R v Dougas; R v Read; R v Linke; R v Casamento; R v Counihan [2021] NSWSC 682 | Case summary

R v Dougas; R v Read; R v Linke; R v Casamento; R v Counihan [2021] NSWSC 682 | Case summary | Zoe

[3]

Introduction

On 5 November 2020, the Crown filed an indictment which charged the five accused as being parties to one of two conspiracies (or in the case of Geoffrey Linke, both) to provide a bribe to a foreign public official as follows: 1. between about 1 January 2000 and 30 June 2005, Paul Dougas, Mark Read and Mr Linke, in Sydney, the Republic of the Philippines and elsewhere, did conspire with each other, Lyndsay Chapple, Mohit Kumar and Yolanda Fernandez and various others to provide a benefit to another person with the intention of influencing a foreign public official in the Philippines in the exercise of the official's duties as a foreign public official in order to obtain or retain business (the Philippines conspiracy); and 2. between about 1 December 2006 and about 20 June 2012, Mr Linke, Paul Casamento and Andrew Counihan, in Sydney, the Socialist Republic of Vietnam and elsewhere, did conspire with each other, Lyndsay Chapple, Adam Carey, Mohit Kumar and Nguyen Ngoc Thang and various others to provide a benefit to another person with the intention of influencing a foreign public official in Vietnam in the exercise of the official's duties as a foreign public official in order to obtain or retain business (the Vietnam conspiracy).
As can be seen from the indictment, Mr Dougas, Mr Read and Mr Linke are charged with being parties to the Philippines conspiracy and Mr Linke, Mr Casamento and Mr Counihan are charged with being parties to the Vietnam conspiracy. The time between the end of the Philippines conspiracy and the Vietnam conspiracy is approximately 17 months.
By notices of motion filed in late January and February 2021, each of the accused sought an order pursuant to s 21(2) of the Criminal Procedure Act 1986 (NSW) (the Act) that counts 1 and 2 be tried separately (the severance applications). At the conclusion of the hearing on 8 June 2021, I made the order sought by the accused that counts 1 and 2 be severed and tried separately. What follows are my reasons for making this order.
All references in these reasons to legislation are references to the Criminal Procedure Act, unless otherwise stated.

[7]

Mr Dougas

The Crown alleges that Mr Dougas, who was Chief Executive Officer of the company during the relevant period, agreed to and approved the payment of bribes to Filipino public officials. The Crown also alleges that he established the initial framework within which bribes would be paid. The Philippines conspiracy is based on two conversations (in 2000 or 2001 at an unspecified place and time) between Mr Dougas and Mr Chapple, during which the agreement which constituted the conspiracy was reached.
The heart of the prosecution case against Mr Dougas appears from the following paragraphs of the Crown Case Statement: "20. In about early 2000, Chapple met with the CEO of SKM Dougas and explained to him that in order to obtain loan project work within the Philippines that it would be necessary to pay bribes to Filipino public officials involved in the tender approval process of Filipino infrastructure projects. Dougas approved of the payment of bribes by SKM so long as three conditions were met: a. the 'circle of knowledge' (i.e. those aware of the bribes) was kept to an absolute minimum; b. not to pay anything until after the bid was won; and c. payments should not be made by SKM directly, but through an auditable invoice; Dougas also told Chapple that approval for payments should come from Read not himself. [numbering not sequential; paragraphs 21-24 do not appear in original.] 25. In another conversation Dougas said to Chapple words to the effect of: 'Making illegitimate payments is not illegal if it is paid only after a contract has been won and in order to thank the government officials for their assistance.' 26. During the implementation of the Philippines Conspiracy, bribes were referred to, particularly in written material, using terms related to marketing expenses such as: external marketing costs, marketing development fees, marketing fees, and marketing representation."
The Crown relies on these conversations, together with emails subsequently sent by or to Mr Dougas, dated 8 May 2001, 9 May 2001, 19 June 2001 and 10 July 2002, to prove the conspiracy and Mr Dougas's role in it. The penultimate overt act in which Mr Dougas was said to be involved occurred on 31 October 2003 when Mr Dougas sent an email to Mr Read. The final overt act in which Mr Dougas is alleged to have been involved occurred sometime later, on 13 May 2005, when it is said that he met with Mark Clarke and Mr Kumar in Kuala Lumpur and advised them of his "policy" with respect to "marketing fees".

