If "control" were a fact, and if the statement set out above were a matter of fact, then "control" was conceded.
22 Other matters of "fact" were formulated in terms which involved statutory concepts. For example, it was stated that on 25 January 2006 the goods were "reported" to the ACS by an entity identified as "Mediterranean Shipping Company (Aust) Pty Ltd", the involvement of which was otherwise unidentified. The facts further stated:
"The container arrived at Patrick Stevedores at Port Botany, New South Wales, on 4 February 2006 on board [a vessel] from Singapore."
23 Patrick Stevedores was identified as the entity which was "appointed to operate the wharf and container terminal". When, in the course of argument, counsel was asked what that meant, the Court was referred to s 15 of the Customs Act. However, that section provides that the Chief Executive Officer of Customs may "appoint" wharves and fix the limit of those wharves: it says nothing about appointing persons to operate a wharf and container terminal.
24 The facts stated that at about 7.50pm on 4 February, "the container was transferred from the ship to the wharf" and placed in a particular position, by an employee of Patrick Stevedores. The facts continued:
"There is no further record of any operational movement of the container."
25 One of the co-accused, Mr Phapakdy, was stated to be employed as a security guard at Patrick Stevedores and was required "to ensure that the correct paperwork was presented by the truck drivers as they exited the facility". It may perhaps be inferred, although it was not expressly stated, that there was no "paperwork" permitting the removal of the container from the wharf at the time of its removal, namely 5.53pm on Monday, 6 February. Mr Phapakdy was observed by police "to allow the prime-mover and trailer to leave the terminal" with the shipping container on the trailer.
26 Two further matters of importance were stated: first, when the goods carried in the container had been "reported" to Customs on 25 January 2006, they were described as "750 cartons of PVC electrical tape". (This appears to have been an "impending arrival report" under s 64 of the Customs Act.) When the container was searched it was found to contain "750 boxes of cigarettes which equates to 8,556,000 cigarettes". The statement did not identify when the container was searched and its contents identified, but counsel submitted that the appropriate inference was that that occurred when the prime-mover and trailer were stopped by police shortly after leaving the terminal on 6 February.
27 The other matter arose from two statements to the following effect:
"ACS records indicate that a 'held' status was placed on the container. This indicates that there was an impediment to the release of the goods into home consumption. The records also indicate that no import declaration was ever made, nor any duty paid, in respect of the goods.
…
The prime mover and trailer was stopped by a marked police vehicle on Foreshore Drive, Botany. The container was seized by the New South Wales Police and delivered to the ACS."
28 The full import of these "facts" requires reference to the provisions of the Customs Act.
Relevant provisions of Customs Act
29 It was an agreed fact that the terminal where the container was stored was appointed as a wharf under s 15(2) of the Customs Act. Such an area may constitute a "waterfront area" within the meaning of s 20, if it is "signposted" so as to give a clear indication to persons present in the area that it is "an area under Customs control" and that they require appropriate identification to be there: s 20(8), waterfront area (b). In such an area, a customs officer is entitled to request a person to leave if he or she is "unable to establish his or her identity or to explain his or her presence" in the area: s 20(5). Failure to comply with such a request renders the person liable to a penalty: s 20(7).
30 Although again the facts were somewhat imprecise, it might be inferred from the fact that the facility had "entry and exit gates", controlled by a security guard, that the appointed wharf was physically secured in a manner which prevented the unauthorised movement of goods. That might also be inferred from the legal obligation imposed on the operator of the wharf to ensure payment of duty on any goods received at the wharf: ss 35A and 42 and Customs Regulations 1926 (Cth) reg 3 and Form 68. Further, a wharf appointed under s 15 is a "Customs place" as defined in s 183UA(1), for the purposes of Division 1 of Part XII of the Customs Act. Section 197, which is within that Division, provides:
" 197 Power to stop conveyances about to leave a Customs place
(1) If a conveyance is about to leave a Customs place, an officer of Customs may:
(a) require the conveyance to stop; and
(b) check to establish that there is appropriate documentation authorising the movement from the Customs place of any goods in or on the conveyance that are subject to the control of Customs within the meaning of section 30."
