Sage v AYI23

Federal Court of Australia|2023-11-02|Before: Abraham J

The respondent is guilty of contempt of the Australian Criminal Intelligence Commission (ACIC) in that, on [REDACTED], when appearing as a witness at an examination before the applicant, the respondent refused to answer four questions that he was required to answer by the applicant, contrary to s 34A(a)(ii) of the Australian Crime Commission Act 2002 (Cth) (ACC Act).
The respondent is guilty of contempt of the ACIC in that, on [REDACTED], when appearing as a witness at an examination before the applicant, the respondent refused to answer six questions that he was required to answer by the applicant, contrary to s 34A(a)(ii) of the ACC Act.

The respondent is sentenced to a term of imprisonment of 7 months, to commence on 2 November 2023 and end on 1 June 2024.
A warrant for the respondent's committal to prison be issued and with a copy of these Orders, be provided to Corrective Services NSW.
The respondent is to pay the applicant's costs of the application to be agreed or assessed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Evidence 5 In support of the application the applicant read affidavits of the following persons: (a) a Senior Lawyer of the ACIC, affirmed 31 March 2023; (b) Darshana Sivakumaran, sworn 26 July 2023; and (c) Nicola Colagiuri, affirmed 26 July 2023. 6 The respondent read affidavits of the following persons: (a) the respondent's mother, affirmed 18 October 2023; and (b) a paralegal employed by the respondent's solicitor's firm, sworn 18 October 2023.

Statutory and regulatory background 7 The ACIC, which is established by s 7 of ACC Act, has functions including the collection, correlation, analysis and dissemination of criminal information and intelligence, and undertaking "special ACC operations" and "special ACC investigations" relating to "federally relevant crime": s 7A(a)-(c). The Board of the ACIC (the Board) makes determinations pursuant to ss 7C(2) and (3) to authorise special ACIC operations and special ACIC investigations to occur. 8 In carrying out the ACIC's functions, examiners appointed under Div 3 of Pt 2 of the ACC Act may require the production of specified information or documents, and examiners or police officers on the staff of the ACIC may obtain and execute search warrants: ss 19A, 21A, 20-22 of the ACC Act. An examiner may summon a person to appear before the examiner to give evidence and to produce such documents or other things as are referred to in the summons: s 28 of the ACC Act. It is an offence for persons summonsed to appear as a witness at an examination not to attend as required, to refuse or fail to take an oath or affirmation as required, to refuse or fail to answer a question that they are required to answer, and to refuse or fail to produce a document or thing which they were required by the summons to produce: s 30 of the ACC Act. 9 It is evident that the examination of persons by examiners, such as the respondent in this case, is an important means by which the ACIC obtains information relevant to the discharge of its functions: Anderson v DKH18 [2018] FCA 1571 (DKH18) at [6]; Anderson v XLVII [2015] FCA 19 (XLVII) at [15]. 10 Persons appearing as witnesses at an examination before an ACIC examiner are in contempt of the ACIC if they refuse or fail to answer a question which they are required to answer by the examiner: s 34A(a)(ii) of the ACC Act. If an examiner is of the opinion that a person is in contempt of the ACIC during an examination, the examiner may apply to this Court for the person to be dealt with in relation to the contempt: s 34B(1)(a). 11 If the Court finds the person was in contempt of the ACIC, the Court may deal with the person as if the acts or omissions involved constituted contempt of this Court: s 34B(5) of the ACC Act. Contempt of this Court is addressed by s 31 of the Federal Court of Australia Act 1976 (Cth), and the procedure for punishment is contained in Pt 42 of the Federal Court Rules 2011 (Cth). 12 The relevant summons was issued to the respondent on 23 November 2022, which required him to attend an examination before the applicant on [REDACTED] (the Summons). 13 The examination in this matter was for the purpose of a special ACIC operation, being the High Risk and Emerging Drugs 2020 Special ACIC Operation (Operation). The Operation was authorised by the Special Australian Criminal Intelligence Commission Operation Determination (High Risk and Emerging Drugs) 2020 (Determination), dated 28 July 2020. The Summons on its face, stated that it required the respondent to answer questions for the purposes of the Operation about matters relating to "high risk and emerging drugs" (as defined in the Determination), which included the importation and trafficking of border-controlled drugs (in particular cocaine); dealing with money or other property, especially large volumes of cash, that were the proceeds or instruments of such activities; the use of dedicated encrypted communication devices to facilitate such activities; connected activities involving the provision of electronic counter surveillance measures to organised crime groups or individuals; and the identities of other persons involved in such activities and the nature and extent of their involvement. 14 The evidence establishes that the purpose of the examination was for the ACIC to obtain information in relation to criminal activities involving the distribution of cocaine and laundering of significant amounts of monies as a part of a known sophisticated drug supply syndicate, including further information regarding the communications services supporting the syndicate.

