R v Macdonald; R v Edward Obeid; R v Moses Obeid

R v Macdonald; R v Edward Obeid; R v Moses Obeid - [2019] NSWSC 1286 - NSWSC 2019 case summary — Zoe

The Crown submitted that Moses Obeid's legal representatives had a reasonable opportunity to cross-examine Mr Fang as clear notice was given of the date he was to be called. In the Crown's submission, this afforded Moses Obeid the opportunity to secure representation when Mr Fang gave evidence and also allowed for Mr Littlemore and Mr Hale to take meaningful instructions from their clients to prepare for cross-examination, given what the Crown submits must have been the reasonable expectation that he would give evidence of discussing the prospect of a coal mining venture at Cherrydale Park given that, at the commencement of the public hearing on 12 November 2012, the ambit of the inquiry included amongst 17 areas, relevantly: (3) The circumstances surrounding a decision made in 2008 by the Minister for Primary Industries and Minister for Mineral Resources, the Hon Ian Macdonald MLC, to open a mining area in the Bylong Valley for coal exploration, including whether that decision was influenced by the Hon Edward Obeid MLC or members of his family, whether on Mr Obeid's behalf or otherwise. (7) The actual and potential financial benefits of the award of the Mt Penny and Yarrawa tenements to those parties who have or have had a direct or indirect interest in those tenements, whether by way of the holding of shares or as a trust beneficiary or otherwise. (8) Without detracting from the generality of (7), the actual and potential financial benefit to Cascade Coal Pty Ltd and investors in that company including Travers Duncan, Brian Flannery, John Kinghorn, John McGuigan, John Atkinson, Greg Jones and Richard Poole of the award of the Mt Penny tenement to Cascade Coal Pty Ltd. (10) Whether Mr Macdonald or any member of his personal staff, or any employee of the Department of Primary Industries (whether instructed to do so by Mr Macdonald or otherwise), in breach of their duties, provided confidential information relating to the expression of interest process in respect of the Mount Penny and Yarrawa tenements to members of the Obeid family or persons associated with Cascade Coal Pty Ltd. (11) Whether such confidential information was used by members of the Obeid family or persons associated with Cascade Coal Pty Ltd.

[3]

Is Mr Fang unavailable?

The unavailability of a witness, a precondition to the operation of ss 65(2) and 65(3), is defined in the Dictionary to the Evidence Act as follows: (1) For the purposes of this Act, a person is taken not to be available to give evidence about a fact if: … (f) all reasonable steps have been taken, by the party seeking to prove the person is not available, to find the person or secure his or her attendance, but without success, or (g) all reasonable steps have been taken, by the party seeking to prove the person is not available, to compel the person to give the evidence, but without success. (2) In all other cases the person is taken to be available to give evidence about the fact.
Mr Fang is a Chinese-born Australian citizen. He was last in Australia in 2015. It would appear that he has since taken up permanent domicile in China. The Crown tendered two affidavits from Ms Alison Graylin, solicitor, dated 25 January 2019 and 22 May 2019 in discharge of its onus of demonstrating that Mr Fang is "not available" to give evidence about any of the "facts" asserted by him in the evidence he gave before ICAC (the previous representations as defined) set out below at 19-(12).
Despite what I am satisfied were concerted attempts by officers of the DPP to arrange for Mr Fang to give evidence at the trial of the accused, and despite early indications that he would supply a witness statement to that end, I am satisfied that as at 18 June 2019 Mr Fang is unwilling to return to Australia, voluntarily, to give evidence. Self-evidently, he is not compellable. In the course of the pretrial hearing which concerned the Crown's application to tender his evidence, on further enquiry, at my suggestion, Mr Fang confirmed an unwillingness to make himself available at a designated location in China in order that he might give evidence at the trial of the accused by audiovisual means.
