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[2006] NSWCA 76
Court of Appeal (NSW)
2006-03-08
Mason P, Giles JA, Basten JA, Howie J
Original judgment source is linked above.
Reported Decision : 161 A Crim R 97 (2006) 65 NSWLR 478
CITATION: New South Wales Crime Commission v Ollis [2006] NSWCA 76
JUDGMENT OF: Mason P at 1; Giles JA at 2; Basten JA at 42
DECISION: 1. Answer 'no' the question - Whether a single judge of the Court has power to order that -; (a) orders 2, 3 4, 5, 6 and 7 of the orders made in this Court in these proceedings on 19 January 2006 be varied by the addition in each case at the end of the Order of the words 'pending a hearing as to the existence of a reasonable suspicion within the meaning of section 10 of the Criminal Assets Recovery Act 1990 ("the Act") as at the date of such hearing that the property described in those Schedules is serious crime derived property within the meaning of section 9 of the Act'; (b) order 5 of the orders made on 19 January 2006 be varied by the deletion of the word "Nineteen" so that the concluding words of the order read: "… in the property described in Schedules Eighteen and Twenty hereto"; and; (c) the orders sought in paragraph 7 of the Amended Notice of Motion dated 13 February 2006 be made; 2. The balance of the proceedings remitted to the Common Law Division; 3. Defendants pay the Commission's costs in this Court.
CATCHWORDS: STATUTORY INTERPRETATION - Criminal Assets Recovery Act 1990 (NSW) - consideration of statutory scheme - restraining order made under s10 - power to make ancillary orders under s12 - whether power under s12 extends to reconsideration of the basis of the restraining order - consideration of the ability to apply for exclusion order under s25
Criminal Assets Recovery Act 1990 (NSW), s4, s6, s7, s9, s10, s11, s12, s13, s22, s23, s25, s27 Licensing Ordinance 1939 (NT) LEGISLATION CITED: Proceeds of Crime Act 1987 (Cth), s48 Supreme Court Act 1970 (NSW), s51 Telecommunications (Interception) Act 1979 (Cth) Uniform Civil Procedure Rules 2005
Director of Public Prosecutions v Toro-Martinez (1993) 33 NSWLR 82 Koala Motels Pty Ltd v Chief Licensing Inspector (1977) 18 ALR 12 CASES CITED: McCleary v Director of Public Prosecutions (Cth) (1998) 157 ALR 301 New South Wales Crime Commission v Gardiner [1999] NSWSC 1210 New South Wales Crime Commission v Keen [2005] NSWSC 1151 Woodcroft v Director of Public Prosecutions [2000] NSWCA 128
New South Wales Crime Commission - Plaintiff Victor Warren Ollis - First Defendant Gail Anne Shields (also known as Gail Anne Lye and Gail Anne Ollis - Second Defendant PARTIES: Aaron Gregory Lye - Third Defendant Christopher Lye - Fourth Defendant Koala Development Pty Ltd ACN 116 719 754 - Fifth Defendant Parkes Airport Business Centre Pty Ltd ACN 116 261 913 - Sixth Defendant Parkes Airport Construction Pty Ltd ACN 117 091 737 - Seventh Defendant
COUNSEL: Mr I D Temby QC/Mr D V Robinson - Plaintiff Mr C J Dibb - First-Seventh Defendants
SOLICITORS: John M. Giorgiutti, New South Wales Crime Commission - Plaintiff Christopher Dibb, Counsel, 15th Floor Wardell Chambers - First-Seventh Defendants
LOWER COURT JURISDICTION: Supreme Court - Common Law Division
IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40078/06 SC 10278/06
MASON P GILES JA BASTEN JA
11 April 2006 NEW SOUTH WALES CRIME COMMISSION v OLLIS & ORS This case concerns the interpretation of the Criminal Assets Recovery Act 1990 (NSW). Section 10 of that Act allows the Crime Commission to apply ex parte to the Supreme Court for a restraining order in relation to certain property. The Court must make the order if the application is supported by an affidavit of an authorised officer stating certain suspicions and the grounds for those suspicions and the Court considers there are reasonable grounds for the suspicions. Section 12 permits the Court to make ancillary orders in relation to the restraining order. An order obtained under s 10 remains in force for two days unless there is pending an application including, inter alia, an application for an assets forfeiture order under section 22. Section 25 allows a person, whose interests are affected by an assets forfeiture order, to apply for an exclusion order to vary the restraining order so that their property is no longer caught by it. The issue for determination by the Court of Appeal was whether s12 permits a single judge to vary an order made under s10 so as to exclude certain interests from the order by way of reconsideration of the reasonableness of the suspicion formed when granting the restraining order under s10, or whether the applicant must rely on the mechanism in s 25 to have their interests released. Held by Giles JA (Mason P agreeing) and Basten JA:
IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40078/06 SC 10278/06
MASON P GILES JA BASTEN JA
11 April 2006 NEW SOUTH WALES CRIME COMMISSION v OLLIS & ORS Judgment 1 MASON P: I agree with Giles JA. 2 GILES JA: The long title to the Criminal Assets Recovery Act 1990 ("the Act") states that it is "to provide for the confiscation of interests in property that are interests of a person engaged in serious crime related activities; to enable proceeds of serious crime related activities to be recovered as a debt due to the Crown; and for other purposes". In relation to confiscation of interests in property, it authorises the making of "restraining orders" and "assets forfeiture orders". On the application of the New South Wales Crime Commission ("the Commission"), a restraining order may be made in respect of interests in property, and an assets forfeiture order may then be made as to the interests subject to the restraining order. 3 On the application of the person whose interest it is and with the burden of proof on that person, an "exclusion order" may be made excluding an interest in property from a restraining order. These reasons are concerned with whether, otherwise than by appeal against the making of the restraining order or by applying for an exclusion order, the person can seek to have the restraining order varied so that the interest in property is no longer caught by it.
