Sage v CFT22

Federal Court of Australia|2022-09-06|Before: Bromwich J

THE COURT DECLARES THAT:

The respondent is guilty of a charge of contempt of the Australian Crime Commission in that, on [REDACTED], being a witness appearing at an examination before an Examiner, he refused or failed to take an oath or affirmation when required to do so under section 28 of the Australian Crime Commission Act 2002 (Cth), contrary to s 34A(a)(i) of that Act.

THE COURT ORDERS THAT: 2. The respondent be imprisoned on and from [REDACTED], being the day before he is eligible for parole on the sentences imposed on [REDACTED], until further order. 3. By or before [REDACTED], a warrant for the respondent's committal to prison be issued and be provided to Corrective Services NSW, together with a copy of these Orders. 4. If the respondent purges his contempt: (a) the applicant notify the Associate to Justice Bromwich of that within 2 working days; and (b) either party has liberty to apply for an order discharging or modifying order 2 and/or order 3. 5. If the parties reach an agreement on arrangements for the respondent to purge his contempt and for the commencement of the operation of order 2 and/or order 3 to be delayed to facilitate that taking place, either party has liberty to apply for an order modifying order 2 and/or order 3 to permit that to take place. 6. If order 2 is still in force as at [REDACTED], the proceeding be listed for a case management hearing on a date proximate to [REDACTED] (being 12 months from when the respondent is eligible for parole on the sentences imposed on [REDACTED]), with such hearing date to be fixed in consultation with the parties. 7. Pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), to prevent prejudice to the proper administration of justice: (a) The unredacted version of the reasons for judgment not be published and not be made available to any person other than a party to the proceeding or their legal representatives otherwise than pursuant to an order of a judge of the Court. (b) Within 7 days the parties provide to the Associate to Justice Bromwich a proposed redacted version of the reasons for judgment which the parties consider is appropriate for publication. 8. Liberty to apply generally. 9. The respondent pay the applicant's costs of the originating application and statement of charge as agreed or assessed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BROMWICH J: 1 These are reasons for a delayed indeterminate sentence of imprisonment imposed upon the respondent for contempt of the Australian Crime Commission. By force of statute, and also by regulation, the Commission is known interchangeably as the Australian Criminal Intelligence Commission. The respondent's contempt, which he admits, arises from his refusal to take an oath or an affirmation for the purposes of an examination compelled by summons. 2 The applicant, Mr Geoffrey Sage, is an Examiner appointed under s 46B of the Australian Crime Commission Act 2002 (Cth). On [REDACTED], Mr Sage issued a summons to the respondent under s 28(1) of the Act. The summons required the respondent to appear at an examination on [REDACTED]. The summons was served on the respondent in person on [REDACTED]. Among the documents annexed to the summons were explanatory notes, which informed the respondent that he could consult a lawyer, and advised that he must take an oath or affirmation if required to do so, together with warnings about criminal offences and contempt for not complying with such requirements. 3 The respondent attended the examination, was required several times by Mr Sage to take an oath or make an affirmation, and refused to do so. This refusal persisted after he was warned that it constituted a contempt and that an application for him to be dealt with for contempt could be made, the warning being a requirement before bringing such a proceeding, and after being given an opportunity to consult a lawyer who gave him advice. The respondent also verbally advised that he did not wish to participate in the examination, and did not wish to answer any questions. 4 It is plain on the evidence, especially from the transcript of the examination, that the respondent never had any intention to take an oath, make an affirmation, answer any questions, or to participate in the examination beyond appearing before Mr Sage to indicate his stance towards the process. He has never given any reason for the stance he has taken, nor indicated whether that might change, with or without a change in his circumstances. Despite that, there is no reason in the evidence for concluding that he is immune from potentially deciding to comply as required in the face of imprisonment if he does not do so. 5 On 29 June 2022, as foreshadowed, this proceeding for contempt under s 34B and s 34C of the Act was commenced by Mr Sage, by an originating application and statement of charge. 6 On 26 July 2022, Mr Sage's solicitors wrote to the respondent, inviting him to purge his contempt. He did not respond to that letter and has never given any indication of any intention to purge his contempt, either to the Commission or to this Court. Nor has he indicated that he will not purge his contempt. His attitude in that regard is likely to be affected by his personal circumstances, most particularly him serving a sentence of imprisonment, with the head sentence expiring on [REDACTED], and his non-parole period expiring on [REDACTED]. It is notorious that cooperating with any kind of law enforcement authority is viewed poorly, to say the least, by many in the criminal milieu, especially in the prison system. 7 On 1 August 2022, the respondent's solicitors advised the Commissioner and the Court by email that he would plead guilty to contempt. On [REDACTED], at the commencement of the hearing of the originating application and statement of charge, and after the charge was read out to him, the respondent entered a plea of guilty to contempt by reason of refusing to be sworn or make an affirmation. 8 The contempt hearing was conducted by the reading of affidavits, the tendering of documents, and the making of submissions both orally and in writing. There was no evidence from the respondent, and no oral evidence from anyone. 9 There is no dispute between the parties that in all the circumstances the respondent must be sentenced to a period of imprisonment. The only live issues for determination are whether that sentence should be for a fixed duration (and if so, for how long) or for an indeterminate period, and whether it should commence now, or only when he is eligible for parole on [REDACTED] for existing sentences, or perhaps on some later date. 10 For the reasons that follow, I have determined that it is necessary and appropriate in all the circumstances to impose an indeterminate sentence of imprisonment upon the respondent to commence on the day before he is eligible for parole in [REDACTED], and to make provision both for him to purge his contempt and for the parties to reach an agreement to facilitate that taking place and to seek to have his sentence varied for that purpose. 11 I have also determined that it is appropriate for the proceeding to be relisted about 12 months after he is eligible for parole if the contempt has not been purged by then.

