The balance of the purchase monies were transferred by Taban entities into Sportscars' bank account.
2. Under the Contract for Sale, settlement was to occur on 31 July 2014, but was delayed to 22 August 2014. The Minister spoke with Mr Taban and asked him to arrange to transfer further funds loaned to KK Coaches to Sportscars' bank account, so that he and his family could settle on the Narre Warren property and pay the stamp duty.
3. It is not in dispute AUSTRAC records[86] show KK Coaches transferred funds to a bank account of Sportscars as follows:

(a) AUD 638,528 on 28 July 2014;

(b) AUD 485,657 on 14 August 2014;[87] and

(c) AUD 321,708 on 19 August 2014.[88]

1. On 21 August 2014, Nguoth transferred $1,405,195.66 from Sportcars' Business Cash Maximiser Account into Sportcars' Business Cheque Account. The same day, he withdrew a sum of $1,306,661.00 from Sportcars' Business Cheque Account to make cheque payments towards settlement of the Narre Warren property. The sale was completed the next day.[89]
2. The July and August 2014 transfer records note in the "Details Of Payment", "PYMT TOWARDS PROPERTY IN AUSTRALIA". The Commissioner does not accept these statements on the AUSTRAC documents can be accepted for the truth of the statements.
3. On 8 September 2014, Belgravia Services, Kenya,[90] transferred AUD 85,507 to Sportscars' bank account.[91] On 19 September 2014, Nguoth transferred $83,000 from Sportscars' Business Cash Maximiser Account into Sportscars' Business Cheque Account, and then made out a cheque for $82,500 payable to the State Revenue Office to pay the stamp duty payable on the purchase of the Narre Warren property.[92]
4. Nevertheless, it appears that the July, August and September 2014 transfers:

(a) were in round numbers in USD, less a transaction fee;

(b) accord almost exactly to the timing of, and with the amount required for, the settlement of the purchase of the Narre Warren property in August 2014, and payment of stamp duty in September 2014; and

(c) were almost immediately applied for those purposes.

1. On the balance of probabilities, I accept the Minister's evidence, which overall has been given on a consistent basis, corroborated in many respects, over many years. I find that the payments made into Sportscars' account on 28 July, 14 August, 19 August and 8 September 2014 were to fund the purchase of the Narre Warren property and associated costs.

Was there a meeting to discuss the use of Sportscars' bank account?

1. The Minister stated he and Nyawarga asked Mr Demissie and Nguoth about using Sportscars' account to deposit funds for the purchase of the Narre Warren property at a meeting in June 2014. Further, that Mr Demissie and Nguoth agreed at that, or a later, meeting, prior to the transfer of the funds.
2. Nyawarga corroborated the Minister's account, but could not remember the time or date of the meeting.[93] I find Nyawarga was a witness of truth who gave honest evidence of her best recollection of events, albeit that her memory was imperfect. I accept her evidence.
3. When cross-examined, Nguoth did not remember any meeting in June 2014. Nguoth in fact appeared to recall very little about the operation of the company. He agreed he was informed as to what was to occur in relation to Sportscars, and that he discussed all company matters with the Minister. He generally corroborated the substance of the Minister's evidence. His evidence included:

"My Dad told me that he would arrange for money to be transferred to settle the purchase of the Narre Warren Home. The fund will be provided by my Dad from the money he had saved in South Sudan."[94]

4. I find Nguoth was an honest witness whose recollection of the detail of events was poor. I accept the applicants' submission that this is most likely because of the passage of time and his relative youth when relevant events occurred.
5. Mr Demissie's evidence included:

(a) the Minister started transferring funds into Sportscars' account by way of a loan to provide funding to start the business;

(b) he knew the funds were coming into the account from Mr Taban;

(c) the funds in Sportscars' account were seed money for the business, but he agreed the funds would be repaid by directing them to the purchase of the Narre Warren property;

(d) he consented to all of the withdrawals of funds from Sportscars. The funds were the Minister's money and the transfers were all repayments of loans that the Minister had made to the company;

(e) all funds provided by the Minster to Sportscars were owed by Sportscars to the Minister;

(f) he did not object to the Minister using "his money" to purchase the house;

(g) in July 2014, he agreed with the Minister that the funds in Sportscars' account could be used to purchase the Narre Warren property;[95] and

(h) he agreed with the Minister that Nguoth would arrange for the funds in Sportscars' account to be used for the purchase.[96]

