R v Alex

[2023] NSWSC 180

Supreme Court of NSW|2023-03-02|Before: Fagan J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2023-03-02

Before

Fagan J

Source

Original judgment source is linked above.

Judgment (13 paragraphs)

[1]

Solicitors: Solicitor for the Commonwealth DPP Matouk Joyner Lawyers - Accused George Alex Birchgrove Legal - Accused Kirschberg McGirr & Associates - Accused McAndrew Kingston Fox - Accused Loccisano Nyman Gibson Miralis - Accused Bryers Matouk Joyner Lawyers - Accused Arthur Alex File Number(s): 2020/216740; 2020/213439; 2020/210570; 2020/212593; 2020/210541; 2020/210516

[2]

Judgment

These are the Court's reasons for vacating the trial of six accused on two charges, one count of conspiring to cause loss to the Commonwealth dishonestly and one count of conspiring to deal with proceeds of crime. The accused are George ALEX, Lindsay KIRSCHBERG, Gordon McANDREW, Pasquale LOCCISANO, Mark BRYERS, and Arthur ALEX. The charges arise from alleged defrauding of the Commonwealth in the 2019, 2020 and 2021 financial years, by causing several corporations not to remit to the Australian Taxation Office ("ATO") approximately $14.67 million of PAYG withholding tax and approximately $4.92 million of net GST collected. On 2 March 2023 the Crown notified the Court and all accused that it no longer contends that evasion of GST was an object of the first conspiracy
The principal dates in the history of the criminal proceedings are as follows: 21 July 2020 Charges laid. 7 December 2021 Order of the Local Court for committal to this Court for trial. 9 February 2022 Indictment filed. 4 March 2022 Proceedings on the indictment allocated to Fagan J and first listed for directions; trial fixed to commence on 23 January 2023. 31 October 2022 Trial date of 23 January 2023 vacated on the application of the Crown; trial re-fixed to commence 3 April 2023. 7 February 2023 Crown sought listing of the proceedings to locate the trial date of 3 April 2023 and to refix for 8 May 2023 14/15 February 2023 Hearing of the Crown's further application to defer the trial.

[3]

4 March 2022 - trial fixed 11 months in advance

When the indictment was filed on 9 February 2022 there were 11 accused, one of whom has since died. The charges against four more of the original accused have been severed from the indictment and remitted to the District Court. At the first directions hearing on 4 March 2022, Mark BRYERS was self-represented and the other accused were represented by solicitors, who for the most part had limited funding and limited instructions. Defence counsel had not been briefed. At that time the Crown estimated that the trial would occupy up to 7 months. It was fixed for 23 January 2023.
The reasons for setting a trial date 11 months ahead, as stated at the time, were: 1. to provide the Court, well in advance, with certainty as to the date from which it would be necessary to make a trial judge available for such a long matter and to reserve a courtroom with capacity for 11 accused (4.03.22, T 1.50, 3.29-3.40, 4.25); 2. to have the trial commence at the beginning of term in 2023, in order to ensure completion within the year, allowing for possible prolongation (4.03.22, T 3.1); 3. to allow time for the accused to engage legal representatives, with sufficient notice for them to commit themselves for a trial of such length and to set aside adequate preparation time (4.03.22, T 4.40, 7.20); 4. to allow the Crown a sufficient period within which to prepare its own case for trial (4.03.22, T 3.14-3.45).
The Crown sought that the trial not be set down before 1 March 2023, to accommodate senior counsel who would be unavailable throughout 2022 and "would require some time at the beginning of 2023 to be prepared". The Court's position was that it would be unworkable for the Crown to depend upon senior counsel who would be unavailable during 2022, when substantial preparation of a case of this magnitude would have to be undertaken.
Hundreds of thousands of pages of documentary evidence had been served on the accused during the committal stage of the prosecution. The two principal aspects of readiness for trial are, first, notification by the Crown to the accused of the parts of large volume of served material that will be tendered and, secondly, review by defence counsel of the nominated documentary evidence and taking instructions thereon. The Crown indicated that it could particularise its evidence by way of Notice of Prosecution Case by 15 August 2022. That time frame should also have been adequate for the accused to brief counsel, so that defence lawyers would have more than six months within which to prepare. The alternative of not fixing a date until after service of the Notice of Prosecution Case assessment of it by defence counsel would have meant that the trial could not be conducted before 2024.
On 4 March 2022 the proceedings were stood over to 11 April 2022 for arraignment of the accused. The one month adjournment was for the explicit purpose "that there be some significant advance in the meantime in the Crown's decisions about how the case is to be presented" (T 5.22). On 11 April 2022 the six accused who are still to be tried in this Court were arraigned and pleaded not guilty.