Relevant provisions of the Act 4 A restraining order is described in s 10(1) of the Act - "(1) A restraining order is an order that no person is to dispose of or attempt to dispose of, or to otherwise deal with or attempt to otherwise deal with, an interest in property to which the order applies except in such manner or in such circumstances (if any) as are specified in the order." 5 Section 7(1) provides that a reference to an interest of a person in property is a reference to an interest the person has in real or personal property, a chose in action enforceable at the suit of the person, or an interest of the person that is within a class of interests prescribed as interests in property for the purposes of the Act. There is further elaboration, including that an interest in property subject to the effective control of another person is an interest of the person who has effective control. In s 7(4), "interest" is defined to mean - "(a) a legal or equitable estate or interest in the property, or
(b) a right, power or privilege in connection with the property,
whether present or future and whether vested or contingent." 6 Section 10(2) and (3) provides - "(2) The Commission may apply to the Supreme Court, ex parte, for a restraining order in respect of: (a) specified interests, a specified class of interests or all the interests, in property of a person suspected of having engaged in a serious crime related activity or serious crime related activities, including interests acquired after the making of the order and before the making of an assets forfeiture order affecting the interests that are subject to the restraining order, or
(b) specified interests, or a specified class of interests, in property that are interests of any other person, or
(c) interests referred to in both paragraph (a) and paragraph (b). (3) The Supreme Court must make the order applied for under subsection (2) if the application is supported by an affidavit of an authorised officer stating that: (a) in the case of an application in respect of an interest referred to in subsection (2) (a) - the authorised officer suspects that the person has engaged in a serious crime related activity or serious crime related activities and stating the grounds on which that suspicion is based, and
(b) in the case of an application in respect of any other interest - the authorised officer suspects that the interest is serious crime derived property because of a serious crime related activity or serious crime related activities of a person and stating the grounds on which that suspicion is based,
and the Court considers that having regard to the matters contained in any such affidavit there are reasonable grounds for any such suspicion." 7 There are definitions in ss 6 and 9 of "serious crime related activity" and "serious crime derived property", the latter essentially being the product of the former. For present purposes, the detail of the definitions does not matter. There is a definition of "illegally acquired property" in s 4(1), effectively property acquired by illegal activity whether or not serious crime related activity; serious crime derived property is a subset of illegally acquired property. 8 By s 11 of the Act, the Commission must give notice of the restraining order and of any variation of the order to the Director of Public Prosecutions, the Commissioner of Police, and (if the person was not notified of the application for the making of the restraining order) the person in respect of whose interest in property the restraining order was made. 9 The reference in s 11 to any variation of the restraining order is at least in part explained by s 10(5), by which at the time it is made or at a later time a restraining order may make provision for meeting out of the property to which it applies the reasonable living and legal expenses of any person whose interests in property are subject to the order. It may also be explained by s 12(1)(a) of the Act, said in the appeal to provide the basis for the person seeking to have the restraining order varied so that the interest in property is no longer caught by it - "(1) The Supreme Court may, when it makes a restraining order or at any later time, make any ancillary orders (whether or not affecting a person whose interests in property are subject to the restraining order) that the Court considers appropriate and, without limiting the generality of this, the Court may make any one or more of the following orders: (a) an order varying the interests in property to which the restraining order relates, … " 10 Succeeding paragraphs in s 12(1) provide for orders for examination on oath of persons, including the owner of an interest in property subject to the restraining order and the owner's spouse or de facto partner, concerning the affairs of the owner and the spouse or de facto partner; an order with respect to the carrying out of any undertaking as to damages or costs given in connection with the making of the restraining order; an order directing the owner of an interest in property subject to the restraining order (including a director of a corporate owner) to provide a verified statement of particulars of and dealings with the property; orders concerning taking control of an interest in property by the Public Trustee; and an order requiring or authorising the seizure or taking possession of property. By s 12(2) - "(2) An order under subsection (1) may be made on application: (a) by the Commission, or
(c) if the restraining order directed the Public Trustee to take control of an interest in property - by the Public Trustee, or
(d) with the leave of the Supreme Court - by any other person." 11 The effect of s 10(9) is that a restraining order remains in force in respect of an interest in property for two days unless there is a pending application for an assets forfeiture order in respect of the interest, a pending application for a "proceeds assessment" order against the person whose suspected serious crime related activities formed the basis of the restraining order or an unsatisfied proceeds assessment order in force against that person, or an order under s 20 of the Act extending the operation of the restraining order. 12 Going then to assets forfeiture orders, s 22(1) of the Act provides - "(1) The Commission may apply to the Supreme Court for an order forfeiting to, and vesting in, the Crown all or any of the interests in property that are, or are proposed to be, subject to a restraining order when the assets forfeiture order takes effect." 13 Other provisions concerning assets forfeiture orders can be described more briefly. By s 22(2) and (2A) the Supreme Court must make an assets forfeiture order if it finds certain matters more probable than not. By s 23(1), on an assets forfeiture order taking effect in relation to an interest in property the interest is forfeited to the Crown. The broad equivalent to s 12(1) is s 23(4), which provides - "(4) The Supreme Court may, when it makes an assets forfeiture order or at any later time, make any ancillary orders that the Court considers appropriate. For example, the Court may make ancillary orders for and with respect to facilitating the transfer to the Crown of interests in property forfeited to the Crown under such an order." 14 Going finally to an exclusion order, s 25 of the Act provides so far as presently relevant - "(1) If an assets forfeiture order: (a) has been applied for but not made - a person whose interest in property might be subject to the order if made, or
(b) has been made - a person whose interest in property was forfeited by the order, may apply to the Supreme Court for an order (in this section called an exclusion order ) excluding the interest from the operation of the assets forfeiture order or any relevant restraining order.
(2) The Supreme Court must not make the exclusion order applied for unless it is proved that it is more probable than not that: (a) in the case of an order relating to fraudulently acquired property - the interest in property to which the application relates is not fraudulently acquired property or is not illegally acquired property, or
(b) in any other case - the interest in property to which the application relates is not illegally acquired property.
(5) Notice of an application for an exclusion order is to be given to the Commission and any other person required by the regulations to be given notice and a person entitled to be given notice may appear, and adduce evidence, at the hearing of the application.
(6) The applicant for an exclusion order must give the Commission notice of the grounds on which the exclusion order is sought.
(7) If the Commission proposes to contest an application for an exclusion order, it must give the applicant notice of the grounds on which the application is to be contested. In such a case, the Commission is not required to give the applicant notice of those grounds, and the application must not be heard, until the Commission has had a reasonable opportunity to conduct an examination of the applicant under section 12."
The restraining orders 15 On the application of the Commission, on 19 January 2006 orders were made including orders pursuant to s 10 of the Act. The orders began by noting the giving of the usual undertaking as to damages and reciting, "Considering that, having had regard to the matters contained in the affidavit of Jonathan Lee Spark sworn 19 January 2006, there are reasonable grounds for the suspicions therein … ". 16 Seven orders were made pursuant to s 10 of the Act, each in the form that no person should deal with the interest in property of a named defendant. Order 1 restrained dealing with "any interest in property" of the first defendant Mr Ollis "including the interest in property in the property described in Schedules One, Two, Three, Four and Five hereto". Orders 2 to 7 were less general, restraining dealing with "the interest in property" of the respective second to seventh defendants "in the property described in" other Schedules, up to Schedule Twenty Two. Some of the Schedules identified specific real property, funds in bank accounts and (in one case) money owed to Mr Ollis. Other of the schedules, however, were non-specific and doubled-up on "interest in property" by taking the form - "All interests in property acquired by [the named defendant] since 17 June 2005 using funds directly or indirectly sourced from: "1. funds drawn on Westpac Banking Corporation account No 032523 180123 held in the name of Victor Warren Ollis; or
The defendants' application 18 By their amended notice of motion filed on 13 February 2006, the second to seventh defendants (hereafter, "the defendants") applied for the substantive orders - "1. That orders 2, 3, 4, 5, 6 and 7 of the Orders made by this Court in these proceedings on 19 January 2006 be varied by the addition in each case at the end of the Order of the words 'pending a hearing as to the existence of a reasonable suspicion within the meaning of s 10 as at the date of such hearing that the property described in those Schedule [sic] is serious crime derived property within the meaning of s 9 of the Act'.