The Crown is required to identify the particular representation it proposes to adduce in evidence by the tender of the transcript of Mr Fang's evidence as a source of proof of a fact or facts that are relevant to an issue in the trial (see Sio per curiam). The representations relied upon by the Crown are as follows (the references are to pages of the transcript of Mr Fang's evidence): 1. Mr Fang was the founder and proprietor of the Tianda group of companies which were interested in a number of areas including pharmaceuticals and mining, and including mining in New South Wales [T3841.1 - 21]. 2. He met Ian Macdonald (who he knew to be a politician) in about 2003 [T3841.23 - 30]. 3. He spoke to Mr Macdonald about business opportunities involving pharmaceuticals and coal mining [T3841.37 - 44]. 4. Mr Fang and Mr Macdonald became friends. They would meet at Mr Macdonald's office, and sometimes meet for lunch or dinner. Mr Macdonald had been to Mr Fang's home, and Mr Fang had been to Mr Macdonald's home. They had each other's mobile phone numbers [T3842.4 - 15]. 5. Mr Fang introduced Mr Macdonald to a lot of people in China, including political figures, and Mr Macdonald introduced Mr Fang to lots of people in New South Wales, including taking him to Parliament House on many occasions to meet Ministers and different Premiers. 6. Mr Fang had attended a number of fundraisers at NSW Parliament House where Mr Macdonald introduced him to various ministers. They spent a great deal of time trying to develop and promote commercial relationships between China and New South Wales [T3860.1 - 3861.3]. 7. In the first part of 2008 (before 30 June 2008): 1. Mr Fang had been speaking to Mr Macdonald about his desire to invest in farms and coal mining. Mr Macdonald told Mr Fang that Edward Obeid's family had a very good farm and that he should see if it could offer any possibility for a business arrangement [T3843.31 - 38; T3863.7 - 29]. 2. A couple of months later [T3863.31 - 41], Mr Macdonald took Mr Fang to Edward Obeid's office at Parliament House and introduced him to Edward Obeid [T3848.12 - 29]. After making the introduction, Mr Macdonald left the room [T3864.31 - 4]. 3. Mr Fang gave Edward Obeid a briefing about his company's business [T3843.46 - 48]. 4. Mr Fang thought Edward Obeid mentioned having a family farm at Mount Penny [T3844.1 - 2; T3858.42]. 5. Edward Obeid said that Mr Fang should meet his son, Moses Obeid [T3844.20 - 22; T3859.20 - 21], to discuss cooperation on a project concerning his family farm which had coal underneath it [T3849.4 - 33]. 6. Mr Fang left his contact details with Edward Obeid [T3859.25 - 26]. Mr Fang only met Edward Obeid on this one occasion [T3861.17]. 1. Mr Fang attended the farm on a Saturday. He travelled there in his own car. He met Moses Obeid and two of Moses' brothers, Paul and Gerard [T3844.46 - T3845.33; T3848.37 - 39]. Moses did most of the talking [T3868.26 - 38]. At the farm, they showed Mr Fang around. Mr Fang was told by Moses Obeid there was coal underneath the farm and that the government would possibly allow the area to be explored [T3845.35 - 48; T351.32 - 44; T3852.15 - 19]. 2. Moses Obeid arranged for Mr Fang to meet a solicitor, Mr Christopher Rumore, from Colin Biggers and Paisley. Some of the Obeid brothers also attended the meeting, which occurred on or about 30 June 2008. They discussed the family farm and the existence of coal [T3846.16 - 42]. 3. About a week after Mr Fang visited the farm, he spoke to Mr Macdonald. Mr Fang could not recall if it was by telephone or in person or where the discussion occurred [T3864.46 - 3865.22]. He told Mr Macdonald that he had been up to the farm with members of the Obeid family [T3846.8 - 14] and they had discussed the possibility of cooperation on a project involving the farm and its coal resources [T4847.1 - 27]. He also told Mr Macdonald that they had a meeting with a lawyer to discuss a potential cooperation but that no agreement was made [T3865.28 - 32]. Mr Fang could not recall exactly what Mr Macdonald said but recalled that Mr Macdonald opined that their farm was a very good farm and they had very good resources underneath the farm [T3847.29 - 33; T3865.34]. 4. Mr Macdonald introduced Mr Fang to a solicitor, Mr John Gerathy, who Mr Fang used as a lawyer for the project [T3849.37-3850.4]. Mr Fang then had a staff member, Mr Warwick Liu at Tianda Headquarters in Hong Kong, follow up on the project [T3850.14 - 21]. 5. Mr Fang did not proceed with the project [T3846.45 - 46]. The main problem was it was a long term project and he had no idea if the government was going to allow for a bidder (upon an EOI process) and he did not know about the quality of coal underneath the land [T3852.5 - 9].
The Crown submitted that Mr Fang's evidence was relevant in proof of its case against each of the accused in the following respects: 1. Mr Macdonald's knowledge as at June 2008 that Edward Obeid and his family had a farm (being Cherrydale Park) and that they believed the farm contained an underground coal resource. 2. Edward Obeid's knowledge of and involvement in pursuing a project concerning that coal and, after being introduced to Mr Fang by Mr Macdonald, introducing Mr Fang to his son, Moses Obeid, to pursue that project. 3. Moses Obeid's involvement with Mr Fang in pursuit of the project. 4. Moses Obeid's knowledge, as at mid-2008, that the NSW government might issue an exploration licence in respect of an area which included Cherrydale Park, before the EOI process, which included the Mount Penny coal exploration area, was publicly announced.
The Crown also submitted that Mr Fang's evidence of his meeting with Edward Obeid, following a meeting with Mr Macdonald at his office and his telephone contact with Moses Obeid thereafter, is consistent with telephone records, reproduced in the form of a schedule (MFI 21) which it is anticipated will be tendered at the trial under s 50 of the Evidence Act. The likely timing of Mr Macdonald's introduction of Mr Fang to Edward Obeid and the telephone contact between Mr Fang and Moses Obeid thereafter (being, on the Crown case, within the month of June 2008) was said by the Crown to be highly probative of the existence of the conspiracy, since by that date Mr Macdonald had already taken steps internal to the Department to focus on the coal release area at Mount Penny and that Mr Fang's evidence is temporally linked to the acts of misconduct the subject of the conspiracy in that way.