31 As noted above, a critical provision in the Customs Act for the purpose of the analysis is s 33 which provides:
" 33 Persons not to move goods subject to the control of Customs
(1) If:
(a) a person intentionally moves, alters or interferes with goods that are subject to the control of Customs; and
(b) the movement, alteration or interference is not authorised by this Act;
the person commits an offence punishable, on conviction, by a penalty not exceeding 500 penalty units."
32 Section 33 has other provisions relating to movement not described as intentional, movement by an employee and movement pursuant to the direction or permission of another person. It is not necessary to consider these various provisions, the question being whether a movement "not authorised by this Act" either alone, or in combination with other provisions, confers on Customs a degree of control sufficient to satisfy the language of the Criminal Code.
33 Section 33 applies to goods "that are subject to the control of Customs". Section 30 provides that goods shall be "subject to the control of Customs" in a number of circumstances including "goods to which section 68 applies that are unshipped" for a period from the time of their importation until the time of their delivery into home consumption. Section 68 applies, amongst others, to goods that are "imported into Australia", subject to exceptions. The facts as stated do not in terms adopt the language of s 68, nor negative the exceptions. Nevertheless, it seems to have been assumed that the goods were "imported into Australia" and did not fall within any of the exceptions. That assumption should be adopted. Further, it was accepted by the Appellant that the goods had been unshipped and, prior to their removal from the wharf in the circumstances which became the subject of the charge, had not been delivered into home consumption or otherwise dealt with in a manner which would render them no longer subject to the control of the Customs. It was, as noted above, accepted that the goods were at the relevant time "subject to the control of the Customs" within the meaning of s 30 of the Customs Act. That in turn means that they could not lawfully be moved or removed from the wharf without authority under the Act.
34 Further assumptions were made which were not clearly reflected in the statement of facts. First, pursuant to s 68(2), the owner of the goods may "enter the goods … for home consumption" prior to their first arrival at a port in Australia at which the goods are to be discharged. If that does not happen, the owner "must enter the goods" for a relevant purpose, after the ship first arrives at the port at which they are to be discharged: s 68(3). The only information about the goods referred to in the statement of facts was the "report" made on 25 January 2006 relating to 750 cartons of PVC electrical tape. The further statement that "no import declaration was ever made" in respect of the goods would appear to imply that the goods were not "entered" for the purposes of s 68. The term "import declaration" in the statement of facts appears to be an adaptation of the term "import entry", which is used in s 71A of the Customs Act. The statement of facts assumed that an import entry was required and that duty was payable in respect of the goods and stated that no entry was made and no duty had been paid prior to their removal from the wharf. Whatever the significance of a "held" status in Customs records, it appears to have been accepted that one consequence of that status was that no authority had been granted by Customs for any movement of the goods from the wharf.
35 The Customs Act also contains certain penal provisions, pursuant to which certain goods are forfeited to the Crown: s 229(1). Forfeited goods include:
"(a) All goods … which are smuggled, or unlawfully imported, exported or conveyed.
…
(g) All goods subject to the control of the Customs that are moved, altered or interfered with except as authorised by this Act.
…
(o) All dutiable goods concealed in any manner."
36 The primary facts stated indicate misdescription of the goods and would support the inference that they were dutiable and that they had been concealed so as to avoid payment of duty. Because the absence of authority to move should also be inferred, they were forfeited immediately they were moved.
37 The case below was argued on the basis that the goods were subject to the control of Customs and in that sense were in the control of a Commonwealth entity. It was not argued that the Customs, or the Commonwealth, had possession or property in the goods. Dealing with the matter on that basis, it is nevertheless a significant statutory feature, relevant to the concept of control, that immediately the goods were moved without the authority of the Customs, they were forfeited to the Crown. Accordingly, when seized, subject to the requirements of the law enforcement agency, they should properly have been returned, in law, to the Customs, a step which was in fact taken as the facts reveal. The "facts" thus demonstrate that the Commonwealth had a proprietary interest in the goods at the time of their removal from the wharf.