(c) That the reference to Schedule 16 be deleted from Order 3 and the Schedule itself be deleted; and
(d) That Order 4 be set aside and Schedule Seventeen be deleted; and
(e) That the reference to Schedule 20 be deleted from order 5 and the Schedule itself be deleted; and
(f) That Order 6 be set aside and Schedule Twenty-One be deleted; and
(g) That order 7 be set aside and Schedule Twenty-Two be deleted. 8. Alternatively to 7(d) above, a declaration that the bank account of the Fourth Defendant with the Gosford Branch of the Westpac bank, being account number 732-523-61-3870 is not an interest in property restrained by the Orders made by this Court on 19 January 2006." 19 The amendment of the original notice of motion explains a rather odd make-up although it does not explain the application to vary order 1 made in relation to the interest in property of Mr Ollis or failure to follow the Act's references to interests in property. The orders sought were of four kinds. 20 First, by order 1 it was sought that the restraining orders made in relation to interests in property of the defendants be varied to provide for a further hearing as to the existence of a reasonable suspicion as at the date of the further hearing. It was not said what orders should be made at the further hearing, and in particular whether orders should be made having the effect that none or only some of the (interests in) property described in the Schedules was caught by a restraining order: compare the particular deletions in orders 4 and 7. That, however, must have been what was intended, through a holding at the further hearing that there was not a reasonable suspicion that some or all of the (interests in) property were serious crime derived property. 21 Secondly, order 3 sought a stay of the orders made against the defendants and others in relation to examination on oath and provision of verified statements; the application for the stay supports that the defendants wished to contend at the further hearing that it should be held that there was not a reasonable suspicion that interests in property in the Schedules were serious crime derived property. 22 Thirdly, by orders 4 and 7 it was sought that particular deletions of interests in property be made from the retraining orders. The ground for the particular exclusions was not apparent, but must have been something other than the existence of reasonable suspicion that interests in property in the Schedules were serious crime derived property. 23 Fourthly, order 8 sought a declaration that a particular bank account was not an interest in property caught by the restraining orders. From the reference to order 7(d), and its concern with order 4 made on 19 January 2006 and Schedule Seventeen, it appears that the bank account was an interest in property of Mr Lye and that he wished to contend that the bank account was not directly or indirectly sourced from funds in the Westpac account of Mr Ollis or funds provided by Mr Ollis. 24 The materials before this Court did not include either the affidavit of Mr Spark sworn on 19 January 2006 on which the restraining orders were made, or any affidavits indicating the bases of the defendants' application for the orders in the amended notice of motion.
Separate question and referral to this Court 25 On 16 February 2006 the Commission filed an amended notice of motion seeking the orders - "1. Pursuant to Part 28 Rule 28.2 of the Uniform Civil Procedure Rules 2005 the court separately determine the question whether a single judge of the Court has power to order that - (a) orders 2, 3 4, 5, 6 and 7 of the orders made in this Court in these proceedings on 19 January 2006 be varied by the addition in each case at the end of the Order of the words 'pending a hearing as to the existence of a reasonable suspicion within the meaning of section 10 of the Criminal Assets Recovery Act 1990 ("the Act") as at the date of such hearing that the property described in those Schedules is serious crime derived property within the meaning of section 9 of the Act';
(b) order 5 of the orders made on 19 January 2006 be varied by the deletion of the word "Nineteen" so that the concluding words of the order read: ' … in the property described in Schedules Eighteen and Twenty hereto"; and
(c) the orders sought in paragraph 7 of the Amended Notice of Motion dated 13 February 2006 be made. 2. An order that the Court hear the separate questions referred to in prayer 1 above, prior to the hearing of the Notice of Motion filed by the Second Defendant, the Third Defendant, the Fourth Defendant, the Fifth Defendant, the Sixth Defendant and the Seventh Defendant on 2 February 2006." 26 As can be seen, neither the stay (order 3 in the defendants' amended notice of motion) nor the declaration (order 8) was raised in this question of the power of a single judge. 27 Apparently because it was thought that different views material to the question had been expressed by judges in the Common Law Division, on 16 February 2005 a judge of the Division ordered that the Commission's amended notice of motion "be removed into the Court of Appeal pursuant to section 51(5)(a) of the Supreme Court Act 1970". Section 51(5)(a) provides for removal of "proceedings" into the Court of Appeal, and by Pt 12 r 2(1) of the Supreme Court Rules it is necessary that the Court state the question to be decided or determined and be satisfied that special circumstances exist which render it desirable to make an order for removal. The order made on 16 February 2006 was deficient, in that it ordered the removal of part only of the proceedings and there may not have been compliance with Pt 12 r 2(1). At the hearing in this Court an order was made removing the whole of the proceedings into the Court of Appeal, upon the special circumstances of the question in para 1 of the amended notice of motion, together with an order that that the question be separately determined.
The scope of s 12(1)(a) of the Act 28 Any order empowered by s 12(1) of the Act must be an "ancillary" order, although the kinds of orders which can be made do not suggest a narrow notion of what is ancillary. The same notion is found in s 23(4), with less by way of descriptive example. In Woodcroft v Director of Public Prosecutions [2000] NSWCA 128 at [72] I said of the equivalent s 48(1) of the Proceeds of Crime Act 1987 (C'th) that an ancillary order "must be ancillary to something, here to the restraining order, in that it is incidental or supplemental to it", but that there was no point in attempting an exhaustive description of the situations in which an ancillary order varying the property the subject of a restraining order may be made. There is no point in the present case. 29 I do not accept the Commission's submission that variation within s 12(1)(a) is confined to variation on the application of the Commission. That is belied by s 12(2)(b), referring to application by the owner, of what being unstated but comprehending an interest in property the subject of the restraining order. A ready instance of such an application is for a variation of the restraining order so far as it provides for meeting out of the property to which it applies the reasonable living expenses of the owner of the interest in property (see s 10(5) earlier mentioned). 30 There is, however, ample work for s 12(1)(a) to do short of providing an alternative avenue for a defendant to apply for the exclusion of an interest in property from the restraining order, as an alternative to application for an exclusion order under s 25 of the Act. The Commission might apply to correct a misdescription or other slip, or if persuaded that the interest in property was wrongly made the subject of restraint or should no longer the subject of restraint. Apart from the instance given above of application by the owner of an interest in property, there may be other occasions for variation of a restraining order on the application of the owner of an interest in property the subject of the order, other than by an application amounting to an application for an exclusion order. 31 Focussing on the question in this case, does s 12(1)(a) provide an avenue for varying the restraining orders in the ways described in the question?
