233 CLR 542
Attorney-General (Cth) v Breckler [1999] HCA 28
197 CLR 83
Attorney-General (NT) v Emmerson [2014] HCA 13
253 CLR 393
Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 7
89 ALJR 382
Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10
Source
Original judgment source is linked above.
Catchwords
233 CLR 542
Attorney-General (Cth) v Breckler [1999] HCA 28197 CLR 83
Attorney-General (NT) v Emmerson [2014] HCA 13253 CLR 393
Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 789 ALJR 382
Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10183 CLR 245
Burton v Honan [1952] HCA 3086 CLR 169
Cheatley v The Queen [1972] HCA 63127 CLR 291
Commonwealth v Tasmania (the Tasmanian Dam Case) [1983] HCA 21158 CLR 1
Grollo v Palmer [1995] HCA 26184 CLR 348
Huddart, Parker & Co Pty Ltd v Moorehead [1909] HCA 368 CLR 330
ICM Agriculture Pty Ltd v The Commonwealth [2009] HCA 51240 CLR 140
JT International SA v The Commonwealth [2012] HCA 43250 CLR 1
Luton v Lessels [2002] HCA 13210 CLR 333
Precision Data Holdings Ltd v Wills [1991] HCA 58173 CLR 167
Price v Fitzgerald [2000] FCA 13497 FCR 227
Re Director of Public ProsecutionsEx parte Lawler [1994] HCA 10
179 CLR 270
Rola Co (Australia) Pty Ltd v The Commonwealth [1944] HCA 17
69 CLR 185
R v Kirby
Ex parte Boilermakers' Society of Australia [1956] HCA 10
94 CLR 254
Theophanous v The Commonwealth [2006] HCA 18
225 CLR 101
The Queen v Spicer
Ex parte Australian Builders' Labourers' Federation [1957] HCA 81
100 CLR 277
The Queen v The Trade Practices Tribunal
Ex parte Tasmanian Breweries Pty Ltd [1970] HCA 8
123 CLR 361
The Queen v Quinn
Ex parte Consolidated Food Corporation [1977] HCA 62
138 CLR 1
Thomas v Mowbray [2007] HCA 33
233 CLR 307
Tran v The Commonwealth [2010] FCAFC 80
Judgment (16 paragraphs)
[1]
mmentaries on the Laws of England, (1769), Bk IV
Category: Principal judgment
Parties: 2013/317587
Representation: Counsel:
DPM Ash / WK Soon / TCN Phan (Appellant)
MG Sexton SC / C Lenehan (Second Respondent)
NL Sharp (Third Respondent)
[2]
Solicitors:
Joe Weller & Associates (Appellant)
Crown Solicitor's Office (First and Second Respondents)
Australian Government Solicitor (Third Respondent)
File Number(s): 2015/13950; 2015/143560
Decision under appeal Court or tribunal: Supreme Court of NSW
Jurisdiction: Common Law Division
Citation: [2014] NSWSC 1788
Date of Decision: 17 December 2014
Before: Johnson J
File Number(s): 2013/317587
[3]
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
[4]
[This headnote is not to be read as part of the judgment]
Paphos Providores Pty Ltd (the appellant) conducted a business selling clothing and accessories. The first respondent, a Constable of police, executed a search warrant on the appellant's business premises. A number of items, including clothing, handbags, watches and jewellery, were seized. The appellant commenced proceedings in the Supreme Court seeking return of the items and damages. A decision was made not to prosecute the appellant for offences under the Trade Marks Act 1995 (Cth). However, the first respondent applied to a magistrate for an order pursuant to s 3ZQZB(4)(d) of the Crimes Act 1914 (Cth) for the seized items to be destroyed on the basis that the items were likely to be used in the commission of a serious offence, namely, an offence under s 148 of the Trade Marks Act.
Under s 3ZQZB of the Crimes Act, a magistrate could permit a thing seized or document produced under the Act to be retained or forfeited. Relevantly, the magistrate could order that the thing or document be destroyed if he or she was satisfied that it was likely to be used in the commission of a serious offence. Under s 3CA, these functions were conferred on the magistrate in a personal capacity.
The appellant sought a declaration in the Supreme Court that the conferral of power on magistrates by s 3ZQZB(3)(b) and s 3ZQZB(4)(d) of the Crimes Act, to order the destruction of seized things and documents, was invalid. The appellant submitted that this was for three reasons. First, the conferral of power on the magistrate in a personal capacity was an invalid exercise of the judicial power of the Commonwealth. Second, the sections were not a valid exercise of the trade mark power for the purpose of s 51(xvii) of the Constitution. Third, the destruction involved an acquisition of property other than on just terms, contrary to s 51(xxxi) of the Constitution. The primary judge rejected each of these contentions.
The appellant appealed against the decision of the primary judge relying on the first and third of its reasons as to why the provisions were invalid.