[4]

Is Mr Fang's evidence admissible under ss 65(3)(a) and/or (b)?

The first substantive question raised by the Crown's application is whether the representations (set out at [19] above) were "made in the course of giving evidence in an Australian or overseas proceeding". An Australian or overseas proceeding is defined in Part 1 of the Dictionary to the Evidence Act as: a proceeding (however described) in an Australian court or a foreign court.
An "Australian Court" is defined as, relevantly: (e) a person or body authorised by an Australian law, or by consent of parties, to hear, receive and examine evidence, …
There is no requirement that a "person or body authorised … to hear, receive and examine evidence" is subject to the Evidence Act. This is to be contrasted with the situation that might obtain where a "person or body" whose role is purely investigatory or which is not independent of executive or administrative oversight in decision-making, and therefore not bound by the rules of procedural fairness, may not fall within the definition of an "Australian Court" (see Ryan v Watkins [2005] NSWCA 426 at [119]-[120] per Campbell AJA, Mason P and Handley JA agreeing).
It was accepted by all accused that as at 3 February 2013 when Mr Fang gave evidence, the Commissioner was authorised under s 35 of the Independent Commission Against Corruption Act 1988 (NSW) (ICAC Act) to hear, receive and examine evidence. Section 35 of the ICAC Act relevantly provides: 35 Power to summon witnesses and take evidence (1) A Commissioner may summon a person to appear before the Commission at a compulsory examination or public inquiry at a time and place named in the summons (the required appearance): (a) to give evidence, or ... (2) ... (3) The Commission may, at a compulsory examination or public inquiry, take evidence on oath or affirmation and for that purpose: (a) the person presiding at the compulsory examination or public inquiry may require a person appearing at the compulsory examination or public inquiry to give evidence either to take an oath or to make an affirmation in a form approved by the person presiding, and (b) the person presiding, or a person authorised for the purpose by the person presiding, may administer an oath or affirmation to a person so appearing at the compulsory examination or public inquiry. …
Accordingly, it was accepted by the accused that Mr Fang's evidence before ICAC was given in "an Australian proceeding".
The second question raised by the Crown's application is whether each of the accused either cross-examined Mr Fang in those proceedings (s 65(3)(a)) or had a reasonable opportunity to do so (s 65(3)(b)). That issue attracted detailed argument.
I propose to address Mr Barry QC's submissions first. If they have currency, the Crown's application for the tender of Mr Fang's evidence must fail.
Mr Barry submitted that the cross-examination with which s 65(3) is concerned is that which is defined in Part 2 of the Dictionary to the Evidence Act, namely "questioning of a witness by a party other than the party who called the witness to give evidence". Mr Barry submitted that since Edward Obeid was not a party to the proceedings before ICAC, such cross-examination as was undertaken by Mr Littlemore QC on his behalf in those proceedings was not cross-examination of the kind which attracts the operation of s 65 and, that being the case, the Crown's application to tender the transcript of Mr Fang's evidence must fail. Mr Barry submitted that while ss 32 and 33 of the ICAC Act afforded Edward Obeid an entitlement to apply to the Commissioner to appear and to be legally represented as a person substantially and directly interested in the subject matter of the public inquiry, by that grant of leave he did not become a party to the proceedings.
Furthermore, as the Commissioner made clear on the first day of the public hearing on 12 November 2012, the proceedings were, as the Commissioner described it: … inquisitorial rather than adversarial … an inquiry, not a piece of litigation … This is not a trial, it is an investigation. The rules of evidence do not apply.
I note that s 17 of the ICAC Act expressly provides that the Commission is not bound by the rules of practice or of evidence and can inform itself on any matter in such manner as it considers appropriate.
The Commissioner went on to pronounce: This inquiry is to be conducted by myself as Commissioner. This means that all the decisions have to be taken by me. It is I and I alone who will decide what witnesses are to be called. It is also for me to decide what matters their evidence will be directed to. There is in an inquiry of this sort no legal right to cross-examination but I will, to the extent that I consider it relevant and helpful to the forwarding of the inquiry, allow cross-examination.
Supplementary directions as to the cross-examination of witnesses were given during the course of the Commission's public hearing. These directions had the effect of qualifying the extent to which any challenge to the credibility or reliability of a witness was to be mounted, and to delimit the issues to which cross-examination was to be directed under the Commissioner's grant of leave to permit cross-examination.
Mr Barry submitted that in giving those directions the Commissioner was simply using language that it was expected lawyers would understand and that "cross-examination" in that context was used in its common or vernacular usage, namely a testing by searching questions, and not cross-examination as defined in the Evidence Act.