1. In his oral evidence, Mr Demissie confirmed he believed the money in the account was for Sportscars; and although he recalled a conversation with the Minister concerning using the funds to buy the Narre Warren property, he could not remember a meeting prior to its transfer into Sportscars' account.[97]
2. The Commissioner disputed that any meeting occurred regarding use of the bank account before the money arrived in Australia. It relies solely upon the evidence of Mr Demissie to submit there was no such meeting, and that the money was transferred into the account as seed capital for the proposed luxury car business.
3. In the contest on the evidence between the Minister and Mr Demissie, I find it significant that Nyawarga gave evidence that the meeting occurred, and the cross-examination, in particular of Nguoth, did not persuade me that it had not.
4. The corroboration by Nyawarga and the other surrounding circumstances, including the timing of payment of the money, the significant amounts of money involved, the almost precise amounts of money for the specific purpose asserted by the Mai family, and the fact that the company had never traded or had any income, result in my finding of the inherent probability of such a meeting occurring before the money arrived in Australia.
5. On 6 June 2014, the Minister arranged for payment of the 10 per cent deposit for the Narre Warren property into the real estate agent's trust account. This undisputed international transfer occurred before any meeting is alleged to have occurred in relation to use of Sportscars' account. It is consistent with later transfers in July and August 2014 being for the same purpose.
6. Almost the precise amounts required to settle the purchase and related transactional costs arrived after the June 2014 transfer of the deposit, in just enough time to complete the purchase of the Narre Warren property in August 2014. I reject the Commissioner's submission that the funds were not for this purpose.
7. The Minister's account is also supported by evidence from the vendor there were difficulties in the purchaser accessing money, which was coming from overseas.[98]
8. I infer from Mr Demissie's evidence, he put a lot of work and time into the company and the proposed car business in the expectation of significant returns. His disappointment that the company had not commenced trading was apparent. In my view, this lends credibility to the authenticity of the purpose of the company.
9. I give very little weight to Mr Demissie's evidence he thought the money transferred was for the purpose of investing into the business, because no meeting had occurred before the money arrived in Australia to establish the likely set-up and operating costs of the business. In the context of all of the evidence, it is more likely he is mistaken.
10. Mr Demissie otherwise appeared to be an honest witness who tried his best to recall events of more than ten years before the trial. Unsurprisingly, his recollection was not perfect. To the extent that his recollection at trial conflicted with his affidavit, I prefer his affidavit evidence, which had been sworn four years earlier.
11. I find that at all relevant times, the money in Sportscars' bank account was not capital. The directors and shareholders of Sportscars consented to its bank account being used, firstly, to receive, and then, to pay out those funds for the purchase of the Narre Warren property.

1. After his daughter, Titchiang, asked him for a car for her 18th birthday, the Minister arranged for an Audi A1 1.0L to be purchased in August 2015 for $35,274.74. Following payment of a $2,000 deposit paid by credit card on 15 August 2015, the funds used to complete the purchase of the Audi likely comprised cash provided by the Minister to his family and funds transferred by the Minister through Dahabshiil.[99]
2. On 17 August 2015, Nguoth deposited the $28,600 cash required for the purchase of the Audi into Sportscars' bank account. The purchase of the Audi was effected by cheque and a further amount in cash the following day. The cash was deposited into Sportscars' bank account because none of the family had a cheque account or a cheque book.
3. This evidence was not challenged by the Commissioner.
4. I find that Titchiang has an interest in the Audi, and there is no evidence of a reasonable basis for the Court or Titchiang to suspect the funds were sourced illegally.

1. Thomas Rengers is a tax specialist at the Australian Taxation Office. Based on certain documentation provided to him, and an assumption of liability under Division 7A (of which there is no evidence), Mr Rengers calculated the total tax payable by Nguoth ($716,574.45) and Titchiang ($2,979.75) for the financial years ended 30 June 2015 and 30 June 2016.[100]
2. Mr Rengers confirmed in his oral evidence that the ATO had not assessed Nguoth or Titchiang for, let alone issued any (amended) assessments in relation to, notional Division 7A liability.
3. He also confirmed that if a company is repaying a loan within the meaning of s109J of the ITAA 1936, the "deemed" dividend provisions do not apply.

1. Neil Jeans is a partner in the Risk Consulting division of Grant Thornton, who prepared an expert report dated 3 December 2024. On the basis of his financial crime risk management and compliance background, spanning over 30 years, Mr Jeans provided his opinion on money laundering typologies, and whether those typologies apply to the specific facts, circumstances and assumptions identified in the material provided to him. In his opinion:

(a) a politically exposed person is someone who holds a prominent public position or function, which may make them more susceptible to involvement in bribery or corruption, dependent on their level of influence, the nature of their position, and their level of their authority;

(b) the Minister is a politically exposed person;

(c) a high number of indicators of money laundering by a politically exposed person are present in relation to the Minister.[101]