Held (Bathurst CJ, Beazley P and Leeming JA agreeing) dismissing the appeal:
1 Was there an invalid conferral of judicial power on the magistrate
(i) The judicial power of the Commonwealth can only be conferred on a court created by s 71 of the Constitution or brought into existence by a State. While the concept of judicial power is incapable of precise definition, the exercise of judicial power generally involves the determination of controversies between parties as to the existence of rights or obligations according to law: [38]-[40] (Bathurst CJ); [57] (Beazley P); [58] (Leeming JA).
R v Kirby; Ex parte Boilermakers' Society of Australia [1956] HCA 10; 94 CLR 254; Huddart, Parker & Co Pty Ltd v Moorehead [1909] HCA 36; 8 CLR 330; The Queen v The Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd [1970] HCA 8; 123 CLR 361
(ii) There are powers which are neither purely administrative nor purely judicial and it lies within the authority of the legislature to determine where the exercise of the powers will lie. An example is the power to order forfeiture of property: [41] (Bathurst CJ); [57] (Beazley P); [58] (Leeming JA).
R v Kirby; Ex parte Boilermakers' Society of Australia [1956] HCA 10; 94 CLR 254; Thomas v Mowbray [2007] HCA 33; 233 CLR 307; The Queen v Spicer; Ex parte Australian Builders' Labourers' Federation [1957] HCA 81; 100 CLR 277; The Queen v Quinn; Ex parte Consolidated Food Corporation [1977] HCA 62; 138 CLR 1; Attorney-General (NT) v Emmerson [2014] HCA 13; 253 CLR 393; Precision Data Holdings Ltd v Wills [1991] HCA 58; 173 CLR 167
(iii) The finding of facts and formation of opinions as to the legal rights and obligations of parties can be elements in the exercise of administrative power. The fact that it is necessary for an administrative body to form an opinion as to the commission of an offence, as a step in a decision to take action, is not offensive to principle. That is equally the position where what is required is a finding of satisfaction that property is likely to be used in the commission of a serious offence, as a precondition for making an order under s 3ZQZB(4) of the Crimes Act: [42] (Bathurst CJ); [57] (Beazley P); [58] (Leeming JA).
Precision Data Holdings Ltd v Wills [1991] HCA 58; 173 CLR 167; Attorney-General (Cth) v Breckler [1999] HCA 28; 197 CLR 83; Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 7; 89 ALJR 382
(iv) The making of an order under s 3ZQZB(4) of the Crimes Act does not involve the exercise of judicial power as first, there is no determination of existing rights and duties, as distinct from exercising a discretion to deprive a person of rights on the satisfaction of a precondition to jurisdiction. Second, the power to order forfeiture can be validly conferred on either judicial or administrative bodies. Third, the fact that the exercise of the power requires the formation of an opinion that there are reasonable grounds to suspect that the property is likely to be used in the commission of a serious offence, does not mean that the power can only be exercised judicially. Fourth, the magistrate has no power to enforce any order that he or she may make and any decision is subject to judicial review and collateral challenge in proceedings for return of the goods: [43]-[46] (Bathurst CJ); [57] (Beazley P); [58] (Leeming JA).
Attorney-General (Cth) v Alinta Ltd [2008] HCA 2; 233 CLR 542; The Queen v The Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd [1970] HCA 8; 123 CLR 361; Rola Co (Australia) Pty Ltd v The Commonwealth [1944] HCA 17; 69 CLR 185; Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10; 183 CLR 245
2 Was there an acquisition other than on just terms
(i) An order under s 3ZQZB(4)(d) of the Crimes Act does not involve an acquisition under s 51(xxxi) of the Constitution as no interest in property, however slight, is acquired by the Commonwealth or any other person as a result of the order: [52] (Bathurst CJ); [57] (Beazley P); [58] (Leeming JA).
Commonwealth v Tasmania (the Tasmanian Dam Case) [1983] HCA 21; 158 CLR 1; JT International SA v The Commonwealth [2012] HCA 43; 250 CLR 1; ICM Agriculture Pty Ltd v The Commonwealth [2009] HCA 51; 240 CLR 140
[5]
Judgment
BATHURST CJ: The facts in this matter are uncontroversial. Paphos Providores Pty Ltd (the appellant) conducted a retail business selling clothing and accessories. On 15 August 2012, the first respondent, a Constable of police, in company with employees of the Trade Mark Investigation Service and other police officers, executed a search warrant on the appellant's premises at Bankstown. A number of items, including clothing, handbags, watches and jewellery, were seized. Officers of the NSW Police Force seized similar items in the execution of a search warrant at the appellant's premises at Punchbowl.
The basis on which the warrants were said to be issued was that, either the sale by the appellant or the possession of the goods by it, constituted a contravention of the Trade Marks Act 1995 (Cth).