A further hearing as to reasonable suspicion 32 Section 10 of the Act specifically provides for ex parte application for a restraining order, as is understandable given the nature of the order and the basis for making it. Even if the order is made on an inter partes application, however, s 10(3) applies: the Supreme Court must make the order applied for if it is supported by an affidavit of an authorised officer stating the suspicion and grounds to which paras (a) or (b) refer and "the Court considers that having regard to the matters contained in any such affidavit there are reasonable grounds for any such suspicion". The only material for consideration is the affidavit, and as to the basis for the order the only matter for determination is whether there are reasonable grounds for the suspicion. 33 Once the restraining order is made, the interest in property can be excluded from it by an exclusion order only if it is proved that it is more probable than not that it was not illegally acquired property, which it will be recalled includes property acquired by serious crime related activity (s 25(2)). Procedural and other inhibitions apply (s 25(5)-(7)). In short, the suspicion on which the restraining order was founded must be positively displaced within the regime of s 25. 34 It is not consistent with this scheme of the Act that, when a restraining order is made, there can be a further hearing at which the same judge or another judge can be asked to determine on the same material whether there are reasonable grounds for the suspicion; nor that there can be a further hearing at which further material is put before the same judge or another judge by the defendant and the judge is asked to determine on the enhanced material whether there are reasonable grounds for the suspicion. The making of the restraining order can be challenged on appeal, on the contention that the judge was in error in determining that there were reasonable grounds for the suspicion; or application can be made for an exclusion order. Whatever the scope of s 12(1)(a) of the Act, however, it does not extend to reconsideration of the basis of the restraining order, and the variation sought in order 1 of the defendants' amended notice of motion can not be made by a single judge (or, for that matter, on appeal). To the extent to which it was decided otherwise in New South Wales Crime Commission v Gardiner [1999] NSWSC 1210, I respectfully disagree.
Deletion of interests in property 35 It is also not consistent with the scheme of the Act that the defendants can apply, relying on s 12(1)(a), for variation of the restraining orders in the alternative to applying for exclusion orders. If the deletions in orders 4 and 7 of their amended notice of motion amount to exclusion from the restraining orders of some of their interests in property, the regime of s 25 of the Act requires that they give notice to the Commission of the application and of the grounds on which the order is sought, and the application must not be heard until the Commission has had a reasonable opportunity to conduct examinations of the defendants under s 12(1); and it must be proved that the interests in property were not illegally acquired property. This may be thought to bear hard on the defendants, but the Act is drastic in its operation, see as to the analogous Proceeds of Crime Act (C'th) Director of Public Prosecutions v Toro-Martinez (1993) 33 NSWLR 82 esp at 85-8. Section 25 can not be circumvented by resort to the ancillary s 12(1)(a). 36 The deletion sought by order 4 in the defendants' amended notice of motion would exclude from the restraining order the interest of the defendant Koala Developments Pty Ltd in funds held in a particular bank account in its name. There is no reason to see the ground for the deletion as other than that the interest is not illegally acquired property. 37 The deletions sought by order 7 in the defendants' amended notice of motion are of a different kind. All seek to delete from the relevant defendant's interest in property the subject of the restraining order the interest in property described in the form earlier noted - "All interests in property acquired by [the named defendant] since 17 June 2005 using funds directly or indirectly sourced from: "1. funds drawn on Westpac Banking Corporation account No 032523 180123 held in the name of Victor Warren Ollis; or
The result 41 On the understanding of the question disclosed in these reasons, the question should be answered no. At the conclusion of the hearing in this Court so much of the proceedings as are constituted by the claim against Mr Ollis were remitted to the Common Law Division. The balance of the proceedings should now be remitted to the Common Law Division. The defendants should pay the Commission's costs in this Court. 42 BASTEN JA: On 19 January 2006 the New South Wales Crime Commission ("the Commission") filed a summons seeking orders, ex parte, against seven defendants pursuant to the Criminal Assets Recovery Act 1990 (NSW) ("the Act"). Restraining orders were made in respect of interests in property of each defendant under s 10 of the Act. Further orders were made for the examination of the four individual defendants, together with the examination of a fifth individual who was not a defendant in the proceedings, presumably because no restraining order was sought in relation to his property. Such orders were made pursuant to s 12(1)(b) of the Act. 43 Further orders were sought directing each of the defendants to supply information with respect to property in which he, she or it had an interest. Orders were made, as sought, pursuant to s 12(1)(c1) of the Act, a provision which permits such an order directing a person "who is or was the owner of an interest in property that is subject to the restraining order" to provide particulars "of the property, or dealings with the property in which the owner has or had an interest". Whether such a mandatory direction should be restricted to the property the subject of a restraining order, and whether it can lawfully extend to particulars of liabilities of a company, "on both a capital and recurring basis" is not a matter which need be further addressed. 44 The summons also sought in relation to the Second-Seventh Defendants "assets forfeiture orders" in relation to the property subject to the restraining orders, pursuant to s 22 of the Act. In relation to the First Defendant, it sought a "proceeds assessment order", requiring the First Defendant to pay to the Treasurer an amount assessed by the Court as the value of the proceeds derived from illegal activities, under s 27 of the Act. 45 Pursuant to s 11 of the Act the Commission is required to give notice of a restraining order made under s 10 to the persons who had an interest in property which became the subject of a restraining order. Notice is effected by giving the person a "minute of the order": Criminal Assets Recovery Regulation 2000 (NSW), cl 4. If the defendants were given a copy of the orders as entered in the present proceedings, they would not know that a judge of the Court had formed a view about the material placed before him or her in support of the orders, nor what matters were in fact placed before the Court for the purpose of obtaining the orders. 46 Such orders are, this Court was told, routinely obtained "ex parte" as provided for in sub-ss 10(2) and (2AA) of the Act. There will undoubtedly be cases, perhaps a high proportion of cases in which orders are sought, where that course is appropriate. That the Act does not require or assume that such orders will be made ex parte appears from s 11(2)(b), which requires notification of a restraining order only where the person was not notified of the application for the restraining order. Whether this was a matter in which an application for restraining orders was properly made ex parte and whether the orders themselves should properly have been made ex parte are not issues before this Court. 47 Having being given notice of the orders, the Second-Seventh Defendants (hereinafter "the defendants") applied by notice of motion for a variation of each of the restraining orders affecting those defendants, "pending a hearing as to the existence of a reasonable suspicion within the meaning of s 10 as at the date of such hearing that the property described in those schedules is serious crime derived property within the meaning of s 9 of the Act." 48 In addition, the defendants sought the deletion of restraining orders made in relation to three of their number and the removal of specific schedules containing descriptions of property, in relation to the others including, curiously, in relation to the First Defendant, who is not an applicant on the motion. The defendants sought a stay of orders for their examination, pending the further hearings sought with respect to the restraining orders. 49 By notice of motion dated 16 February 2006, the Commission sought an order pursuant to Part 28, r 28.2 of the Uniform Civil Procedure Rules 2005 that the Court "separately determine the questions whether a single judge of the Court has power" to grant the relief sought by the defendants. On 16 February, the motions both appear to have come before a single judge in the Common Law Division who ordered that the Commission's motion be removed into this Court, pursuant to s 51(5)(a) of the Supreme Court Act 1970 (NSW). 50 Section 51(5)(a) of the Supreme Court Act provides: (5) Where proceedings by way of appeal or otherwise under any Act other than this Act … are commenced in a Division - (a) the Court in the Division in which the proceedings are pending, if satisfied that special circumstances exist which render it desirable so to do, may, on application by a party or of its own motion, order that the proceedings be removed into the Court of Appeal; and (b) upon an order being made under paragraph (a), the proceedings may be continued and disposed of in the Court of Appeal. 51 The order removed only the motion and not the proceedings. No reasons were provided for the order indicating the "special circumstances" said to exist. However, it appears to have been accepted by the parties, and no doubt by the judge who made the order, that the relevant special circumstances were the existence of different views expressed by two judges in the Common Law Division as to the standing of a person subject to a restraining order to seek a variation of the restraining order and as to the scope of the variations which might be sought. At the commencement of the hearing in this Court, it was accepted that those matters amounted to special circumstances and an order was made removing the whole of the proceedings. 52 Although the form of the question presented by the Commission implied that this Court (as opposed to a single judge in a Division) might have power to make the orders sought by the defendants it became apparent in the course of the hearing that the issue sought to be raised was whether the Act permitted a restraining order to be reconsidered (to use a neutral term) and conditioned or varied as sought by the defendants. If there were no such power, it would not matter whether the application had been made to a single judge or to this Court, the answer being in each case the same. The Commission conceded that, if a restraining order should not have been made, or not made in the terms adopted by a single judge, that might be a matter which could be the subject of an application for leave to appeal to this Court. The defendants' motion did not purport to be such an application. Nor did it purport to be a challenge to the orders made in the sense that it alleged that they should not have been made on the basis of the material before the primary judge. Thus, the Commission's primary basis of opposition to the relief sought by the defendants was directed to the underlying premise that the existence of a reasonable suspicion could be decided at any time other than the time at which the restraining order was originally made, or should be determined on the basis of any material other than that upon which the Court was required to act by s 10(3) of the Act.