Criminal Code: meaning of "control"
38 The thrust of the argument for the Appellant was that the concept of "control" when used in the context of property, and as an extension of the concept of "possession" or "a proprietary right or interest", was not apt to refer to a legal power, but should be understood as referring to the physical exercise of such a power. That conclusion was said to flow from a number of cases discussing the concept of control in relation to the law of theft which, it was said, informed the content of the concept when used in the Criminal Code in 1995.
39 The Appellant also referred to a number of cases discussing the meaning of "subject to the control of the Customs", being the phrase used in the Customs Act. Those cases were of only indirect relevance, unless it could be said that the term "control" in the Criminal Code was intended to pick up and apply the term used in the Customs Act. However, if it were so intended, it seems almost inevitable that the present appeal must fail.
40 The thrust of the Appellant's argument was that the term "control", in the context of the Criminal Code, was intended to identify a primary right of an owner of moveable property. It thus referred to physical control of property, which is the interest protected against dishonest appropriation. That concept was developed by the general law, without reference to or knowledge of the kinds of regulatory control which may be conferred by statute on government authorities. The distinction is made explicit by the Customs Act, which identifies the "owner" in respect of goods as "any person (other than an officer of Customs) … having any control of, or power of disposition over the goods": s 4.
41 Reliance on the definition of "owner" in the Customs Act provides, however, a somewhat unstable basis for the Appellant's argument. If the concept of "control" in provisions such as s 30 of the Customs Act is to be treated as having its own special meaning, so, arguably, does the statutorily defined concept of "owner". The argument is further weakened by the apparent assumption of the drafter that a restricted definition is being given to the term "owner", which would include an officer of Customs, were such persons not expressly excluded.
42 The contention of the Appellant obtains some limited support from the legislative history. Although s 130.1 is restricted to property belonging to a Commonwealth entity, and thus envisages as an essential element of the offence an entity which is likely to be statutorily defined and regulated, the reports which gave rise to the Code contain no suggestion that the concept of control in the description of "belonging to" was adopted with any consideration other than general law principles in mind. Section 131.1 in its present form was introduced by the Criminal Code Amendment (Theft, Fraud, Bribery and Related Offences) Act 2000 (Cth). The revised explanatory memorandum for the Bill noted at par 56 that:
"One effect of the section is that co-owners or people with different rights to a piece of property can be guilty of theft from one another. For example, one owner of property can be guilty of theft from another owner (eg theft by one business partner from another), or an owner can be guilty of theft by taking his or her property away from someone who has possession or control of it (eg an owner who dishonestly took back his or her own goods from a pawnbroker). … The Commonwealth can co-own property with someone else - so this interpretative provision is as relevant to it as the Model Criminal Code provision upon which it is based (section 14.5)."
43 The reference to the Model Criminal Code provision is a reference to that contained in the "Final Report of the Model Criminal Code Officers Committee of the Standing Committee of Attorneys-General", released in December 1995. That Committee was not specifically concerned with theft from government entities and the discussion in chapter 3 of the Final Report, in relation to s 14.5, is broadly concerned with the meaning of "dishonesty" and in particular the test discussed by the UK Court of Appeal in Feely [1973] QB 530, as modified in Ghosh [1982] 3 WLR 110 at 118-119.
