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Director of Public Prosecutions (Cth) v Garcia[2004] QDC 523

Director of Public Prosecutions (Cth) v Garcia[2004] QDC 523

DISTRICT COURT OF QUEENSLAND

CITATION:

Commonwealth Director of Public Prosecutions v Garcia & Ors [2004] QDC 523

PARTIES:

COMMONWEALTH DIRECTOR OF PUBLIC PROSECUTIONS

(Applicant)

V

JOSITA ANN GARCIA

(First Respondent)

AND

CHRISTOPHER PAUL WOOLGROVE

(Second Respondent)

AND

DAVID JOHN WOOLGROVE

(Third Respondent)

AND

JEANNE MARIAN WOOLGROVE

(Fourth Respondent)

AND

NOSRAC (SA) PTY LTD ACN 062 562 313

(Fifth Respondent)

AND

LORRAINE CARSON

(Sixth Respondent)

AND

HANS JURGEN VIERTEL

(Seventh Respondent)

AND

STEVEN JOHN WOOLGROVE

(Eighth Respondent)

AND

ELIZABETH JEAN LOTOCKI

(Ninth Respondent)

AND

ROSEMARY LENORE CARROLL

(Tenth Respondent)

AND

GREGORY CARLTON MAY

(Eleventh Respondent)

FILE NO/S:

997/04

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court

DELIVERED ON:

17 December 2004

DELIVERED AT:

Brisbane

HEARING DATE:

15 and 16 of November, 10 of December 2004

JUDGE:

FORDE DCJ

ORDER:

  1. Save for the monies in ANZ Bank Account number 015 310 3523 53336 held by the Fifth Respondent NOSRAC (SA) Pty Ltd (ACN 062 562 314), pursuant to section 42 of the Proceeds of Crime Act, 2002 the order made by His Honour Judge Rackemann on 16 March 2004 as against the fifth and sixth respondents is revoked.
  1. Liberty to apply in writing as to costs. Submissions to be exchanged and faxed to the Associate Forde DCJ by 24 January 2005.

CATCHWORDS:

PROCEEDS OF CRIME ACT 2002 (CTH) – APPLICATION TO REVOKE EX PARTE ORDER TO RESTRAIN ASSETS – lack of candour – additional evidence – new foreign indictable offences – reasonable grounds to suspect that the property is the proceeds of an indictable or foreign indictable offence – accrued jurisdiction – interpretation of legislation

Proceeds of Crime Act 2002 (Cth) ss 19, 22, 27, 29, 30, 42, 180, 317, 329, 330, 335, 337A, 338

Behbahni & Ors v Salem & Ors [1987] 1 WLR 723

Briginshaw v Briginshaw (1938) 60 CLR 366

Burgundy Royale Investments Pty Ltd & Ors v Westpac Banking Corporation & Ors (1987) 76 ALR 173

DPP (Cth) v Tan [2003] NSWSC 717

DPP (Cth) v Tan & Anor [2004] NSWSC 856

Fowkes v. Director of Public Prosecutions [1997] 2 V.R. 506

George v Rockett (1990) 170 CLR 104 at 115-116

Gould v Vaggelas (1983-1985) 157 CLR 215

Hussien v. Chong Fook Kam [1970] AC 942 at 948

Jeffrey v Director of Public Prosecutions (Cth) BC9505150- C.A. 3 August 1995

McCleary & ors v DPP (Cth) (1998) 157 ALR 301

Murphy v Farmer (1988) 165 CLR 19

NSW Crime Commission v Ibrahim & Anor [2002] NSWSC 791

NSW Crime Commission v Mammone [2003] NSWSC 950

NSW Crime Commission v Murchie [2000] NSWSC 591

The Queen v Edward Morales (1997) QCA No 451 of 1996

COUNSEL:

Mr M Abbott for the Applicants/Fifth and Sixth Respondents

Mr P Flanagan for the Respondent/Applicant

SOLICITORS:

Iles Selley

Commonwealth Director of Public Prosecutions

CONTENTS

Introduction:

page 5

Revocation:

page 6

Nature of the case before His Honour Judge Rackemann on 16 March 2004:

page 7

Issues on the present application:

page 9

Nature of an ex parte application:

page 11

Submissions of the Parties:

page 17

The basis for the original order by His Honour Judge Rackemann:

page 17

Relationship between sections of the Act:

page 20

S. 22 & s. 180 (1) (b):

page 23

Construing penal legislation:

page 24

Jurisdictional Question:

page 25

The Sale of Shares in USSSIL:

page 27

What is a foreign indictable offence?:

page 28

What are reasonable grounds for suspicion that the property is the proceeds of crime?:

page 29

Evidence of Mr. Fryer at hearing 16 November 2004:

page 31

Evidence of Mr. Gray Clare as told to the New Zealand Serious Fraud Squad:

page 33

Affidavit evidence of Mr. Fryer in relation to the alleged misrepresentations:

page 34

Evidence of Mr. Fryer on 10 December 2004:

page 35

Is there a foreign indictable offence?:

page 38

Intermingling of Proceeds:

page 40

Conclusions:

page 40

Introduction

  1. [1]
    This is an application to revoke an order made on 16 March 2004 whereby certain assets were made the subject of a restraining order (s. 42 Proceeds of Crime Act 2002 (Cth) (the “Act”).  It was alleged initially that certain offences involving breaches of the Corporations Act 2001 (Cth)  and similar legislation from overseas had been committed both in Australia and New Zealand, Canada and British Columbia.  On this application, the Commonwealth Director of Prosecutions (the “Director”) has broadened the allegations to include new offences of fraud and theft being foreign indictable offences within the meaning of s. 19 of the Act.
    1. [2]
      The original order of 16 March 2004 related to various respondents. Two of those respondents, NOSRAC (SA) Pty Ltd and Lorraine Carson (NOSRAC and Mrs.                         Carson or the applicants) have applied to revoke  the order that they not  dispose of                     or deal with certain assets. To succeed on such an application, the applicants have to                 establish on the balance of probabilities that there are no grounds for such an order                 being made as at the time that the application to revoke the order is made.[1] On such                   an application, it is open to the Director to adduce  additional material.[2]  Overall,                   then it would require a determination as to whether the applicants have discharged                   the  requisite onus.[3]
      1. [3]
        As against Mrs. Carson, the order not to dispose related to a Jaguar XKR coupe motor vehicle.  As against NOSRAC, the order related to two Lexus motor vehicles, four taxi licences and three bank accounts.[4]  At the outset of the present hearing, the application to revoke  was amended to read:

        “1.  Save for the amount of AUD$20,401.26 in ANZ Bank Account number 015 310 3523 53336 held by the fifth respondent, pursuant to section 42 of the Proceeds of Crime Act, 2002 that the order made by this Honourable Court on 16 March 2004 by His Honour (sic) Judge Rackemann be revoked”.

        The original application affected both the fifth and sixth respondents only. It  required that the whole of the order be revoked  as  it affects the sixth respondent.               The   amended application will be treated as if the words “as against the fifth and               sixth respondent” are inserted after the words “His Honour.”

        Revocation

        1. [4]
          It is implicit that by the amended application the whole of the order should not be revoked. The ANZ Bank Account was included in the original order. The order is, to that extent, not challenged. Although the point has not been argued originally, it may be that this application NOSRAC should more properly be dealt with under s. 29(2)(d) whereby certain property can be excluded from a restraining order. Revocation is available under s. 42(5) where there are “no grounds on which to make an order at the time of considering the application to revoke”.
        1. [5]
          When one speaks of revoking an order, it is usually the case that the whole of the order is revoked. It may be on the grounds that the order was improperly obtained.[5]  Revocation means to annul by recalling or taking back.[6] To annul the order of his Honour Judge Rackemann would mean that it would have no effect.  In fact, the applicants concede that part of the order as it relates to NOSRAC should remain as conceded by the amended application.
        1. [6]
          However, whether the application be under s. 42 or s. 29, a question for determination is whether the property is relevantly the proceeds of an indictable offence or a foreign indictable offence. The onus of proof pursuant to s. 42(5) is on the applicants to establish there are no grounds. When this matter was raised, counsel for the Director seemed to accept that the application should proceed as one of revocation. There may be some benefit to the applicants to do so, but it is accepted that it was not as a matter of tactics that the applicants rely on s. 42(5). Rather, the application to revoke was made before the additional material was filed by the Director and before the accountant’s report was available.