On 19 September 2012, the appellant requested the return of the items. On 24 October 2012, it commenced proceedings in the Supreme Court seeking return of the items and damages.
On 28 March 2013, a decision was made not to prosecute the appellant for offences under the Trade Marks Act.
On 8 April 2013, the first respondent applied to a magistrate for an order pursuant to s 3ZQZB(4)(d) of the Crimes Act 1914 (Cth) (the Act) for the seized items to be destroyed. I have set out the relevant provisions of the Act below. The basis of the application was that there were reasonable grounds to suspect that if the seized items were returned to the appellant, it was likely that they would be used in the commission of a serious offence, namely, an offence under s 148 of the Trade Marks Act.
The primary judge recorded that the Court was informed that the application before the magistrate had been stood over and the Supreme Court proceedings had been adjourned pending the outcome of these proceedings.
By summons filed on 22 October 2013, the appellant sought a declaration that s 3CA of the Act was invalid, to the extent that it referred to an order to be made under s 3ZQZB(3)(b) and s 3ZQZB(4)(d) of the Act. The appellant also sought a declaration that s 3ZQZB of the Act was invalid, to the extent that it authorised a magistrate to make an order under s 3ZQZB(3)(b) and s 3ZQZB(4)(d) of the Act.
[6]
The relevant legislation
Section 148 of the Trade Marks Act was in the following terms:
"148 Goods with false trade marks
Indictable offence
(1) A person commits an offence if:
(a) the person:
(i) sells goods; or
(ii) exposes goods for sale; or
(iii) possesses goods for the purpose of trade or manufacture; or
(iv) imports goods into Australia for the purpose of trade or manufacture; and
(b) any of the following applies:
(i) there is a registered trade mark on the goods;
(ii) there is a mark or sign on the goods that is substantially identical to a registered trade mark;
(iii) a registered trade mark on the goods has been altered, defaced, added to, wholly or partly removed, erased or obliterated; and
(c) the registered trade mark, or mark or sign, was applied, altered, defaced, added to, wholly or partly removed, erased or obliterated, as the case requires, without:
(i) the permission of the registered owner, or an authorised user, of the trade mark; or
(ii) the application being required or authorised by this Act, a direction of the Registrar or an order of a court.
Penalty: Imprisonment for 5 years or 550 penalty units, or both.
Summary offence
(2) A person commits an offence if:
(a) the person:
(i) sells goods; or
(ii) exposes goods for sale; or
(iii) possesses goods for the purpose of trade or manufacture; or
(iv) imports goods into Australia for the purpose of trade or manufacture; and
(b) any of the following applies:
(i) there is a registered trade mark applied to the goods;
(ii) there is a mark or sign applied to the goods that is substantially identical to a registered trade mark;
(iii) a registered trade mark applied to the goods has been altered, defaced, added to, wholly or partly removed, erased or obliterated; and
(c) the registered trade mark, or mark or sign, was applied, altered, defaced, added to, wholly or partly removed, erased or obliterated, as the case requires, without:
(i) the permission of the registered owner, or an authorised user, of the trade mark; or
(ii) the application being required or authorised by this Act, a direction of the Registrar or an order of a court.
Penalty: Imprisonment for 12 months or 60 penalty units, or both.
(3) The fault element for paragraphs (2)(b) and (c) is negligence.
Note 1: For registered trade mark see section 6.
Note 2: For applied to goods see section 9.
Note 3: International trade marks may be protected under the regulations: see Part 17A."
[7]
The historical background to the legislation
Some reliance was placed by the appellant on the historical background to the legislation in question.
Section 3CA was introduced into the Act in 1994 by the Law and Justice Legislation Amendment Act (No 2) 1994 (Cth) at the same time as Pt 1AA was inserted into the Act by the Crimes (Search Warrants and Powers of Arrest) Amendment Act 1994 (Cth). Section 3CA, as inserted by the former Act, provided that a magistrate, in making an order under s 3ZI, s3ZJ, s 3ZK, s 3ZN or s 3ZW of the Act, was acting in a personal capacity and not as a court. The sections in which such powers were conferred related to orders in respect of strip searches, taking fingerprints or samples, destruction of identification material where proceedings were discontinued or the person charged with the offence was acquitted, orders in relation to identification parades for persons under 18 years of age and orders to retain material seized for the purpose of an investigation or to enable evidence to be secured for the purpose of a prosecution. At the time, there was no equivalent to s 3ZQZB.
It should be noted that Pt 1AA, as originally enacted, conferred powers to make orders under s 3ZI, s 3ZJ, s 3ZK, s 3ZN and s 3ZW on a court. However, those provisions were amended by the Law and Justice Legislation Amendment Act (No 2) to confer power on a magistrate acting in a personal capacity.
Section 3CA, as originally enacted, was held to confer power on a magistrate as persona designata and not on a court: Price v Fitzgerald [2000] FCA 134; 97 FCR 227 at [32]. It was not contended in that case that the powers conferred on the magistrate were judicial powers of the Commonwealth.