Factual background 15 The respondent appeared before the applicant at the examination on [REDACTED]. 16 At the commencement of the first examination the respondent was represented by a lawyer. The examiner explained various matters to the respondent, including that the examination would be conducted in private; that the respondent could take a break to speak to his lawyer, that the respondent's evidence would be treated as confidential, his legal rights and obligations, including his obligation to answer questions and that a failure to do so is a contempt which is punishable by a potentially indefinite term of imprisonment, and that the respondent had protection from self-incrimination. The respondent was then asked questions relating directly to the Operation. Although he initially answered the questions, the respondent thereafter refused to answer questions and made it clear he was not going to answer any further questions. As a consequence, the examination was adjourned to [REDACTED]. The respondent appeared before the applicant on [REDACTED], where he again refused to answer questions that the applicant required him to answer, which were relevant and material to the Operation. Again, he clearly stated that he would not answer any further questions. As a consequence, the examination was adjourned to [REDACTED] for mention only. At the end of the second examination the respondent was invited to contact the ACIC if he changed his mind and decided that he was willing to speak to the ACIC. He has not done so. 17 During each of the hearings the examiner reminded the respondent of his obligation to answer questions and the consequences of failing to do so. The respondent was given repeated opportunities to seek further legal advice. The respondent repeatedly made clear he was not going to answer further questions. 18 On 7 March 2023, the applicant's solicitors, the Australian Government Solicitor, wrote to the respondent, inviting him to purge his contempt. The applicant has not accepted that invitation and he has not purged his contempt. 19 A special ACIC operation and/or investigation can be undertaken only while a determination is in force: s 7C(4E) and (4F) of the ACC Act. The relevant Determination expired on 27 July 2023 and the Summons is no longer extant.