[10]

The Vietnam conspiracy

Mr Counihan, Mr Casamento and Mr Linke are charged with the Vietnam conspiracy. Mr Chapple, Mr Kumar, Mr Carey and Mr Thang are alleged to have been parties to the Vietnam conspiracy but have not been charged. Mr Chapple is also to be called as a witness to prove the Vietnamese conspiracy. The Crown alleges that the Vietnam conspiracy lasted for five and a half years from 1 December 2006 until 20 June 2012.
The Crown alleged that there was a degree of pre-planning in that budgets were drafted and revised to conceal the alleged bribes within different line items in spreadsheets. The method which the Crown alleged was used to effect the payment of bribes pursuant to the Vietnam conspiracy was that invoices were issued by and paid to one of four different companies associated with Mr Thang, or to Mr Thang himself. The amounts were referred to as "project management" or "logistic" costs and were variously invoiced as "study tours", "training services" and "success fees". The Crown alleges that a total amount of $285,623.52 was paid in bribes pursuant to the Vietnam conspiracy over a period of approximately two and a half years from 19 June 2009 to 16 December 2011. Unlike the other parties to the conspiracy, Mr Thang was not alleged to be an employee of the company; rather, he was alleged to be an "in-country agent" for the company. Payments made allegedly in pursuance of the Vietnam conspiracy were made both before and after contracts were awarded to the company.
It can be seen from this summary of the Vietnam conspiracy that there are similarities and differences between the methodology used by the alleged parties to the Vietnam conspiracy when compared with the methodology used by the alleged parties to the Philippines conspiracy.
It was common ground that there were fewer documents which were relevant to the proof of count 1 than which were relevant to proof of count 2 (disregarding for present purposes the prospect of cross-admissibility) and that, if the counts were severed, the trial relating to the Philippines conspiracy would be likely to be shorter than that relating to the Vietnam conspiracy. The documents to be tendered in support of the Vietnam conspiracy include emails from which the Crown will submit an inference can be drawn that invoices or budgets were fabricated and agreements were backdated to conceal the payments of bribes.

[13]

Mr Counihan

The Crown alleges that Mr Counihan became a party to the Vietnam conspiracy. By letter dated 13 May 2021, the Crown answered a request for particulars as to the location and date of Mr Counihan's alleged entry into the Vietnam conspiracy as follows: "[T]he Crown does not rely upon a particular location or a particular date to prove Mr Counihan's entry into the Vietnam conspiracy. The Crown alleges that Mr Counihan entered into the conspiracy with one or more of the co-conspirators named in the indictment."
The Crown relies on Mr Counihan's position from 2007 until 2011 as a consultant to SODA, based in Kuala Lumpur, who reported to Mr Chapple and Mr Kumar. The Crown also relies on his position as Acting Business Manager of SODA from 25 September 2011. The Crown alleges that Mr Counihan created documents, including budget spreadsheets, which represented the bribes as legitimate business expenses; authorised the payment of auditable invoices which were created to hide the bribes when the amount of the invoices was within his delegated authority; and arranged for the bribes to be paid by Mr Carey when they exceeded his delegated authority. The Crown also alleges that he negotiated with Mr Thang about the amount and timing of the payment of bribes.
The overt acts relied on by the Crown which are said to involve Mr Counihan are as follows: an email dated 16 June 2009 sent by Mr Counihan to Mr Chapple advising him of the company's failure to win the contract on stage 1 of the Da Nang project and that Mr Thang would be meeting a public official concerning the company's bid for stage 2 of the Da Nang project; emails sent on 28 August 2009 by Mr Counihan to Mr Chapple and Mr Thang regarding an invoice for, and payment of, USD$15,000 said to amount to bribes for Vietnamese public officials in relation to the Thanh Hoa and Da Nang projects; and an email dated 16 September 2009 from Mr Chapple to Mr Counihan concerning negotiations for bribes in respect of the Thanh Hoa project. The Crown also relies on the following overt acts in 2010: the creation by Mr Counihan of two draft budgets for the Hai Phong Roads project (one of which revealed and the other which concealed the bribes to be paid) which he emailed to Mr Carey on 12 October 2010 and which were the subject of a return email from Mr Carey on the same day. The Crown relies on further budgets prepared and discussed in 2011 for stage 3 of the Da Nang project and Mr Counihan's involvement in invoices to be rendered for amounts the Crown alleges were for bribes. The Crown also relies on a budget prepared for the company's bid for the Northern Mountains project.
The evidence of Mr Chapple at committal was that Mr Counihan's role was "largely clerical" as he was not the person who initiated, approved or was responsible for the company agreeing to the payments.

[15]

The requirement for the Crown to identify the evidence that was said to be cross-admissible and the basis for its cross-admissibility