44 Reference was also made to the UK Court of Appeal decision in R v Woodman [1974] 2 All ER 955. The accused were charged with theft of scrap metal from a property occupied by a business known as English China Clays, which had sold the scrap metal to a third party. Part of the scrap metal was not removed, but English China Clays was not aware of its existence. It was that which was the subject of the theft. The Court accepted that the scrap metal had in fact been sold to the third party, but nevertheless upheld the conviction based on the fencing of the property by English China Clays, with a clear intention to exclude trespassers, and thus to control the scrap metal, although it neither retained a proprietary interest in it, nor knew of its existence. The scrap metal was found to "belong to" English China Clays, based on s 5(1) of the Theft Act 1968 (UK) which was in relevantly identical terms to the equivalent provisions of the Criminal Code. The case might be distinguished from the present on two bases: first, in the present case Customs had actual knowledge of a container with its contents on premises which it was able to control, but, on the other hand, the actual degree of physical control was apparently exercised by Patrick Stevedores. Woodman and other cases dealing with the relevant intention or state of knowledge of a person said to be in possession or control of goods provide limited assistance in the present case. The question really turns on whether Customs were exercising statutory control over the goods in circumstances where they knew of their presence, believed them to be in a secure environment and had provided no-one with authority to move the goods.
45 Control of moveable property for statutory purposes is a well-established statutory device. Apart from the Customs Act, it was found in the Fauna Conservation Act 1974 (Qld), which provided a scheme for licensing and regulating the taking of native fauna and provided that fauna taken otherwise than in accordance with the Act "is the property of the Crown and under the control of the Fauna Authority": s 7(1). The nature of the proprietary interest thus created in the Crown was discussed in Walden v Hensler (1987) 163 CLR 561 and again in Yanner v Eaton [1999] HCA 69; (1999) 201 CLR 351. The statutory vesting was designed in part as a basis for a claim for royalties which had not been paid. In Yanner, the Court was concerned with the effect of such a provision on native title rights and interests. The joint judgment (of Gleeson CJ, Gaudron, Kirby and Hayne JJ) contains the following comments on the concept of "property" in such circumstances.
"17 The word 'property' is often used to refer to something that belongs to another. But in the Fauna Act , as elsewhere in the law, 'property' does not refer to a thing; it is a description of a legal relationship with a thing. It refers to a degree of power that is recognised in law as power permissibly exercised over the thing. The concept of 'property' may be elusive. Usually it is treated as a 'bundle of rights'. But even this may have its limits as an analytical tool or accurate description, and it may be, as Professor Gray has said, that 'the ultimate fact about property is that it does not really exist: it is mere illusion'. Considering whether, or to what extent, there can be property in knowledge or information or property in human tissue may illustrate some of the difficulties in deciding what is meant by 'property' in a subject matter. …
18 Nevertheless, as Professor Gray also says, 'An extensive frame of reference is created by the notion that "property" consists primarily in control over access. Much of our false thinking about property stems from the residual perception that "property" is itself a thing or resource rather than a legally endorsed concentration of power over things and resources.'"
46 The importance of distinguishing between the concept of property as a physical object and as a term used "to denote the legal interest (or aggregate of legal relations) appertaining to such physical object" was emphasised by Gummow J at [85]-[86], quoting Professor Hohfeld.
47 It is quite possible that a statutory regime may regulate the rights of owners with respect to moveable property without extinguishing their rights in relation to the property, or indeed conferring on a government officer any right of control over the physical object. On the other hand, a statutory scheme may take the further step of conferring a right of control on a government officer. In the latter case it is at least possible that, because property consists primarily in control over the moveable object, the government or relevant government agency thereby acquires a right akin to the right of an owner, within the sphere of protected interests, which can be dishonestly appropriated.
48 Owners may have rights to use and deal with goods as they wish; to prevent others, without their consent, from interfering or dealing with the goods, and to transfer those rights or powers to third parties, whether for valuable consideration of otherwise. None of these rights is necessarily an essential element of ownership of the goods, but each may be a protected interest. For example, an interest in goods need not necessarily be susceptible of transfer or assignment: see Yanner at [85] (Gummow J). Nor does an owner cease to have any interest in the goods because they are with a bailee who has an exclusive right to possession, at least for a period. On the other hand, there is no necessary reason why the law should not protect an exclusively restrictive right, namely the right to prevent any other person, including the person having custody or possession of the goods from time to time, from moving or using the goods in any way. It is a right of the last kind which constitutes part of the control conferred on Customs by the Customs Act.