1. In cross-examination, Mr Jeans candidly explained how the task he was asked to perform and the manner in which he performed it led to conclusions that were favourable to the Commissioner. Specifically, he was not provided with all the evidence, and he routinely disregarded evidence from the applicants, unless corroborated to his satisfaction.
2. The Commissioner relies on Mr Jeans' evidence to allege the funds used to purchase the Narre Warren property and the Audi should be suspected to be proceeds of crime.
3. The applicants submit Mr Jeans was generally a witness of credit, who made appropriate concessions (other than in respect of his estimate of the Minister's salaries prior to 2011), but that ultimately his evidence can only be of limited use to the Court.
4. I agree with that assessment. Mr Jeans' research sources proved to be unsound, confusing South Sudan and Sudan, and being unable to justify sources cited when given the opportunity in cross-examination. He was also unable to verify the basis of his opinion - in an area outside his expertise - with respect to South Sudanese salaries. I reject his opinion as it relates to and where it relies upon salaries in South Sudan.
5. His evidence was often expressed at a high level, with a number of factual errors.[102] Many "indicators" are able to be explained otherwise than by reference to money laundering. For example Sportscars operating both a business banking and also a cheque account does not support his opinion the Minister was "using multiple bank accounts for no apparent reason". Mr Jeans accepted many businesses conduct business with two such accounts.
6. I afford no weight at all to Mr Jeans' opinion insofar as it relies upon the use of multiple bank accounts in Australia. The opening of a trading and savings account by Sportscars entirely accords with Australian business practice, a proposition which Mr Jeans quite sensibly readily accepted. Further, a family receiving support for living expenses including private school fees from a father resident overseas is unremarkable.
7. I reject his central opinion that the purchase of the Narre Warren property involved a "large and unexplained amount of money", because I accept that the source of the funds was rental income from the Minister's properties in Juba.
8. His evidence overall was impugned by his failure to demonstrate a proper basis for his opinion concerning corruption in South Sudan. This was unsupported, as the sources he relied upon in fact related to corruption in Sudan, the very regime against which the Minister had fought to secure independence and form the Republic of South Sudan.
9. There is also some force in the Minister's submission that where evidence was contested by the Commissioner, Mr Jeans habitually accepted the Commissioner's evidence over the Minister's evidence without providing reasons.
10. While several "indicators" are present, I accept the evidence of the Minister and Mr Kuol as to the source of the funds, and, accordingly, that the money was lawfully derived. As a matter of weight, Mr Jeans' evidence provides an insufficient basis to arrive at a suspicion that the funds were the proceeds of indictable crime.

1. I accept the Commissioner's submission that it is open to this Court to draw an inference from the Minister's failure to call Mr Taban, that his evidence would not have assisted the applicants.
2. This finding must be considered in the context of the following:

(a) I accept the evidence of the Minister, Nyawarga and Nguoth, that Mr Taban provided the relevant funds;

(b) the Commonwealth, save for the evidence of Mr Jeans, cannot point to any evidence that the Minister did not pay funds to Mr Taban, or were not remitted by him to the Minister. The documents tendered establish the flow of money from Taban related entities;

(c) Mr Jeans' evidence does not preclude a finding the Minister provided Mr Taban cash monies: rather, Mr Jeans considered that there were a number of red flags in terms of money laundering, going to the issue of the source of the funds;

(d) I have accepted the Minister's evidence the funds were likely derived from the rental of the two properties in Juba;

(e) I may not speculate as to the evidence Mr Taban may have given;

(f) there is no evidence of other sources of money available to the Minister, save for his salary, per diem allowances and his farm, which would cause me to doubt the Minister's evidence as to the source of the funds.[103]

1. Masters Home Improvement Pty Ltd v North East Solution Pty Ltd[104] provides a useful summary of the principles that apply to drawing an inference in a civil case:

"The principles, relating to the drawing of inferences in civil cases, are well established. First, any inference must be based on facts established by admissible evidence. Secondly, the process of reasoning must constitute a valid inference, as distinct from speculation or guesswork. Thirdly, and importantly, where the inference is drawn in favour of the party which bears the burden of proof in the case, the conclusion must be 'the more probable inference' from those facts. In other words, the inference drawn by the judge must be reasonably considered to have a greater degree of likelihood than any competing inference. Fourthly, in determining whether an inference is to be drawn as a matter of probability, the tribunal of fact is not required to consider each primary fact, established by the evidence, in isolation. Rather, the Court considers the totality of those facts together, giving effect to their united and combined force."

2. Unexplained failure by a party to call a witness may, not must, in appropriate circumstances, lead to an inference that the uncalled evidence would not have assisted that party's case. This depends of course upon there being an issue on which the witness's evidence would assist.
3. The rule cannot be applied to the non-calling of a witness unless it would be natural for the party to call the witness, or the party might reasonably be expected to call the witness. I am satisfied that the Minister might reasonably have been expected to call Mr Taban as a witness.
4. In Reynolds v Patel,[105] Tsalamandris J considered the failure of the driver, Mr Patel, an Uber driver, to give evidence. A passing cyclist, Mr Reynolds, had sued Mr Patel in negligence for injuries sustained when the Uber passenger opened the door of the Uber, into which Mr Reynolds collided.
5. Based on that failure, Tsalamandris J drew an adverse inference that Mr Patel's evidence would not have assisted his defence. Her judgment included the following analysis:[106]