The legislative framework 12 The following paragraphs in this section of these reasons, and the first part of the section below headed "Sentencing principles for contempt of the Commission", largely replicates what I said in Sage v CFS22 [2022] FCA 1023 at [14]-[25]. 13 The Commission is established by s 7 of the Act. It has a wide range of functions set out in s 7A involving the obtaining, use and dissemination of criminal information and intelligence, including conducting special operations. The performance of its functions includes examinations, which are conducted by examiners appointed under the Act. 14 Examinations are a key part of the Commission's functions, enabling it to obtain information that would not otherwise be available or only be able to be obtained after lengthy and detailed investigations, assisting in understanding how serious and organised crime operates, and helping to produce intelligence and other information to use and to disseminate to law enforcement agencies: see p.28 of the Explanatory Memorandum to the Law Enforcement Legislation Amendment (Powers) Bill 2015 (Cth). 15 A person may be compelled by summons to attend an examination, and at the examination that person may be compelled to be sworn or take an affirmation and to answer questions and to produce documents or other things. The consequences for non-compliance with the obligation to attend an examination, to be sworn or take an affirmation, to answer questions, or to produce documents or other things; or for giving false or misleading evidence or obstructing or hindering the Commission or an examiner (including in relation to an examination), may be prosecution for an indictable offence provided for by ss 30(1), 30(2), 33 and 35 of the Act. 16 A more timely and responsive remedy for enforcing and promoting compliance with examination requirements, especially when the need for such compliance is ongoing, is a proceeding such as this for contempt of the Commission provided for by s 34A of the Act. Such contempt proceedings may concern some of the same conduct that is criminalised, namely of failure to attend an examination, of refusing or failing to be sworn or take an affirmation and of failing or refusing to answer questions or produce documents or other things. 17 Section 34B bestows jurisdiction on this Court and on the State and Territory Supreme Courts to hear a contempt application, subject to preconditions being met as to the witness being informed of the proposed application and the application being accompanied by a certificate stating the grounds and evidence. 18 For the purposes of determining whether a person is in contempt of the Commission contrary to s 34A of the Act, Chapter 2 of the Criminal Code (Cth) applies as if such a contempt was an offence and references to criminal responsibility were references to a person being responsible for such a contempt: s 34B(6). Chapter 2 of the Criminal Code contains the general principles of criminal responsibility, including in particular the conventional legal standard of proof of beyond reasonable doubt: s 13.2. This mirrors the common law obligation to prove an alleged contempt beyond reasonable doubt: Witham v Holloway (1995) 183 CLR 525 per Brennan, Deane, Toohey and Gaudron JJ at 534.5 and per McHugh J at 535.5. While s 34B(6) has the effect of imposing criminal law thresholds on what must be proven to establish contempt, it does not dispense with the real distinction between contempt proceedings, even when essentially criminal in nature, and ordinary criminal proceedings. Even a proceeding for what was historically regarded as a criminal contempt is not a criminal proceeding: see Kazal v Thunder Studios Inc (California) [2017] FCAFC 111; (2017) 256 FCR 90 per Besanko, Wigney and Bromwich JJ at [20]-[27], especially [24]-[25]. 19 Importantly, there is no equivalent provision to s 34B(6) creating a like regime for the imposition of sanctions for contempt as there are for sentencing, imprisonment and release of federal criminal offenders in Part 1B of the Crimes Act 1914 (Cth). While Part 1B may be used as a convenient general guide or checklist for the imposition of sanctions for contempt, especially for conduct that is complete rather than ongoing, it does not apply as if contempt was an offence and does not otherwise apply by force of law: see by analogy Australian Securities and Investments Commission v Whitebox Trading Pty Ltd [2017] FCAFC 100; 251 FCR 448 per Allsop CJ, Middleton and Bromwich JJ. It follows that the statutory restrictions and obligations in Part 1B do not apply to this proceeding, contrary to a submission made to that effect by senior counsel for the respondent. 20 The remedy of commencing a contempt proceeding is generally going to be more appropriate when compliance with attendance at an examination, or with requirements to be sworn or take an affirmation and to answer questions and to produce documents or other things, is still sought, such that coercion to comply is the most important objective, rather than punishment and related objectives such as for a so-called criminal offence involving only past conduct. In that regard, it is important to note that this contempt proceeding retains at its core the historic, if otherwise largely illusory, civil contempt distinction of being remedial or coercive in nature, primarily used to compel obedience, rather than to punish for disobedience, with the contemnor in such a case being in the position to "carry the keys of their prison in their own pockets": see Kazal at [22(1)], citing Witham v Holloway at 532, in turn quoting from the United States case of In re Nevill (1902) 117 Fed Rep 448 at 461. That is so even though the historical distinction between civil contempt and criminal contempt was found in Witham v Holloway to be largely illusory and unsatisfactory. The Commission generally just wants compliance to be compelled, not the examinee to be punished except to secure that outcome.