49 Each statutory scheme must be construed in its own terms. The Appellant sought to rely upon the early authority of Hedberg v Woodhall (1913) 15 CLR 531 for the proposition that the words "have in his possession or control", in relation to any fish below a certain size, in the Fisheries Act 1889 (Tas), supported the view that such a phrase involved only the single concept of physical control. No doubt in that context it did, so that an information laid in those terms was not duplicitous or uncertain, but that provides little assistance in the present legislative context. Nevertheless, the Appellant argued that in truth possession and control were to be treated as a common element and noted the comment of Mason J in Kitano v The Commonwealth (1973) 129 CLR 151 at 170 that "[g]oods subject to the control of Customs are not as such in the possession of the Customs (see s 35A)".
50 Kitano involved a dispute between two men, each of whom claimed possession of a yacht. Prior to obtaining a "certificate of clearance" from Customs, the yacht was subject to the control of Customs and could not leave Australia. Customs issued a certificate of clearance to Mr Matsushita who promptly sailed the yacht away. Mr Kitano claimed that the certificate had been wrongly issued and, as a result, there had been a conversion by Mr Matsushita of goods which were subject to the control of Customs. The Commonwealth was thus said to have converted the yacht and the goods on board. The circumstances in which the yacht came to be subject to the control of Customs were curious, as his Honour noted at pp 169-170. In any event, as a matter of fact, it was not suggested that Customs had immediate possession or physical control of the yacht, although its departure without a certificate of clearance, would have rendered the master liable to an offence under s 118.
51 There are other circumstances in which goods legally subject to the control of Customs are not in any physical sense within that control. As noted by Kitto J in Collector of Customs (Vic) v Wilh Wilhelmsen Agency Pty Ltd (1956) 102 CLR 147 at 156-157, the Act contemplates that goods which no longer exist, are missing, or have never entered Australian waters, but which are contained in a report of a ship's cargo may be within the control of Customs, under the Customs Act, for the purpose of rendering the shipper liable for duty.
52 Collector of Customs (NSW) v Southern Shipping Co Ltd (1962) 107 CLR 279 dealt with goods which were "subject to the control of the Customs" but which were in the "possession, custody or control" of another person, that person being the defendant shipping company which was in an analogous position to that of Patrick Stevedores in the present case. The goods having been stolen from the wharf, the question was whether the shipping company was liable for duty payable on the goods pursuant to s 60 of the Excise Act 1901 (Cth). Not only did the statutory control of Customs not relieve the shipping company of its liability as the party with possession, custody or control of the goods, but neither did the lodging of the key to the warehouse in the Customs office. However, because it is clear that more than one party may have possession or control over goods at a particular time, statutory provisions imposing liability for duty are of limited assistance in this context.
53 Reference was also made in the course of the hearing to a number of judgments in the matter of Goben Pty Ltd v Chief Executive Officer of Customs in the Federal Court of Australia. In the first reported decision, Beazley J considered whether s 58 of the Business Franchise Licences (Tobacco) Act 1987 (NSW), under which a State officer purported to take the tobacco into the custody of the Chief Commissioner was invalid because inconsistent with goods to which ss 30, 33 and 153 of the Customs Act applied. Her Honour held that there was no necessary inconsistency because the State law permitting tobacco to be "taken and kept in custody by the Chief Commissioner" did not require that there be a physical taking or movement of the goods: Goben Pty Ltd v Chief Executive Officer of Customs (1996) 65 FCR 180 at 189. Her Honour stated:
"The taking and keeping in custody can be effected by the identification of the goods with a direction to the then holder of the goods that they are not to be interfered with. Such a taking and keeping in custody of the goods is not inconsistent with any control of Customs. Customs continues to regulate what can be done physically with the goods whilst so ever they are subject to its control."