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[2013] NSWSC 1011
Supreme Court of NSW
2013-05-17
Rothman J
Original judgment source is linked above.
Judgment 1The proceedings before the Court have a complicated history. For present purposes, it is sufficient to refer to a series of interlocutory judgments relating to the admissibility of evidence and the reopening of matters to allow for the filing of further affidavits. The New South Wales Crime Commission (hereinafter, "the Commission" or "the Applicant") moved on notice filed on 21 July 2010 for orders under s 31A of the Criminal Assets Recovery Act 1990 (hereinafter, "CARA") against the first defendant in the proceedings, Charles Michael Cassar (hereinafter also referred to as "the Respondent"). 2Orders under s 31A of CARA relate to an interest in property that has not been disclosed, in circumstances where the interest was required to be disclosed, by a defendant to such proceedings in the following terms: "31A Assets forfeiture orders after interests in property not disclosed (1) This section applies if: (a) an application for an assets forfeiture order or proceeds assessment order or unexplained wealth order is made, and (b) evidence or a warranty or other representation was given or made in proceedings for the order, or examination proceedings under this Act, by a person against whom the order is made (the defendant) as to the defendant's interests in property. (2) The Commission may apply to the Supreme Court for an order forfeiting to, and vesting in, the Crown a specified interest in property of the defendant at the time the evidence, warranty or representation was given or made that was not disclosed in the evidence, warranty or representation. (3) The Supreme Court must make the order if the Court finds it more probable than not that the interest in property was an interest of the defendant at the time the evidence, warranty or representation was given or made." 3The earlier interlocutory judgments dealt with the capacity of the Commission to prove the existence of property in which the Respondent had or has an interest and the manner in which such proof could be effected: see, inter alia, New South Wales Crime Commission v Cassar [2012] NSWSC 1170. Other judgments also dealt with the admissibility of a letter (Exhibit S1) from which the Commission seeks to draw an inference, which letter was part of the process whereby the Commission and Mr Cassar negotiated earlier consent orders. 4The jurisdictional precondition to the operation of s 31A of CARA is relevantly a warranty that was said to be given by Mr Cassar as part of consent orders issued by the Court on 21 April 2008. Other than the alleged warranty, the remainder of the consent orders are presently irrelevant. The alleged warranty is paragraph 3 of the consent order and was noted by the Court as part of those consent orders. The warranty was in the following terms: "THE COURT NOTES: ... 3. The First Defendant warrants to the Plaintiff that the First Defendant's only interests in property as at the date of the signing of these orders are the First Defendant's interests in the seized cash (together with any interest earned thereon), and the property specified in Schedule Two hereto ('the Seven Hills property') and Schedule Three hereto ('the Holden motor vehicle')." 5Because of the delay in the final hearing of the matter, the issue relating to the admissibility of documents purporting to prove the existence of the Respondent's interests in property in Swiss banks is no longer extant. Exhibit A in the proceedings is a certificate under the hand of the Acting Assistant Secretary, International Crime Cooperation Central Authority, International Crime Cooperation Division, Attorney General's Department of the Australian Government, being a certification under subsection 26(1) of the Foreign Evidence Act 1994 (Cth) of material obtained as a result of a request made by or on behalf of the Attorney General. It has been admitted without objection and proves an interest in property held in Swiss bank accounts, being property beyond the property described in Schedules Two and Three of the consent orders of 21 April 2008 and therefore property interests beyond that purportedly warranted by Mr Cassar in the note recited above. 6There are two issues in the proceedings: first, whether a warranty of the kind to which s 31A refers can be given by a solicitor or agent on behalf of a defendant or, in other words, whether such a warranty is required to be given personally by a defendant. 7Secondly, whether such a warranty was authorised by the Respondent and, if not, whether ostensible authority is sufficient to satisfy the jurisdictional requirements of s 31A of CARA. 8I am satisfied, on the material before the Court, that it is more probable than not, if the warranty were given, that the Respondent held interests in property beyond that described in the warranty.