        Nature of the case before His Honour Judge Rackemann on 16 March 2004

        1. [7]
          On the hearing for an order under s. 19 of the Act, it was necessary for the “authorised officer”(s. 338) to satisfy the court that he held a suspicion on reasonable grounds that the property being the subject of the application is proceeds of the offence or offences. Mr. Martin Fryer was the authorised officer. The offences relied upon by Mr. Fryer were ss. 601ED(5) and 1041E(1) of the Corporations Act. Other possible offences concerning overseas securities legislation were referred to by Mr. Fryer.[7] The case before Judge Rackemann was argued on the breach of Australian law[8] with passing reference to possible breaches of foreign law.  Counsel for the Director did not address his Honour on any foreign indictable offences.[9]  In His Honour’s reasons there is reference to the Corporations Act only[10]:

        “The alleged offences, in respect of which there is a suspicion, are offences under section 601 ED(5) of the Corporations Act and section 1041 E(1) of the same Act.

        Each of the offences are said to arise in the course of the promotion and operation of schemes of schemes to attract investment into one of two, or in some cases both, trust arrangements known as the Hatcher Unit Trust and the Nanking Unit Trust. The trusts were in a common format and were promoted and operated, it would seem, in the same way.

        It is unnecessary for me to set out in detail the arrangements with respect to these schemes or the details of the trust provisions. In general terms investors were encouraged to invest money into these schemes in the belief that their moneys would be pooled and applied towards marine salvage projects which would realise a return to the investors. The scheme was promoted on the basis that moneys invested or that sufficient moneys invested would be paid to a company USSIL which owned a certain percentage of marine salvage rights with any over subscriptions either used for further investment or returned to the investors.

        It would appear from the material before the Court, however, that the investors’ money was simply transferred to those associated with the promotion and operation of the trust rather than being applied to the promised purpose and investors, it would seem, have not received a return.

        It is apparent from the material that the schemes constituted managed investment schemes for the purposes of the Corporations Act and they had more than 20 members and so were the subject of an obligation to be registered under section 601E(D) of the Corporations Act by reason of the matters referred to in subparagraph (a). There is also evidence that the schemes were promoted in circumstances which would attract subparagraph (b).

        Whilst the scheme and the documents originated from New Zealand it is evident that the schemes were operated in Australia particularly with respect to the promotion of the schemes to investors and procuring members to create the pool of funds. In such circumstances , it seems to me, on the material which has been filed, that that there is a contravention of section 601 ED (5), since the material also shows that the schemes were not registered.

        It was also submitted that there are reasonable grounds to suspect that the property, the subject of the application, was proceeds of an offence namely an offence under section 1041E of the Corporations Law which deals with false or misleading statements. The material certainly provides a reasonable basis or reasonable grounds to suggest that the statements made in the documents inducing persons to invest in the scheme by way of the acquiring an interest in the trust were made in circumstances where they were either known to be false or where the person did not care whether they were true or false.

        The interest which the investors were induced to take as a result, satisfies the definition of financial products for the purposes of that section. Accordingly, it would seem that the promotion and operation of the scheme also involved offence under that section or that at least there are reasonable grounds for so suspecting. It remains, further, to determine whether there are reasonable grounds for suspecting that the property, which is the subject of the application, is the proceeds of such an offence.”

        1. [8]
          It was convenient to quote at length from the reasons as His Honour provided a summary of the facts relating to the alleged offences. His Honour was satisfied as to the requisite standard based on the suspicion of Mr. Fryer. His Honour made no reference to any suspicion relative to foreign indictable offences being committed as a basis for his reasons. On the present application, save for the sum of AUD$20,401.26, it is conceded by the Director that none of the proceeds are receipts from investors in the Hatcher Unit Trust or the Nanking Unit Trust.[11]  The sum of AUD$20,401.26 is part of the balance in a NOSRAC bank account as at 9 July 2003.[12]  Therefore, the applicant’s case is that they have discharged their onus of proof save for that amount in the NOSRAC bank account and that  the order made by Judge Rackemann can no longer be maintained on the grounds upon which it was first obtained, at least as appears in His Honour’s reasons.