An equivalent provision to that contained in s 3ZQZB was introduced into the Act by the Anti-Terrorism Act (No 2) 2005 (Cth). That section referred to things likely to be used in the commission of a terrorist act or serious offences, but did not include an express power to order destruction of the thing in question. There was no amendment to s 3CA.
In 2010, s 3ZQZB was introduced into the Act by the Crimes Legislation Amendment (Serious and Organised Crimes) Act (No 2) 2010 (Cth). As enacted, it did not expressly provide for the destruction of things or documents. Further, s 3CA was not amended to incorporate within it the powers and functions of making orders under s 3ZQZB.
[8]
The proceedings below
As is apparent from the declarations sought in the summons, the appellant asserted that the conferral of power on magistrates by s 3ZQZB to order the destruction of seized things and documents was invalid. It submitted that this was for three reasons. First, the conferral of power on the magistrate in a personal capacity was an invalid conferral of the judicial power of the Commonwealth: R v Kirby; Ex parte Boilermakers' Society of Australia [1956] HCA 10; 94 CLR 254 (Boilermakers'). Second, the challenged sections did not involve a valid exercise of the trade mark power for the purpose of s 51(xviii) of the Constitution. Third, the destruction involved an acquisition of property other than on just terms, contrary to s 51 (xxxi) of the Constitution.
The primary judge rejected each of these contentions. He held that first, the power exercised by magistrates under the relevant provisions was administrative not judicial. Second, he held that there was a sufficient connection with the trade mark power as s 51(xviii) authorised laws that provide for the enforcement of intellectual property rights in trade marks. Third, he held that there was no acquisition of property and, even if there was, a purpose of forfeiting or destroying property to prevent its use in further crimes was incongruous with the notion of acquisition of property on just terms.
[9]
The appeal
The appellant sought leave to appeal, seeking to raise the same matters raised in the hearing before the primary judge. Prior to the hearing, it abandoned the contention that s 3ZQZB(3)(b) and s 3ZQZB(4)(d) were not supported by the power conferred by s 51(xviii) of the Constitution.
However, prior to the hearing, the appellant sought leave to raise a further ground. The appellant contended that if the power conferred on the magistrate to make an order under s 3ZQZB(3) and (4) was not an exercise of judicial power, it was "incompatible with the magistrate's performance of his or her judicial functions or with the proper discharge by the judiciary of its responsibilities as an institution exercising judicial power" (the amended ground).
Leave to raise the amended ground was refused. It was not disputed by the appellant that if leave was to be given, it would be necessary to postpone the hearing of at least that part of the proceedings until notice of the new constitutional issue had been given to the Attorneys General under s 78B of the Judiciary Act 1903 (Cth). Therefore, leave would have resulted in either an adjournment of the proceedings, which had been ongoing for a considerable period of time, or an undesirable bifurcation of the proceedings. Both of these results would be contrary to the overriding purpose of the Civil Procedure Act 2005 (NSW), stated in s 56. The new ground had not been raised at first instance.
Further, although hearing of the argument on this point was not able to be embarked upon, it is difficult to see how the conferral of a power on a magistrate as persona designata, to order destruction of a thing or document if he or she was satisfied that there were grounds to suspect that the thing or document was likely to be used in the commission of an offence, is incompatible with the exercise of judicial functions by the magistrate or with the proper discharge by the judiciary of its responsibility. Counsel for the appellant stated that his client's contention was supported by what was said in Grollo v Palmer [1995] HCA 26; 184 CLR 348 at 362-365. There does not appear to be anything in the passages cited to support the appellant's contention.
For these reasons, I joined in a refusal to grant leave to raise this ground of appeal.
As I indicated, the appellant sought leave to appeal. The grant of leave was not opposed insofar as it was sought to raise the points taken before the primary judge.
[10]
Was there an invalid conferral of judicial power on the magistrate
[11]
(a) The parties' submissions
The appellant referred to the history of the legislation, which I have set out above, and submitted that the functions conferred by s 3ZQZB were "distinctly judicial when it was introduced in its original form" and "the legislative intention evidenced by the 2011 amendment … cannot displace that distinctiveness".
The appellant submitted that the appropriate characterisation of the law, identified by the Court below, had two elements. First, "an intention to prevent unlawful conduct in the future, and the second an essence of protection". In regard to the first element, it submitted that there was already a body of law which dealt with this issue, namely, the issue of the power in a court to grant an injunction to restrain an actual or threatened breach of the criminal law. It submitted that the powers granted to the executive (in this case the magistrate in a personal capacity) in the relevant provisions went far beyond that body of law as there was no requirement that the circumstances be exceptional, no requirement that a civil standard of proof be imposed and there were a range of options going well beyond an injunction. It submitted, in these circumstances, that the "attempt to place another much less rigorous path into the executive fails".
