Solicitors:
New South Wales Crime Commission
File Number(s): 2010/269920
[2]
Judgment
HER HONOUR: Before the Court is an application by the New South Wales Crime Commission under s 28A of the Criminal Assets Recovery Act 1990 (NSW) for an unexplained wealth order requiring the defendant to pay to the Treasurer an amount assessed by the Court as the value of the defendant's unexplained wealth.
The defendant is Joseph Hakan Ayik, also known as Hakan Ayik. Mr Ayik has not appeared or been represented at the hearing; the evidence establishes that he left Australia on 23 February 2010 bound for Hong Kong and has never returned. He was due to return to Australia on 2 August 2010. He had, in the intervening period, been the subject of surveillance by police in respect of the suspected importation of a large quantity of prohibited drugs. On 31 July 2010, Mr Ayik's alleged co-offenders were arrested in Australia. It is a reasonable inference that he became aware of that fact, since one of them was on the phone to him telling him there was a "situation" at the time of that person's arrest. In the event, Mr Ayik evidently determined not to return to Australia, for obvious reasons.
The Criminal Assets Recovery Act is highly prescriptive as to the task to be undertaken by the Court when an application for an unexplained wealth order is made. In fact, on my reading of the legislation, there are only two requirements of the Commission in establishing an entitlement to such order. One is that the Commission makes the application, as allowed under s 28A(1). The second is that the Court must find there is a reasonable suspicion that the person against whom the order is sought has, at any time before the making of the application for the order, either engaged in a serious crime related activity or activities or acquired serious crime derived property. If that element is established, the Act provides that the Supreme Court must make an unexplained wealth order.
The only apparent discretion of the court in respect of the making of an order once those two elements are satisfied is that, under s 28A(4), the court may refuse to make an order, or may reduce the amount that would otherwise be payable "as assessed under s 28B", if it thinks it is in the public interest to do so. I do not apprehend Parliament contemplated, in making provision for that exception to the otherwise clear operation of the section, that the court would consider it to be in the public interest to subvert the plain scheme of the legislation by simply deciding on the grounds of some evaluative judgment that a lesser sum should be ordered than is calculated in accordance with s 28B.
Rather, as submitted by Ms Dobraszczyk, it appears the kind of circumstance that might persuade a Court that it is in the public interest to order a lesser sum would be, for example, extreme hardship or an extremely remote connection between the defendant's wealth and the serious crime-related activity on which the Crime Commission relied to enliven the power.
Even remoteness of connection between serious crime-related activity and a defendant's wealth might not warrant reduction of an order under subs 4, since subs 3 expressly provides that a finding of serious crime-related activity need not be based on a reasonable suspicion as to the commission of a particular offence, and can be based on a reasonable suspicion that "some offence or other" constituting a serious crime-related activity was committed.
As it happens, the present application is based on serious crime-related activity which may well be unrelated to the defendant's current wealth. The evidence in support of the application establishes that the applicant pleaded guilty in March 2000 to an offence of armed robbery for which he was sentenced to a term of imprisonment. That offence falls within the definition of "serious crime related activity" in the Criminal Assets Recovery Act.
I pause to note that it would appear the Crime Commission could equally have relied upon the defendant's activities which prompted the present proceedings, since there was before the Court (when the proceedings were commenced and restraining orders made) evidence that the relevant authorised officer, Mr Nigel Robinson, held a suspicion that the defendant had engaged in the crime-related activity of supplying a prohibited drug of an amount not less than the commercial quantity, contrary to s 25(2) of the Drug Misuse and Trafficking Act 1985 (NSW) and participating in an organised criminal group contrary to s 93T of the Crimes Act 1900 (NSW), each being an offence falling within the relevant definition.
The initial application for restraining orders was supported by an affidavit of Mr Robinson which annexed the relevant facts sheet. The content of the facts sheet plainly persuaded the Court when the restraining orders were made of the existence of a reasonable suspicion against the defendant, and plainly warrants that conclusion at this point. In any event, as already noted, the Commission does not rely on that activity, nor does it need to for present purposes. The defendant's plea of guilty to the armed robbery offence enlivens the authority and indeed the obligation to make the order sought.