"In Swain v Waverley Municipal Council ('Swain'),[107] the High Court considered what could be made of a failure by a party to call evidence which was available to it. In Swain, the plaintiff suffered a catastrophic injury whilst swimming between flags at Bondi Beach when he dove into a sandbar. The plaintiff alleged the Council was negligent for placing flags in an area where there was a disguised danger, and also for failing to warn swimmers of that danger. At the trial of the proceedings, the Council did not call anyone to explain whether or not the flags could have been placed elsewhere. The jury found that the Council was negligent. That verdict was subsequently overturned in the Court of Appeal and the plaintiff then appealed to the High Court, the majority of whom allowed the appeal. > > It was held that it was open for the jury to consider that it was up to the Council, and not the plaintiff, to call evidence to explain if there was a difficulty in moving the flags to avoid the sand bank, or to explain why nothing would have been gained by putting the flags in a different location. The consequence of the Council's failure to call a witness to give such evidence was able to be relied upon by the jury in its assessment as to whether the Council had been reasonable or not in its placement of the flags on the day of this incident. > > Gleeson CJ referred to the over 200-year-old decision of Blatch v Archer ('Blatch'),[108] in which Lord Mansfield said that 'all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted.'[109] In endorsing this proposition, Gleeson CJ described it as a 'basic principle of adversarial litigation,[110] and one that 'accords with common sense and ordinary human experience'."[111]

6. Unlike in Reynolds or in Swain, there is no gap in the applicants' evidence. Further, there is no evidence that the Minister had derived the funds from unlawful activity, save perhaps of Mr Jeans, which would invoke the principles in Jones v Dunkel.[112]
7. I accept that evidence might possibly have been given by Mr Taban on the topic of whether the funds transferred by him from Uganda were derived from the Minister's rental income, but there is no evidence Mr Taban knew of the source of any funds provided to him, lawful or otherwise.
8. I find there is no contradictory or competing evidence to the effect that the Minister was manufacturing his evidence as to receipt of rental income. The leases were not disputed. A body of other evidence, much of which is objective and provided by contemporaneous documents, or otherwise corroborated by the evidence of his family - including current and historical lease agreements - exists upon which I may rely in support of my finding the funds were not derived from some sort of unlawful activity.
9. Considering the evidence as a whole in this case, where the applicants bear the burden of proof, I do not accept inference is available that the funds were derived from unlawful activity.
10. Even if Mr Taban's evidence may not have assisted the Minister's case, it is not open to infer from the absence of his evidence that the source of the funds was unlawful activity: if there are no positive proved facts from which this inference can be made, the method of inference fails and what is left is mere speculation or conjecture.
11. The likely inferences from established facts are that Mr Taban transferred funds from Uganda and Kenya to Australia at the Minister's direction, the Minister having provided those funds to Mr Taban/KK Coaches in accordance with the Memorandum of Understanding.
12. Any inference Mr Taban's evidence would not have assisted the applicants would simply be one factor to take into account in my assessment overall as to whether the applicants have disproved the offence under s400.9 of the Criminal Code alleged by the Commissioner.
13. I am satisfied there was sufficient evidence at trial to determine that:

(a) the Minister had a beneficial interest in two properties in Juba;

(b) he leased the buildings to two separate government entities;

(c) the rental income was provided to Mr Taban; and

(d) the funds were transferred to Australia at the Minister's direction via entities controlled by Mr Taban.