[4]

August 2022 - partial notification of Crown tender

On 11 April 2022 the Crown provided the Court with statistics about the evidence it proposed to adduce, in a list handed up on that day supplemented with information provided from the bar table. to the following effect: Intercepted conversations: 156 hours of audio, accompanied by 8,132 pages of transcript. - still being reviewed for proposed further reductions. Estimated to require 34 sitting days at 4.5 hours per day to replay to the jury. Banking, ASIC and ATO records: more than 8000 documents proposed to be summarised into schedules which would be either agreed or tendered under s 50 of the Evidence Act. Witnesses: 71 to be called to give oral evidence, with an estimate of 7 weeks for evidence in chief, on the assumption that continuity of exhibits and authenticity of documents would not need to be proved strictly.
On 15 August 2022 the Crown served its Notice of Prosecution Case. Attached schedules listed the intercepted phone conversations and documents that the Crown proposed to adduce at trial, as follows: Sch E Intercepted conversations: approximately 960 items. Sch F1 Banking, ASIC and ATO records combined: approximately 840 items. Sch F2 SMS text messages: 214 items Sch F3 Emails and attachments: approximately 1,450 items. Sch F4 "All other documents": approximately 1,914 items.
At about the time of serving the Notice of Prosecution Case the Crown also served summaries of the content of some classes of material and invited the accused to agree the facts set out therein. The classes of documents summarised were: ASIC records: a 38 page summary. Banking records: 96 summaries in the form of "reconstructed bank accounts".
The Notice of Prosecution Case informed the accused that the Crown intended "to prepare and serve additional documents of this nature" summarising extensive documentary evidence in the following categories: Bank account opening information. ATO records of interactions with the accused, their associates and entities. Travel movements of the accused and associates. Communications relied upon by the Crown, including date, time and parties for SMS text messages, emails and voice communications. In the event, as will be seen, summaries of data in the above four categories were not served on the accused until 3 February 2023.
On 26 August 2022 a directions hearing was convened at the instigation of the Court for the purpose of receiving an update on the Crown's selection of the evidence to be adduced in its case. The Crown then advised that the intercepted conversations in Schedule E are transcribed on 6,500 pages and comprise 124 hours of audio, requiring approximately 30 sitting days for replay to the jury.

[6]

31 October 2022 - Crown application to vacate January 2023 trial date

On 20 October 2022 the Crown filed a notice of motion seeking that the trial listed for 23 January 2023 be vacated and be re-fixed to commence no earlier than 3 April 2023. The solicitor with carriage of the case in the office of the Commonwealth Director of Public Prosecutions deposed to a list of Crown evidence that had been specified to the accused, substantially unchanged from Schedules E to F4 in the Notice of Prosecution Case, with the additional information that had been conveyed to the Court on 26 August 2022: see [10]-[13] above.
The solicitor deposed that, as at 20 October 2022, summaries under s 50 Evidence Act 1995 (NSW) in the following categories were being prepared and that the consent of the accused would be sought for tender of the summaries once they had been served: ATO records. Flight records and travel movements. Mobile phone account subscription and usage information. SMS text messages. Executions of search warrants, including data concerning premises searched, occupants, officers present and so on.
On 31 October 2022 counsel for the Crown said that deferral of the trial for nine weeks to 3 April 2023 was intended (a) to give the accused sufficient time to engage legal representatives and to have them prepare the case, on the basis that the accused had only received funds for this purpose on 25 October and (b) to allow for engagement between the Crown and the defence legal representatives to try to agree upon shortening the proof of non-contentious facts (31.10.2022, T 9.30-.34). Each of the accused consented to vacation of the trial date of 23 January 2023. I acceded to the application because the accused, having only recently received legal assistance, would need more than the 10 weeks from 31 October 2022 until 23 January 2023 within which to prepare, on the basis of the Crown evidence that had thus far been identified. The speculative possibility of agreement being reached upon means of shortening the trial apparently rested upon the Crown's intention to serve further Evidence Act summaries and to seek the accused's consent to their tender.
Counsel for the Crown accepted that, with reasonable allowance for prolongation and to conclude within the year, a new trial date could not be fixed any later than 3 April 2023 (31.10.2022, T 10.1-.21). The accused submitted that the additional nine weeks for preparation would be insufficient and opposed the trial being set down for 3 April 2023. On the information received from the Crown to that point it appeared to me that deferral of the trial by nine weeks, allowing a total of 4½ months for defence preparation, would be sufficient.