Source of power to vary orders made 53 The Commission's challenge to the orders sought by the defendants was squarely based on the assumption that the power to alter an order made under s 10 must be found in another provision of the Act. Pursuant to s 25, a person whose interest in property might be affected by an assets forfeiture order, which must be property subject to a restraining order, could seek to have the interest excluded from the operation of such an order. The last-mentioned is called an "exclusion order" in s 25(1). That provision had not been expressly invoked by the defendants, and indeed part of the relief sought was inconsistent with the procedure required by that provision. If it were invoked, the defendants would be required to give the Commission notice of the grounds on which the exclusion order was sought: s 25(6). If the exclusion order were resisted, the Commission would then be required to give notice of the grounds on which the application was to be contested, but was not required to do that, nor could the application be heard, "until the Commission has had a reasonable opportunity to conduct an examination of the applicant under section 12": s 25(7). To succeed under s 25, an applicant is required to establish on the balance of probabilities that the interest in property to which the application relates "is not illegally acquired property": s 25(2)(b). Further, the examination to which the applicant might be subjected would permit him or her to be examined on oath "concerning the affairs of the owner [of an interest in property], including the nature and location of any property in which the owner has an interest": s 12(1)(b). The person examined under s 12 is not entitled to claim the privilege against self-incrimination, although use immunity is accorded to the answers given: s 13A. 54 The alternative course apparently relied on by the defendants, according to the Commission, was s 12(1)(a) of the Act, which provides: 12 Supreme Court may make further orders (1) The Supreme Court may, when it makes a restraining order or at any later time, make any ancillary orders (whether or not affecting a person whose interests in property are subject to the restraining order) that the court considers appropriate and, without limiting the generality of this, the court may make any one or more of the following orders: (a) an order varying the interests in property to which the restraining order relates … 55 The Commission gave four reasons why this provision was not available to the defendants. These were:
(1) read in context, it is clear that the other orders available under s 12(1) are orders appropriately sought by the Commission and not by a defendant and hence a defendant does not have standing to seek an order under paragraph (a);
(2) each order restricting a dealing with an interest in property constitutes a restraining order, so that to remove an interest in property is effectively to revoke a restraining order and not merely to vary it;
(3) the chapeau to the provision envisages that it is concerned with "ancillary orders" rather than the restraining order itself, and
(4) to permit a defendant to exclude property pursuant to this provision would be to set at nought the carefully constructed conditions upon which an exclusion order may be obtained under s 25. 56 Senior counsel for the Commission did not seek to place more weight on the noscitur a sociis principle invoked by (1) than it would bear in the circumstances. He merely submitted that it would 'not be surprising' if paragraph (a) were not intended to be available to a party other than the Commission. That submission may be accepted without detailing the nature and content of the other paragraphs in sub-s 12(1). However, against that conclusion must be weighed the express terms of sub-s (2) which reads: (2) An order under subsection (1) may be made on application: (a) by the Commission, or (b) by the owner, or (c) if the restraining order directed the Public Trustee to take control of an interest in property - by the Public Trustee, or (d) with the leave of the Supreme Court - by any other person.
This provision tends to reverse the effect of the Commission's argument. If the paragraphs other than paragraph (a) are, in their nature, unlikely to be the subject of an application by any person other than the Commission, that provides weight for the proposition that it is precisely an order under paragraph (a) that might be envisaged by sub-s (2)(b) as being made by the owner of an interest in property. The first limitation on the availability of s 12(1), sought to be imposed by the Commission, should be rejected. 57 The second proposed limitation relies upon the terms of paragraph (a) as not extending to the case where an interest is removed entirely from the scope of an order. Thus, senior counsel argued that the paragraph should not permit a variation which would "gut the order". Even if the extreme case were excluded, that does not help to identify what form of variations are within the terms of paragraph (a), and what are not. Further, the paragraph clearly envisages that one restraining order can relate to numerous interests in property, so that to remove one interest would not necessarily constitute an extreme case of variation, amounting to a revocation of the order. The argument for reading down the scope of paragraph (a) may be stronger when it is considered in the context of s 25, to which reference is made below. 58 The third argument, relying on the construction of the language in sub-s 12(1), focused upon the concept of "ancillary orders". The Commission submitted that the meaning of "ancillary" was well-known. Thus, in a case concerning the Licensing Ordinance 1939 (NT), Muirhead J was required to consider the concept of the supply of liquor as "ancillary to the meal" being taken in a dining room: Koala Motels Pty Ltd v Chief Licensing Inspector (1977) 18 ALR 12. His Honour noted, at p 14: "It is important to note that the word 'ancillary' has a special meaning. It means less than supplementary or supplemental to - it means 'subservient' or 'subordinate' the derivation being from the Latin 'ancillaris' - 'ancilla' being a handmaid - a person who in the good old days was regarded as subservient to her mistress and perhaps even to her master. So the meal is clearly the principal thing that … could be enhanced by the supply of liquor." 59 In McCleary v Director of Public Prosecutions (Cth) (1998) 157 ALR 301 the Full Court of the Supreme Court of Western Australia considered whether proceedings for enforcement of an undertaking, given in relation to a restraining order, were exempt proceedings for the purposes of the Telecommunications (Interception) Act 1979 (Cth). In answering that question, Ipp J (with whom Malcolm CJ and Franklyn J agreed) referred to Koala Motels and continued (at 332): "According to the Macquarie Dictionary , 'ancillary' means 'accessory; auxiliary;', and 'ancillary relief' means 'supplementary or incidental relief sought in addition to the main relief as in matrimonial causes, proceedings for maintenance, custody, settlement of property or damages for adultery'. The proceedings for the enforcement of the Commonwealth's undertaking are brought by reason of the fact that the undertaking was given … in support of the application for a restraining order, and the undertaking becomes open for enforcement because the restraining has expired. The giving of the undertaking has a close and direct connection with a restraining order. While proceedings for the enforcement of the undertaking are not supplementary or incidental to the main relief (the latter being the obtaining of the restraining order), the enforcement proceedings are incidental and subordinate to the restraining order as they are dependent on the grant of the restraining order and the expiry thereof. In my opinion, on this basis, the proceedings for the enforcement of the undertaking are ancillary to the restraining order." 