1. At the end of the day, having considered in particular the evidence of the Minister, Nyawarga, Nguoth and Mr Demissie, the evidence on key issues is in favour of the exclusion applicants' case.
2. I find the meeting prior to the funds being transferred to Sportscars account in July and August 2014 established an agreement whereby the company's account could be used for the purchase of the Narre Warren property.
3. The Commissioner submits that the proper characterisation is of the funds provided by the Minister to the company is working capital, as opposed to a loan or funds subject to an express trust. He relies on the evidence of Mr Demissie in this regard. I reject that submission, having found Mr Demissie is likely mistaken in his evidence.
4. Ultimately, I accept the submission of the applicants that their case is uncomplicated and inherently probable. The evidence has established that the Minister owned or had a beneficial interest in two properties in Juba, South Sudan, from which he derived rental income. That income was loaned to KK Coaches under a Memorandum of Understanding. The Minister directed the funds to be repaid by KK Coaches, firstly, to an estate agent's trust account (being for the deposit of the purchase of the Narre Warren property), and later, to Sportscars' bank account in Australia, to complete the purchase of the Narre Warren property.
5. On the balance of probabilities, the Minister derived significant income from his two investment properties in Juba. Although there is some doubt about the precise amount of his expenses over the "reasonable period" from 2007 to 2015, there was evidence about the loans required to build the properties, and significant other evidence of income which was available to meet his likely living expenses, and other known expenses in relation to his family and travel.
6. I accept the evidence of the Minister that his income was applied to his extended family in South Sudan, towards modest living expenses - because he often travelled and was subsidised - and to the construction of two rental properties.
7. Accordingly, the Commissioner has not established the "deeming" provision in s400.9(5).
8. Nor has the Commissioner established that either Nguoth, Titchiang or the Minister had a reasonable suspicion that the money was not derived from lawful activity.
9. On the balance of probabilities, the Minister derived rental income in accordance with the amounts on the various leases.
10. Although some of the lease documents do not bear his name, I am satisfied the Minister's representative signed leases on his behalf in respect of Block K3K. I accept the Minister's explanation that from time to time, a bank or the other leasing entity requested a Power of Attorney, which was the reason it existed in relation to one lease, but that no other entity or bank required it.
11. I find that there was a gift of Block K3K from Brigadier Kenyi to the Minister in 2007 and a later transfer in 2019 of the legal estate. In the interim period, the Minister dealt with the property as his own, rented it, and earned rental income from it. There are a number of documents consistent with that arrangement. The lease of Khor William from the Sudanese Government to the Minister is not disputed.
12. The Commissioner's failure to accept the Minister's evidence was in part without basis. During his cross-examination,[113] counsel for the Commissioner put in robust terms to the Minister that the buildings in Juba said to have generated the funds to purchase the Narre Warren property, "did not exist". Such an allegation has attendant to it multiple elements of fraud and other criminal behaviour of a very high level. I note the Commissioner's grounds of contest did not extend to any allegation of production of fraudulent documents for the purpose of gaining financial advantage, or perjury.
13. In order for a party to put such an allegation, a factual foundation must exist, and the evidence must be cogent.[114]
14. When this line of cross-examination was objected to late on day two of the trial, I suggested all parties reflect on their position, and the Court would do likewise. The very next morning, the Commissioner tendered, through the Minister, an aerial photograph[115] which established the location and existence one of the buildings he had the day before put to the Minister "did not exist". The allegation was then withdrawn on instructions.
15. Despite the Court's invitation during the hearing to put the Minister on notice of a positive case of fraud in relation to the Lease documents and any other South Sudanese documents on a proper basis, the Commissioner did not apply to amend his Notice of Grounds.
16. This exchange, over two days, was an example of challenges to the Minister which, ultimately, I find did not impugn his evidence.
17. The oral evidence given by the applicants' witnesses concerned events that occurred at least a decade, and in some cases two decades, before their evidence was given. Some of the affidavits were sworn up to seven years ago. The fallibility of human memory, particularly in relation to minor details or about events that were not at the time significant, means that perfect recall is not to be expected, and on the contrary, would be suspicious.
18. There were inconsistencies in the witnesses' recall of events - both as between themselves, and by comparison with accounts previously given by the same witness. My impression was that all of the witnesses gave their best attempts to recall facts. A number of principles for evaluating witness evidence and assessing credit were set out in the judgment of Croft J in LL UP Pty Ltd v Kegland Distribution Pty Ltd.[116] Specifically, the inherent plausibility of a witness's account, when considered in the light of contemporaneous documents, have a leading role in assessing the reliability of that oral evidence.
19. The principal challenges to the Minister's evidence were based on inconsequential or explicable discrepancies in his recall of events, or the absence of contemporaneous documents that in many cases simply never existed.
20. I accept the Minister, Nyawarga and Nguoth as honest witnesses.

Did the Minister or Nguoth dishonestly and intentionally cause a loss to the Commonwealth in contravention of s135.1 of the Criminal Code?

1. I have found that the funds transferred to Sportscars were for the purchase of the Narre Warren property. Even if the Minister provided seed capital to Sportscars, use of the funds to purchase the Narre Warre property did not constitute any dishonesty offence under s135.1 of the Criminal Code, because the money loaned to the company by the Minister was repaid within the meaning of s109J of the ITAA 1936. Accordingly, it did not constitute a deemed unfranked dividend which was not declared.
2. At no time did the Australian Taxation Office issue a notice of assessment in respect of the putative income from the 2014 or 2015 tax years.
3. It would be a surprising result if the Court found Nguoth acted dishonestly by not paying an asserted taxation liability that he did not know existed, and which the Australian Taxation Office did not assess him as liable to pay, despite the ATO knowing about the underlying facts for seven years.
4. There is no evidence that Nguoth had a tax liability in respect of the purchase of the Audi. It was not put to Nguoth that he knew about a tax liability or dishonestly intended not to meet it.

Did the Minister or Nguoth dishonestly use their position with the intention of gaining an advantage for themselves or others in contravention of s184(2) of the Corporations Act?

1. The conduct constituting the alleged offence is the use of Sportscars' money to purchase the Narre Warren property and the Audi.
2. Adopting the interpretation of dishonesty set out in Mai, Nguoth and the Minister have disproved any element of dishonesty. I accept their evidence that the money was derived from the Minister's rental properties, to be applied for the benefit of the Mai family.
3. The Commissioner accepts that if there was a loan from the Minister to Sportscars, and Sportscars held those loaned funds in its bank account, and then Sportscars paid out those funds to discharge that debt, the applicants have disproved this offending.[117]
4. I have made those findings, so it is unnecessary to consider the question of dishonesty. Had I been required to do so, I would find that the conduct was not dishonest by current standards of ordinary, decent people.
5. It is significant that the Minister arranged for transfer of funds to Sportscars' account in almost the precise amounts in USD, reflecting:

(a) the 10 per cent deposit for the purchase of the Narre Warren property, which was transferred directly to the real estate agent conducting the sale on behalf of the vendor;

(b) the funds required for the settlement of the purchase; and

(c) later, for $83,500 stamp duty.