Counsel for the appellant referred to the citation by Gleeson CJ in Thomas v Mowbray [2007] HCA 33; 233 CLR 307 at [16]-[17] of W Blackstone, Commentaries on the Laws of England, (1769), Bk IV, p 248, dealing with what was described as preventative justice. He also referred to the Chief Justice's conclusion in that case that the control orders under challenge were not incompatible with judicial functions. He submitted that it followed that incapacitation for the purpose of prevention and making a public announcement of suspected criminality directed to a particular person, was "wholly within the bounds of the criminal courts".
Counsel for the appellant stated that the particular pre-condition to an order for destruction being made, namely, the determination that it was reasonable to suspect that the thing was likely to be used in the commission of a serious offence, gave the function a special compelling factor which placed its exercise in the realm of judicial power: The Queen v The Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd [1970] HCA 8; 123 CLR 361 (Tasmanian Breweries) at 374. In reply, he acknowledged that, having regard to Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 7; 89 ALJR 382 (Today FM) at [33]-[34], it is not offensive to principle for an administrative body to be empowered to determine whether a person is engaged in conduct which constitutes a criminal offence, as a step in a decision to take action. However, he said that the compelling feature in the present case was the fact that the magistrate was required to determine whether there was a reasonable suspicion that this would occur in the future.
[12]
(b) Consideration
It is well established and not in dispute that the judicial power of the Commonwealth can only be conferred on a court created by s 71 of the Constitution or brought into existence by a State: Boilermakers' at 270. It is equally well established that the concept of judicial power is incapable of precise definition. In Huddart, Parker & Co Pty Ltd v Moorehead [1909] HCA 36; 8 CLR 330, Griffith CJ described the concept of judicial power, as used in s 71 of the Constitution, in the following terms (at 357):
"Apart from these considerations, I am of opinion that the words 'judicial power' as used in sec. 71 of the Constitution mean the power which every sovereign authority must of necessity have to decide controversies between its subjects, or between itself and its subjects, whether the rights relate to life, liberty or property. The exercise of this power does not begin until some tribunal which has power to give a binding and authoritative decision (whether subject to appeal or not) is called upon to take action."
In Tasmanian Breweries, Kitto J, while emphasising (at 373) that it was not possible to frame an exhaustive definition of judicial power and that there was "a borderland in which judicial and administrative functions overlap", made the following remarks (at 374-375):
"Thus a judicial power involves, as a general rule, a decision settling for the future, as between defined persons or classes of persons, a question as to the existence of a right or obligation, so that an exercise of the power create a new charter by reference to which that question is in future to be decided as between those persons or classes of persons. In other words, the process to be followed must generally be an inquiry concerning the law as it is and the facts as they are, followed by an application of the law as determined to the facts as determined; and the end to be reached must be an act which, so long as it stands, entitles and obliges the persons between whom it intervenes, to observance of the rights and obligations that the application of law to facts has shown to exist. It is right, I think, to conclude from the cases on the subject that a power which does not involve such a process and lead to such an end needs to possess some special compelling feature if its inclusion in the category of judicial power is to be justified."
Each of the passages which I have cited emphasise that the exercise of judicial power generally involves the determination of controversies between parties as to the existence of rights or obligations according to law. It is significant, but not conclusive, in the present case, that the exercise of the power in question does not involve settlement of a controversy between parties or a determination of existing rights and duties.
[13]
(a) The parties' submissions
The appellant submitted that the legislation conferred a power of election on the magistrate, including a power to order that the property in question be forfeited to the Commonwealth. It submitted that this was a law with respect to the acquisition of property within s 51(xxxi) of the Constitution. It submitted that there was no evidence to justify the primary judge's acceptance of the submission that a destruction order was "the only realistic order". With respect, this seems to me to be somewhat irrelevant. The question involved is whether an order that property be destroyed constituted an acquisition of property for the purpose of s 51(xxxi).
The appellant submitted that the incongruity principle (see, for example, Theophanous v The Commonwealth [2006] HCA 18; 225 CLR 101) does not extend to crimes which are suspected to be committed in the future.
The second and third respondents submitted that a complete answer to the appellant's case on this issue was that neither the Commonwealth, nor any other party, acquired an interest of a proprietary nature. They referred to the decision of the Full Court of the Federal Court in Tran v The Commonwealth [2010] FCAFC 80; 187 FCR 54 at [234], which held, in the context of a forfeiture order under the Customs Act 1901 (Cth), that the Commonwealth obtained no interest in property which, when seized, was destroyed.