[8]

3 February 2023 - additional Crown material served

On 3 February 2023 the Crown served on the accused six summaries under s 50 of the Evidence Act, summarising a very large amount of data from thousands of pages of primary evidence. The summaries were concerned with the following subjects, some of which had been foreshadowed on 9 December 2022 (see [20] above): 1 Execution of search warrants: 21 pages summarising searches at 28 separate premises plus data concerning interception warrants on 5 mobile phone services and surveillance device warrants for 3 premises. 2 Bank account details: 24 pages summarising account opening and operation and authorised signatory details for approximately 100 accounts in the names of 36 companies and 14 individuals. 3 Mobile phone service account details: 11 pages summarising subscriber names, usernames and periods of service for 45 phone numbers attributed to 34 individuals, being the accused and their associates. 4 ATO records: 84 pages summarising documents filed with the ATO, notices issued by the ATO, registrations, assessments, audits and correspondence, concerning each of 46 corporations. 5 Flight records: 17 pages summarising domestic and international travel movements of the accused and their associates. 6 ASIC records: 38 pages summarising dates of incorporation, officeholders, shareholders, registered office particulars and external administration events for each of 58 corporations. 7 Funds flow charts: 24 A3 charts of funds flows between corporations and individuals, the first chart relating to a period of three months in 2018 and each of the other charts relating to a single month between October 2018 and July 2020 inclusive. Each chart depicts approximately 60 to 100 individual banking transactions between a web of corporations and individuals. 8 Communications spreadsheet: 248 A3 pages of an Excel spreadsheet listing the date, time and parties for each of 3,832 communications. Where the communication was an email or SMS text message, the content is included. Where the communication was a voice call, only the date, time and parties are listed, with the content to be found separately in the 124 hours of audio recordings, transcribed on 6,500 pages of transcript.
Significant extra preparatory work arises from the service of those summaries three months after the re-fixing of the trial date for 3 April 2023. The allowance of 14 days for defence response, up to 17 February 2023, as had been directed on 9 December at the Crown's suggestion, was manifestly inadequate. First, the accused will have to determine whether the documents should be objected to in any respect, or contradicted by other evidence, on grounds of inaccuracy. Many thousands of facts are summarised. The task of checking is assisted by the inclusion on the summaries of hyperlinks to source documents. Some, or all of the accused may be able instruct their advisers as to the accuracy of large parts of the summaries from memory, based upon their involvement in the events referred to. Some accused may conclude that many facts in the summaries are inconsequential and need not be checked at all. Even making those allowances the verification task will be time consuming.
The Crown submits that the 3 February 2023 summaries are "anodyne". That may be true of items 1, 2, 3, 5 and 6 but even with respect to those summaries counsel could not advise their clients about consenting to tender without some examination of accuracy and some consideration of the relevance of the summarised facts to proof of the charges.
The funds flow charts (item 7 at [22] above) were prepared by a forensic accountant. They purport to identify in the order of 2,000 transactions. The defence may well require their own forensic accountant to assist in verifying or disputing what is summarised on the documents. The charts were served in an early version in May 2021 and in a revised version on 25 June 2021. They were re-served on subsequent occasions, the last being 25 August 2022. It does not appear that they would have come to the attention of defence counsel as a proposed tender under s 50 of the Evidence Act, thereby requiring critical consideration, until 3 February 2023.
Secondly, some of the summaries contain data that, assuming it accurately reflects source documents, requires careful consideration as to admissibility. That is particularly so with respect to the ATO records (item 4 at [22] above). The Crown has summarised in that schedule thousands of facts concerning communications between the ATO and 46 corporations. Until Crown counsel has opened the prosecution case, as I will require him to do at the commencement of the pre-trial hearing on admissibility, it will not be possible to foresee how many of the summarised facts are relevant to any real issue in the case.
Many entries on the schedule record conclusions of ATO officers regarding shortfalls in reporting and remittance of PAYG Withholding and GST net positions. It is not clear at present how the ATO's formation of such conclusions will be relevant. Having regard to the alleged object of the conspiracies as charged, the material facts would appear to be the amounts of PAYG Withholding and net GST that were payable and the shortfall in the amount, if any that was remitted. It would seem to be a central part of the Crown's proof to establish those figures for each period in respect of which the employer company was obliged to lodge a Business Activity Statement ("BAS") and remit PAYG withholding tax. The BAS and remittance cycle may have been weekly, monthly, quarterly or annually, depending upon the company - it is not clear from the Crown Case Statement. The central fact of shortfall in required periodic remittances could not be proved by evidence that the ATO made an assessment after audit, or arrived at an estimate, without the auditor or estimator being called to prove the underlying facts concerning wages paid, from which the amounts due to the Commissioner would be a matter of calculation.