1. I reject the evidence of Mr Demissie that these funds were seed capital for the business.
2. Like the Court of Appeal in Mai, I regard it significant that the company never traded, and never earned any income. I find that the money was never that of Sportscars. This finding is sufficient to disprove the offending alleged under s184(2), being misuse of company funds for the benefit of a (shadow) director.
3. The transfer of funds from Uganda to Sportscars' bank account was in the nature of a loan, and is also consistent with an express trust for the purpose of purchasing the Narre Warren property.
4. I am satisfied as to the essential elements of such a trust: certainty of intention for the money to be applied to purchase a home in the name of Nguoth for use by the family and, thus, the subject and object of the express trust.
5. The consent of Sportscars' shareholders and directors also stands against any finding of dishonesty.

Was there any dealing with proceeds of crime in contravention of s400.9(1) of the Criminal Code?

1. The remaining offence for disproving by the applicants is the money laundering offence under s400.9.
2. I accept the applicants' submission that if the person dealing with property has an objectively reasonable belief as to the lawful source of funds (without any reasonable basis for a contrary suspicion), that will end the enquiry in his or her favour under s400.9(5).
3. I accept the evidence of the Minister and Mr Kuol that the source of the money was lawful, so there was no reason for him to suspect that the funds were the proceeds of unlawful activity and the Minister has disproved this offending.
4. There are no reasonable grounds for the Court to suspect that the funds were proceeds of crime.
5. Further, the deeming provision in s400.9(2)(c) is not satisfied, because the Minister has established the sources of his income. I reject the Commissioner's submission that the expenditure is grossly disproportionate to income and expenses during the period 2007 to 2015 because:

(a) the payments are shown to be derived directly from just one part of his income (rental);

(b) the balance of his (workplace) income was of a similar value; and

(c) his living expenses were minimal.

1. In this circumstance, the Commissioner has no recourse to the deeming provision in s400.9(2)(c).
2. Nguoth knew his father had a high-ranking government position in South Sudan at all relevant times, and owned investment properties. In the circumstances, Nguoth had no reasonable grounds for suspecting that the money used to purchase the restrained property was derived from unlawful activity, and has disproved any offending under s400.9(1).

1. A limited number of documents were marked for identification in part on the basis that the proceeding was not interlocutory, and therefore the hearsay exception in s75 of the Evidence Act did not apply.
2. In Re Luck,[118] McHugh ACJ, Gummow and Heydon JJ observed:

"... the usual test for determining whether an order is final or interlocutory is whether the order, as made, finally determines the rights of the parties in a principal cause pending between them. That question is answered by determining whether the legal effect of the judgment is final or not. If the legal effect of the judgment is final, it is a final order; otherwise, it is an interlocutory order."

3. Drawing on that passage, in Ashby v Commonwealth of Australia (No 3),[119] Rares J explained that an application will be interlocutory if the order that would be made to determine it will either (depending on which party succeeds) permit the proceedings to continue to a final hearing or terminate the proceedings with an order that is interlocutory (even if it has a final effect, practically speaking).
4. I accept the applicants' submission this is the case here, and find this hearing is interlocutory in nature.
5. Applications for exclusion from a restraining order have repeatedly been described as "interlocutory", including in a passage twice endorsed by the Victorian Court of Appeal[120] and in Commissioner of the Australian Federal Police v Lee (No 2).[121]
6. The statutory scheme involves Part 2-1, restraining orders (and exclusion), and then forfeiture orders in Part 2-2. The principal cause pending between the exclusion applicants and the Commissioner is whether the property in which they claim an interest should be forfeited. A restraining order is not discharged or vacated by an exclusion order; the property is merely excluded from its operation. Here, the applications for forfeiture remain on foot, and must be discontinued or dismissed by a separate act of the Commissioner or the Court. It is the determination of the forfeiture application (or perhaps even a compensation application) that constitutes the final order in the proceeding.

