[2019] HCA 48
Liberato v The Queen (1985) 159 CLR 507
[1985] HCA 66
LN v R [2020] NSWCCA 131
The Queen v De Simoni (1981) 147 CLR 383
Source
Original judgment source is linked above.
Catchwords
[2019] HCA 48
Liberato v The Queen (1985) 159 CLR 507[1985] HCA 66
LN v R [2020] NSWCCA 131
The Queen v De Simoni (1981) 147 CLR 383
Judgment (6 paragraphs)
[1]
Solicitors:
Stephen Modder (Applicant)
Solicitor for Public Prosecutions (Respondent)
File Number(s): 2017/65291
Decision under appeal Court or tribunal: District Court
Jurisdiction: Criminal
Date of Decision: 08 May 2020
Before: Townsden DCJ
File Number(s): 2017/65291
[2]
Judgment
BASTEN JA: On 1 March 2017 the applicant, Simon Yacoub, was apprehended by police whilst in possession of $499,850 in cash. He was charged with one count of dealing with property valued at more than $100,000, there being reasonable grounds to suspect that the property was the proceeds of crime: Crimes Act 1900 (NSW), s 193C(1). The offence carried a maximum penalty of imprisonment for 5 years.
On 4 November 2019 he was arraigned before Judge Townsden and a jury on an indictment jointly with his brother Bourack Raad. On 13 November 2019 the jury returned verdicts of guilty in respect of each. On 8 May 2020 the applicant was convicted and sentenced to imprisonment for 3 years with a non-parole period of 2 years and 3 months. On 7 January 2021 the applicant filed an application for leave to appeal against conviction. The sole ground of appeal was formulated as follows:
"That in the circumstances of the Applicant's trial there was occasioned to the Applicant a miscarriage of justice in that the trial judge failed to direct the jury that even if they did not believe, on the probabilities, the Applicant's defence, the obligation on the prosecution to prove its case beyond reasonable doubt remained and it was not necessary the jury believe his defence before finding a reasonable doubt as to his guilt."
On 7 May 2021 the applicant filed an amended notice, seeking to appeal against both conviction and sentence. The sole ground of appeal with respect to the sentence was as follows:
"The sentencing judge erred by finding that the applicant was 'money laundering' such a finding erroneously inflated the objective criminality of the applicant and consequently the quantum of both the head sentence and non-parole period."
The applicant accepted that both applications were out of time and sought the necessary extensions of time to permit the matter to proceed. Those extensions were not opposed and should be granted. However, the applicant also accepted that he required leave with respect to the conviction appeal pursuant to r 4.15 of the Supreme Court (Criminal Appeal) Rules 2021 (NSW), no direction in the terms sought having been requested in the course of the trial. Counsel for the Director of Public Prosecutions opposed leave on the basis that the ground lacked merit. For reasons explained below, that submission should be accepted.
Counsel for the Director also submitted that leave to appeal against sentence should be refused because the ground was lacking in merit. As explained below, leave should be granted, but the appeal dismissed.
[3]
Factual background
Given the limited nature of the proposed appeal, the circumstances of the offending may be briefly summarised. The incident giving rise to the charge took place in a period of a few minutes in the car park of a business known as "Flower Power" at Taren Point in southern Sydney. The applicant and his brother arranged to meet one Daniel Laurentiu at the car park. The applicant and his brother arrived in a white Toyota Corolla which the applicant had hired. Following telephone conversations that morning, the applicant and his brother arrived at Flower Power shortly before 1pm on 1 March 2017. A grey Lexus sedan driven by Mr Laurentiu arrived at 1pm. Laurentiu and the applicant got out of their vehicles and shook hands. The applicant then got back into the driver's seat of the Toyota and Mr Laurentiu got into the back seat on the driver's side. A few minutes later a Volkswagen Caddy van entered the car park and stopped next to the Toyota. Both the Lexus and the Caddy were registered in Mr Laurentiu's name. Laurentiu and the applicant then got out of the Toyota. About one minute later, the Volkswagen left the car park. Mr Laurentiu returned to his Lexus and drove away; the applicant drove the Toyota out of the car park. At all stages his brother was sitting in the front passenger seat.