Relevant legal principles 20 In Anderson v BYF19 [2019] FCA 1959 (BYF19) at [42]-[49], and Lusty v CRA20 [2020] FCA 1737 (CRA20) at [31]-[39], I summarised the principles applicable to sentencing for contempt offences in this context. The following summary of principles is taken in large part from those reasons. 21 As I observed, in DKH18, White J summarised some of the authorities which reflect on the significance and importance of the offence of contempt (both in the context of the ACC Act and more broadly), at [24]-[27] as follows: [24] A number of the authorities bear out the seriousness with which conduct of the present kind is viewed. In Von Doussa v Owens (No 3) (1982) 31 SASR 116, the contempt of the defendant consisted of a failure to comply with an order of the Full Court of the Supreme Court of South Australia which required him to answer questions put to him by an inspector appointed under the Securities Industry (South Australia) Code. King CJ (with whom Zelling and Wells JJ agreed) said, at 117-8: The effectiveness of the administration of justice depends upon compliance by witnesses with the legal obligation to answer relevant questions. This is so whether the proceedings are in a court of law or before some other tribunal or authority which Parliament has empowered to compel answers. No private undertaking can be regarded as an excuse for failure to comply with that legal obligation. This investigation is still in progress in that the inspector has not, we are told, lodged his report, and the applicant still has the opportunity to purge his contempt by giving the answers required. His continuing non-compliance with the Court's order to do so amounts to a deliberate and considered persistent defiance of the authority of the law. It cannot be condoned or tolerated. … It is to be emphasised that [the] answers were sought not in any private litigation between citizens but in the course of an investigation authorised and established pursuant to the powers conferred by an Act of Parliament in the public interest. The Court must do what it can to prevail upon the applicant to see the matter in a clearer light and to comply with his legal obligation. [25] King CJ referred with approval to a statement of Mitchell J that, if witnesses were able to gain the impression that information sought by an inspector could be withheld "by the mere payment of a tariff", investigations may well prove completely ineffective, at 118. [26] A statement of Moffitt P in Thelander v Woodward [1981] 1 NSWLR 644 at 646 is to like effect: Where appropriate, the sanctions of contempt and a charge under s 21 should be pursued with vigour and expedition. Indeed unless this is done an inquiry is at risk of becoming a lame one, which does not reach out to the leaders or the central planning of crime. [27] In Hannaford v HH [2010] FCA 1214; (2010) 205 A Crim R 366, Dodds-Streeton J noted: [57] While the respondent pleaded guilty, the contempt was extremely serious. The answers to the specified questions were sought by the ACC in pursuit of its functions in the public interest. As noted in comparable cases, the ACC's examination processes would be hamstrung if all witnesses adopted the respondent's approach. Dodds-Streeton J also noted, at [59], that a primary objective of the legislation enabling this Court to deal with contempts of the ACIC was "the introduction of a compelling incentive for an unco-operative witness to co-operate in a timely way, by providing the information sought while it remains useful for the ACC's purposes". 