The second and third respondents also submitted that the incongruity principle applied. They submitted that it was applicable where property was destroyed, in circumstances where there was a risk that it would be used in the commission of a crime in the future. The second respondent also submitted that it was not open to challenge the validity of the power to order destruction of the seized goods on the basis that it was one of a number of orders which could be made, including forfeiture to the Commonwealth. It submitted that the only challenge was to the provision empowering the magistrate to order destruction of the goods in question and the argument based on the election between various remedies, including forfeiture to the Commonwealth, should be rejected.
[14]
(b) Consideration
In my opinion, an order for destruction of property under s 3ZQZB(4)(d) does not involve an acquisition by the Commonwealth or any other person such that s 51(xxxi) of the Constitution has application. As was stated by Mason J in Commonwealth v Tasmania (the Tasmanian Dam Case) [1983] HCA 21; 158 CLR 1 at 145, "it is not enough that legislation adversely affects or terminates a pre-existing right that an owner enjoys … there must be an acquisition … however slight or insubstantial": see also JT International SA v The Commonwealth [2012] HCA 43; 250 CLR 1 at [42], [118], [144]-[148] [169]; ICM Agriculture Pty Ltd v The Commonwealth [2009] HCA 51; 240 CLR 140 at [82]-[84], [130]-[141]. In the present case, no interest in the property, however slight, was acquired by the Commonwealth or any other person as a result of the order for destruction. The character of other subsections within s 3ZQZB(4) is irrelevant to the position.
The second and third respondents also sought to rely on what has been described as the incongruity principle. As was stated by the plurality in Theophanous at [60], exactions by way of forfeiture are a regular feature of the law of the Commonwealth and the imposition of just terms would be incompatible with the very nature of exactions: see also Re Director of Public Prosecutions; Ex parte Lawler [1994] HCA 10; 179 CLR 270 at 289.
The appellants submitted that the incongruity principle did not apply because the forfeiture was in respect of a suspected future offence and not in respect of crimes found to have been committed. Because of the view I have taken on the question of acquisition, it is unnecessary to finally determine whether the requirement of just terms in those circumstances would be inconsistent or incongruous with an acquisition for the purpose of preventing suspected future offences against the Commonwealth: see Theophanous at [71] but cf the dissenting judgment of Gageler J in Emmerson at [134].
[15]
Conclusion
In the result, I am of the opinion that the following orders should be made:
1. To the extent necessary, grant the appellant leave to appeal.
2. Appeal dismissed.
If either of the second or third respondents seek an order for costs, they may apply under the Supreme Court Rules 1970 (NSW).
BEAZLEY P: I have had the advantage of reading in draft the reasons of the Chief Justice. I agree with his Honour's reasons and the orders he proposes.
LEEMING JA: I agree with the reasons of Bathurst CJ and the orders proposed by him.
[16]
Amendments
01 December 2015 - [17] "Law and Justice Amendment Act" to "Law and Justice Legislation Amendment Act"
[19] "Anti-Terrorist Act" to "Anti-Terrorism Act"
[36] "affect" to "effect"
[39] "right of obligation" to "right or obligation"
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 01 December 2015
Parties
Applicant/Plaintiff:
Paphos Providores Pty Ltd
Respondent/Defendant:
Constable Ladha
Legislation Cited (8)
Crimes Legislation Amendment Act 2011(Cth)
Crimes (Search Warrants and Powers of Arrest) Amendment Act 1994(Cth)
The parties accepted before the primary judge that s 148, in its current form, as distinct from the form that it was in at the time of the seizure, was relevant for the purpose of the present proceedings.
Part 1AA of the Act provided for search, information gathering, arrest and related provisions in respect of Commonwealth offences, offences against the law of a Territory, or State offences that had a Federal aspect.
Section 3CA of the Act dealt with the functions of magistrates in making certain orders. It provided as follows:
"3CA Nature of functions of magistrate
(1) A function of making an order conferred on a magistrate by section 3ZI, 3ZJ, 3ZK, 3ZN or 3ZQZB is conferred on the magistrate in a personal capacity and not as a court or a member of a court.
(2) Without limiting the generality of subsection (1), an order made by a magistrate under section 3ZI, 3ZJ, 3ZK, 3ZN or 3ZQZB has effect only by virtue of this Act and is not to be taken by implication to be made by a court.
(3) A magistrate performing a function of, or connected with, making an order under section 3ZI, 3ZJ, 3ZK, 3ZN or 3ZQZB has the same protection and immunity as if he or she were performing that function as, or as a member of, a court (being the court of which the magistrate is a member).
(4) The Governor‑General may make arrangements with the Governor of a State, the Chief Minister of the Australian Capital Territory, the Administrator of the Northern Territory or the Administrator of Norfolk Island for the performance, by all or any of the persons who from time to time hold office as magistrates in that State or Territory, of the function of making orders under sections 3ZI, 3ZJ, 3ZK, 3ZN and 3ZQZB."