In the Crown's submission, the use of the word "cross-examine" in s 65(3) should be given a purposive construction and should not be read down in the way proposed by Mr Barry, the effect of which would be to render meaningless the broad definition of "an Australian Court" in Part 1 of the Dictionary (which expressly provides that the "person or body … authorised to hear, receive and examine evidence" need not be governed by the Evidence Act) by limiting the application of s 65(3) only to proceedings governed by the Evidence Act and inter partes proceedings. In support of that construction (which I favour), the Crown referred again to Thomas which concerned the admissibility of a transcript from the Royal Commission (which the Court of Appeal was satisfied was "a proceeding in an Australian Court"), the tender of which was, in the view of Hodgson JA, accommodated within the operation of s 65(3) and admissible as an exception to the rule against hearsay on that basis (although that was a view his Honour expressed obiter dicta) but not admissible as a business record under s 69 of the Evidence Act.
The remaining issue on the Crown's application is whether I am satisfied that each of the accused cross-examined Mr Fang (as the person who made the previous representation) about it (that is, about the representation) or, in the event that one or more of the accused did not cross-examine him, that they had a reasonable opportunity to do so.
Although the parties did not direct argument to the operation of s 65(4), it is clear that in the event that I am satisfied that a particular accused either did not cross-examine Mr Fang about the representation or did not have a reasonable opportunity to do so, Mr Fang's evidence will not be admissible against that accused.
On this issue Mr Neil's submissions were extensive. He sought to make two general submissions at the outset. The first concerned what he described as the fundamental principle enshrined in the common law that cross-examination is an effective way of testing the truth and reliability of a witness' testimony. He went on to submit that the clear object of s 65(3) operating as an exception to the rule against hearsay where a witness is unavailable to give evidence in criminal proceedings, is in recognition of the fact that there are sound reasons why the hearsay rule should not apply where either: (a) the party against whom the evidence is to be admitted has already cross-examined the witness on the particular representation sought to be proved; or (b) an inference is available from a lack of cross-examination that the party has accepted that cross-examination would not assist in testing the representation for its truth or reliability.
Mr Neil's second submission is related to the first by the emphasis which s 65(3) gives to the need for the Court to consider whether there was cross-examination on the particular representation and not whether, speaking globally, a person had the opportunity to cross-examine the person whose previous representation was made in the course of giving evidence as a witness.
With the operation of s 65(3) analysed in this way (an analysis which he submitted, and which I am satisfied is consistent with s 65(4) and the analysis given to s 65(2) by the High Court in Sio) Mr Neil submitted that in addition to the submissions advanced by Mr Barry as to the nature of the proceedings before ICAC in which Mr Fang gave evidence, there are a number of additional features which demonstrate that Moses Obeid did not have a reasonable opportunity to cross-examine Mr Fang within the meaning of s 65(3) of the Evidence Act.
Mr Neil emphasised that ICAC is an investigatory body that curtails the common law rights of persons of interest, including the right to silence and privilege against self-incrimination for the stated statutory purposes under the ICAC Act, inter alia, to determine whether a matter should be referred for a prosecution. To that end, he submitted that persons the subject of the inquiry must participate in it cognisant of, and necessarily limited by, the fact that ICAC may refer them for prosecution afterwards.
That being the case, Mr Neil submitted the ICAC Act cannot be construed so as to oblige a person of interest (an "affected person" under s 32) to fully participate in an inquiry and to cross-examine witnesses to the fullest extent possible. Furthermore, not only are the terms of the inquiry set by the Commissioner and directions given as to the limits of cross-examination, none of the accused had any right to cross-examine Mr Fang. The Commissioner restricted cross-examination only to the extent that an affected person sought to put a positive case.
Accordingly, Mr Neil submitted, in circumstances where no affected person was obliged to put a positive case on a particular issue and (for reasons set out above) it must be accepted they had a legitimate basis for not doing so, there was no reasonable opportunity to cross-examine on each of the representations the Crown seeks to prove by the tender of Mr Fang's transcript. Furthermore, in circumstances where, at the time Mr Fang gave his evidence, none of the accused were (nor could they have been) aware of the full extent of the evidence that the Crown intends to adduce in proof of its case at trial, or the particulars of the charge that is being prosecuted, there was no "reasonable opportunity" for them to cross-examine on each of the representations the Crown seeks to prove by the tender of the transcript of Mr Fang's evidence.
Most importantly, in Mr Neil's submission, the representations sought to be adduced by the Crown by the tender of Mr Fang's evidence, could not reasonably have been cross-examined on where the accused were not provided with advance notice of Mr Fang's evidence or how it meshed (if it did) with the matters the subject of the ICAC inquiry, including those the Crown has identified as the relevant matters that Mr Fang's evidence might relate to. Mr Neil submitted it would be grossly unfair to infer that any lack of cross-examination by any one or more of the representations of Edward Obeid or Mr Macdonald was due to acceptance by them that cross-examination would not assist to test Mr Fang's evidence.