        Issues on the present application

        1. [9]
          The present application is now concerned with the new foreign indictable offences relied upon by Mr. Fryer for saying that there are reasonable grounds for suspecting that the property is the proceeds of such offences[13]:

        “(j)  fraud contrary to Article 246 of the Criminal Code of Japan

        1. (k)
          obtaining property by deception, contrary to s 240 of the Crimes Act of New Zealand (1962);
        2. (l)
          theft contrary to s 219 of the Crimes Act of New Zealand (1962);
        3. (m)
          theft by a person in a special relationship contrary to s. 220 of the Crimes Act of New Zealand (1962)”.
        1. [10]
          S. 246 of the Criminal Code of Japan relates to the offence of defrauding property[14].  S. 240 of the Crimes Act of New Zealand refers to “obtaining money by deception” e.g. a false representation or a fraudulent stratagem.[15]
        1. [11]
          Any breaches of the abovementioned legislation was not the subject of any argument or findings before Judge Rackemann. The Director now contends that its case is not limited to the offences relied upon before Judge Rackemann. The Director contends that additional evidence can be led pursuant to s. 42(4) of the Act to establish that the property is the proceeds of any foreign indictable offence. Counsel for the Director contends: “In short it is alleged that moneys were obtained falsely by representing to investors both in Australia and subsequently in Japan that moneys were being raised with the intention of using them to finance a search for sunken treasure, when in fact there was no intention of using all, or at least a substantial part of those moneys for that purpose.”[16]  There is no doubt that additional evidence can be led on the application for revocation.  The questions for determination as suggested by the applicants are:

        “1. That the affidavit sworn in support of the ex parte application for the restraining orders did not (notwithstanding that it purported to) articulate the grounds upon which the deponent, Mr Fryer, claimed to suspect that the restrained assets represented proceeds of the offences alleged.

        2.  That Mr Fryer could not have had reasonable cause to suspect that the assets restrained represented the proceeds of any offence; and

        3.  That there was material non-disclosure of evidence in the possession of the AFP or available to the AFP from which the Court might have inferred that Mr Fryer could not have had reasonable grounds to suspect that the assets restrained represented the proceeds of any offence.”[17]

        1. [12]
          Another issue for determination, assuming that the ex parte order is not set aside on the grounds suggested by the applicants, is whether the Director can rely on new offences to sustain the ex parte order. Despite objection by the Director, the applicants did raise in correspondence their contention that there are no grounds for Mr. Fryer having a suspicion even with the additional material[18]. On this application, the additional evidence is related to the new offences.  That evidence touches upon the proceeds of sale of shares in United Sub Sea Services International Limited (USSSIL or USSIL) and whether the sale of those shares was tainted by fraud.  If so, then there were probable foreign indictable offences committed in Japan and New Zealand.[19]             
        1. [13]
          The applicants contend that a s. 42 application to revoke a restraining order does not allow the Director to seek the same order or seek to maintain the same order on an entirely different basis in respect of a different suspect and a different offence or offences from the original “offence to which the restraining order relates”[20]. I accept the submission that it is not open to find that His Honour could have been satisfied that Mr. Fryer had reasonable grounds to suspect that there had been any breach of any foreign indictable offences which are now relied upon. The restraining order was not based on any suspicion in connection with the sale of shares in USSSIL.