Issue 1: Requirement for personal and direct warranty 9By his written submissions of 16 May 2013 and his oral submissions of 17 May 2013, counsel for the Respondent relied upon earlier submissions filed on behalf of the Respondent, particularly paragraphs 1 to 10 thereof. 10Those submissions agitate the proposition that the warranty must be from the person against whom the orders are to be made and not from some other person on that person's behalf. The argument is based upon the terms of the Act itself and the requirement to have clear and express words in order to give rise to the kind of "draconian orders" for which s 31A of CARA provides. 11Essentially, as is emphasised in the additional submissions of 16 May 2013, the submission is that the terms of s 31A(1)(b) of CARA should be interpreted strictly and literally, to the effect that a warranty or other representation must be given directly and personally by the Respondent. 12I make no criticism of counsel for the Respondent, or indeed for the Commission, but during the course of submissions, on inquiry from the Court, the provisions of s 55 of CARA were examined. Section 55 is in the following terms: "55 Conduct of directors, employees or agents (1) If it is necessary, for the purposes of this Act, to establish the state of mind of a body corporate in respect of conduct engaged in, or taken by subsection (2) to have been engaged in, by the body corporate, it is sufficient to show that a director, employee or agent of the body corporate (being a director, employee or agent by whom the conduct was engaged in within the scope of his or her actual or apparent authority) had that state of mind. (2) Any conduct engaged in on behalf of a body corporate: (a) by a director, employee or agent of the body corporate within the scope of his or her actual or apparent authority, or (b) by any other person at the direction or with the consent or agreement (whether express or implied) of a director, employee or agent of the body corporate, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the director, employee or agent, is to be taken, for the purposes of this Act, to have been engaged in by the body corporate. (3) If it is necessary, for the purposes of this Act, to establish the state of mind of a person in relation to conduct taken by subsection (4) to have been engaged in by the person, it is sufficient to show that an employee or agent of the person (being an employee or agent by whom the conduct was engaged in within the scope of his or her actual or apparent authority) had that state of mind. (4) Conduct engaged in on behalf of a person other than a body corporate: (a) by an employee or agent of the person within the scope of his or her actual or apparent authority, or (b) by any other person at the direction or with the consent or agreement (whether express or implied) of an employee or agent of the first-mentioned person, where the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the employee or agent, is to be taken, for the purposes of this Act, to have been engaged in by the first-mentioned person. (5) A reference in this section to the state of mind of a person includes a reference to the knowledge, intention, opinion, belief or purpose of the person and the person's reasons for the person's knowledge, intention, opinion, belief or purpose." 13The provisions of subsection 55(4) expressly relate, amongst other things, to conduct engaged in by a solicitor on behalf of Mr Cassar, within the scope of his actual or apparent authority. For the purposes, amongst other things, of s 31A of CARA, such conduct is taken to have been engaged in by the first-mentioned person. In other words, subsection 55(4) of CARA allows a solicitor to give a warranty (assuming, for this purpose, actual or apparent authority) as to the ownership of property, the giving of which is taken to have been engaged in by the first defendant, the client to the solicitor. 14In this case, the solicitor acting for the Respondent executed the consent orders containing the warranty upon which the Commission relies. Subject to the existence of actual or apparent authority to give that warranty, the solicitor was entitled to give that warranty and, to the extent that the solicitor had actual or apparent authority, that warranty is taken to be a warranty given by the Respondent. 15In my view, s 55(4) of CARA provides a total answer to the submission that the terms of s 31A of CARA should be strictly interpreted to disentitle a solicitor from giving a warranty on behalf of her or his client. 16I accept that a warranty needs to be clearly and expressly stated in order to give rise to orders under s 31A of CARA. In this case, the warranty clearly and expressly warrants that no other property is held save for the property described in Schedules Two and Three to the consent orders in which the warranty is contained. 17I also consider that the terms of the warranty are clear and express. The consent orders are signed by Mr Goold, solicitor, on behalf the Respondent and expressly state that "The First Defendant consents to the terms of order above". The order is otherwise (i.e. on its first page) headed Consent Order and thereunder there are, leaving aside the formal parts, four paragraphs in which the Court notes certain aspects and a further seven paragraphs in which the Court orders certain conduct, or the restraining of certain conduct. In my view, the phrase "terms of order above" refers to the entirety of the consent orders, including the noted paragraphs. That reference is clear and express. 18As earlier stated, Mr Goold was the solicitor acting for Mr Cassar. As such, he had authority, as an agent, to sign consent orders. Mr Goold was an agent of Mr Cassar, but it does not follow that the terms of the arrangement between Mr Cassar and Mr Goold were such that Mr Goold possessed actual or apparent authority to provide the warranty.