[9]

14 February 2023 - Crown application for further deferral of trial

On 7 February 2023 the Crown gave notice to the Court and the accused of an application for orders to the following effect: 1. the date of 17 February 2023, by which the accused had been directed to notify all objections to the intercepted conversations (and transcripts) and to the Crown's proposed Evidence Act summaries, should also be the time limit for objections to the summaries served only two weeks earlier; 2. there be a pre-trial hearing of the defence objections to that material on 2 and 3 March 2023; 3. an extension of time from 3 February to 1 March 2023 for the Crown to serve an index of its proposed tender bundle, which would identify 3,958 documents comprising approximately 12,000 pages (presumably drawn from Schedules F3 and F4 of the Notice of Prosecution Case); 4. by 17 March 2023 the accused notify all objections to the tender bundle index; 5. there be a pre-trial hearing of the defence objections to the tender bundle index in the week of 3 April 2023; 6. deferral of the commencement of the trial for five weeks, to 8 May 2023.
On hearing the Crown's application on 14 and 15 February 2023 I accepted the submissions of all defence counsel that they could not finalise by 17 February all objections to the intercepted conversations (and transcripts, now said to run to 7,800 pages) and to the Crown's proposed documentary tender, as notified up to and including the schedules served on 3 February 2023. I accepted that they could not be in a position to argue such objections by 2 or 3 March 2023, as ordered on 9 December 2022. All accused acknowledged that the Crown's selection of intercepted conversations, from a larger bulk, had been identified since August 2022 but in mid-February 2023 counsel were still reviewing the transcripts. That element of the Crown's evidence understandably remains the central focus of defence preparation.
Reviewing and taking instructions upon such a large body of intercepted conversations is obviously very time-consuming. Initial delay in tackling it was caused by the Commonwealth Attorney General's Department resisting the provision of legal assistance over many months during 2022. Distraction of the defence lawyers with the task of now reviewing the recently served Evidence Act summaries and a large index of sundry tender documents is a significant further impediment to the core task. The Crown appears to have assumed that because the schedules of 3 February 2023 are intended as a means of abridging proof and shortening the trial, service of them relatively close to the proposed hearing date would not cause disruption. This fails to recognise the significant pre-trial work that is required of defence counsel in relation to such documents before they could specify any objections or indicate consent to tender.
The Crown informed the Court on 15 February 2023 that, in addition to the tender bundle index of 3,958 documents, there is yet another part of its documentary case of which notice in specific terms has not yet been given to the accused. This is to consist of "individual benefit schedules" summarising, under the Evidence Act, the flow of funds from corporate bank accounts, that were used in furtherance of the conspiracy, to individual alleged conspirators.
The timetable proposed by the Crown on 7 February 2023 would have been unachievable for the accused and, if ordered, would have been grossly unfair. The accused were prepared to accept 10 March 2023 for serving their objections to the intercepted phone conversations (and transcripts) and to the Evidence Act summaries that had been served up to 3 February, with the qualification that they would use best endeavours to comply with that time limit. As a consequence of having to allow the accused until 10 March 2023 to nominate their objections, with time allowed for a Crown response a pre-trial hearing of those objections could not take place before the week of 3 April. In those circumstances, on 15 February 2023 the Crown sought, and I allowed, up to 6 March for the service of its tender bundle index and up to 24 March for the accused to notify objections thereto. The objections to the tender bundle would also have to be argued on or after 3 April 2023 and the trial could therefore not proceed on that appointed date.