The Toyota was stopped by police shortly after leaving Flower Power. A pink (or purple) Coles shopping bag was found by police behind the driver's seat of the Toyota. In it was a cardboard box with a large quantity of Australian currency. The police also found a blue Staples drawstring bag (with the strings drawn tight) behind the driver's seat in which was a further amount of Australian currency. The pink/purple Coles bag was found to contain, in the unsealed cardboard box, an amount of $279,950. The blue Staples bag contained a small brown paper bag and two plastic shopping bags with their handles tied in a knot, one being grey and one blue. Inside the shopping bags were large brown paper bags. The total amount in the blue Staples bag was $219,900.
None of the above facts were in dispute. The principal factual dispute concerned what happened at the time that the Volkswagen arrived. The police case was that Mr Laurentiu opened the rear sliding door of the Volkswagen, reached in and then handed the pink/purple Coles bag and the blue drawstring bag to the applicant who placed them inside the Toyota behind the driver's seat. Further, forensic experts obtained a fingerprint from the blue plastic shopping bag inside the blue drawstring Staples bag on which there was a print identified as that of the right middle finger of Mr Laurentiu. There was no suggestion that Mr Laurentiu was known to or had any contact with the applicant or his brother prior to 1 March 2017. Accordingly, it was the prosecution case that Mr Laurentiu's fingerprint could only have been on the plastic bag inside the blue Staples drawstring bag if the bag had been provided to the applicant by Mr Laurentiu at the Flower Power car park.
The dispute about what happened at the car park turned in part upon evidence given by three police officers who conducted surveillance at the time. One officer, who did not take photographs, stated that he saw Mr Laurentiu reach into the back of the Volkswagen and remove the pink Coles bag and hand it to the applicant, who placed it behind the rear driver's seat of the Toyota. He did not see the blue bag. A second officer also witnessed something appearing to be taken from the rear of the Volkswagen, although he could only see the movements of Mr Laurentiu and the applicant, but saw the applicant place the pink bag in the rear driver's side of the Toyota. He did not see the blue bag.
The applicant gave evidence that he had taken the two bags, the blue and the pink bag to the Flower Power car park where he was intending to meet Mr Laurentiu to buy bitcoin. He said that the two bags were on the floor behind the driver's seat when Mr Laurentiu got into the car. However, Laurentiu thought he was obtaining a loan, rather than selling bitcoin. He said that one of the bags stuck to Mr Laurentiu's foot as he was getting out of the car. He, the applicant, jumped out of the car and Laurentiu picked up the bag and gave it to the applicant who put it back behind the driver's seat. He said it was the pink bag, not the blue bag. [1]
The applicant stated that he had obtained an amount of $550,000 in Australian currency in the course of dealing with a person said to live in Dubai named "Haj". He said that Mr Haj owed him $620,000 and, in August 2016, he had collected an amount of $250,000 in Queensland on behalf of Mr Haj. He said that in October 2016 he had been asked to collect a further $300,000 on behalf of Mr Haj and, because he was then in Lebanon, had arranged for his brother to collect the money on his behalf. His evidence was that he had retained the money and taken it with him to the Flower Power car park to pay for the expected bitcoin purchase.
The evidence of receipt of two amounts being $250,000 on 25 August 2016 and $300,000 on 5 October 2016 were confirmed by a police officer who had been in charge of a controlled operation in the course of which those amounts had indeed been handed to the applicant and his brother. He also gave evidence that the $250,000 was directed to be delivered to a specified account in US currency and that an amount of $US167,515 had been deposited in the account on 22 September 2016. With respect to the $300,000 collected on 5 October 2016, pursuant to further directions, two amounts of $US205,000 and $US55,000 had been delivered to an undercover operative in New York. The applicant gave evidence that he did not know that the funds were supplied by undercover police at the time. He denied that he had been given instructions to pay the money to any person in New York or to an account.
[4]
Jury direction
In order to consider the proposed jury direction, it is necessary to identify the circumstances in which the issue as to the burden of proof arose. First, s 193C of the Crimes Act relevantly provided:
193C Dealing with property suspected of being proceeds of crime
(1) A person is guilty of an offence if -
(a) the person deals with property, and
(b) there are reasonable grounds to suspect that the property is proceeds of crime, and
(c) at the time of the dealing, the value of the property is $100,000 or more.
Maximum penalty - Imprisonment for 5 years.