Mr Neil submitted that although Moses Obeid did not cross-examine Mr Fang at all, no relevant inference may be drawn from the fact that he chose not to put a positive case. He went further to observe that Mr Littlemore's cross-examination was limited to his stated positive case on behalf of Edward Obeid, namely that Mr Fang only met Edward Obeid at a fundraiser and Edward Obeid did not use the words "Mount Penny" in his conversation with Mr Fang, while Mr Hale's cross-examination was limited to his stated positive case that Mr Macdonald denied having met Mr Fang as alleged and that Mr Macdonald was not present during Mr Fang's conversation with Edward Obeid.
Despite the Commissioner's directions imposing the substantive and procedural limits on the cross-examination of any witness called in the inquiry, I am satisfied that each of the accused either cross-examined Mr Fang on the representations set out at [17] above or were given a "reasonable" opportunity to do so.
That is not to say that the concerns raised by Mr Neil have no traction. Rather, in my view, they each carry considerable weight on the question whether the evidence should be excluded in the exercise of the discretion in s 135.

[5]

Is the probative value of the evidence outweighed by the risk of unfair prejudice such that the Court is obliged to refuse to admit the tender of Mr Fang's evidence?

Mr Barry submitted that even if Mr Fang's evidence is strictly admissible under s 65(3), it is tainted in three significant respects which serve to both undermine its probative value and to highlight the risk of unfair prejudice to Edward Obeid by its tender.
The first (endorsed by Ms Cunneen SC in her submissions) related to the attitude of the Commissioner and his counsel in the private hearing. Whilst Mr Barry accepted that neither the Commissioner nor his counsel might have intended to be threatening, he submitted that their attitude may have been interpreted by Mr Fang in that way, thereby undermining the reliability of his evidence in the public hearing. He also submitted his evidence in the public hearing was, in significant respects, in direct contrast to the evidence he gave under compulsion. Those areas of difference included that he could not be sure whether he met Edward Obeid at Mr Macdonald's initiation; that when they were introduced there was no discussion to the effect that Mr Obeid's family were interested in coal mining as distinct from that being his interest with Cherrydale Park marketed to him by Moses Obeid as a functioning rural property with the mere possibility of coal as an underground resource.
The second source of prejudice was said by Mr Barry to result from one occasion when there was an unbridled attack on Mr Fang launched by counsel assisting the Commissioner in the private hearing and that Mr Fang's unwillingness to make himself available to give evidence at the accused's trial (either by video link or in person) has likely been so coloured by that encounter that it would be unfair to the accused that they should be required to suffer the prejudice of not being able to cross-examine him within the proper procedural limits of a trial.
The third source of prejudice identified by Mr Barry, again emerging from the private hearing, is that many of the answers given after an adjournment when Mr Fang was invited by the Commissioner to "consider his position" were given in answer to leading questions put by counsel assisting, to the extent that as Mr Barry submitted "counsel was thrusting the answers down [Mr Fang's] throat" and followed up by Mr Fang being invited to accept what was being put to him because he was told his evidence was supported by records the Commissioner had in his possession in any event. Mr Barry submitted that the overwhelming effect of that encounter on a man who, it must be assumed, is unfamiliar with court proceedings in this jurisdiction, must have impacted upon the evidence he gave in the public hearing and which could not be tested in the public hearing in any meaningful way when cross-examining counsel were unaware of it.
Mr Neil submitted that the unfairness to which both Ms Cunneen and Mr Barry referred was compounded by the fact that, as is clear from what Mr Fang has since told officers of the DPP in the course of correspondence, he would not have been able to give the evidence he gave before the Commission in February 2013 about the events of June 2008 were it not for what he described as his access to "all relevant documents". These documents, Mr Neil emphasises, cannot meaningfully be identified in Mr Fang's absence as a witness. As I understand it, one aspect of that submission is that the Crown should not be afforded the forensic advantage of having Mr Fang's evidence before the Commissioner tendered at the trial of the accused in circumstances where Mr Fang has informed the prosecuting authorities he has only a vague memory now of events in 2008 and even after reviewing the transcript of his evidence he claims little independent memory of those events.
Mr Neil also submitted that there is a danger of unfair prejudice in the form of the evidence sought to be tendered by the Crown when many of the answers to questions asked by counsel assisting the Commissioner were what Mr Neil described as "blanket answers to leading questions" which in ordinary curial proceedings would be objectionable.
Ms Cunneen advanced a submission in slightly different terms to that advanced by Mr Barry and Mr Neil. She essentially focused on what she submitted was the risk of unfair prejudice to Mr Macdonald by the admission of Mr Fang's evidence given the circumstances in which it was adduced and the form and function of the ICAC hearings.