On 4 March 2021, the matter came before me for directions following the filing of the notices of motion for severance of counts 1 and 2 on behalf of each of the accused. In the course of the hearing, Mr Boulten SC, who appeared with Mr Gullaci for Mr Read, raised the desirability of all accused knowing, before they made submissions on severance, how the Crown says that the evidence in support of count 1 would be relevant to count 2 and vice versa, given the absence of a tendency or coincidence notice. Mr Boulten submitted that the cross-admissibility of such evidence was "at the heart of the severance application" and that if the Crown identified the evidence which was said to be cross-admissible, the accused could "craft" their submissions "much more relevantly and pithily". All accused agreed with Mr Boulten's proposal. The Crown did not wish to be heard against it. On that basis, I directed the Crown to file and serve submissions, by 9 April 2021, which identified the basis on which evidence adduced in respect of count 1 was said to be admissible in respect of count 2 and vice versa.
On 9 April 2021, the Crown filed and served written submissions in which it identified the evidence it sought to tender which it contended was relevant on both counts, as follows: "a. Chapple's conversations with Paul Dougas (Dougas) in early 2000 where Dougas, as CEO of SKM, approved the payment of bribes as long as specific conditions, or rules, were followed: CCS [Crown Case Statement] [20] and [25]. b. Chapple's communications with Mark Read (Read) that bribes should total less than 5 percent of the final contract amount and the approval for the payment of specific bribes: Chapple statement dated 26 March 2014 at [56]; CCS [27], [42], [46] and [48]. c. Chapple's communications with Linke about the payment of bribes on Philippine's Aid projects and the approval for the payment of a specific bribe: CCS [61] and [64]. d. Chapple's conversation with Kumar about the payment of bribes on Philippines Aid projects: CCS [74]. e. Email chain between Kumar and Linke commencing 15 February 2005 where Kumar seeks, and Linke gives, approval for the payment of a bribe: CCS [76] and [77]. f. Kumar's email to Linke dated 20 May 2005 that details how bribes are paid on Philippine's Aid projects: CCS [80]. g. Carey's conversation with Linke about the budgeting of an Aid project containing provision for a bribe: CCS [89]. h. Email chain between Kumar, Linke and Chapple commencing on 26 June 2007 where Kumar seeks approval for the payment of a bribe of less than 5 percent of the project budget as previously discussed: CCS [93] to [95]. i. Statement made by Chapple to Linke and others at a SODA review meeting on 12 November 2009 that bribes had to be paid to the government to make projects work in Vietnam: CCS [105]. j. Documents including emails, budget spreadsheets, correspondence and agreements that demonstrate the methodology throughout the conspiracies adhering to the 'rules' established by Dougas and Read in the early period of the Philippines conspiracy."
It was common ground that the evidence in (a)-(f) concerns only the Philippines conspiracy, whereas (g), (h) and (i) concern the Vietnam conspiracy, and (j) potentially applies to both.
The Crown contended that the evidence was relevant to the nature and scope of both conspiracies; the knowledge and state of mind of the participants in various communications; and provided context to the nature of the dealings between the conspirators. These separate bases will be addressed below.
On 16 April 2021, I made directions requiring the applicants to file and serve written submissions and for the Crown to file and serve written submissions in reply.

[16]

Consideration

The principles relating to joint and separate trials are well established. The present case, however, does not fall into the usual category of case where such principles arise. Typically, an application for severance arises where a single accused is charged with several offences or when two accused are charged with the same offence. Counsel were unable to identify a single instance of the situation in the present case, where two conspiracies involving different parties were charged together on a single indictment. The present case is all the more unusual since the Crown expressly disavowed any reliance on the evidence of one conspiracy as amounting either to tendency or coincidence evidence of the other conspiracy, or as similar fact evidence.
Against this background, the Crown submitted that the counts ought not be severed because the two counts constituted part of a series of offences that are of the same or similar character and that there is significant evidence that is cross-admissible. On this basis, the Crown submitted that it would be in the interests of justice to have a single trial.
The accused raised the following submissions in support of the application for severance: 1. the alleged offence (the Vietnam conspiracy) could not properly be characterised as part of a "series of offences" within the meaning of s 29(2)(c) of the Act (this matter was raised only on behalf of Mr Dougas); 2. the Crown had not identified any evidence of the Vietnam conspiracy which would be admissible to prove the Philippines conspiracy and vice versa (this matter was relied on by all accused); 3. as a matter of discretion, under s 21(2)(b) and s 29(3) of the Act, the court ought order that counts 1 and 2 on the indictment be severed (this matter was raised by all accused); and 4. it would be prejudicial to Mr Linke (who was the only accused charged with both counts) to have the counts heard together because the evidence in support of the Vietnam conspiracy was significantly stronger than that in support of the Philippines conspiracy and the former might tend to overwhelm the latter, thereby jeopardising Mr Linke's right to a fair trial of count 1 (this matter was raised only by Mr Linke, for whom Mr Morgan appeared).

[17]

Alleged cross-admissibility of evidence

Because the Crown substantially relied on the proposition that there was a substantial amount of evidence that was cross-admissible in respect of both counts, and the accused each contended to the contrary, it is convenient to address this question first. As referred to above, the Crown identified, in broad terms, the evidence which it argued was cross-admissible and the basis on which it was said to be cross-admissible. The accused argued that the Crown ought be required to identify with precision the evidence in respect of count 1 it sought to rely on in support of proof of the individual accused's guilt in respect of count 2 and vice versa.
Further, Mr Boulten submitted that, as the Crown had already been given the opportunity to identify the evidence it alleged was cross-admissible and the basis on which it contended that it was cross-admissible, I ought make a ruling on the evidence in the course of this application. The accused accepted that such a ruling could be revisited by the Crown in the event that a further basis of admissibility was propounded or if the Crown wanted to argue for the admissibility of a particular document or passage within the category. The Crown argued that I ought not make a ruling on the evidence because it had not come prepared to argue the admissibility of the evidence and that that could be done at a subsequent pre-trial hearing.
Having regard to the procedural background to the applications, the evident importance of cross-admissibility to the Crown's decision to charge two counts on the same indictment and the corresponding prejudice to the accused if the evidence were held to be cross-admissible, I propose to make a ruling on the evidence alleged to be cross-admissible as part of the present application. I have heard full argument on the question from all parties, including the Crown.
I propose to address the various bases on which the evidence sought to be adduced by the Crown in respect of both counts is said to be cross-admissible. As most arguments made by one accused were common to all accused, I do not propose to differentiate between the accused, unless it is necessary to do so.