The purpose of the examination of the respondent 21 The examination that the respondent was required to attend was in relation to a special operation into criminal wealth, concerning such activities as money laundering, tax evasion, dishonesty and fraud offences and like areas of concern, as well as related or connected offences. The Board of the Commission, which includes the heads of all Australian Police Forces and the heads of other major law enforcement agencies, determined that this special operation was in the public interest.

Sentencing principles for contempt of the Commission 22 The range of penalties available to punish for contempt include prison, including for an indefinite period of time, a fine, sequestration of assets, or a suspended sentence: Australian Competition and Consumer Commission v Info4pc.com Pty Ltd (2002) 121 FCR 24 per RD Nicholson J at [138], endorsed by French, Emmett and Dowsett JJ in Hughes v Australian Competition and Consumer Commission [2004] FCAFC 319; (2016) 247 FCR 277 at [55]. In instances such as this where the contemnor has refused to comply with the requirements of the Commission during an examination, the Court can be left with no real alternative but to impose a sentence of imprisonment, the only question being whether that term should be indefinite or fixed and perhaps what other provisions should be made. 23 There are a number of decisions of this Court in recent years that have comprehensively considered the purposes and the penalties that may be appropriate for examination-related contempt of the Commission and like law enforcement bodies with coercive powers, such as royal commissions, drawing upon contempt of court cases as well. Recently in Australian Crime Commission v DTO21 [2022] FCA 288, Thawley J succinctly summarised the burden of a number of those decisions: [29] The effectiveness of the administration of justice depends upon compliance by witnesses with the legal obligation to answer relevant questions in proceedings, whether those proceedings are in a court of law or before some other tribunal or authority which Parliament has empowered to compel answers: Von Doussa v Owens (No 3) (1982) 31 SASR 116 at 117-8 (King CJ, Zelling and Wells JJ agreeing), referred to by White J in the present context in Anderson v DKH18 [2018] FCA 1571 at [24]. [30] The statutory scheme recognises that answers are sought by the ACIC in the public interest, for the protection of the community, and in circumstances where prompt answers are often highly desirable. The scheme has, as a principal object, 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": Hannaford v HH [2010] FCA 1214; (2010) 205 A Crim R 366 at [57]-[59] (Dodds-Streeton J); Anderson v DKH18 [2018] FCA 1571 at [26]-[28]. [31] In Anderson v XLVII [2015] FCA 19; (2015) 319 ALR 139 at [49], White J observed that "[a] principal purpose of the enactment of ss 34A-34F was to provide the ACC with a means of dealing with uncooperative witnesses which was quicker than the conventional prosecution process". His Honour referred to the explanatory memorandum for the Crimes Legislation Amendment (Serious and Organised Crime) Act (No 2) 2010 (Cth) in which the Minister said: Allowing an examiner to refer a person to a Court to be dealt with for contempt will provide a swift mechanism for dealing with uncooperative witnesses as contempt proceedings bring with them the threat of immediate detention. It is anticipated that the new contempt provisions will motivate an uncooperative witness to reconsider his or her position and comply with the requirements of an examination, and avoid the immediate threat of detention. [32] His Honour then stated at [49(2)]: 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: Wood v Galea (1995) 79 A Crim R 567 at 571; Von Doussa v Owens (No 3) (1982) 31 SASR 116 at 118; Hannaford v HH [2010] FCA 1214, (2010) 205 A Crim R 366 at [39]; [33] In Wood v Staunton (No 5) (1996) 86 A Crim R 183 at 185, Dunford J identified considerations relevant to sentencing for criminal contempt as including: (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. 24 A material consideration is whether the contemnor has been given an opportunity to purge the contempt, and if so, whether that has taken place. The need for the coercive effect of a sentence is greater if that opportunity has been given and not acted upon, and it may add weight to the need for or value of an indeterminate sentence. As Thawley J pointed out in DTO21 at [37]: It has been observed that, because of the importance of the element of coercion, an order for imprisonment for an indefinite period will often be appropriate: Wood v Galea (1995) 79 A Crim R 567 at 573; Von Doussa v Owens (No 3); Hannaford v HH at [60]-[63]; Royal Commissioner v Staunton (unreported, Supreme Court of New South Wales, Dunford J, 8 June 1995) at [26]-[27]; XLVII at [49(4)]; CRA20 at [34]. Indeterminate detention 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: Wood v Galea at 573; XLVII at [49(5)].

