NSW Crime Commission v Shane John Meads

Supreme Court of NSW|2010-09-14|Before: Garling J, McLelland J

CITATION : NSW Crime Commission v Shane John Meads [2010] NSWSC 1145

DECISION : Grant restraining and ancillary orders sought. Decline to give reasons.

CATCHWORDS : CRIMINAL LAW - Confiscation of criminal proceeds - Restraining orders - Ancillary orders - Necessity for reasons - New statutory regime for applications to set aside restraining orders.

Criminal Assets Recovery Act 1990 LEGISLATION CITED : Criminal Assets Recovery Amendment Act 2009 Drug Misuse & Trafficking Act 1990 Evidence Act 1995

Geoffrey W. Hill & Associates v King (1992) 27 NSWLR 228 International Finance Trust Company Limited v NSW Crime Commission [2008] NSWCA 291 CASES CITED : International Finance Trust Company Limited v NSW Crime Commission (2009) 240 CLR 319 NSW Crime Commission v John Sant (unreported, NSWSC, 9 July 2010) NSW Crime Commission v Hakan Arif (unreported, NSWSC, 22 June 2010)

PARTIES : NSW Crime Commission (P) Shane John Meads (D)

COUNSEL : (P) Alexandra Bishop (D) Ex parte

SOLICITORS : (P) NSW Crime Commission (D) Ex parte

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

2010/306629 NSW CRIME COMMISSION v SHANE JOHN MEADS

1 HIS HONOUR: On 14 September 2010, the NSW Crime Commission made an application, ex parte, for a restraining order, pursuant to s 10A of the Criminal Assets Recovery Act 1990, in respect of any interest in the specified property of Shane John Meads. The NSW Crime Commission also sought a number of ancillary orders. 2 The restraining order sought was in respect of five nominated bank accounts with the Australia & New Zealand Group Limited which were either in the name of Shane Meads or else in company names for which he was a signatory.

The Evidentiary Basis for the Application 3 The application was supported by an affidavit sworn 14 September 2010 by Jonathan Lee Spark, a Certified Practising Accountant. Mr Spark deposed to the fact that he suspected that Mr Meads had engaged in a serious crime related activity (or activities), namely supplying prohibited drugs contrary to s 25(2) of the Drug Misuse & Trafficking Act 1990. Conduct contrary to s 25(2) of the Drug Misuse & Trafficking Act 1990 is a serious criminal offence. 4 Mr Spark deposed that his suspicion was based upon his knowledge of the existence of the ANZ accounts to which I have earlier referred and his belief in the truth of the contents of a Facts Sheet sent to him on 13 September 2010 by Detective Inspector Stephen Patton. 5 I was satisfied that these five bank accounts fell within the definition of property as that expression is used in the Criminal Assets Recovery Act. 6 Having regard to the details provided in the facts sheet about the methodology of the investigation, the extent and detail of it, and accepting its truth which was not unreasonable of Mr Spark to do, I was satisfied that there were reasonable grounds for the suspicion which Mr Spark held, namely that Mr Meads had engaged in serious crime related activity. 7 In addition to the evidence contained in the affidavit of Mr Spark, the NSW Crime Commission proffered an undertaking as to damages in the usual form.

Principles applicable to an Application 8 In considering the application, it was necessary to bear in mind the applicable legal principles. 9 An application for a restraining order is governed by the rules of evidence applicable in civil proceedings: s 5(2)(b) of the Act: International Finance Trust Company Limited v NSW Crime Commission [2008] NSWCA 291 at [9]. 10 An application is an interlocutory one in character, governed by the Evidence Act 1995 as it applies to interlocutory proceedings: s 4(1)(b) and (c), Evidence Act 1995; International Finance at [9]. 11 The Court has the power to dispense with the application of various provisions of the Evidence Act 1995 if there is a matter not genuinely in dispute, or else if the application of those provisions would cause or involve unnecessary expense or delay: s 190, Evidence Act 1995; s 9, Criminal Assets Recovery Act 1990. 12 As well, the common law evidentiary rule which enabled the Court to exercise a power to dispense with the operation of the rule of evidence in an interlocutory proceeding remains: See Geoffrey W. Hill & Associates v King (1992) 27 NSWLR 228 at 230 per McLelland J; s 9, Criminal Assets Recovery Act 1990; International Finance at [13].