22 The purposes of punishment for a contempt constituted by a refusal to answer questions in a Court or Commission of Enquiry are said to be retribution for the contempt, coercion of the person into answering the question, and the deterrence of others: XLVII at [49] per White J; Wood, Honourable Justice v Galea [1995] NSWSC 100; (1995) 79 A Crim R 567 (Wood v Galea) at 571 per Hunt CJ; Von Doussa v Owens (No 3) [1982] SASC 6369; (1982) 31 SASR 116 (Von Doussa v Owens (No 3)) at 118 per King CJ (Zelling and Wells JJ agreeing); Hannaford (an examiner under the Australian Crime Commission Act 2002) v HH [2010] FCA 1214; (2010) 205 A Crim R 366 (Hannaford) at [39] per Dodds-Streeton J citing Wood v Galea at 571. A contempt constituted by a refusal to answer questions in a Court or Commission of Enquiry is usually to be regarded as a serious contempt: XLVII at [49]; Wood v Galea at 571; Von Doussa v Owens (No 3) at 117-8 per King CJ (Zelling and Wells JJ agreeing). 23 It has been recognised that because of the importance of the element of coercion, an order for imprisonment for an indefinite period will often be appropriate: XLVII at [49] per White J citing Wood v Galea at 573; Von Doussa v Owens (No 3); Hannaford at [60]-[63], although coercion is inappropriate if the person has purged his or her contempt, or if it is no longer necessary to obtain answers to the questions giving rise to the contempt: XLVII at [49] per White J; Wood v Galea at 573. 24 In Anderson v GPY18 [2019] FCA 954 (GPY18), Banks-Smith J at [25]-[27] referred to the considerations identified by Dunford J in Wood v Staunton (No 5) (1996) 86 A Crim R 183 at 185 as having been regarded by subsequent cases as a convenient guide when sentencing for criminal contempt both in the context of statutory contempt provisions and common law; and see for example: DKH18 at [29]; Allbeury v Corruption and Crime Commission [2012] WASCA 84; (2012) 42 WAR 425 at [216]; Australian Competition and Consumer Commission v Jutsen (No 6) [2012] FCA 809 at [9]; Hannaford v HH (No 2) [2012] FCA 560; (2012) 203 FCR 501 (Hannaford (No 2)) at [27]. Although, it must be acknowledged that the list of considerations is not exhaustive: Hannaford (No 2) at [73]. Dunford J identified ten considerations in assessing the proper punishment for contempt in the following terms: (1) the seriousness of the contempt proved; (2) whether the contemnor was aware of the consequences to himself of what he did; (3) the actual consequences of the contempt on the relevant trial or inquiry; (4) whether the contempt was committed in the context of serious crime; (5) the reason for the contempt; (6) whether the contemnor has received any benefit by indicating an intention to give evidence; (7) whether there has been any apology or public expression of contrition; (8) the character and antecedents of the contemnor; (9) general and personal deterrence; and (10) denunciation of the contempt. And see: Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83; (2006) 149 FCR 494 at [25] per Merkel J; Kazal v Thunder Studios Inc (California) [2017] FCAFC 111; (2017) 256 FCR 90 (Kazal) at [101]-[103] per Besanko, Wigney and Bromwich JJ. 25 There is no prescribed or maximum penalty for a contempt of this nature. There are a range of penalties available: see Hughes v Australian Competition and Consumer Commission [2004] FCAFC 319; (2004) 247 FCR 277, in which the Full Court (French, Emmett and Dowsett JJ) at [55] citing Nicholson J in Australian Competition and Consumer Commission v INFO4PC.com Pty Ltd [2002] FCA 949; (2002) 121 FCR 24 at [138], set out the range as follows, being to: (1) commit a contemnor to prison for an indefinite period of time; (2) to impose a fine for a wilful breach of an order or undertaking; (3) to impose a daily fine; (4) to order the sequestration of the assets of a contemnor; and (5) to suspend on condition any sentence of imprisonment that it might impose in respect to contempt.