Consideration of the competing arguments 25 Mr Sage characterises the respondent's contempt as deliberate and serious, being committed in the context of an investigation to gather information and intelligence on serious offences of or related to criminal wealth activity. He relies upon evidence that the inquiry is not confined to the matters upon which the respondent has been sentenced and is serving a gaol term. He also relies upon the opportunities given to the respondent to comply, both on [REDACTED] and since then, the advice as to the consequences that he was given and was also able to access, and the lack of any reason given for non-compliance (let alone any compelling reason). 26 Mr Sage submits that prolonged delay of the examination has and will continue to adversely impact on the Commission obtaining and analysing current intelligence and other information that the respondent can likely provide, noting that there is no indication that he has obtained any benefit from his defiance, but also that he has not expressed any contrition. Mr Sage points to the respondent's criminal history and the [REDACTED] sentence he is now serving as going adversely to his character and antecedents. Mr Sage characterises the respondent's conduct as being very serious, citing the observations of Banks-Smith J concerning compliance with examination requirements in Anderson v GPY18 [2019] FCA 954 at [20]. Mr Sage seeks an immediate indeterminate sentence in order to coerce compliance by the respondent. 27 The respondent relies upon the evidence and submissions that were before the sentencing judge for the [REDACTED] offences for which he is incarcerated. While I have considered that material, and take it into account generally, I did not find it of much assistance in relation to the present contempt offences. The respondent's deprived background and his mental health issues would have been of significant relevance to those sentence proceedings, especially on the topics of culpability and deterrence when it comes only to punishment and related objectives such as deterrence. However, they do not take matters very far in relation to this very different conduct and the very different objectives guiding penalty determination for ongoing contempt which is in the hands of the respondent to rectify. That sentence material engenders a real measure of sympathy for the respondent, but does not have much bearing on the present circumstances and in particular on his considered decision not to comply and the need for coercion to encourage him to change his mind. I did not find that the submissions made on behalf of the respondent were such as to convince me otherwise. 28 Although the submissions for the respondent adverted to further evidence possibly being adduced to explain why he had declined to cooperate, that was not ultimately forthcoming. The Court is left with little more than defiance without any reason being given. It was suggested that I could take some kind of judicial notice as to what might have been going on and what might have motivated the respondent to behave as he did, but there was no proper basis identified for that taking place. In the end, no persuasive argument was advanced to disregard any material aspect of Mr Sage's submissions. 29 The respondent also suggests that some kind of comparison can be drawn with the indictable offences provided for the same conduct, for which the maximum penalty is five years' imprisonment and/or a fine. This might conceivably provide some comparative value if the contempt was all in the past, such that the sanction to be imposed was more like a criminal sanction, without any coercive and remedial objective. However, that is not the present situation and I find the criminal offence provisions and maximum penalties of no real assistance. 30 I mostly prefer and accept Mr Sage's submissions, subject to one aspect considered below. I find the respondent's contravening conduct in refusing to take an oath or make an affirmation was pre-planned, deliberate and serious, and that it has impeded the important objectives of the special operation that the examination was in aid of, as well as the Commission's objectives and functions more generally. I find that the respondent has not given any reason at all as to why he has made the deliberate decision not to take an oath or make an affirmation, and I decline, as urged by his senior counsel, to have regard to general knowledge to speculate as to the reasons he might have had, but has chosen not to place before the