Section 28B of the Act provides a simple mathematical formula for the calculation of the amount in which an unexplained wealth order must be made. The Court is required first to calculate the "current or previous wealth" of a person by calculating the sum of the values of certain matters specified in subs (4) as follows:
The "current or previous wealth" of a person is the amount that is the sum of the values of the following:
(a) all interests in property of the person,
(b) all interests in property that are subject to the effective control of the person,
(c) all interests in property that the person has, at any time, expended, consumed or otherwise disposed of (by gift, sale or any other means),
(d) any service, advantage or benefit provided at any time for the person or, at the person's request or direction, to another person,
whether acquired, disposed of or provided before or after the commencement of this section and whether within or outside New South Wales.
Subsection (2) provides that the "unexplained wealth" of a person is, in effect, that part of the sum of the values calculated in subs (4) as to which the defendant has failed to discharge the onus of proving that the current or previous wealth is not or was not illegally acquired property or the proceeds of an illegal activity. The mechanism is accordingly one which turns critically on the discharge by the defendant of an onus of proof.
Since the defendant in the present proceedings has not appeared and not put on any defence to the claim or any evidence, and in the absence of any suggestion that this might be a case for the exercise of the court's discretion under s 28A(4), it follows inexorably (on my understanding of the legislation) that I must make an unexplained wealth order in the sum properly calculated in accordance with s 28B(4).
That calculation is set out in detail in an affidavit sworn by Mr Robinson on 10 August 2016. I have given careful consideration to the contents of that affidavit so far as the calculation and the evidence to support it is concerned. Mr Robinson sets out his conclusion as to the value of the defendant's current and previous wealth at para 42 of the affidavit, as follows:
Value of the current wealth of the Defendant $430,064.86
Amount expended the Defendant $2,585,469.72
Value of the advantages provided for the Defendant $1,282,825.10
Total $4,296,359.68
[3]
Value of the Defendant's taxable income $295,313
Value of other income (loan from Satici) $150,000
Total $3,851,046.68
[4]
I am satisfied that that calculation is supported by the evidence and is correct. It follows in accordance with the terms of the Act that I must make an order in that sum.
I should record one issue addressed by Ms Dobraszczyk in her careful written and oral submissions. The application of the formula provided for in s 28B(4) is open to the possibility that certain values contributing to a person's "current or previous wealth" within the meaning of the Act might be double counted. Indeed it is clear from a close consideration of the evidence in the present case that that has occurred here, there being for example inclusion of the value of a property and the value of loan repayments made to acquire the property.
Ms Dobraszczyk submitted, and I accept, that if double counting (which is my expression) is the right expression, that is what is expressly contemplated under the Act. Indeed it would appear that, even where a defendant appeared and adduced evidence which persuaded the Court on the balance of probabilities that part of his estate was not illegally acquired property, the Court might still ultimately be required, faithfully applying the formula prescribed in the section, to make an unexplained wealth order which included an element of duplication.
That Parliament intended such a Draconian approach is made plain within the terms of the section itself. For example, s 28B(6) provides, where the value of any thing to be included as part of the calculation relates to wealth that has been expended, for the court undertaking the calculation to count the greater of the value at the time the wealth was acquired and its value immediately before the wealth was expended. Similarly, subs (b) of subs 28B(6) requires the person undertaking the calculation to count the greater of the value of wealth at the time it was acquired and its value at the time of the application for the unexplained wealth order.
Leaving aside the clear terms of the section, I am fortified in this construction of the legislation by my experience of having taken a different approach (admittedly in respect of a different section) and subsequently been overturned by the Court of Appeal in the matter of New South Wales Crime Commission v Kelaita. [1] Although that decision was concerned with a different part of the legislation, it broadly confirms the construction contended for by Ms Dobraszczyk in respect of s 28A and 28B.
For those reasons, for the purpose of making the unexplained wealth order sought by the Crime Commission, I assess the value of the defendant's unexplained wealth in the of $3,851,046.68.
I make the orders sought by the Crime Commission in the form of order handed up.
[5]
Endnote
[2008] NSWCA 284
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Decision last updated: 25 August 2016