The evidence 19The issue of authority is a contentious one. 20The authority that is required is not a general authority. Actual authority in this regard is not conferred by an authority to state the interests in property of the client. Nor would an expression of opinion by a client relating to the interests in property of the client be sufficient to allow a solicitor to warrant in terms necessary to satisfy the jurisdictional precondition in s 31A of CARA. 21Thus, if all that had occurred, was that a solicitor had been informed by her or his client that the client owned certain property and no more, that statement of the client would not be sufficient to grant actual authority to the solicitor to execute a warranty, or warrant, in terms sufficient to satisfy s 31A of CARA. 22In this case the Commission relies upon the terms of the letter from Mr Goold (Exhibit S1) to allow the Court to draw an inference that Mr Goold had instructions as to the property that was available for confiscation. I have no doubt, on the material before the Court, that Mr Cassar told Mr Goold of his property interests in terms not dissimilar to that which is repeated in Exhibit S1. 23In order for Mr Goold to warrant in terms that would satisfy the provisions of s 31A of CARA, Mr Goold would have to have actual or apparent authority to issue a warranty of the kind sought. The provision of information to him as to interests in land is not authority for the signing of a warranty that would give rise to the kind of orders, or satisfy the provisions of, s 31A of CARA. However, there is other evidence. 24In his affidavit of 20 October 2011, Piet Baird attests to a number of meetings between Mr Cassar and Mr Baird. He also attests to a discussion between Mr Cassar and Mr Baird concerning the consent orders that are impugned or relied upon in these proceedings. 25Mr Baird refers to the fact that Mr Cassar told him he did not sign the orders and that his solicitor, Mr Goold, had no authority to sign the consent orders which included the warranty. They also had a conversation relating to the Swiss bank account records, the effect of which was that Mr Cassar admitted that the moneys were "my account" and asserted that the moneys were "a family trust". 26Mr Baird also attests to a conversation with Mr Goold on 4 August 2010. The terms of that conversation bear reciting: "He [Mr Goold] said: 'What's going on?' I said: 'Same old, same old. He's playing the usual game.' He said: 'What? Saying I didn't have instructions to sign the consent orders?' I said: 'Yes.' He said: 'That's rubbish. I'll go in and see him.'" 27Further evidence has been adduced (affidavit of Jonathan Lee Spark of 17 May 2013) in which Mr Spark recites part of the terms of the Goold letter (Exhibit S1) and annexes a copy of the records of the New South Wales Department of Corrective Services disclosing all visitors received by Mr Cassar whilst in custody between 21 December 2007 and 26 May 2008. Those records disclose that Mr Goold, the solicitor in question, visited Mr Cassar on 4 February 2008, 17 February 2008, 26 February 2008, 7 March 2008, 16 March 2008, 31 March 2008, 10 April 2008 and 23 April 2008. The Court proceedings before the Registrar, in which the consent orders in question issued, were on 21 April 2008. 28Against the foregoing is the affidavit of Mr Cassar in which he attests to the fact that he had been provided with some legal papers whilst in prison. He had instructed Mr Goold as his solicitor and was, thereafter, in regular contact with him. In the course of the affidavit Mr Cassar says: "Goold did not ask me any questions about my assets. I did not give him any instructions to sign any consent orders nor make any warranty as to my assets." 29Mr Cassar also attests that 7 April 2008, when he met Mr Baird at the premises of the Commission, was the first occasion that Mr Cassar had seen the consent orders and the terms of the alleged warranty. 30Neither Mr Spark nor Mr Baird was cross-examined. Nor was Mr Cassar. Mr Goold was not called to give evidence. 31I accept that a conversation occurred between Mr Baird and Mr Goold to the effect of that recounted in Mr Baird's affidavit. I do not accept that Mr Cassar did not give Mr Goold instructions as to the state of his interests in property, whether or not those instructions were given in answer to questions from Mr Goold. 32As earlier stated, if Mr Cassar were to have given instructions as to the state of his property interests and confined to that aspect, such instructions would not, on their face, be sufficient to grant actual authority to Mr Goold to give the warranty in the consent orders. 33I am also satisfied, on the balance of probabilities, that Mr Cassar saw the terms of the consent order ultimately signed by Mr Goold and issued by the Court. Such an inference is inevitable from acceptance of the description by Mr Goold in the conversation with Mr Baird that it was "rubbish" that Mr Cassar did not give instructions to sign the consent orders. I also draw the inference from the foregoing that Mr Goold had actual authority to sign the consent orders.