Court. Accordingly, there is no evidence before me by which I am able to form any conclusion that the ordinary incidence of a coercive sanction would not be likely to be effective over time. 31 I am satisfied that the respondent has been given ample opportunity to purge his contempt and that he has made a conscious decision not to do so. I am satisfied that without sanction, the respondent will continue to refuse to take an oath or make and affirmation, and necessarily as a consequence will not answer questions or otherwise comply with examination requirements. I am satisfied that it is necessary and appropriate in all the circumstances to impose a sentence for contempt that will maximise the prospect of him changing his mind and purging his contempt. 32 The conclusions I have reached are reinforced by the respondent's existing sentence and criminal history and therefore his capacity to resist any other incentives for purging his contempt. I also take into account that the coercion of a prison sentence, if effective, is likely to have the collateral benefit of also causing or encouraging the respondent to cooperate with the examination process more generally, including complying with the usual lawful requirements likely to be imposed upon him. 33 While I accept that prolonged delay of the examination has and will continue to adversely impact on the Commission obtaining and analysing current intelligence and other information that the respondent can likely provide, the practical reality of the situation is that no sentence that this Court can impose now will have any real effect while he is still serving his non-parole period. While the existence of such a sentence may impede the grant of parole, all that will mean is that he will remain in custody principally because of his prior criminal offending, not because of this contempt. It follows from this reasoning that I am unable to accept Mr Sage's argument that there is any real utility in imposing an immediate indeterminate sentence now. Apart from any possible impact on the grant of parole, which is speculative in the absence of any specific information in that regard, a sentence imposed now will have no practical effect upon the respondent at least until he is eligible for parole after [REDACTED]. The respondent being eligible for parole, yet at peril of remaining in custody if he does not purge his contempt, makes the commencement of a sentence at that later time more compelling and coercive in its effect. It is more likely from then to have an impact on the respondent in deciding to purge his contempt. 34 Weighing up the competing arguments and considerations, and being predominantly concerned with arriving at a penalty most likely to cause the respondent to purge his contempt, I have determined that the appropriate sentence is one that does not commence until the last day of his non-parole period. I gave careful consideration as to whether a fixed sentence would be appropriate, but am unable to find that is so. That is because the parole period runs for [REDACTED]. Unless and until the respondent is granted parole, any sentence that I impose will not have any separate effect upon him. The question of a determinate sentence can be revisited if and when a parole decision is made in his favour. 35 For the present, the only viable option is to impose an indeterminate sentence commencing on the last day of the non-parole period, and making provision for this to be revisited upon the respondent either purging his contempt, or 12 months into his parole period. I will also make provision for an agreement to be reached between the parties as to arrangements for the respondent to purge his contempt and for the commencement of the sentence to be delayed to facilitate that taking place. The parties will also be granted liberty to apply upon such an agreement being reached to modify the start date for the sentence, or to change it in some other way.

Conclusion 36 The foregoing are my reasons for making a declaration of contempt, orders for the respondent to serve an indeterminate sentence to commence on the last day of his non-parole period, and ancillary orders related to the respondent purging the contempt or facilitating him purging the contempt. I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Bromwich.

Australian Crime Commission Act 2002(Cth)ss 7, 7A, 28, 28(1), 30(1), 30(2), 33, 34A, 34B, 34B(6), 34C, 35, 46B

At a glance

Court

Decision date

Before

Source

Judgment (8 paragraphs)

Parties

Legislation Cited (3)

Cases Cited (16)

Cited By (1)