1. The fundamental facts, as agreed and found above, are sufficient to dispose of the exclusion applications in favour of granting the orders sought. The applicants have disproven that any of the three offences put in issue occurred.
2. To the extent that the Commissioner relies upon s400.9(1) of the Criminal Code to establish that Nguoth, in particular, must have had a reasonable suspicion that the monies were not derived from lawful activity, it relied upon the evidence of the Jeans' indicators. Certain indicators were established during Mr Jeans' cross-examination to be mundane, and in and of themselves, indicators which could apply to a number of innocent circumstances. His evidence certainly does not displace or outweigh my finding that the lawful source of the funds was rental income from property beneficially owned (Block K3K) or leased (Khor William) by the Minister.
3. On the balance of probabilities, the Minister derived significant income from his two investment properties in Juba. Although there is some doubt about the precise figures of his expenses, there was some evidence about the loans required to build the properties, and significant other evidence of income which was available to meet his other known expenses in relation to his family and travel.
4. The Commissioner has not established the deeming provision in s400.9(5).
5. Nor has the Commissioner established that either Nguoth or the Minister had a reasonable suspicion that the money was not derived from lawful activity.
6. I find that there was a gift of Block K3K from Brigadier Kenyi to the Minister and a later transfer in 2019 of the legal estate.
7. I find the Minister was granted a lease of Khor William in 2008, a sufficient interest for the purposes of this proceeding at the relevant time, when the Minster exercised control of the land, including building a house and renting it to the South Sudan Government, consistent with ownership.
8. I am unable to make a finding Nguoth holds the Narre Warren property on trust for benefit of the Mai family. While there are intra-family expectations, the evidence is not sufficient to establish a formal trust arrangement; and it is not necessary in any event to determine this question in light of my other findings.
9. Although the Minister may have been a "shadow director" of Sportscars within the meaning of s9AC(1)(b)(ii) of the Corporations Act, having regard to Nguoth's evidence and concessions as to his involvement with Sportscars, again, it is not necessary in any event to determine this question in light of my other findings
10. I find that:

(a) when the Minister arranged for funds to be transferred to Australia, and Nguoth received and dealt with them, it was not reasonable to suspect that any of the funds transferred were proceeds of indictable crime within the meaning of s400.9 of the Criminal Code;

(b) I accept the funds transferred to Australia were earned by the Minister from his rental properties, so there was no reason for him to suspect that the funds were the proceeds of unlawful activity;

(c) I accept Nguoth's evidence that the Minister told him that he had enough money saved to buy a house and that he would arrange for the money to be transferred. That money was ultimately used to acquire the Narre Warren property; and the Minister also provided Nguoth with the money needed to pay for the balance of the Audi (by cheque). In the circumstances, Nguoth had no reasonable grounds for suspecting that the money was derived from unlawful activity;

(d) there are no reasonable grounds for the Court to suspect that the funds were proceeds of crime, because the source of funds has been established;

(e) the Minister did not use his asserted position as a shadow director of Sportscars at all because he did not transact on its bank account; and

(f) when Nguoth drew cheques on Sportscars' bank account, he did not use his position dishonestly to gain an advantage within the meaning of s184(2)of the Corporations Act because the funds (a loan) were paid as directed by the depositor, the Minister, with the consent of all directors and shareholders; and

(g) when Nguoth drew cheques on Sportscars' bank account:

(i) he did not pay a deemed divided under Division 7A of the ITAA 1936 because the payment discharged an obligation to the Minister within the meaning of s109J of the ITAA 1936 and was therefore excluded; and

(ii) he therefore did not intentionally and dishonestly (or at all) cause a loss to the Commonwealth under s135.1 of the Criminal Code.

1. As a result of the above findings, I am also satisfied that Titchiang's interest in the Audi as registered owner was not derived or realised, directly or indirectly, from the commission of any offence.
2. In terms of the various applications, I grant:

(a) Nguoth's application for exclusion in relation to the Narre Warren property; and

(b) Titchiang's application for exclusion in relation to the Audi.

1. Pursuant to s29 and s31 of the Act, the Narre Warren property and the Audi are excluded from the restraining order.
2. It is not necessary to determine the remainder of the applications, so they should be dismissed.
3. I will hear the parties as to the form of final orders, having regard to my findings, and costs.

Each exclusion application is made on grounds that the interests claimed are neither the "proceeds of unlawful activity" nor "an instrument of any serious offending"; and the interests claimed are, relevantly, neither the proceeds of an indictable offence nor an instrument of any serious offence.

7-8 Wiringa Close, Narre Warren North (more particularly described in Certificate of Title Volume 10650 Folio 383)

Audi A1 1.0L vehicle, chassis number WAUZZZ8X9FB042678

[1] Many of the documents show this applicant's name as Nguoth Oth Mai; however, according to that applicant's affidavit, the correct name is Nguoth Hoth Mai (emphasis added)

[2] James Hoth Mai is the current Labour Minister in the government of the Republic of South Sudan

[3] Mai v AFP [2018] VCC 2013

[4] (2020) 62 VR 118

[5] Each application is described in the Schedule of Applications to this judgment, marked as Annexure "A"

[6] By agreement between the parties, the compensation applications are to be determined at any subsequent forfeiture hearing

[8] Served in accordance with s30(4) of the Act

[9] See paragraphs [69]-[72] as to s184.2 of the Corporations Act and paragraphs [79]-[81] as to s135.1 of the Criminal Code

[11] Transcript ("T") 453, evidence of Nyawarga

[12] T148, Line/s ("L") 28 - T149, L12; T150, L10-17

[15] T285, T278 and Exhibit Z (affidavit of Nguoth) at paragraphs [16]-[17]

[17]18 Certificate of Title Volume 10650 Folio 383, Joint Court Book ("JCB") 1514

[19] Historical company extract for Sportcars Dealers Pty Ltd dated 8 December 2017, JCB 2843-2845