[10]

Electronic presentation of evidence

In an affidavit sworn on 7 February 2023, a solicitor who is engaged upon preparation of the Crown case deposed that it was the Crown's intention to load electronic images of all its documents for tender onto iPads, which would be provided to the jurors at the commencement of the trial. The solicitor deposed as follows: 18 The CDPP does not have options for any other e-trial solution for this matter given its breadth, other than [as above described] involving evidence being preloaded onto juror iPads prior to the commencement of the trial. 20 If the trial is to proceed in [this way] with the tender bundle [apparently, referring to all documentary evidence] loaded onto iPads, it will not be possible to determine objections to material on the iPads on an ongoing basis throughout the trial. To ensure that the jury is not given access to material that is not in evidence, objections must be resolved prior to the iPads being loaded.
The solicitor deposed that the Crown would require approximately one month after all rulings on objections had been made, within which to edit its documents in accordance with the rulings and to load the documents. That was the basis of the Crown seeking to defer empanelment of the jury until 8 May 2023, five weeks after the proposed pre-trial hearing of objections in the first week of April.
This proposed manner of providing documentary evidence to the jury is unacceptable to the Court in this proceeding. First, having regard to the very large scale of the Crown's documentary case, it would be unwise to allow the whole of it to be in the jury's hands from the outset. Documents that may appear relevant and admissible from the present perspective may turn out to be irrelevant and prejudicial in light of a better understanding of the case after the opening statements of counsel, or in light of oral evidence adduced, or as a result of significant unforeseen developments in the course of the trial. Provision of everything to the jury at the beginning of such a long and document-heavy case would run the risk of a discharge if it should later transpire that the jury had received evidence that should not have been admitted.
Secondly, it is not appropriate that jurors should have all documentary evidence from the beginning of the trial and be free to browse through it prior to the documents being tendered, in the sequence chosen by the Crown. Sequential tender would likely be accompanied by explanation from the witnesses through whom the documents would be introduced and any necessary statement of limitation and/or warning regarding the use that may be made of the evidence, either from the prosecutor or the trial judge.
Thirdly, when the accused have notified their objections to the Crown's proposed documentary evidence, it will be a matter for the trial judge's discretion whether to make a pre-trial ruling or to defer doing so until after counsel have made opening statements to the jury and, possibly, until other evidence has been tendered and/or some of the oral evidence has been called. It is often appropriate to defer rulings until the trial has progressed some way, in order that context may inform the decision. That is particularly so with respect to objections that turn upon discretionary considerations, such as the importance of the evidence that is the subject of objection in light of other proof in the case. The exercise of discretion about whether to make pre-trial rulings should not be subordinated to the exigencies of courtroom technology that the Crown has chosen to deploy.
For these reasons, the Crown will have to find a means of presenting its documents to the jury that does not depend upon complete and irrevocable pre-trial rulings on objections. It may be possible to install a computer in the courtroom, with monitors for each of the jurors and other participants, through which tendered documents may be added to a database as the trial progresses. The Crown's commitment to the use of preloaded iPads, with the inflexibility described in the solicitor's affidavit, is surprising in view of the following exchange on 11 April 2022: CROWN COUNSEL: [This] is intended to be, given the nature of the matter, an electronic trial and electronic copies provided to a jury and everyone being capable of navigating the material electronically […]. HIS HONOUR: I don't know that the Crown can really insist upon that. That will be a matter for my determination CROWN COUNSEL: Yes, your Honour. HIS HONOUR: It's another of the many reasons for me wanting to see everything in the final form as to be presented to the jury as quickly as possible. CROWN COUNSEL: Yes. […] HIS HONOUR: […] One of the dangers of having everything done electronically is that everything that you have on a USB just gets bundled across to the tribunal [of fact] without thought to how much is really digestible by a jury of 12 laymen. So the decision about how the evidence may be presented to the jury is yet to be made and will be made in light of how the totality of evidence ultimately looks. Therefore, applications such as this at the present shouldn't be dealt with on the assumption that this will be a fully electronic trial.
After it became clear from the Notice of Prosecution Case that the Crown would tender a very large volume of documents, the Court has recognised that electronic presentation to the jury in some form and to some extent would be appropriate. It was not suggested until February of this year that the only "e-trial solution" available to the Crown would be the inflexible one described in the solicitor's affidavit, requiring complete and final rulings on the admissibility of all documents before commencement of the trial. During the hearing on 15 February 2023 the Crown accepted that time constraints would preclude the use of fully preloaded iPads if the trial were to be re-fixed for 8 May 2023, as sought by the Crown. No alternative technology was proposed.