Determination of the Application 13 On 14 September 2010, I determined that the evidence was sufficient to satisfy me that it was appropriate to make the ex parte restraining order sought together with the ancillary orders, which the NSW Crime Commission then sought. 14 The NSW Crime Commission submitted that it was necessary for me to deliver reasons explaining the basis upon which I made the orders sought. I indicated that I would consider that issue and deliver a judgment in due course. This is that judgment.

Necessity for Reasons 15 The submission of the NSW Crime Commission was that the decision of the NSW Court of Appeal in International Finance was authority for the proposition that it was necessary for a judge determining an application for an ex parte restraining order under the Criminal Assets Recovery Act to provide reasons for that decision. It was submitted that the decision was applicable with respect to these proceedings, and that I was bound to apply it. 16 Allsop P (Beazley JA agreeing), made it clear in International Finance, that having regard to the nature of the orders sought, the fact that the exercise of the power was a judicial one, the absence of any first instance review and the need for confidence in the judicial system in ensuring that justice is seen to be done, reasons were required to explain the making of an ex parte order under s 10 (as it then was) of the Criminal Assets Recovery Act 1990. 17 The learned President explained that any such reasons need not be elaborate and their extent would vary from case to case: International Finance at [46]-[50] per Allsop P (Beazley JA agreeing). 18 The articulation of the basis for the conclusion of the learned President, with whom Beazley JA agreed, for the necessity for reasons to accompany the making of an order under the Act is to be found at [41]. There he says: "[41] It has not been the practice of the Judges of the Common Law Division to give reasons. The primary judge followed that practice. What follows is not intended, in the slightest, as a criticism of the primary judge. My view, however, is that the subject matter of the Act, the nature of the application, including its judicial character, the consequences to the person of a successful ex parte application by the Commission, the lack of an inter-partes interlocutory hearing, the existence of the supervisory appeal and the character of the assessment to be made by the Judge all point to, or are consistent with, the obligation by the Court to provide reasons." 19 The expression of the learned President's conclusion is to be found in [50], where he said: "[50] In my view, reasons were required. Nothing in these reasons is directed, or should be taken as relevant, to the usual practice in dealing with urgent ex parte applications for relief in civil proceedings where the defendant will be brought before the Court for an inter-partes interlocutory hearing promptly."

Invalidity of s 10 of the Criminal Assets Recovery Act 1990 20 The decision of the NSW Court of Appeal was the subject of an appeal to the High Court of Australia. The High Court delivered its judgment on 12 November 2009: International Finance Trust Company Limited v NSW Crime Commission (2009) 240 CLR 319. 21 By a majority, the High Court declared that the provisions of s 10 were invalid. The basis of the invalidity was held to be that the section required the Supreme Court of NSW to engage in an activity which was repugnant in a fundamental degree to proper judicial process: [55]-[56] per French CJ, [98] per Gummow and Bell JJ, [155], [161] per Heydon J.

22 In that decision, Gummow and Bell JJ described the then existing process involving an application for restraining order under s 10 of the legislation in this way:

"[97] The Supreme Court is conscripted for a process which requires in substance the mandatory ex parte sequestration of property upon suspicion of wrong doing, for an indeterminate period, with no effective curial enforcement of the duty of full disclosure on ex parte applications. In addition the possibility of release from that sequestration is conditioned upon proof of a negative proposition of considerable legal and factual complexity." 23 None of the members of the High Court of Australia gave any specific consideration to the judicial obligation to give reasons when granting an ex parte restraining order under s 10.