60 The derivation of the term "ancillary" is evocative, but does little to identify the bounds within which it must operate in a particular statutory context. Indeed, the proposition, upheld in McCleary, that proceedings to enforce an undertaking are ancillary to "a restraining order", being consequent upon a breach of the restraining order, tends to support the breadth, and arguably the vagueness, of the concept. In the present case, the term must take its meaning from the kinds of orders which the Parliament envisaged could be properly described as "ancillary orders" without, as the provision states, "limiting the generality of" the power. They include orders varying the interests in property to which the restraining order relates (par (a)), an order for the examination of any person on oath in relation to the location of property the subject of a restraining order (par (b)), orders with respect to the carrying out of any undertaking with respect to the payment of damages or costs (par (c)), and orders requiring or authorising the seizure or taking possession of property (par (e)). These identified orders do not constrain the power conferred by s 12(1). However, some at least of the specified kinds of order are clearly directed towards the likely conclusion of proceedings, namely the making of an assets forfeiture order, pursuant to s 22 of the Act. A restraining order is, in a sense, merely a preliminary step in that process. Accordingly, there is something to be said for a view similar to that expressed by Adams J in NSW Crime Commission v Gardiner [1999] NSWSC 1210 at [24] that the kind of orders envisaged are "ancillary to proceedings undertaken pursuant to the Act and accordingly ancillary to proceedings" for an order under either s 22 or s 27, in the course of which a restraining order has been made. 61 At the heart of the Commission's case is the proposition that an order made under s 10 cannot be varied at a later time (except pursuant to s 25) merely because further information becomes available or because a different view might later be taken as to whether, at that later point in time, there were reasonable grounds for the suspicion required to ground the restraining order. If that argument be accepted, as it should be, the concept of later ancillary orders which may involve, for the purposes of par (a), varying the interests in property to which the restraining order relates, must give the term "ancillary" the meaning "consequential upon" rather than limiting it to "subservient or subordinate to", or must permit reference to the proceedings as a whole in identifying that to which the order is ancillary. 62 The fourth submission relied on by the Commission places weight on the basis on which the restraining order is made, pursuant to s 10(3) of the Act (set out at [6] above), and the power to obtain an exclusion order, pursuant to s 25, the provisions of which are set out at [14] above. 63 The Commission's argument is thus that a judge of the Supreme Court is obliged to make the orders sought under sub-s 10(2) if, having regard to the matters contained in the affidavit tendered by the Commission in support of the order, he or she is satisfied that there are reasonable grounds for the identified suspicion. By implication, the Court cannot look at other material, nor can the authorised officer be cross-examined on his or her affidavit. Once the restraining order is made, an interest in property can only be removed by an exclusion order made pursuant to s 25, when the preconditions noted at [53] above have been fulfilled. 64 Against that background, the Commission argues that s 12(1)(a) does not permit an order in the nature of an exclusion order. However, if that is so, the Commission cannot rely on s 12(1)(a) to remove property from the scope of a restraining order, once made, even if persuaded that the property is not that of any person suspected of having engaged in a serious crime related activity, nor serious crime derived property. Of course, it may be possible for the Commission to amend its application for an assets forfeiture order, before such an order is made, so as to exclude the property which was mistakenly included in the restraining order. But, if, as is the case with the First Defendant in the present proceeding, no assets forfeiture order is sought under s 22, but only a proceeds assessment order under s 27, that course is not open and presumably the restraining order cannot be lifted unless a person with an interest in the property is willing to commit resources to, and suffer the potential consequences of a personal examination of his or her affairs, by making an application under s 25. 65 A second difficulty with the close confinement of the power under s 12(1)(a), as proposed by the Commission, is that it also relies upon a limited view of the operation of s 10(3). If, as noted above, an application under s 10 need not be made ex parte, one would be reluctant to imply, absent express terms to this effect, that the person against whom such an order is sought would not be able to present evidence to demonstrate that he or she had no interest in the property in question. And if such evidence could be presented, presumably the Court would be entitled to take it into account. 66 Of course, it does not follow that, if a restraining order were made in circumstances where it was opposed in the manner suggested, the defendant could mount a separate and later challenge under s 12(1)(a), without regard to the constraints imposed by s 25. On the other hand, where an order is made ex parte, for good reason, it would be rare that, as a matter of principle, there would be reason to prevent the defendant from putting forward material which could have been put forward if the initial proceeding had been inter partes. 67 The resolution to this conundrum is to be found in the express constraint contained in the two paragraphs of sub-s 25(2). To take the second paragraph, which would appear to be that relevant in the present case, the issue in contention on the application for an exclusion order is whether the property is illegally acquired property. If that is the issue, then the constraints imposed by s 25 will operate. That is not to say that an exclusion order made under s 25 may not also constitute an order of the kind referred to in s 12(1)(a). But if the reason for excluding the property from the restraining order was that it was owned by a person having a name similar to that of the person whom the police suspected of committing a serious crime, but in fact having no connection with the suspect, the terms of s 25(2) are not engaged. In that situation, there is no reason to limit the power conferred by s 12(1)(a). 68 A further reason for thinking that such property should be capable of being removed, without resort to s 25, is that, when the Court is asked to make an assets forfeiture order, it does so on the basis of the suspicion attaching to the person who committed a serious crime related activity, rather than the nature of property, being serious crime derived property. Accordingly, there is some scope for unintended injustice, if the property of uninvolved parties cannot readily be removed from the scope of a restraining order. 69 In Woodcroft & Ors v Director of Public Prosecutions [2000] NSWCA 128, this Court considered the scope of a similar power to that contained in s 12(1)(a), as found in s 48(1)(a) of the Proceeds of Crime Act 1987 (Cth). In that case the primary judge had made an order, by consent, varying an existing restraining order made against all of the property of one Geraghty, so as to include specific reference to land at Clovelly of which the registered proprietors were the claimants. The Court held that such a variation would not be "ancillary to the order against all of Geraghty's property", but rather would be "an order against someone else's property, the claimants' property, on the basis of effective control" by Mr Geraghty: at [73]. The addition of a new property should not have been made, the Court held, unless the preconditions to a restraining order had been satisfied in relation to that additional property: at [77]. Accordingly the Court (Giles JA, with whom Meagher and Beazley JJA agreed) held that the restraining order with respect to the property was made without power: at [79]. 70 The approach adopted in Woodcroft is not inconsistent with that proposed by the Commission, or that adopted above. Just as the exclusion of an interest requires compliance with specific requirements of the Act relating to exclusion orders (where applicable), so the addition of a property must be done strictly in accordance with the requirements specified in relation to obtaining a restraining order.