[19]

Harriman

Mr Harriman was charged with being knowingly concerned in the importation of heroin in April 1987. The principal Crown witness was Mr Martin, who was criminally concerned in the importation. It was not disputed that Mr Harriman and Mr Martin had separately travelled from Australia to Thailand, met in Bangkok by prior arrangement and travelled together to Chiang Mai before returning together to Bangkok. Subsequently, Mr Martin had travelled to London, where he posted five parcels of heroin to various addresses in Australia.
Mr Martin's evidence was that he and Mr Harriman had met in Bangkok to obtain heroin, which Mr Harriman had arranged to be collected from Chiang Mai. According to Mr Martin, Mr Harriman had helped him divide the heroin into five parcels and directed him to fly to London and post the parcels back to Australia. Mr Martin said that he and Mr Harriman were both directors and shareholders of a mining company which was in financial trouble and their motivation was financial gain.
Mr Harriman's defence case was that Mr Martin had arranged for the importation entirely independently and that he, Mr Harriman, had travelled to Thailand as a tourist. Mr Harriman's counsel cross-examined Mr Martin as to a previous occasion on which Mr Martin had been in Chiang Mai in March 1987 and had not contacted Mr Harriman whom Mr Martin knew to be, at that time, in South East Asia.
As a consequence of the cross-examination of Mr Martin, the Crown sought to adduce evidence to show that, before Mr Harriman left Australia in March 1987, he and Mr Martin were jointly involved in selling heroin. Mr Harriman's counsel objected to the Crown leading this evidence. The trial judge accepted the Crown's submission that "once you have a known fact framework and are only looking at the colouration of it, then the evidence is inevitably to be admitted".
The evidence was not to be used for a tendency purpose and was not admitted as "similar fact" evidence (since the charge related to importation and the prior conduct concerned the use and sale of heroin). It was admitted because it was relevant to rebut the proposition that there was an innocent association between Mr Harriman and Mr Martin in Thailand in April 1987.
Mr Harriman was convicted. His appeal to the Court of Criminal Appeal of Western Australia was dismissed. The High Court also dismissed the appeal. Although the judges of the High Court disagreed about the admissibility of Mr Harriman's prior use of heroin, they were unanimous that the evidence of Mr Harriman's prior involvement with Mr Martin in the sale of heroin was admissible on the ground that it was highly probative of the criminal character of Mr Harriman's association with Mr Martin in Thailand in April 1987, and, therefore, the unlikelihood that Mr Harriman was there as a tourist.
Brennan J enunciated the relevant test at 594 as follows: "If, as a matter of human experience, the evidence tends to establish the offence charged or a fact in issue otherwise than by showing merely the commission of another offence or a propensity to commit an offence, the evidence is admissible."

[20]

Quach

Mr Quach was charged with supplying not less than a large commercial quantity of heroin on 2 May 2000. The Crown case was circumstantial. On the evening of 1 May 2000, Phuong Le drove from Melbourne to Sydney. After arriving in Sydney, the vehicle driven by Mr Le went along a laneway behind James Street, Leichhardt, where Mr Quach lived. When Mr Le's vehicle was stopped by police at about 7.05am on the morning of 2 May 2000, it was found to contain about 5.9kg of heroin of 70-75% purity. The police searched Mr Quach's residence under warrant and found $780,720 in newly issued bank notes, a mobile phone registered in a false name and a piece of paper on which "Phuong" and "$748,000" were written. Evidence was adduced that the market value of 5.9kg of heroin was worth about the amount of cash found in Mr Quach's premises.
Mr Quach said, in a second recorded interview, that he did not know Mr Le. He could not explain why he had written "Phuong" and "$748,000" on a piece of paper and said that the cash on his premises had been accumulated over 20 years from gambling wins.
At the trial, the Crown sought to tender 11 tapes and accompanying transcripts, together with voice identification evidence, to prove that Mr Le and Mr Quach had spoken with each other on several occasions. The evidence was capable of giving rise to the inference that they were discussing the supply of heroin. The Crown argued at trial that the evidence was relevant to show both the existence, and the nature of, a relationship between Mr Quach and Mr Le at around 2 May 2000. The Crown expressly disclaimed any intention to lead the material as tendency evidence. Mr Quach's objection to the evidence was overruled. The trial judge held that the probative value of the evidence was high and outweighed the danger of unfair prejudice to Mr Quach. Mr Quach was convicted.
Mr Quach's appeal to the Court of Criminal Appeal (Spigelman CJ, Sully and James JJ) was dismissed. Spiegelman CJ said: "8. In this case also, the issue is to be determined by an analysis of relevance, rather than by characterisation of the evidence globally as 'relationship evidence' or 'contextual background'. 9. In Gipp v The Queen (1998) 194 CLR 106 at [182]; 102 A Crim R 299 at [182], Callinan J said: I would, with respect, therefore reject the notion that there is a special category of background evidence that may be adduced by the prosecution in a criminal case (absent, that is, any forensic conduct by the defence that may make it admissible). If such evidence is to be received it must owe its admissibility to some, quite specific, other purpose, including for example, in an appropriate case, proof of a guilty passion, intention, or propensity, or opportunity, or motive. There may also be cases in which a relationship between people may be directly relevant to an issue in a trial and in those circumstances admissible as such."
At [12], Spiegelman CJ identified the "central issue" in the trial as being: "… whether an act of supply had occurred on 2 May at the appellant's residence. The Crown case was circumstantial. The case was based in part on the fact that Le had driven from Melbourne to the immediate vicinity of the appellant's residence in Sydney. It was obviously important for the Crown to establish that it was overwhelmingly probable that Le had entered the appellant's house. The fact that they knew each other, and the extent and nature of their association, was a matter which was relevant to this issue and, therefore, to the issue of supply."
His Honour decided that there was a "specific purpose of this character" in the evidence which the trial judge had admitted, which his Honour identified at [15]: "Admissibility can be justified on two bases. First, a narrow basis that the evidence of the conversation of 29 April was admissible as possibly referring to a drug supply to occur within a few days and earlier conversations establishing the true nature and content of that conversation. Alternatively, the earlier conversations were admissible on a broader basis identified in Harriman v The Queen (1989) 167 CLR 590; 43 A Crim R 221, that the prior relationship of other drug dealings was such that no innocent explanation of Le's trip from Melbourne to the vicinity of the appellant's residence was open."