…
(4) It is a defence to a prosecution for an offence under this section if the defendant satisfies the court that the defendant had no reasonable grounds for suspecting that the property was substantially derived or realised, directly or indirectly, from an act or omission constituting an offence against a law in force in the Commonwealth, a State or a Territory or another country.
The term "deal with" in s 193C(1)(a) is defined to include "receive, possess, conceal or dispose of": s 193A, deal with (a).
There was no doubt that the applicant possessed the money, so as to satisfy par (a) in s 193C(1), and that the money had a value of more than $100,000, so as to satisfy par (c). Thus, the only issue in dispute in the prosecution case was whether there were reasonable grounds to suspect that the property was the proceeds of crime. That element had to be established beyond reasonable doubt and the jury were clearly so directed by the trial judge. The prosecution called evidence about how money laundering occurred and the indicia which were common to such operations and were found in the particular case. These elements were identified as the reasonable grounds to suspect that the money in the car was indeed the proceeds of crime.
The applicant's evidence as to the source of the funds received in 2016 was confirmed by the police evidence. However, the applicant's evidence that he retained the money after October 2016 was contradicted by the officer's evidence that the money had been transferred to the US as directed. If the officer's evidence were accepted, the same money could not have been in the applicant's possession on 1 March 2017 at Taren Point.
In this Court, counsel for the Director described the applicant's explanation as to the source of the money as "fanciful". The jury may well have taken the same view. However, they were required to consider first whether the prosecution case established beyond reasonable doubt that there were reasonable grounds to suspect that the money was the proceeds of crime, before considering the applicant's explanation. That led to the present complaint that the jury were not directed that "even if they did not believe, on the probabilities, the applicant's defence the obligation on the prosecution to prove its case beyond reasonable doubt remained and it was not necessary that the jury believe his defence before finding a reasonable doubt as to his guilt."
Counsel for the applicant contended that such a direction was required in accordance with the principles stated by the High Court in Liberato v The Queen. [2]
The passage sought to be relied upon is to be found in the dissenting judgment of Brennan J (with whom Deane J agreed) and has been widely accepted as a matter of principle. The offences in Liberato involved multiple charges of rape; the case turned on the conflicting evidence of the victim and the several accused, each of whom gave evidence. Concerns about the directions given to the jury arose from suggestions that the jury would have to choose who to believe. In that context, Brennan J identified the matter of principle in the following terms: [3]
"When a case turns on a conflict between evidence of prosecution witness and the evidence of a defence witness, it is commonplace for a judge to invite a jury to consider the question: who is to be believed? But it is essential to ensure, by suitable direction, that the answer to that question (which the jury would doubtless ask themselves in any event) if adverse to the defence, is not taken as concluding the issue whether the prosecution has proved beyond reasonable doubt the issues which it bears the onus of proving. The jury must be told that, even if they prefer the evidence for the prosecution, they should not convict unless they are satisfied beyond reasonable doubt of the truth of that evidence. The jury must be told that, even if they do not positively believe the evidence for the defence, they cannot find an issue against the accused contrary to that evidence if that evidence gives rise to a reasonable doubt as to that issue."
That was the foundation of the proposed direction raised on this appeal.
The foundation for such a direction has since been doubted. As explained by the High Court in De Silva v The Queen, [4] "it is never appropriate for a trial judge to frame the issue for the jury's determination as involving a choice between conflicting prosecution and defence evidence: in a criminal trial the issue is always whether the prosecution has proved the elements of the offence beyond reasonable doubt." Accordingly, the Court held that "the occasions calling for a Liberato direction should be few." [5] The joint reasons continued:
"[13] Whether a Liberato direction is required will depend upon the issues and the conduct of the trial. At a trial where there has been no suggestion, whether express or implied, that the jury's determination turns on which of conflicting prosecution and defence versions is to be believed, there may be no need to expand on conventional directions as to the onus and standard of proof. As Wheeler JA also observed in Johnson, the expression 'reasonable doubt' is apt to convey that a juror who is left in a state of uncertainty as to the evidence should not convict. [6] "
Neither by reason of the directions in fact given, nor the issues in the case, was this a case in which the principle in Liberato was engaged. The reason is twofold. First, this was not a case in which the prosecution had to prove a factual element, which the accused denied. Neither had to prove the source of the money beyond reasonable doubt. The prosecution had to establish that, objectively, there were "reasonable grounds to suspect" that the property was the proceeds of crime. That did not turn on the state of mind of the accused. The defence, on the other hand, was entirely concerned with the state of mind of the accused. This was different from the situation envisaged by Brennan J in Liberato. Secondly, the Crimes Act provided a defence if the defendant satisfied the jury that he had no reasonable grounds for suspecting that the property was the proceeds of crime. The burden borne by the accused was, conventionally, the lower standard of proof on the balance of probabilities. Again, he did not need to prove that the money was not proceeds of crime, but merely that he had no reasonable grounds for suspecting that it was. No such circumstance arose in Liberato.