Ms Cunneen also submitted that what occurred in the compulsory hearing, as reflected in the transcript of those proceedings and the accompanying video recording, must be taken to have impacted upon how Mr Fang gave evidence in the public hearing and on the evidence that was given. She submitted that there was, at the very least, an atmosphere of intimidation in the attitude taken by the Commissioner and by counsel assisting him in the course of the private hearing, and that must be taken to have had a continuing impact upon Mr Fang and the evidence he gave when he returned to give evidence in the public hearing some months later. She submitted that in circumstances where that material was not available to Mr Hale, cross-examining counsel, under the limited grant of leave afforded him, and because Mr Fang cannot be cross-examined by her on that material as a prior inconsistent statement (as to which no grant of leave is required) there is a real danger that the tender of Mr Fang's relevantly untested evidence will be unfairly prejudicial to Mr Macdonald.
Ms Cunneen also submitted that even were the Court to find that the cross-examination of Mr Fang which was permitted under the grant of leave given by the Commissioner and was undertaken by Mr Hale on behalf of Mr Macdonald on 5 February 2013 satisfies the requirement under s 65(3)(a) (as I have found it does), that cross-examination was directed to a vastly different purpose than the cross-examination of witnesses called by the Crown at the trial of an accused.
It is that issue and the others highlighted by all defence counsel, in the particular circumstances of this case, which I consider carries significant weight in the balancing exercise which underpins the discretion under s 135 of the Evidence Act.
While each of the accused was entitled to apply to the Commissioner to be represented before the Commission as "affected persons", and while the nature and ambit of the ICAC inquiry into Operation Jasper was publicly known, it is clear that none of the accused, nor any of the persons the subject of the nomination of an "affected person", was provided, in advance, with any of the materials collected during the course of the investigation, nor any indication of the evidence Mr Fang (or any witness) was likely to give, whether referable to a statement they had provided investigators, or any evidence they had given under compulsory examination, or for that matter that a compulsory examination had taken place at all. In those circumstances, such cross-examination as was ventured by Mr Littlemore or Mr Hale must, although satisfied by the requirements of s 65(3), nevertheless be general in nature being neither disciplined by instructions nor delivered with any particular forensic strategy in mind.
By contrast, in criminal proceedings cross-examination by an accused is circumscribed at the outset by the nature of the charge and the elements of the offence that is alleged. It is also undertaken in the context of the full knowledge of the prosecutor's brief of evidence and such other documents as are provided in discharge of the prosecution's duty of disclosure. As both Ms Cunneen and Mr Neil emphasised in their submissions, a trial is also conducted in an adversarial context where the Crown has the burden of proof. This is in direct contrast to the ICAC inquiry which, as the Commissioner was at pains to make clear, was inquisitorial in nature and where the relevance of cross-examination was to be determined by him as referable to whether the questioning advanced the inquiry he was undertaking and not by the legal representatives with an eye to any potential criminal proceedings, irrespective of whether it was more or less a risk as they perceived it.
In addressing the various ways in which the accused contended that the admission of the transcript of Mr Fang's evidence would be productive of the danger of unfair prejudice to them at their trial, a danger that outweighs the probative value of the evidence, the Crown submitted that while it must be accepted that the inquiry convened under ICAC, including the procedural directions given by the Commissioner as to the form and content of cross-examination, was not cross-examination conducted in the ordinary way, the representatives of each of Mr Macdonald and Edward Obeid as the "affected persons" were nonetheless afforded an appropriate level of fairness in the cross-examination their counsel elected to embark upon under the Commissioner's grant of leave. In the Crown's submission, there was no practical limitation of any kind concerning the extent or length of the cross examination and, importantly, each of them focused on Mr Fang's evidence in the crucial respects in which the Crown submits his evidence is probative of the guilt of the accused, namely the introduction of Mr Fang by Mr Macdonald to Edward Obeid and Edward Obeid's discussions with him about the Mount Penny coal mining project and his intention to speak to Moses Obeid about it.
The Crown also submitted that there will be no difficulty in this case unravelling the leading questions asked by counsel assisting the inquiry, since the Crown is proposing that the transcript and the associated video would be the subject of editing in such a way that the questions and answers are retained with a fair level of completeness in the interests of ensuring that the accused have a fair opportunity to address the jury as to whether they should accept Mr Fang's evidence as truthful and reliable.
The Crown submitted that what occurred in the compulsory hearing, when viewed against the evidence Mr Fang gave in the public hearing, does not admit of the characterisation given to it by each of the accused. In the Crown's submission, Mr Fang's evidence on 5 February 2013, some months after the private hearing, is not suggestive that he had capitulated to any pressure to "reflect upon his evidence" consistent with the admonition delivered by the Commissioner some months earlier. Rather, in the Crown's submissions, Mr Fang accepts some propositions, declines to accept others and seeks clarification with respect of others before he gives his answer.