Reconsideration of restraining orders 71 As noted above, the relief sought in relation to each of the restraining orders is twofold. First and generally, each restraining order is sought to be varied so as to limit its operation to the period pending a further hearing as to whether the reasonable suspicion required by s 10 is established, as at the date of the further hearing. The basis for challenge is not identified in an affidavit or any other material before the Court, but may be inferred from the terms of the order sought. It is a challenge to the existence of a reasonable suspicion that the property in each case is "serious crime derived property". 72 For the purposes of s 10(3)(b), being the provision affecting the relevant defendants, the authorised officer who swore the affidavit must have asserted a suspicion that there had been "serious crime related activity" of some person and that the interest in property of the relevant defendant was all or part of the proceeds of that activity, or otherwise fell within the definition of s 9(1). Without knowing the content of the affidavit of the authorised officer, or the basis on which the defendants seek to challenge the existence of the reasonable suspicion, one cannot be sure what the issue in dispute might be. However, the definition of serious crime derived property and the definition of "illegally acquired property" are identical in form, although the nature of the activity may, in the latter case, extend to any act or omission that constitutes an offence: see s 4(1), illegal activity. Accordingly, it would seem that the challenge being mounted by the defendants is that which is available under s 25. The Commission objects that the relief sought in relation to the restraining orders is thus misconceived. The defendants will seek to establish at the proposed hearing that the reasonable suspicion is no longer made out (although it may have been at the ex parte hearing) and therefore the restraining orders should be revoked. 73 These questions were raised for consideration in New South Wales Crime Commission v Gardiner [1999] NSWSC 1210, a case in which Adams J held at [25]: "I must confess that during argument my mind has wavered upon the question posed by the application that I consider that as this matter has been left in a state of ambiguity or at least uncertainty by the Act, s 12 should be construed as giving ancillary power to permit a hearing, where there has been an order made ex parte under 10(2) and proper grounds are shown, in respect of the continuance of the restraining order, that is to say concerning the continuance of the reasonableness of the suspicion, providing that by so doing the power is not so exercised, as it were, to allow an appeal from the order made under s 10(2) … ."
His Honour continued at [27]: "Accordingly, I propose to order under s 12(1) that the applicant may apply to terminate the effect of the restraining orders … upon grounds directed to the question whether as at the date of such hearing there are reasonable grounds for a suspicion that the applicant's interests in serious crime derived property for the reasons specified in s 10(3)(b) of the Act." 74 Rather than an order under s 12(1), his Honour's conclusion may better be understood as a ruling that the application before him could proceed in the manner proposed. The condition that the application could not be a form of appeal from one judge to another, and the identified basis of the application, appear to have been based on the assumption that the reasonableness of the suspicion must be ongoing and, if at any stage it could be shown no longer to satisfy the statutory test in s 10, the restraining order must end. I agree with the Commission that this assumption is inconsistent with the scheme of the legislation. Accordingly, the primary orders sought by the defendants are misconceived. 75 The second set of orders sought by the defendants in relation to the restraining orders require either that an order be set aside, or that interests in property identified in particular schedules be removed from the orders. The grounds on which that relief is sought is not identified. Nevertheless, it bears the hallmark in each case of an exclusion order which could only be sought in compliance with the requirements of s 25. Whether, if that were the only available basis, the defendants would wish to pursue the relief, need not be determined for present purposes. The question for this Court is whether a single judge has power to grant relief: if the power exists, but only in specified circumstances, the answer to the question should reflect that conclusion. 76 The relief sought might, however, be based on other grounds, which may be illustrated by reference to the apparent circumstances in New South Wales Crime Commission v Keen [2005] NSWSC 1151 (Hall J). The applicant in that case was not, it appears, a person in respect of whom a restraining order had been made, but rather a person who claimed an interest in the property which had been the subject of a restraining order and, ultimately, an assets forfeiture order. The applicant was a Mr Masri; the defendant in the proceedings under the Act was a Mr Keen. What was forfeited was said to be "the interest in property of the defendant in the property specified in … the schedule hereto". Although the schedule is not set out in the judgment, it is said at [11] that it "identified the Ramsey motor cruiser". 77 As Hall J noted at [27], an assets forfeiture order may only be made "so as to apply to specified interests in property": s 22(4). It is at least doubtful that an order could validly be made which identified a piece of land or an item of personal property and specified that which was the subject of forfeiture (or indeed a restraining order) as "the defendant's interest in" such land or other property. The difficulty said to attend Mr Masri's application was that, for the purposes of s 25, the only person who could seek an exclusion order was "a person whose interest in property was forfeited by the order". Because the order in terms only forfeited Mr Keen's interest, Mr Masri had no standing. (It may be noted by way of comparison that the equivalent provision in the Proceeds of Crime Act (Cth), considered in Woodcroft, allowed any person "having an interest in the property" to apply to the Court "for a variation of the order to exclude the person's interest from the order": s 48(3)(c).) 78 Mr Masri thus failed to invoke s 12(1) on an entirely different basis from that raised against the defendants, namely that it provided no basis for varying a forfeiture order, but only a restraining order and, once a forfeiture order was made (as had occurred in Keen), the restraining order ceased to operate: s 10(9)(a). 79 Mr Masri apparently relied on the comments of Adams J in Gardiner at [25] (noted at [60] above) for the proposition that the variation he sought was in relation to a forfeiture order and therefore fell within the scope of s 12(1). Hall J appears to have accepted the proposition put for Mr Masri that such might be the effect of the comments of Adams J and disagreed with them, holding that "the ancillary order provisions in s 12(1) do not operate to vest either jurisdiction or power in the court to vary or alter the effect of a forfeiture order": Keen, at [45]. That may be accepted, but it may be that Adams J did not intend to express a view to the contrary. He suggested that an order under s 12(1), varying a restraining order, could be "ancillary to proceedings under s 22 where an application for forfeiture is made". His Honour appears to be referring to proceedings which remain on foot (as was the situation before him), being proceedings where an application for forfeiture had been sought but not determined. For reasons noted above, I do not see any error in that approach, nor with the conclusion of Hall J in relation to proceedings which have concluded. 80 The problem identified in Keen highlights the need for the Commission to identify with precision the interests in property with respect to which it seeks a restraining order and an assets forfeiture order. If it asserts that only the identified defendant has an interest in the property, it should seek an order in relation to "all interests" in the identified property. In every other case, the interest must be described with sufficient precision for it to be a "specified interest". Where the interest is identified as the interest of a named person in a piece of land of which the named person is the sole registered proprietor, it may perhaps be inferred that the interest sought to be identified is the freehold estate. On the other hand, order 2 made by the Court (which is in a form common to the other defendants) prohibits dealing with "the interest in property … of" the Second Defendant "in the property described in" Schedule 14 to the order. Schedule 14 reads as follows: "1. Funds held in Bendigo Bank Ltd account number … in the name of [the Second Defendant] as trustee for the Shields Family Trust. 2. Funds held in Bendigo Bank Ltd account number … in the name of [the Second Defendant] trading as Cash Flow Positive Investments." 81 Putting to one side questions as to the interest of a bank customer in funds held in a bank account, there must at least be uncertainty as to whether the Second Defendant had a beneficial interest in the first identified account and as to whether she held the sole interest in the second identified account. 82 The same formula is used in each of the restraining orders although the content of the schedules differs. There are, however, schedules with respect to each of the individual defendants which identify: "All interests in property acquired by [a named defendant] since 17 June 2005 using funds directly or indirectly sourced from: 1. funds drawn on Westpac Banking Corporation account number … held in the name of [the First Defendant]; or 2. funds provided by [the First Defendant]."