[22]

Alleged relevance to the nature and scope of both conspiracies

Further, the Crown contended that the evidence identified at (a)--(f) and (h)--(i) was admissible to prove the nature and scope of both conspiracies. It submitted that the conversations between Mr Chapple and Mr Dougas ((a)) and Mr Chapple and Mr Read ((b)) provide the "framework" for how both conspiracies were to be implemented, and that it was significant that both conspiracies were implemented in a manner which was substantially the same as the other. The Crown submitted that this was consistent with both conspiracies having been implemented in accordance with a "deliberately common framework". The Crown particularly relied on the use of third party invoices and the limit of 5% of the overall project price for the bribes. Further, the Crown asserted that the evidence of the Vietnam conspiracy was capable of corroborating Mr Chapple's evidence as to the genesis of the Philippines conspiracy in his conversations with Mr Dougas in 2000.
While it would be open to the jury to reason from what the parties to the alleged conspiracy did that they had agreed to act in a particular way in order to achieve an unlawful purpose, or to do an unlawful act (Gerakiteys at 327 (Brennan J)), it does not follow that it would be open to the jury to reason from the way parties to a subsequent and different conspiracy acted, that they had also agreed to an earlier conspiracy.
I have found it difficult to discern any relevance or, to borrow Spigelman CJ's phrase in Quach, "special purpose", of the evidence identified by the Crown, beyond those which were expressly eschewed by the Crown of tendency, coincidence or similar fact evidence (which is generally seen as a species of the first two categories). Unlike in Harriman, there is no substantial probative force in the evidence sought to be adduced, nor is it sought to be adduced to counter any particular defence raised by one of the accused, which could be misleading in the absence of evidence of the second conspiracy.
The decision of D F Lyons Pty Limited v Commonwealth Bank of Australia (1991) 28 FCR 597 (D F Lyons) is of assistance. In that case, the applicants sought to adduce evidence of representations made by officers of the bank in relation to foreign currency loan agreements apart from those entered into between the applicants and the bank. The applicants' counsel argued that the strength of the evidence would lie not in the revelation of "striking similarities" so much as an "underlying unity" in the dealings between Mr Green (the bank officer) and applicants for foreign currency loans. The applicants submitted that the underlying unity would be sufficient to raise the objective improbability of Mr Green not having made the same, or similar, representations to Mr Lyons when Mr Lyons applied for such a loan. Gummow J said, at 607: "Plainly, in applying the principles I have described, each case has to be considered with close regard to its particular circumstances. In the present case, Mr Green had dealings with various customers of the Bank at Taree concerning foreign exchange loans and they took place in the period in which he was dealing with Mr Lyons. In that sense, there was an underlying unity in Mr Green's activities, but as one might expect, the dealings with customers varied with the particular circumstances as they arose. The nature of the causes of action propounded by the applicants means that specific representations must be established. That is why in the oral evidence of Mr Lyons, both in chief and in cross-examination, great attention was paid in eliciting what was or was not said in precise terms on particular occasions. As a matter of ordinary experience of human behaviour, the evidence which the applicants seek to lead would not tend to prove the making of the representations upon which the applicants rely."
His Honour further said that if he had considered the evidence to be relevant, he would have rejected it in the exercise of the discretion because adducing it would have unduly prolonged the trial without any countervailing benefit. His Honour said that to allow the evidence would produce the consequence that a "cobweb of subsidiary factual disputes would be spun".
The arguments in favour of rejection of the evidence as "context" evidence or evidence as to the "nature and scope of the agreement" are even stronger in the present case. Whereas in D F Lyons the evidence sought to be adduced was broadly contemporaneous to the alleged representations made by the bank to the applicants, in the present case, there was no overlap in the periods during which the two conspiracies endured. There was no suggestion that Mr Casamento or Mr Counihan were parties to the Philippines conspiracy or that Mr Dougas or Mr Read were parties to the Vietnam conspiracy. The features of each conspiracy were different in material respects, as set out above. Had there been any "underlying unity", it would have been open to the Crown to charge a single conspiracy to which Mr Linke, Mr Chapple and Mr Kumar (they being the common parties to both conspiracies) were party, which was joined at various times by the other accused. In order to prove each count, the Crown is required to prove each agreement. For the reasons given above, the Crown has been unable to identify any relevance of the evidence of one conspiracy to the proof of the other.
Further, I do not accept that evidence relating to the Vietnam conspiracy is capable, without more, of corroborating Mr Chapple's evidence of conversations he had with Mr Dougas in 2000, about six years before the Vietnam conspiracy is alleged to have been made.