In an admirably succinct summing up, the judge stated and reiterated frequently that the burden lay on the prosecutor to establish the guilt of the accused in respect of each element of the respective offences beyond reasonable doubt. But the key passage, for present purposes, was expressed as follows: [7]
"Let me say something to you about the onus of proof. This is, as you have already been told more than once, a criminal trial of a most serious nature and the burden of proof of guilt of the accused is placed upon the Crown. The onus rests upon the Crown in respect to every element of the charges. There is no onus of proof on the accused at all. It is not for the accused to prove their innocence but for the Crown to prove their guilt and to prove it beyond reasonable doubt."
Counsel for the applicant, in dealing with this passage, noted that the statement that there was no onus on the accused was potentially misleading. That would have been so had the judge stopped at the point reached in the passage set out above; however, he did not, but immediately continued:
"If you are satisfied beyond reasonable doubt about each of the elements of the charge, an accused person may raise a defence, which he must prove on the balance of probabilities, which I will explain to you shortly."
It would be difficult to improve on that direction, which properly emphasised the importance of the jury being satisfied that the prosecution had established each element of the charges before turning to consider any defence.
In the following page, the judge said a little more about the presumption of innocence, then turned to the elements of each count. The phrase "beyond reasonable doubt" appeared six times on that page. [8] Having taken the jury through the elements of the relevant offences, the judge then returned to the defence, stating that the accused was not guilty "if he proves, on the balance of probabilities, that he had no reasonable grounds for suspecting that the money was derived or realised, directly or indirectly, from some form of unlawful activity."
Some time later, after summarising the defence evidence, and before turning to the closing addresses, the judge repeated the statement set out above: [9]
"Members of the jury, as I have said earlier, if you are satisfied the Crown has proved beyond reasonable doubt each of the three essential facts (or ingredients), there is a defence to this charge if the accused proves that he had no reasonable grounds for suspecting that the money was derived or realised, directly or indirectly, from some form of unlawful activity.
Now the accused needs only to establish what the accused relies upon in this regard to a lower standard of proof than 'beyond reasonable doubt'. The accused is required to prove the accused['s] case only on the balance of probabilities. That is to say, the accused needs to show that it is more likely than not what the accused asserts is so."
There were two further points to be noted in relation to the directions given by the trial judge. First, there was a discussion between the judge and counsel before the commencement of the summing up, which included the following exchange with Mr Shridhar, who was appearing for the applicant: [10]
"SHRIDHAR: Your Honour, my friend sort of covered the Liberato in it so I'm sort of content with that, I think that's just the general way your Honour would give your normal direction … ‑‑
…
SHRIDHAR: More about the Liberato aspect. I think that's part of the normal directions that your Honour would give in prosecution cases, they're case or you can look at the other way around, so to speak.
HIS HONOUR: Any particular wording that‑‑
SHRIDHAR: Because my friend's closings on it. Well you've got to be satisfied of the prosecution case itself before you even think about being satisfied and then look at the defence case.
…
HIS HONOUR: … But as I see it, I give a clear direction that the three elements have to be established first beyond a reasonable doubt and then they would consider the defence."
Not only did this conclusion correctly state the approach to be taken in directing the jury, but it echoed the last statement by counsel for the applicant. Further, it was the form of direction given to the jury. Finally, when the judge turned to counsel at the end of the summing up to inquire if they wished to raise anything at that stage, nothing further was raised.
The principle in issue, the nature of the charge, the context provided by the trial, the discussion between the Court and counsel and the directions actually given demonstrate unequivocally the absence of any need for any further direction. Indeed, such a direction would have been unnecessary and possibly confusing.