Subdivision B of Div 4C of Pt 1AA of the Act dealt with the question of returning things seized, or documents produced, under the power of seizure contained in that Part, including material and documents seized on the execution of search warrants. Section 3ZQX(1) provided that if the Commissioner (defined as "the Commissioner of the Australian Federal Police") was satisfied that the things or documents seized were not required for a purpose mentioned in s 3ZQU (which set out the purposes for which seized things or documents may be used and shared) or for other judicial or administrative review proceedings, the Commissioner must take reasonable steps to return the goods or documents to the person from whom they were seized or to the owners, if that person was not entitled to possess them. However, s 3ZQX(2) and (4) provided that the Commissioner did not have to take these steps if a thing or document may be retained because of an order made under s 3ZQZB(3), or if any other order under that subsection was made in relation to the thing or document, or if such an order has been applied for and not determined. The Commissioner was also not required to return the thing or document if it may have otherwise been retained or destroyed under an order of a Court or tribunal, or if it was forfeited to the Commonwealth.
Section 3ZQZB was central to the proceedings. It was in the following terms:
"3ZQZB Magistrate may permit a thing seized or document produced under this Part to be retained, forfeited etc.
(1) A magistrate may, on application by the Commissioner, make an order under subsection (2) or (3) in relation to a thing seized or a document produced under this Part.
Use for purpose mentioned in section 3ZQU or for other judicial or administrative review proceedings
(2) The magistrate may order that a thing seized under Division 3 or 3A be retained for the period specified in the order if the magistrate is satisfied that the thing is being used, or is required to be used, for a purpose mentioned in section 3ZQU or for other judicial or administrative review proceedings.
Preventing use in committing terrorist act, terrorism offence or serious offence
(3) The magistrate may make any of the orders referred to in subsection (4) if the magistrate is satisfied that there are reasonable grounds to suspect that, if a thing seized or document produced under this Part is returned to any of the following persons, it is likely to be used by that person or another person in the commission of a terrorist act, a terrorism offence or a serious offence:
(a) the owner of the thing or document;
(b) in the case of a thing - the person from whom the thing was seized;
(c) in the case of a document - the person who produced the document.
(4) The orders are as follows:
(a) an order that the thing or document may be retained for the period specified in the order;
(b) an order that the thing or document is forfeited to the Commonwealth;
(c) for a thing that is not a document - an order that:
(i) the thing be sold and the proceeds given to the owner of the thing; or
(ii) the thing be sold in some other way;
(d) an order that the thing or document is to be destroyed or otherwise disposed of.
Thing or document must be returned if magistrate not satisfied
(5) The magistrate must order that a thing or document be returned to the following person if the magistrate is not satisfied as mentioned in subsection (2) or (3):
(a) in the case of a thing - the person from whom the thing was seized;
(b) in the case of a document - the person who produced the document;
(c) if the person referred to in paragraph (a) or (b) is not entitled to possess the thing or document - the owner of the thing or document.
Persons with an interest in thing or document
(6) Before making an application under this section in relation to a thing or document, the Commissioner must:
(a) take reasonable steps to discover who has an interest in the thing or document; and
(b) if it is practicable to do so, notify each person who the Commissioner believes to have such an interest of the proposed application.
(7) The magistrate must allow a person who has an interest in the thing or document to appear and be heard in determining the application.
Special rule for things seized under Division 3
(8) The Commissioner may only make an application under this section in relation to a thing seized under Division 3 if the application is made:
(a) before the end of 60 days after the seizure; or
(b) before the end of a period previously specified in an order in relation to the thing under this section."
Serious offence is defined in s 3C of the Act to include a Commonwealth offence punishable by imprisonment for 2 years or more.
The section, in its current form, was introduced by the Crimes Legislation Amendment Act 2011 (Cth). That Act also amended s 3CA to include within its ambit 3ZQZB of the Act.
The Attorney General for NSW (the second respondent) accepted that the fact that s 3ZQZB, as originally enacted, and its predecessors, were not included within s 3CA, may have supported the proposition that the power was conferred on the magistrate as a member of the court and was judicial in nature. However, he submitted, as did the Attorney-General for the Commonwealth (the third respondent), that the 2011 amendment evinced a clear legislative decision to include the power in the same regime as that applied to other powers conferred on magistrates in Pt 1AA of the Act. They submitted that this decision was important, if not decisive, in determining this ground of appeal.
Each of the second and third respondents emphasised that there were many powers which were not purely legislative, executive or judicial and "it lies within the authority of the legislature to determine where the exercise of such a power shall be vested". The second respondent referred to the history of forfeiture provisions, summarised in the joint reasons of six members of the High Court in Attorney-General (NT) v Emmerson [2014] HCA 13; 253 CLR 393 (Emmerson) at [16]-[18], submitting that the history was equally relevant to legislation authorising destruction of property. She pointed out that it had never been the case that forfeiture could only take place by judicial order, although there were a number of cases in which it had. She submitted that it followed that the powers in question were neither peculiarly or distinctly administrative or judicial and it lay within the authority of the Parliament to determine where the exercise of those powers should be vested.