[23]

Alleged relevance to the state of mind of Mr Linke and of other accused

The Crown also contended that the evidence at (c) and (e)--(i) was relevant to prove Mr Linke's state of mind in relation to both counts. It also submitted that the evidence was relevant to the states of mind of other accused persons. However, it did not develop this argument. It can be inferred that evidence of Mr Linke's state of mind, in terms of knowledge, with reference to the Philippines conspiracy is capable of being relevant to his state of mind, in terms of knowledge, at the time of the Vietnam conspiracy since his previous experience and knowledge might inform his later state of mind and conduct. However, it is not immediately obvious how it could work in reverse. While later conduct can shed light on the existence of an earlier agreement, where two agreements are alleged, the later agreement may not be capable of shedding any light on the earlier agreement. Thus, specific references in written communications within the period of the Vietnam conspiracy would not appear to be relevant to the states of mind of the parties to the Philippines conspiracy.
In oral submissions, the Crown contended that the evidence relating to each conspiracy was probative of Mr Linke's guilt with respect to the other conspiracy because the evidence demonstrated "a state of mind of preparedness to offer bribes to foreign public officials in order to obtain or retain business for [the company]". In support of this submission, he relied on Elomar v R; Hasan v R; Cheikho v R; Cheikho v R; Jamal v R [2014] NSWCCA 303; (2014) 300 FLR 323 (Elomar) in which the Court of Criminal Appeal (Bathurst CJ, Hoeben CJ at CL and Simpson J) held that evidence of the accused's state of mind, support for violent jihad, did not amount to evidence tendered for a tendency purpose since the evidence was evidence of his state of mind, as distinct from evidence that he had a tendency to have a particular state of mind, and it did not depend on tendency reasoning: [366]-[367].
I do not consider Elomar to assist in the present case. In effect, the Crown seeks to argue that because Mr Linke conducted himself in a particular way with respect to the Philippines conspiracy, it can be inferred that he was not averse to paying bribes to foreign public officials in the Philippines to obtain work for the company, and that the jury would be entitled to reason, on that basis, that when the company was engaged in bids for work in Vietnam, Mr Linke would have been similarly prepared to pay bribes. This would appear to me to be classic tendency or coincidence reasoning which, accordingly, is governed by Part 3.6 of the Evidence Act 1995 (NSW). There is a real and significant distinction between, on the one hand, an enduring belief (such as, in Elomar, a belief in violent jihad), and, on the other hand, an intention to commit a financially-motivated crime, which is inevitably intermittent and situational.
I am not satisfied that the alleged relevance of the material to the states of mind of the accused (with the exception of Mr Linke) has been made out. For the reasons given above, the relevance would appear to flow only one way: that is, Mr Linke's communications in respect of the Philippines conspiracy are capable of showing his state of mind at a later time. However, the evidence is not admissible in the way foreshadowed by the Crown (as set out above), unless it is admissible under Part 3.6 of the Evidence Act (an avenue which need not be addressed as it has been eschewed by the Crown), and although it may be admissible to show Mr Linke's knowledge at particular times.

[24]