Consideration 26 As the Determination under which the Summons was issued is no longer extant, the parties agreed the penalty to be imposed ought to be a fixed term of imprisonment. As the Determination is not extant, coercion is no longer an element of any sentence. 27 The respondent's contempt was deliberate. The respondent was repeatedly informed of the consequences of his refusal to answer the questions and took that approach in a context where he received legal advice in relation to the examination. He was represented by a lawyer at the outset of the first hearing, but that lawyer subsequently withdrew from the hearing. The applicant was given ample opportunities to obtain further legal advice which he repeatedly declined. He was aware of the obligations imposed on him by the Summons and the consequences of his actions. 28 I accept the applicant's submission that the failure to answer the questions impacted on the ACIC's investigation. It is unnecessary for present purposes to detail the questions asked, noting that these reasons are necessarily written at a level of generality given the non-publication orders in place. Suffice to say that the purpose of the examination, in the context of the Determination, was broader than acknowledged by the respondent in his submissions. The purpose of the examination was for the ACIC to obtain information in relation to criminal activities involving the distribution of cocaine and laundering of significant amounts of monies as a part of a known sophisticated drug supply syndicate, including further information regarding the communications services supporting the syndicate, including a particular encrypted messaging platform. The respondent's failure to answer the questions as required hindered the ACIC at that time from obtaining answers in relation to a number of matters about which he is expected to have knowledge, including: the identities and roles of persons involved in the supply and trafficking of illicit drugs; methods of moving monies suspected to be proceeds of crime offshore; and methodologies employed by members of relevant criminal groups to avoid detection by law enforcement agencies. That is so regardless of what may have become known to the ACIC at any later stage. 29 In the context of the statutory scheme, this offence of contempt is properly characterised as serious: see for example: DKH18 at [24]-[28]; BYF19 at [54]; CRA20 at [40]-[41]. 30 In BYF19 at [54], in like circumstances, I observed that: …the respondent's approach in refusing to answer questions undercuts the effectiveness of the scheme which authorises these compulsory examinations. The examination processes would be hamstrung if all witnesses adopted the approach that the respondent has taken. The investigations of which the examination was a part, are of significant importance to the protection of the broader community. The serious impact on the community of illicit drug use and supply, and associated crime is uncontentious. General deterrence must necessarily play a prominent role in any such sentence. 31 Those observations apply in this case with equal force. And see Australian Crime Commission v DTO21 [2022] FCA 288 (DTO21) at [90]. 32 The respondent provided no explanation for his failure to answer questions. At its highest there is second hand evidence after the event of a subjective generalised fear of the consequences of answering questions. The evidence relied on provides no reasonable objective basis for any fear. There is no evidence of any specific threat. 33 In any event, fear of retribution is a matter that will rarely be given mitigatory weight: BYF19 at [58]-[61]; Hannaford (No. 2) at [33]; CRA20 at [45]; Lusty (Examiner) v DEZ22 (No 2) [2023] FCA 858 (DEZ22) at [14]. And see GPY18 at [31], where Banks-Smith J observed: …it can fairly be said that the exercise of powers to facilitate the investigation of matters such as those the subject of the HRED 3 determination would also be impeded if significant mitigating weight were given to an assertion of fear of retribution as a reason for refusing to provide information. Whilst I acknowledge the somewhat limited explanation for the contempt given by the respondent, it is not a matter to which I give any real weight by way of mitigation. 34 Those comments are apt in this case. 35 The respondent has some prior criminal history, although not of particular significance. He is currently remanded in custody in relation to significant drug and drug related charges for which he has pleaded guilty and is awaiting sentence. This is his first time in custody. He indicated a plea of guilty at a relatively early stage, which I take into account at the very least for its utilitarian value. That said, it says little as to the subjective aspects of his case. The evidence before me establishing the contempt reflects that a plea was inevitable. I accept his mother's evidence as to his background. Nonetheless, there is little by way of mitigation of the sentence to be imposed. There is no evidence of remorse or contrition. There was no purging of the contempt despite opportunities to do so before the Determination expired on 27 July 2023. Given the importance of deterrence and denunciation of the conduct to any sentence imposed, relatively speaking, matters personal to the respondent are of lesser weight. 36 I have been referred by the applicant to a number of decisions where sentences have been imposed in factual circumstances said to be comparable to this case. In any decision relating to sentencing, an important consideration is consistency with the kinds of sentences imposed in comparable cases. Like cases should be treated in like manner: Wong v The Queen [2001] HCA 64; (2001) 207 CLR 584 at [6]; The Queen v Pham [2015] HCA 39; (2015) 256 CLR 550 at [28]. The consistency sought is consistency in the application of relevant legal principles: The Queen v Pham at [28], citing Hili v The Queen [2010] HCA 45; (2010) 242 CLR 520 at [49]. Past contempt sentences do not fix the boundaries within which future judges must sentence, but rather are a historical statement of what has happened in the past and provide some guidance to sentencing judges: Hili v The Queen at [54]. For the application of this principle to the offence of contempt see: Vaysman v Deckers Outdoor Corporation Inc [2011] FCAFC 17; (2011) 276 ALR 596 at [51]; Kazal at [113] - [118]; DEZ22 at [29]. 37 I was referred to the following cases: BYF19; CRA20; DTO21; Lusty v CVA22 [2023] FCA 130; and DEZ22. I have considered these cases, and others where sentences have been imposed for like contempts, (for example, GPY18). It is important to recall, as expressed by Besanko, Wigney and Bromwich JJ in Kazal, each case must be considered on its own facts and circumstances.

Sentence 38 As explained above, the respondent is currently remanded in custody and awaiting sentence in relation to several offences. It was accepted by the parties that only a fixed term of imprisonment is appropriate. I agree. 39 Having taken into account the evidence, submissions, considerations relevant to assessing the proper punishment for contempt and the relevant sentencing principles, in my view a sentence of seven months imprisonment is appropriate. 40 I impose a sentence of imprisonment for seven months commencing on 2 November 2023, to end on 1 June 2024. 41 I also make the declarations in the terms sought. I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Abraham.

Australian Crime Commission Act 2002(Cth)ss 7, 7C, 19A, 21A, 20-22, 34A(a)(ii), 34B, 46B

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