[12]

Determination

I am satisfied that the trial cannot reasonably be refixed for 8 May 2023 having regard to the following considerations: 1. the recent service by the Crown of very substantial additional Evidence Act summaries and the proposed service of a large index of yet further documentary evidence; 2. the incomplete review of the intercepted conversations (and transcripts) by most of the accused; 3. the necessity to postpone pre-trial arguments on admissibility until at the earliest the week of 3 April 2023, with no information as to the likely extent of the accused's objections and no basis for estimating how much hearing time or reserved decision time may be required to resolve the objections; 4. the Crown's inability to commence the trial immediately upon resolution of objections and its requirement of an indeterminate further period, possibly as long as a month, to reorganise its documentary tender around any objections that might be upheld; 5. the Crown's lack of any current proposal for electronic presentation of its very large documentary case, using a system that would have functionality and flexibility compatible with trial by jury on this indictment; 6. the necessity to issue jury summonses immediately in order to give adequate notice to the large jury panel that would be required for 8 May, with the high risk that the trial would not actually be ready on that day and that the summonses would again have to be cancelled and 7. the fact that an 8 May commencement would likely result in the trial continuing through the December/January public holiday period, creating difficulty for Court staffing and probably attracting a large number of applications to be excused by jurors for whom this would be a significant burden.
For all of the above reasons, directions were made on 15 February 2023 for the accused to use their best endeavours to notify objections to the intercepted conversations (and transcripts) and to the Crown's documentary evidence during March. The pre-trial hearing of those objections was listed for the week commencing 3 April, to continue in the following week as necessary. On 20 February 2023 I ordered that the trial fixed for 3 April 2023 be vacated and the Sheriff was notified to cancel the panel summonsed for that day.
On 2 March 2023 the proceedings were again listed before me at the request of the accused George ALEX. In the course of hearing that day all parties submitted that it would not be possible to comply with the directions made on 15 February 2023, which were designed to enable a hearing of pre-trial objections to Crown evidence during the first two weeks that had previously been reserved for the trial, from 3 April 2023. A fresh timetable was ordered, extending out to 30 June 2023. The proceedings have been tentatively listed for two weeks commencing on 17 July 2023, to determine defence objections to the Crown's proposed tender. That date will be adjusted by the Court as necessary to accommodate the listing of other cases before me in the meantime.
In view of the timeframe of the directions made by consent on 2 March 2023, the Court has notified the parties that it does not intend to set a new date for the trial of the accused on these charges until: 1. any objections by the accused to the Crown's intercepted conversations (and transcripts), s 50 Evidence Act schedules and other documents have been notified to the Crown and heard and determined to the extent that the trial judge considers it necessary to determine them prior to empowerment of a jury; 2. the manner in which the Crown's evidence is to be provided to the jury, including any electronic presentation, has been determined and accepted by the trial judge; 3. the trial judge is satisfied that the case is in all respects ready to proceed.
The earliest date on which the trial could be set down is the commencement of the new term in 2024.

R v Alex

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Judgment (13 paragraphs)

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