There is some force in the Crown's submissions. However, what cannot be overlooked is that the cross-examination that was undertaken was in the context of Commissioner's clear and categorical directions that cross-examination was not as of right but heavily circumscribed. This is demonstrated by the following exchange with Mr Hale: MR HALE: Yes. Now can you remember what it was you were talking to Mr Macdonald about on the occasion you say that he introduced you to Mr Obeid? --- Sorry? Can you, can you remember the subject matter of the discussion that you were having --- THE COMMISSIONER: Mr Hale --- MR HALE: --- with Mr Macdonald --- THE COMMISSIONER: Excuse me, I --- MR HALE: --- on the occasion you later were introduced to Mr Obeid? THE COMMISSIONER: Just a moment, please, Mr Fang. Mr Hale, I want to know your affirmative case before I allow you to test the witness in this way. Does your, does Mr Macdonald admit or deny having met Mr Fang? MR HALE: Oh, he certainly admits to meeting Mr Fang. THE COMMISSIONER: At his office and introducing him to Mr Obeid Senior, does he admit? MR HALE: In the circumstances that have been alleged, yes, he will deny it. THE COMMISSIONER: Very well, proceed. MR HALE: Yes. Can you remember the subject matter of the meeting that you had with Mr Macdonald on this occasion where you ultimately met with Mr Obeid? ---Mention, I told Ian before I'm looking for opportunities for investment in farm and the mining (not transcribable) so that maybe, and Ian told me --- What did he say? ---Ian told me, I can't remember exactly when, okay, yeah. Ian told me one of his friends, I mean Mr Obeid Senior, own a farm somewhere that may become the subject Ian took me to see Mr Obeid Senior. Well, what did he actually say to you, can you remember what Mr Macdonald actually said to you? THE COMMISSIONER: He's just recounted that.
Further, what also cannot be overlooked is that cross-examining counsel at the inquiry, being unaware of the evidence Mr Fang gave in the private session, could not meaningfully test questions of reliability and credibility against that evidence, one of the hallmarks of the role of cross-examination in adversarial proceedings. In Libke v The Queen (2007) 230 CLR 559; [2007] HCA 30, in discussing the rules of evidence that bind a prosecutor cross-examining an accused, Heydon J referred to cross-examination and its forensic significance in the following passages: [119] They are rules which necessarily developed over time once it came to be established that oral evidence should be elicited, not by means of witnesses delivering statements, and not through questioning by the court, but by means of answers given to a succession of particular questions put, usually by an advocate, and often in leading form. A cross-examiner is entitled to ask quite confined questions, and to insist, at the peril of matters being taken further in a re-examination which is outside the cross-examiner's control, not only that there be an answer fully responding to each question, but also that there be no more than an answer. By these means a cross-examiner is entitled to seek to cut down the effect of answers given in chief, to elicit additional evidence favourable to the cross-examiner's client, and to attack the credit of the witness, while ensuring that the hand of the party calling the witness is not mended by the witness thrusting on the cross-examiner in non-responsive answers evidence which that witness may have failed to give in chief. To this end a cross-examiner is given considerable power to limit the witness's answers and to control the witness in many other ways. [120] "Cross-examination is a powerful and valuable weapon for the purpose of testing the veracity of a witness and the accuracy and completeness of his story. It is entrusted to the hands of counsel in the confidence that it will be used with discretion; and with due regard to the assistance to be rendered by it to the Court, not forgetting at the same time the burden that is imposed upon the witness." Hence the powers given to cross-examiners are given on conditions, and among the relevant conditions are those which underlie the rules of evidence contravened in this case.
I accept that the impossibility of challenging the veracity and credibility of Mr Fang's hearsay statements is not of itself sufficient to exclude the evidence in the exercise of the discretion under s 135 of the Evidence Act (since to take that approach would effectively neutralise the hearsay exception provided for in s 65(3)). On the other hand, the balancing exercise called for in determining whether to exercise the discretion to exclude the evidence allows the Court to approach the question of the danger of unfair prejudice by reference to the facts of a particular case. In this case, after a careful examination of the nature of the proceedings from which the transcript emerges and what transpired in the proceedings, I am satisfied the danger of unfair prejudice outweighs the probative value of the evidence.
Accordingly, the Crown's application to tender Mr Fang's evidence is refused.
In the event that the application to tender Mr Fang's evidence was refused, the Crown indicated its intention to rely upon evidence, independent of Mr Fang, to establish the fact that he had a long-standing relationship with Mr Macdonald in order to support proof of the further fact that it was Mr Macdonald who facilitated Mr Fang's meeting with Moses Obeid, an introduction that ultimately led to the meeting at Mr Rumore's office on 30 June 2008 where a mining project at Mount Penny was discussed.
The fact that there was such a meeting is independently proved by Mr Rumore's conference notes. They indicate Mr Fang attended in the company of Moses Obeid, and Paul and Gerard Obeid to discuss a potential joint-venture in connection with coal mining at Mount Penny. I do not understand that Mr Rumore has any knowledge of the circumstances in which Mr Fang came to be discussing the joint venture with Moses Obeid or his brothers, or that there had been a meeting at Cherrydale Park before the conference where that project was discussed.