Criminal Assets Recovery Amendment Act 2009 24 On 26 November 2009, the Criminal Assets Recovery Amendment Act 2009 was assented to, and came into force. The significant amendments made to the terms of the original legislation by the Amendment Act were as a consequence of the decision of the High Court of Australia in International Finance. 25 In the Second Reading Speech in the Legislative Assembly, the Minister for Police, Mr Daley, said this: "This bill rectifies anomalies relating to restraining orders based on a recent decision of the High Court of Australia. … … To respond fully to the High Court decision, these amendments separate the restraining order process from the forfeiture order process and make savings and transitional provisions regarding current former restraining orders and former restraining orders." 26 The process by which restraining orders could be made was the subject of significant amendment. One such amendment was to include s 10C in the Act. That section gives the Court the power, upon the timely application of the person affected by a restraining order, to set the order aside, on the grounds, either that the evidence before the Court originally, or else adduced on the application to set aside, was insufficient to satisfy the Court that the relevant suspicion existed, or else that the restraining order was obtained illegally or against good faith. 27 On such an application, the person affected by the restraining order is entitled to adduce evidence: s 10C(4). The Act places no restriction on this evidence. Such evidence may address any of the elements of proof necessary for the NSW Crime Commission to address when seeking a restraining order. 28 The amendment which includes s 10C addresses specifically a number of the concerns expressed about the previously prescribed procedure, including the extent to which it differed from the Court's ordinary practice when granting restraining orders, or alternatively, any ex parte relief. The Court's ordinary practice has not been to give reasons when granting such ex parte relief either by way of restraining order, or otherwise. 29 In considering the consequences of these amending provisions in their context, it is appropriate to have regard to the express reservation about the Court's usual practice noted by Allsop P at [50] in International Finance to which I have referred in para 19 above. 30 Further, clause [7] of Schedule 1 of the Amending Act, provided that s 25 of the original Act was to be supplemented by the addition of a further subsection in the following terms: "(8) An application may be made by a person under this section whether or not the person has also made an application under section 10C and whether or not any such application is successful." 31 This subsection has the effect that it is made plain by the legislature, contrary to the original position, that an application under s 10C to set aside a restraining order is an entirely separate and distinct pathway to relief from an application for an exclusion order under s 25 of the Act. 32 This ensures that a person affected by a restraining order is entitled to seek relief without the burdens which arise from an application under s 25. These burdens were described by Gummow and Bell JJ in International Finance at [96] as requiring "… the negating of an extremely widely drawn range of possibilities of contravention of the criminal law found in the common law, and state and federal statute law".

Reasons: Are they now required? 33 In light of the amendments to the legislation, I am of the opinion that reasons are now no longer required to be delivered when an ex parte application is made for a restraining order under s 10A of the Criminal Assets Recovery Act 1990. 34 Formerly, there was no ability of a person affected by an ex parte order to have the Court reconsider its original decision. All that could be done was to file an appeal to the Court of Appeal, or else to seek an exclusion order of the kind permitted by s 25 of the Act. 35 But since the amendments, the person now affected by a restraining order has the ability to make an application for the order to be discharged. Whilst the grounds for the application are, to some extent, limited by the Act, they are in my view sufficient to encompass the grounds usually relied upon to oppose the making of an ex parte restraining order, or alternatively to discharge one which has been made for a limited period. 36 In coming to this conclusion, I respectfully distinguish the judgment of the Court of Appeal in International Finance and in particular, the remarks of the learned President in the paragraphs to which I have made reference. I do so on the basis that the legislation which now presently governs the making of these orders is significantly different from that which the Court of Appeal considered in that decision. 37 I am conscious that Hislop J in NSW Crime Commission v Hakan Arif (unreported, NSWSC, 22 June 2010) delivered reasons for making an ex parte restraining order pursuant to s 10A of the Criminal Assets Recovery Act and that Whealy J has also done so in NSW Crime Commission v John Sant (unreported, NSWSC, 9 July 2010) on Friday, 9 July 2010. However, it does not appear to me from a perusal of those judgments that their Honours were asked to consider the question of whether or not reasons were necessary, nor were they specifically referred to the amendments which were made after the decision in International Finance, and so neither of them seem to have had posed for their consideration, nor given any consideration to, the issue to which this judgment relates. 38 I am fortified in my conclusion by the terms of s 17(3)(b) of Schedule 1 of the Criminal Assets Recovery Act, which was inserted by the amendments of 26 November 2009. This section, together with other sections added in Part 4 of the Act, permit a s 10C application to be made, in a timely way, in respect of any existing restraining orders which had been made before 26 November 2009. However, that section which permits such applications to be made, specifically denies to any applicant the ability to challenge any earlier order on the basis: "(b) that the Judge who determined the application for the current former restraining order failed to supply reasons for the determination," 39 It seems to me that the legislation envisaged that a s 10C Application was of a kind which did not have as one of its bases the failure of a Judge making the original ex parte restraining order to give reasons.

Conclusion 40 In my opinion, a Judge, making a restraining order under s 10A of the Criminal Assets Recovery Act 1990, upon the ex parte application of the NSW Crime Commission, or any other applicant, is not obliged to give reasons for the making of any such restraining order. 41 Conformably with the usual practice of the Court, and with the reasons which I have expressed above, I decline to give reasons for the orders which I made on 14 September 2010 upon the application of the NSW Crime Commission, made ex parte, with respect to specified property of Shane John Meads.

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