This was not a case where a direction of doubtful adequacy was overlooked, or a direction given the significance of which had not been fully appreciated at the time. On the contrary, the form of the appropriate direction was agreed and the direction was given. The reason why no objection was taken was that no further direction could usefully have been sought and none was. No basis has been established for granting leave pursuant to r 4.15 of the Criminal Appeal Rules.
Accordingly, there should be no grant of leave and the application for leave to appeal against conviction must be dismissed.
[5]
Proposed appeal against sentence
The terms of the proposed challenge to the sentence were expressed somewhat obscurely. They suggested that the judge's reference to "money laundering" was a "finding" which inflated the objective criminality of the applicant.
The basis of the complaint was that the applicant was charged under s 193C(1) of the Crimes Act, a section bearing the heading "Dealing with property suspected of being proceeds of crime". By way of contrast, the previous section, s 193B, is headed "Money laundering". The suggestion was that by using the term "money laundering" the judge had misapprehended the offence for which the applicant had been convicted.
There are in fact three offences within s 193B, each involving dealings with the proceeds of crime. The first involves knowingly dealing and intending to conceal that the property is proceeds of crime; the second involves merely dealing, having knowledge that it is proceeds of crime; and the third involves dealing being reckless as to whether it is the proceeds of crime. The offences are more serious than those under s 193C, carrying penalties of 20 years, 15 years and 10 years respectively. None contains the term "money laundering".
There could be no suggestion that the judge actually mistook the offences: not only had he conducted the trial but, at the beginning of the sentencing judgment, he accurately identified the offence under s 193C(1), noted the maximum penalty (5 years imprisonment) and that there was no standard non-parole period. In considering the appropriate sentence, after setting out the circumstances of the offending and the subjective circumstances of the offenders, the judge noted that the first count on the indictment was "objectively serious as evidenced by the maximum penalty of five years' imprisonment which acts as a legislative guidepost when considering the appropriate penalty."
It is true that the judge used the phrase "money laundering" in the course of setting out the circumstances of the offending. In two passages he stated: [11]
"Police also located a number of mobile phones in the vehicle, including the phone that Raad was using and that was intercepted by police. The phone was found to contain indicia of money laundering.
…
During the search police also located a Samsung phone on a bedside table adjacent to the bed in the main room, containing indicia of money laundering.
Consistent with the jury's verdict, the offender was in possession of the money, and there was a reasonable suspicion that the money was the proceeds of crime."
Not only did those passages demonstrate that the judge was not confusing the offences, but they accurately stated the evidence which had been given by Detective Sergeant Lysaght during the trial, as to the nature and indicia of money laundering.
To establish contact Mr Laurentiu had rung Mr Raad from a public pay-phone. In describing the arrangements for the meeting with Laurentiu, the judge stated: [12]
"During the call, Raad requested Laurentiu to send a message and he replied that he could not because, 'I don't use a phone!' Laurentiu and Raad then arranged the meeting and Laurentiu asked Raad what he will be wearing in order to identify him. The phone call was to arrange a clandestine meeting for the handover of money that was to be laundered.
The jury rejected the offenders' version of events and accepted beyond reasonable doubt that there was a reasonable suspicion that the money was the proceeds of crime. Consistent with that verdict was that the money was to be subsequently laundered. In doing so, I have regard to the evidence of Detective Sergeant Lysaght in respect to the commonly found features often associated with money laundering exchanges and the similarities with respect to the transfer of money at the Flower Power car park."
In this passage, the judge referred to money laundering, not because he was confused as to the nature of the offending, but because he was applying evidence given at the trial to the facts before him, which he was entitled to do in order to make findings relevant to the exercise of sentencing. The two competing purposes for which the applicant had the very large sum of cash were to purchase bitcoin or to launder the money. (The real contest possibly related to the source of the money as much as the purpose.)