The inference that it was Mr Macdonald who proposed that Mr Fang meet with Moses Obeid (whether or not the formal introduction was made via Edward Obeid) is said by the Crown to be drawn from two sources: the first, statements from the following people: 1. Mr Gibson dated 9 May 2014 at [4]; 2. Mr Coutts dated 18 May 2019 ay [20]; 3. Mr Sheldrake dated 9 December 2014 at [4]; and 4. Mr De Ross dated 22 October 2014.
The only statement that I consider bears relevantly upon the inference the Crown seeks to have the jury draw is paragraph 7 of Mr De Ross' statement. Mr De Ross was general manager of Tianda Resources Australia Pty Ltd, the entity owned by Mr Fang at the relevant time. He says: Not long after I started working at Tianda, Alan introduced me to the NSW Minister for Mineral Resources, Ian Macdonald. Alan had known Mr Macdonald before my commencement at Tianda and I observed that they had a close relationship. I met Mr Macdonald on at least two occasions at his ministerial office in Governor Macquarie Tower, Phillip Street, Sydney and his parliamentary office on Macquarie Street Sydney. The purpose of the meeting was to try and put together joint ventures with Australian companies using Mr Macdonald's contacts.
Mr De Ross gives no evidence of any involvement with or knowledge of Moses Obeid's association with any property within the Mount Penny coal release area the subject of some consideration by Tianda when the EOI process was released in September 2008.
Mr De Ross' evidence to the effect that meetings were held with Mr Macdonald at his Ministerial offices with Mr Fang from time to time "to try to put together joint ventures with Australian companies using Mr Macdonald contacts" does provide some evidence that introductions of the kind the Crown contends for were made by Mr Macdonald. It is, however, unclear from Mr De Ross' statement as to the nature of those meetings and their structure, their formality or informality, including whether they were minuted.
The second source of evidence to ground the inference contended for by the Crown is the evidence from which it is said the jury would be entitled to infer that Mr Macdonald knew, from as early as September 2007, that Edward Obeid had purchased Cherrydale Park (R v Macdonald; R v Edward Obeid; R v Moses Obeid (No 3) [2019] NSWSC 898). This, together with what the Crown alleges were the steps taken by Mr Macdonald before June 2008 to direct that there be an EOI process for a coal mining exploration licence at Mount Penny, and his dissemination of "Wiles Map 1" and "Wiles Map 2" to Moses Obeid or Edward Obeid (or both), is evidence from which the jury could conclude that Mr Macdonald knew that both Edward Obeid and Moses Obeid were interested in a potential joint venture mining project encompassing the Cherrydale property, and that an introduction to Mr Fang might prove beneficial to them and to him.
Finally the Crown relies upon what is said to be a coincidence of contact between Mr Macdonald, Mr Fang and Moses Obeid, in particular on 30 June 2008 and 1 July 2008, preceded by multiple entries in Mr Macdonald's diary where he met with and lunched with Mr Fang earlier that month.
That course of contact can be extracted from MFI 21, the comprehensive call charge records assembled in a schedule showing all contact between the co-conspirators and others from 21 January 2007 to 25 November 2010 as follows: 30.06.2008 8:29am Moses Obeid calls Edward Obeid (12 seconds) 30.06.2008 8:30am Moses Obeid SMS to Fang (this is the first telephone contact between Alan Fang and Moses Obeid) 30.06.2008 10:38am Fang calls Moses Obeid (1 minute 42 seconds) 30.06.2008 11:18am Fang calls Macdonald (1 minute 43 seconds) 30.06.2008 - time unknown Rumore meeting - Fang and Moses, Gerard and Paul Obeid 30.06.2008 12:40pm Edward Obeid calls Macdonald (1 minute 13 seconds) 30.06.2008 1:46pm Macdonald calls Edward Obeid (30 seconds) 30.06.2008 2:06pm Moses Obeid calls Edward Obeid (15 seconds) 30.06.2008 2:28:24pm Moses Obeid calls Edward Obeid (26 seconds) 30.06.2008 4:10pm Macdonald calls Fang (30 seconds) 30.06.2008 5:30pm Macdonald calls Fang (30 seconds) 30.06.2008 5:41pm Moses Obeid calls Edward Obeid (41 seconds) 30.06.2008 7:05pm Edward Obeid calls Macdonald (30 seconds) 01.07.2008 7:33am Moses Obeid calls Edward Obeid (3 minutes and 46 seconds) 01.07.2008 8:28am Edward Obeid calls Macdonald (1 minute 34 seconds) 01.07.2008 9:07am Moses Obeid calls Edward Obeid (12 seconds) 01.07.2008 10:28am Edward Obeid calls Moses Obeid (30 seconds) 01.07.2008 1:17pm Fang calls Macdonald (2 seconds) 01.07.2008 1:21pm Macdonald calls Fang (30 seconds) 01.07.2008 1:33pm Edward Obeid calls Moses Obeid (1 minute)

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Judgment (7 paragraphs)

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