Prejudice to the accused if the evidence is admitted

If the evidence relied on by the Crown in respect of one conspiracy is allowed in respect of the other, each accused will suffer prejudice. The prejudice suffered will vary depending on the role of each accused. It is sufficient to consider Mr Dougas (who is charged with count 1 and whose position is similar to that of Mr Read) and Mr Casamento (who is charged with count 2 and whose position is similar to that of Mr Counihan) to demonstrate the prejudice.
The evidence against Mr Dougas depends in large measure on the evidence of Mr Chapple, who is an indemnified witness in respect of whom a warning under s 165 of the Evidence Act will be likely to be required to be given on the basis that Mr Chapple might reasonably be supposed to have been criminally involved in the conspiracy (as alleged in the indictment). Although Mr Dougas is not alleged to have been a party to the Vietnam conspiracy, there is a significant risk that if counts 1 and 2 are tried jointly, the evidence in support of count 2 (which is more explicit and in respect of which there are many more documents) will tend to swamp the jury's consideration of the case against Mr Dougas. Even if I, as the trial judge, were to give the jury directions as to the use to be made of such evidence, there is a risk, which would amount to a positive injustice, that the jury would be inclined to use it against Mr Dougas, notwithstanding strong judicial directions: see the summary of principles relating to applications for separate trials in R v Henry; R v Gravett; R v Swansson [2008] NSWCCA 248 at [12] (Nettle AJA, McClellan CJ at CL and Simpson J agreeing).
Further, if the jury finds Mr Chapple to be credible in relation to the Vietnam conspiracy (because of the corroboration in various contemporaneous documents), it might reason that it ought accept his evidence of the conversations with Mr Dougas in 2000 (which were neither witnessed, nor the subject of contemporaneous note), which formed the basis of the alleged Philippines conspiracy. If the trials are heard together, the discrepancy in the relative strengths of the cases operates to the disadvantage of those who are alleged to be party to the Philippines conspiracy but not the Vietnam conspiracy.
Mr Casamento's role, as set out above, required him to prepare budgets for particular projects, including those which were said to have been won by the company as the result of the payment of bribes to public officials in Vietnam. Mr Dhanji SC, who appeared on behalf of Mr Casamento, submitted that, if the counts are not severed, there will be considerable evidence relating to the Philippines conspiracy which is capable of indicating to the jury that the company, or at least a particular area of its operations, had a corrupt culture. There is a risk that the jury would infer from evidence of a corrupt culture that Mr Casamento must have known of the payments of bribes because of his senior position and by reason of the fact that he had been employed by the company since 1998, although the conduct relied on by the Crown as implicating him in the Vietnam conspiracy is limited to the period from early 2010 until May 2011. This would amount to a positive injustice.
Mr Livermore SC, who appeared with Ms Anniwell for Mr Counihan, made similar submissions about the prejudice which would be suffered by Mr Counihan if the evidence was held to be cross-admissible, or if the counts were tried jointly.
There is a further risk which is common to each accused if the evidence were held to be cross-admissible. Although the Crown does not rely on the evidence for a tendency or coincidence purpose, there is a substantial risk that the evidence of both conspiracies, if adduced in a single trial, will lead the jury to engage in impermissible reasoning: namely, that senior officers of the company had a tendency to engage in the bribery of foreign public officials because they thought that it was an acceptable way of obtaining business in South East Asia. Further, the jury may be inclined to engage in coincidence reasoning, by reference to the similarities between the two conspiracies, to infer that it was improbable that both conspiracies occurred by coincidence. The difficulties of remedying the inevitable prejudice which would flow to the accused from these impermissible lines of reasoning by judicial directions are well known: see, for example, Sokolowskyj v R [2014] NSWCCA 55; (2014) 239 A Crim R 528 at [56]-[57] (Hoeben CJ at CL, Adams and Hall JJ agreeing).

[26]