Each of the second and third respondents emphasised the absence of the traditional hallmarks of judicial power. They pointed out that the exercise of the power did not involve the resolution of a dispute about existing rights and duties, the application of law to past events or a binding declaration of rights. Each of them also submitted that any order made was not enforceable by the magistrate, pointing out that the orders made had effect only by virtue of the Act and were not to be taken as orders of the court (s 3CA(2)). They pointed out that the order was rather the factum by which the legislature imposed rights and duties.
The second and third respondents emphasised that there was no compelling factor in the present case which would lead to the conclusion that the functions to be performed were exclusively judicial. They emphasised that the order was not in respect of past conduct and was not an adjudication of guilt. They submitted that neither commission of, nor conviction for, an offence, was a trigger for the exercise of the power. They each pointed to the fact that the order was not punishment for criminal guilt but rather was protective in nature.
It is also clear, as the second and third respondents emphasised, that there are powers which are neither purely executive nor purely judicial and it lies within the authority of the legislature to determine where the exercise of the powers will lie: Boilermakers' at 278-279; Thomas v Mowbray at [10]-[12]; The Queen v Spicer; Ex parte Australian Builders' Labourers' Federation [1957] HCA 81; 100 CLR 277 at 305; The Queen v Quinn; Ex parte Consolidated Food Corporation [1977] HCA 62; 138 CLR 1 at 10, 18 (the so-called chameleon principle). An example of such a power is the power to order forfeiture of property. As the plurality pointed out in Emmerson at [58], in the context of forfeiture provisions contained in the Misuse of Drugs Act (NT), "[i]n selecting the Supreme Court … to determine a particular fact or status, … it can be inferred that Parliament accepts that the power will be exercised in accordance with standards characterising ordinary judicial processes": see also Thomas v Mowbray at [55]; Precision Data Holdings Ltd v Wills [1991] HCA 58; 173 CLR 167 at 191. However, as the history of forfeiture provisions, summarised in Emmerson, demonstrates, the power to order forfeiture has not been a function historically confined to the judiciary: see Burton v Honan [1952] HCA 30; 86 CLR 169 at 176; Cheatley v The Queen [1972] HCA 63; 127 CLR 291 at 310.
Further, it must be remembered that although the finding of facts and formation of opinions as to the legal rights and obligations of the parties are common ingredients in the exercise of judicial power, they may also be elements in the exercise of administrative or legislative power: Precision Data Holdings v Wills at 189; Attorney-General (Cth) v Breckler [1999] HCA 28; 197 CLR 83 at [45]; Luton v Lessels [2002] HCA 13; 210 CLR 333 at [124]. In particular, the fact that it is necessary for an administrative body to form an opinion as to the commission of an offence, as a step in a decision to take action, is not offensive to principle: Today FM at [32]-[33]. That must equally be the position where what is required is a finding of satisfaction that the property in question is likely to be used in the commission of a serious offence, as a precondition for making an order under s 3ZQZB(4) of the Act.
In my opinion, the making of an order under s 3ZQZB(4) of the Act does not involve the exercise of judicial power. First, there is no determination of existing rights and liabilities, as distinct from the exercise of a discretion depriving a person of rights on the satisfaction of a precondition to jurisdiction: cf Attorney-General (Cth) v Alinta Ltd [2008] HCA 2; 233 CLR 542 at [2], [96]. Thus, the exercise of the power does not involve what is generally involved in the exercise of judicial power: Tasmanian Breweries at 374.
Second, as I have pointed out, the power to order forfeiture is one which has been held to be capable of being validly conferred on either judicial, legislative or administrative bodies. In my opinion, it is clear, having regard to the terms of s 3CA of the Act, that the power is conferred on the magistrate in a personal capacity and not as a member of the court. The fact that the provisions prior to the 2011 amendments may have exhibited a different legislative intention is irrelevant when regard is had to the clear words in the present provisions.
Third, the fact that a precondition to the exercise of the power is the formation of an opinion that there are reasonable grounds to suspect that the property in question is likely to be used in the commission of a serious offence, does not mean that the power can only be exercised judicially.
Fourth, the magistrate has no power to enforce any order that he or she may make. That inability weighs against the power being judicial rather than administrative: Attorney-General (Cth) v Alinta Ltd at [98]; Rola Co (Australia) Pty Ltd v The Commonwealth [1944] HCA 17; 69 CLR 185 at 199; Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10; 183 CLR 245 at 256-257. Further, it was common ground that any decision was subject to judicial review. Any decision was also subject to collateral challenge in proceedings seeking the return of the goods.
In these circumstances, it seems to me that s 3ZQZB does not involve the conferral of judicial power on the magistrate. The section is not invalid on this ground.