[20] T89, L10; Commissioner's closing submissions, at paragraph [9]

[21] Commissioner's closing submissions, at paragraph [9]

[22] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [44]

[23] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [27]

[24] T168, L28-31; T169, L1-6 and 11-15

[26] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [25]: JCB 710

[27] Exhibit 8 - Statement of Agreed Facts dated 20 May 2025 (as to travel movements and citizenship status of the applicants)

[31] Exhibit JHM-3 to the affidavit of James Hoth Mai, sworn 7 May 2021 (Exhibit A)

[32] T174, L3 - T175, L11 and T180, L30 - T182, L7

[42] Exhibit 10, amendment to Lease Agreement dated 7 March 2024

[44] Exhibit B, JCB 1713-1714, at paragraphs [39]-[41]

[45] T180, L30 - T182, L7; JCB 2596-2601 (part of Exhibit 11)

[46] Exhibit T, affidavit of Monyluak Alor Kuol, sworn 12 March 2025 and exhibit bundle MAK-1

[50] JCB 1641 and 2602, part of Exhibits 6 and 11 respectively

[51] See Exhibits 6 and 11, JCB 1641 and 2602; and T305-T307

[55] Exhibit 11, JCB 2603-2606 and T302-304 and T306-T307

[57] The Commissioner of the Australian Federal Police v Chen (No 2) [2022] NSWSC 1743; s58 and s183 of the Evidence Act

[58] Closing submissions, at paragraph [120]

[60] Affidavit James Hoth Mai, sworn 12 March 2025, at paragraph [44]

[62] Affidavit of James Hoth Mai, sworn 7 May 2021, at paragraphs [68-69], Exhibit JHM-5; affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [47]

[63] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [47]; T208-209

[68] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [45]

[69] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [50]

[75] T285, L19 - T286, L14; T278, L14-22

[78] Harcourts Berwick - Sales Trust Westpac account number 277385 statement dated 6 June 2014, JCB 2832

[80] T391; Exhibit X, at paragraph [16]

[81] Affidavit of Nguoth Hoth Mai, sworn 10 May 2021, at paragraph [31]

[82] Sportscars Dealers Pty Ltd NAB Business Cash Maximiser account number 837827763 statement dated 22 December 2014: JCB 2898-2899

[83] Exhibit X, JCB 114, at paragraph [17]

[84] Hoid Establishments Ltd is owned by Mr Taban: Exhibit 11, JCB 2627

[85] Exhibit A, JCB 138, at paragraph [98]; Exhibit B, JCB 1707, at paragraph [11]; JCB 1708, at paragraphs [15]-[16]

[86] Exhibit L; Exhibit M; and Exhibit AC

[89] Exhibit GW-7 to Exhibit 3, JCB 2830, T467

[90] See supply agreement between KK Coaches and Belgravia and invoice issued by KK Coaches to Belgravia - Exhibit D, JCB 1416 and Exhibit E, JCB 1423

[92] Affidavit of James Hoth Mai, sworn 12 March 2025, at paragraph [12]

[94] Affidavit of Nguoth Hoth Mai, sworn 10 May 2021, at paragraph [23]

[95] Exhibit X, JCB 115, at paragraphs [19]-[20] and [23]. T410, L29 - T411, L2

[96] Exhibit X, affidavit of Samson Syum Demissie, sworn 17 April 2018

[98] Affidavit of Graham White, affirmed 28 October 2024

[99] Part exhibit 5, Dahabshiil payment voucher dated 14 August 2015

[100] TR-2, Mr Rengers' statement dated 1 November 2024 - part of Exhibit 2

[102] For example in relation to Indicator 37, JCB 2656

[103] See Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298

[104] ([2017] VSCA 88; 2017) 372 ALR 440, at paragraph [101] (footnotes omitted); see also Cotton On Group Services Pty Ltd v Golowka [2022] VSCA 279

[105] [2022] VSC 211

[106] Ibid, at paragraphs [33]-[35]

[107] [2005] HCA 4; (2004) 220 CLR 517 ('Swain').

[108] [1774] EngR 2; (1774) 1 Cowp 63; 98 ER 969 ('Blatch')

[113] The Minister was cross-examined over three days. This occurred remotely and was effected via his location in Geneva, where his evidence commenced at 2.30am each morning and concluded at around 8.00am (Geneva time), before the Minister attended to his official duties at an International Labour Conference in Switzerland

[114] Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137

[115] Exhibit 1, aerial photograph of Block K3K

[116] [2024] VSC 651, at paragraphs [22]-[24]

[117] Commissioner's closing submissions, at paragraph [31](a)

[118] [2003] HCA 70; (2003) 203 ALR 1, at paragraph [4] (footnote omitted)

[119] [2012] FCA 788; (2012) 206 FCR 444, at paragraph [8]

[120] Saad v Commissioner of the Australian Federal Police [2021] VSCA 246; (2021) 361 FLR 261, at paragraph [8]; and Mai at paragraph [9]

[121] [2016] NSWSC 1131, at paragraph [19]