There may be a doubt as to whether such a description satisfies the requirements of s 10(2)(b) that a restraining order be in respect of "specified interests, or a specified class of interests, or all the interests, in property that are interests of" an identified person other than the person suspected of criminal activity. 83 These points are raised not so that this Court should express any opinion on the validity of the order so made, but rather to indicate the nature of the issues which could arise from the defendants' motion. 84 As indicated above, the kind of exclusion order which is the subject of s 25 is one which involves a challenge to the suspicion which formed the basis of the order under s 10. A complaint that an order made ex parte did not comply with the formal requirements of s 10 has no direct bearing on the question of a reasonable suspicion, except in so far as it may be said that one cannot have a reasonable suspicion with respect to an interest in property, where the interest is undefined. Nevertheless, that not being the basis of the challenge, a complaint about the order made, if premised on the formal issue, is not subject to s 25. To seek to have a description of property removed on the basis that it does not fall within s 10(2), is sufficiently close to the kind of order identified in par (a) of s 12(1) to fall within the class of orders which can be made under that subsection. 85 If for some reason s 12(1) were thought to have a more limited operation, it would be necessary to consider whether such an order can be made by a single judge, under the Uniform Civil Procedure Rules. There is nothing which expressly precludes the operation of r 36.16, which would permit a judge in a Division to vary a judgment or order made in the absence of the defendant. 86 In Keen, Hall J addressed the question whether an exclusion order could be made in relation to an assets forfeiture order under the Uniform Civil Procedure Rules, r 36.16. That rule, so far as relevant, provides: 36.16 Further power to set aside or vary judgment or order (1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order. (2) The court may set aside or vary a judgment or order after it has been entered if: … (b) the judgment or order has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order … . 87 Hall J said that reliance on r 36.16 was not developed in argument, but his Honour held, nevertheless, that the general power it contained was not available "to seek orders in the nature of exclusion orders when the same are not authorised or provided for in the Criminal Assets Recovery Act 1990": at [48]. The reason for this conclusion was that the existence of such an unconstrained power would be inconsistent with the terms of the Act. It is not necessary to determine whether his Honour was correct in holding that s 25 was the only means available to the applicant before him to obtain an exclusion order, in circumstances where s 25 did not, in its terms, permit that applicant to seek such an order, although that result must be doubtful. Because the defendants in the present case have available to them, at least in principle, a basis for challenging the restraining orders made below and still on foot, without invoking the ground contained in s 25, the power under r 36.16 should be available to them, for the same reasons that, in my view, the power under s 12(1)(a) is available. 88 There is a separate question which arises in relation to the availability of relief to someone who is not a party to proceedings under the Act, but who asserts an interest in property which appears to have been identified as an interest of a defendant. As appears from Keen, assets forfeiture orders are sometimes made by consent. It is not hard to imagine cases in which a defendant will be willing to consent to, or at least not challenge, an order sought by the Commission, even though he or she knows that a third party might well seek to assert an interest in the property if given an opportunity. However, the availability of relief to a third party does not arise in the present case as each of the applicants for relief is a defendant in the proceedings and is subject to a restraining order.
Answers to separate questions 89 It was suggested in the course of argument that this matter was properly removed to this Court for either of two reasons. One was that the primary order sought by the defendants was consistent with the form of the application found by Adams J in Gardiner to be available to a defendant, a view which the Commission sought to challenge. The second basis was that there appeared to be a difference of opinion in that regard between two members of the Common Law Division, as illustrated by the later case of Keen. For reasons noted above, the facts of Keen were significantly different because a forfeiture order had been made. Whether Hall J was correct in his understanding of the disputed passage in the judgment of Adams J in Gardiner is not of critical importance in this context: the conclusion of Hall J that s 12(1) was not a source of power to vary a forfeiture order was correct. However, the application held to be available in Gardiner was, in my view, based on a misconception and a similar application in the present case is similarly misconceived. Thus the special circumstances identified in the first contention are made good. 90 No doubt when the questions for separate determination were identified, it was assumed that they would be amenable to a straightforward yes or no answer. For the reasons set out above, the situation is more complex and the availability of power in a single judge to grant some of the relief sought may depend upon the basis upon which it is sought. In those circumstances there a two approaches available to this Court. The first is to decline to answer the questions and remit the matter to the Common Law Division, where a trial judge will have the benefit of the reasons of this Court. The second is to give such answers as may be possible, subject to qualifications, to reflect the reasoning set out above. 91 In the interests of clarification, it is desirable that the Court provide such answers as it can. I would propose that the questions be reformulated so that the separate issues identified above may be dealt with. For example, order 2 made by the Court on 19 January 2006 was an order that no person might dispose of interests in property of the Second Defendant. The variation sought by the Second Defendant was that the order be varied by adding the words "pending a hearing as to the existence of a reasonable suspicion within the meaning of s 10 as at the date of such hearing that the property described in those Schedule [sic] is serious crime derived property within the meaning of s 9 of the Act". If that were intended to provide a stay of the restraining orders, it does not in terms have that effect. If the order were simply intended to seek a hearing with respect to the issue identified, the question should be formulated to refer to that intention. 92 For completeness, it should be noted that no issue was raised by the Commission in the separate questions as to the power of a single judge to vary orders made not under s 10, but under s 12(1) of the Act. Nor was any issue raised as to the power to make an order by way of declaration as to the scope of the interests in property which are subject to the restraining order, as sought by order 8 of the defendants' notice of motion. 93 I propose that the questions should be reformulated and answered as follows:
Question 1: Does a single judge of the Court have power to reconsider, and if necessary revoke, a restraining order on the basis that, at a date subsequent to the date on which the order was made, the Court is not satisfied that there are reasonable grounds for the suspicion identified in a supporting affidavit of an authorised officer, for the purposes of s 10(3) of the Criminal Assets Recovery Act 1990?
Question 2: May a single judge of the Court vary a restraining order so as to set it aside in whole or in respect to a particular interest in property identified in the order?
Answer: (1) Where a restraining order has been made ex parte , and remains in effect, a single judge of the Court may not exclude an interest from the operation of a relevant restraining order on the ground that the interest in property to which the application relates is not illegally acquired property, except in accordance with s 25 of the Act. (2) Subject to (1), a single judge can make an order varying the interests in property to which the restraining order relates on a ground unrelated to those founding s 25, such as the ground that the order fails to specify interests or a class of interests, or all interests in property that are interests of a person other than the person suspected of serious crime related activity, within the terms of s 10(2)(b) of the Act. (3) Whether other grounds are available, or other limitations apply, are not matters that can be answered in this proceeding.
Question 3: Can a single judge of the Court make a declaration that a bank account of a defendant is not an interest in property restrained by a restraining order?
Answer: No argument was addressed to the ground on which this order was sought or the power sought to be invoked; accordingly it is inappropriate to answer this question. 94 The proceedings should be remitted to the Common Law Division. 95 Neither the Commission nor the defendants sought orders as to costs in relation to the proceedings in this Court. In the outcome, both parties have been partly successful in their submissions to this Court. Accordingly there should be no order as to the costs of either party in this Court. **********
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New South Wales Crime Commission
Ollis
(2006) 65 NSWLR 478
(1993) 33 NSWLR 82
(1977) 18 ALR 12
(1998) 157 ALR 301