Consideration 34I have concluded above, and reiterate, that s 55(4) of CARA is a total answer to the proposition that a warranty, representation or evidence must be given personally by the defendant in order for it to form the basis of orders under s 31A of CARA. An agent with actual authority, and express authority, to give a warranty of the kind here given could do so and bind a defendant in the way s 31A of CARA requires. Different issues arise in relation to ostensible or apparent authority, notwithstanding the provisions of s 55 of CARA. 35Ordinarily, for orders, of a kind to which s 31A of CARA relates, to be made on the basis of a breach of a warranty, that warranty would have to have been given expressly, by the defendant. The terms of s 55(4) of CARA require conduct of an agent with the apparent authority of the defendant to be taken, for the purposes of CARA, to have been engaged in by the defendant. 36The effect of s 31A of CARA, on initial examination, is draconian (as earlier stated). Nevertheless, the consent orders issued on 21 April 2008 were, substantially, an order varying previously made restraining orders. Those previously made restraining orders were issued under s 10 of CARA. They related to the property of the defendant. 37The orders of 21 April 2008 varied that restraint in a way that benefited Mr Cassar and allowed him to deal with his motor vehicle. They also allowed for the payment of legal expenses out of moneys seized. Further, the orders of 21 April 2008 forfeited the remaining property, being the property that went beyond that allowed for legal expenses and the motor vehicle. 38The context of the consent orders issued on 21 April 2008 is such that if the Commission were aware of the amounts of money contained in the Swiss bank accounts, the orders would have provided for the forfeiture of the Swiss bank accounts (or there would have been argument in relation to same). 39The provisions of s 22 of CARA, under which the forfeiture order issued, require the Court, on being satisfied that a defendant has interest in property of the kind described in subsection 22(1A), to make a forfeiture order. In other words, there are complementary aspects to both s 22 and s 31A. 40The interests in property of a defendant to an application under CARA are forfeited, once the Court is satisfied that the defendant holds interests in property and the person is suspected of having been engaged in a serious crime related activity. There can be no doubt, in these proceedings, that there is a reasonable suspicion that the Respondent was engaged in serious crime related activity. 41As a consequence, leaving aside the discretion available to the Court under s 10 and s 12 of CARA (each of which was utilised), the Court would, having been satisfied of the jurisdictional requirements, make an order that the assets of the Respondent be confiscated. It issued such an order on 21 April 2008. 42In the order of 21 April 2008, those assets were confined to the disclosed property to which reference has already been made. Because of the warranty, no other order was sought or obtained and the proceedings were otherwise dismissed. 43As a consequence of the foregoing, the warranty, provided in paragraph 3 of the Consent Orders, is an essential, or expedient, means of identifying the property that will be the subject of an assets forfeiture order. It is, in those circumstances, an aspect of the settlement of the proceedings for which a legal representative has apparent or ostensible authority. It is not a subject matter which is extraneous or collateral to the subject matter of the proceedings. 44Further, the effect of the warranty is to do no more than to confine the terms of the assets forfeiture order. In those circumstances, the effect of orders under s 31A of CARA is not draconian. It completes the assets forfeiture that would otherwise have been effected were the totality of the property interests of the Respondent disclosed in the first place. 45For the foregoing reasons, together with the express terms of s 55(4) of CARA, there is no good reason to read down the terms of s 55 and apparent authority is sufficient for the purposes of making or giving a warranty that will give rise to orders under s 31A of CARA. 46Further, Mr Goold had apparent authority to give the warranty that provides the jurisdictional foundation for the orders under s 31A of CARA, and otherwise there was no reason to refuse the application. 47For the foregoing reasons, and notwithstanding the express denial by Mr Cassar, the orders sought by the Commission in its motion are granted. 48The Court makes the following orders: (1)An order pursuant to s 31A of the Criminal Assets Recovery Act 1990 forfeiting to, and vesting in, the Crown the interests in property of Charles Michael Cassar (also known as Charlie Cassar and Carmel Cassar), the First Defendant and Respondent to the motion, being: (a)Funds in UBS Bank, Zurich, Switzerland account number 0206-388418 in the name of Carmel Cassar; (b)Funds in UBS Bank, Zurich, Switzerland account number 0206-00890925 in the name of Golden Jumami Foundation. (2)The Respondent shall pay the Applicant's costs of and incidental to the motion, as agreed or assessed. (3)Liberty is granted to the Applicant and the Respondent to apply on 3 days' notice.
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New South Wales Crime Commission
Cassar