Other factors

It was submitted, without contradiction, that no prosecution under s 70.2 of the Criminal Code Act 1995 (Cth) had yet proceeded to trial and that, accordingly, the relative novelty of the proceedings might tend to lengthen the trial. Further, Mr Boulten submitted that it is a matter of common experience that a single joint trial with five co-accused can take longer than two trials of three accused. I do not accept the Crown's submissions that the cost to the community of separate trials will necessarily be greater than the cost of a joint trial (particularly having regard to my ruling, which rejects the Crown contention as to the cross-admissibility of evidence). Mr Morgan submitted, without contradiction, that it would appear that only one civilian witness, Mr Chapple, would be required to give evidence in relation to each count. As Mr Dhanji submitted, Mr Chapple's oral evidence as to the making of the Philippines conspiracy would be likely to be relatively brief. Thus, even if it were admissible in the trial in relation to the Vietnam conspiracy, its confined ambit does not particularly weigh in favour of a joint trial.
Having regard to the time since these proceedings were commenced (in 2018 in the Local Court) and the time since the offending conduct, the following matters are particularly relevant. There is limited availability of courtrooms of a size to accommodate five accused, their legal representatives and, depending on the expected length of the trial, a jury of 15 rather than 12. Although each of the accused is at liberty, or conditional liberty, each wants the trial to be determined as soon as possible. It is important for the administration of justice that the trial be heard as soon as possible, particularly as the oral evidence of witnesses as to conversations which took place about two decades ago is likely to be significant. I am told that the matters will be ready for hearing from the beginning of term in 2022. They have been listed accordingly.
If the counts are not severed, each accused, apart from Mr Linke (who stands charged with both counts), will be required to sit through significant amounts of evidence which is irrelevant to the case against him. Further, the individual accused will, for the most part, have neither cause nor basis to challenge such evidence because it pre-, or post-dates, his alleged involvement. This factor is not only relevant to the legal costs incurred by the accused in the proceedings, it also affects the jury's perception of the involvement of each accused and who will be required to sit in the dock while all of this evidence is led, whether relevant to the case against the individual accused or not.
To allow the counts to proceed in a single trial would also give rise to difficulties with respect to directions as to the use of the evidence. It is a common, if not inevitable, feature of trials with more than one accused that some evidence will be admissible against one accused and inadmissible against another. In such cases, judicial directions are given to juries as to the use to which evidence can be put. In a conspiracy trial where alleged conspirators are tried jointly, the summing up must deal separately with the case against each accused and the trial judge must separate the evidence properly relevant and admissible against each of the accused. The complexity of this task will be substantially increased if the two counts are tried jointly.
Courts assume, unless there is evidence to the contrary, that judicial directions are complied with. However, it is desirable, in the interests of justice, that trials be conducted in a way which obviates the need for overly complex directions as to the use to which particular evidence can be put. In my view, if counts 1 and 2 were heard together, there would be a risk that the directions which would be required to be given to the jury could tend to undermine the flow of the trial and unduly distract the jury from the evidence as a whole since the concept of the "whole of the evidence" would, necessarily, be fragmented because only parts of the evidence would be admissible against any one accused, with the possible exception of Mr Linke, against whom more evidence would be likely to be admissible. The complexity of necessary directions was addressed by the Court of Criminal Appeal in R v Masters (1992) 26 NSWLR 450 at 461-463 (Hunt CJ at CL, Allen and Badgery-Parker JJ) and is an important factor which weighs in favour of severance of the counts: see also, in a different context (multiple counts of sexual assault charged against a single offender), Hughes v The Queen (2017) 263 CLR 338; [2017] HCA 20 at [172] (Nettle J).
I accept that Mr Linke would be likely to suffer prejudice if the counts were heard together. It appeared to be common ground that the evidence in support of the Vietnam conspiracy was significantly stronger than that in support of the Philippines conspiracy and the former might tend to overwhelm the latter, thereby jeopardising Mr Linke's right to a fair trial of count 1. I note that he did not seek that he be tried separately from the other accused who were charged with him in respect of each conspiracy.
The possibility of inconsistent verdicts if the counts were severed was raised by the Crown. I find it difficult to discern why there would be a greater chance of inconsistent verdicts if the counts were severed. There would appear to be no rational reason why it would not be open to a jury in either trial to acquit or convict one or more of the accused of the offence charged. The present case is to be distinguished from the usual case where, say, there has been an unlawful homicide and the question of which of two, or both, suspects was responsible for the act which caused the death of the deceased. If the two accused in such a case are not tried jointly, there is a possibility of each blaming the other and both being acquitted. The Crown was unable to point to an analogy in the present case or instance a scenario where severance would make inconsistent verdicts more likely.
Another forensic consequence of the Crown charging two conspiracies rather than one is that it cannot be said that the jury, if the counts are severed, will be deprived of the opportunity of seeing and hearing all those who are alleged to have acted in a common purpose. Each conspiracy involves different time periods, some different participants and contracts to be performed in different locations. The severing of the counts would not damage the integrity of the trials since each accused who is tried together with other accused would be tried in relation to the same conspiracy. Indeed, severance would tend to preserve such integrity because the jury would be focussed on one conspiracy rather than two.

[30]

SCHEDULE 1 CATEGORIES OF EVIDENCE SUBJECT TO RULING a. Chapple's conversations with Paul Dougas (Dougas) in early 2000 where Dougas, as CEO of SKM, approved the payment of bribes as long as specific conditions, or rules, were followed: CCS [Crown Case Statement] [20] and [25]. b. Chapple's communications with Mark Read (Read) that bribes should total less than 5 percent of the final contract amount and the approval for the payment of specific bribes: Chapple statement dated 26 March 2014 at [56]; CCS [27], [42], [46] and [48]. c. Chapple's communications with Linke about the payment of bribes on Philippine's Aid projects and the approval for the payment of a specific bribe: CCS [61] and [64]. d. Chapple's conversation with Kumar about the payment of bribes on Philippines Aid projects: CCS [74]. e. Email chain between Kumar and Linke commencing 15 February 2005 where Kumar seeks, and Linke gives, approval for the payment of a bribe: CCS [76] and [77]. f. Kumar's email to Linke dated 20 May 2005 that details how bribes are paid on Philippine's Aid projects: CCS [80]. g. Carey's conversation with Linke about the budgeting of an Aid project containing provision for a bribe: CCS [89]. h. Email chain between Kumar, Linke and Chapple commencing on 26 June 2007 where Kumar seeks approval for the payment of a bribe of less than 5 percent of the project budget as previously discussed: CCS [93] to [95]. i. Statement made by Chapple to Linke and others at a SODA review meeting on 12 November 2009 that bribes had to be paid to the government to make projects work in Vietnam: CCS [105]. j. Documents including emails, budget spreadsheets, correspondence and agreements that demonstrate the methodology throughout the conspiracies adhering to the 'rules' established by Dougas and Read in the early period of the Philippines conspiracy. 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: 20 April 2022

R v Dougas; R v Read; R v Linke; R v Casamento; R v Counihan

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