There is no basis in these passages for thinking that the judge intended by referring to "money laundering" to identify one of the offences under s 193B, none of which use the phrase "money laundering". On the other hand, both sections appear in Pt 4AC of the Crimes Act which itself bears the heading "Money laundering". As might have been noted, the heading to the Part is taken to be part of the Act, but the heading to s 193B is not. [13]
It remains to address a final submission made on behalf of the applicant, namely that the sentencing judge breached the principle identified in The Queen v De Simoni, [14] stating that the applicant was "in practical terms" being punished for the more serious offence of money laundering and the judge did not limit himself to the offence with which the offender was charged. However, as the applicant accepted, "uncharged conduct" may be utilised to inform the assessment of moral culpability involved in the offence which is charged. In LN v R [15] I stated (with the agreement of R A Hulme J [16] ):
"[54] So long as it is legitimate to view an offence in context, which may include other activities of the offender, it is apparent that context may either render the objective seriousness of the offending greater than would otherwise have appeared or, depending on the extent to which different criteria are involved, may increase the moral culpability of the offender. In either case, the result may be to increase the sentence beyond that which might have been imposed had the surrounding events not been examined. There is no reason in principle to conclude that conduct which may involve criminality should be excluded, whereas conduct not itself criminal could be examined. On any view, conduct adverse to the offender's interests must be established beyond reasonable doubt."
LN was an unusual case: the offender having been convicted of murder of her child, the question was whether the sentencing judge erred in taking into account a course of conduct leading to the fatal infliction of injury, involving consistent and escalating forms of assault, which could, perhaps, have been the subject of further charges but was not. The Court accepted that such conduct could be relied upon contextually in determining the moral culpability attaching to the charged offence of murder.
The present case does not fall into that category, but into the more usual category where the sentencing judge has regard to the circumstances in which the offending occurred and the proven motive of the offender. Drug supply cases frequently, if not usually, involve such factors. That one particular motivation may render the conduct more morally culpable than another, and thus lead to a higher sentence than might otherwise be the case does not render that matter something which cannot be taken into account. A finding that the applicant had the money in his possession for the purpose of money laundering does not mean he was being punished for one of the offences which involved a variety of mental elements beyond the mere existence of reasonable grounds to suspect.
The line between legitimate and illegitimate considerations may not always be easy to identify. However, the underlying principle, as stated by Gibbs CJ in De Simoni, is that "no one should be punished for an offence of which he has not been convicted." [17] That is not this case, for two reasons. The first is that the concept of money laundering is not an element of any specific offence, although it involves a process "by which criminals conceal or disguise their proceeds and make them appear to have come legitimate sources." [18] If accompanied by actual knowledge that the money was the proceeds of crime, such conduct might constitute an offence under s 193B(1). However, it cannot plausibly be submitted that the judge purported to sentence the applicant on such a basis. The sentence imposed was 60% of the maximum penalty under s 193C(1), in relation to a crime involving an amount five times the minimum amount, and involving an offender who expressed no element of remorse. The sentence itself was within a reasonable range for the offence charged, and not indicative of error.
The case is an appropriate one in which to grant leave to appeal against sentence; nevertheless, the appeal must be dismissed.
Accordingly, the Court makes the following orders:
1. With respect to the application for leave to appeal against the conviction:
1. grant the applicant an extension of time to file the application to 7 January 2021;
2. refuse leave to appeal pursuant to r 4.15 of the Supreme Court (Criminal Appeal) Rules 2021 (NSW).
1. With respect to the application for leave to appeal against the sentence:
1. grant the applicant an extension of time to file the application to 7 May 2021;
2. grant the applicant leave to appeal from the sentence imposed on him in the District Court on 8 May 2020;
3. dismiss the appeal.
WALTON J: I agree with Basten JA.
ADAMSON J: I agree with Basten JA.
[6]
Endnotes
Tcpt, 07/11/2019, p 320.
(1985) 159 CLR 507; [1985] HCA 66.
Liberato at 515.
(2019) 268 CLR 57; [2019] HCA 48 at [9] (Kiefel CJ, Bell, Gageler and Gordon JJ).
De Silva at [10].
(2008) 186 A Crim R 531 at 535 [14].
Summing up, 12/11/19, p 4.
Summing up, p 5.
Summing up, pp 26-27.
Tcpt, 11/11/19, p 424.
Sentencing judgment, p 4.
Sentencing judgment, p 5.
Interpretation Act 1987 (NSW), s 35(1) and (2).
(1981) 147 CLR 383; [1981] HCA 31.
[2020] NSWCCA 131.
LN at [103].
De Simoni at 389.
Evidence of Detective Sergeant Lysaght, quoting the FBI website: tcpt, 06/11/19, p 221(30).
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Decision last updated: 19 July 2021