        Nature of an ex parte application

        1. [14]
          In oral submissions, Mr. Abbott Q.C. for the applicants[21] dealt with the nature of the ex parte application.  He submitted that equitable principles apply with equal force to an application under s. 19 which in the present case was ex parte. Of particular significance in the present case, it was submitted, was the alleged non-disclosure of the facts that it could not be proved that there were any proceeds which related to any of the breaches of the Corporations Law.  The only exception, of course, to that statement is reflected in the amended application which in itself reflects the revised opinion of the accountant.[22] In dealing with the application of equitable principles, Mr. Abbott made reference to the decision of McCleary and Others v Director of Public Prosecutions[23]:

        “Basically, a restraining order under the Proceeds of Crime Act serves the same purpose as a Mareva injunction in civil proceedings.  A restraining order is intended to maintain intact property which might become the subject of a forfeiture order in relation to tainted property, a pecuniary penalty order or forfeiture which would automatically follow upon conviction under s. 30…”

        1. [15]
          The Court of Appeal was dealing with the Proceeds of Crime Act 1987 (Cth).   The Court was discussing the purpose of the legislation not the nature of an application to revoke in terms of s. 42 of the Act.  A similar submission was made in Mammone’s case concerning the relevance of equitable principles and the need for “the high duty of candour and disclosure on an ex parte application for relief”[24].  The contrary submission put to his Honour and which has been put in the present case is that there is no room to imply into the application of the Act any common law or equity practice.[25]  His Honour accepted that in the event of non-disclosure, it is open to a court in the general jurisdiction to dissolve an injunction granted ex parte but his Honour added[26]:

        “But this order was not made in the exercise of that general jurisdiction but in the exercise of a specific statutory duty as a consequence of the court concluding that the statutory requirement for the duty arising had been met.  It was an order which the court in that event was required by the statute to make.

        I do not see that the Act’s conferral on the applicant of a right to have the order made in the absence of the defendant impliedly incorporated the general law into the proceedings where, on the face of the statute, the court “must” make the order whether full disclosure had occurred or not.  I accept that different considerations might apply in the case of fraud or abuse but, I my view, absent those considerations, the court must make the order and if, in the relevant circumstances the court must make the order, I do not see why the order should be revoked should those circumstances later come to light.”

        1. [16]
          The applicants contend that if Judge Rackemann had known what we now know on this application, he would never have made the order. If that be the case then the onus would shift to the Director and the applicants could reply. It was argued that Tan’s case[27] was only relevant where there had been a failure by the applicants to discharge the onus of proof which occurred in that case.  No evidence was called and so the original order stood.  In Tan’s case, Shaw J. stated[28]:

        “Thus, the question in this case is not whether the applicant for the restraining order, the Commonwealth, has a ‘suspicion’ that the identified property is the product of an indictable offence, which it obviously does, but whether the applicant to revoke the order has shown that there are ‘no reasonable grounds’ for that suspicion”.

        1. [17]
          In the present case, the applicant’s have discharged the onus at least in respect of the grounds relied upon by Judge Rackemann save for the concession in relation to AUD$20,401.46. It may be that a more limited order would have been made by his Honour if that position has been arrived at first instance. It would not follow that the whole of the order was based on a false premise. The Act does contemplate the setting aside of or a variation of a restraining order.[29]  The Director contends that it would be an erroneous approach to declare the original order void, as additional material can be used to justify an order in relation to any offence albeit a new offence on this hearing and even if there has been non-disclosure which is denied by the Director.[30]  His Honour in Mammone’s case  was dealing with a suggestion that inaccurate information has been provided on the initial application.  His Honour was concerned with inaccurate information being provided  that a party had been involved in a shooting offence. An inaccurate  allegation as to the  grounds for the suspicion “might tend to prevent the court’s proper performance of its functions and to subvert the court’s reliance on the material placed before it…”.[31]   I agree, with respect, with those observations of his Honour Justice James that absent fraud or an abuse of process or breach of good faith that the court is obliged to give effect to the restraining order obtained ex parte subject, of course, to s. 42(5).  In the present case there is no suggestion of fraud or abuse of process but rather a lack of candour.
        1. [18]
          The evidence relied upon by the applicants in saying that there was non-disclosure is that it was clear on the material before Judge Rackemann, but not referred to, that the funds invested in the Hatcher Unit Trust had been substantially used for legitimate purposes. Reference was made to the accounts kept by the accountants. Also, it was contended that it was known to Federal Police including Mr. Fryer that the proceeds used to purchase the assets were from the sale of shares in USSSIL not the Hatcher or Nanking Unit Trusts. Those facts, it is said, were not put before His Honour. The following matters were also established, I find, in cross examination of Mr. Fryer on 10 December 2004:
        1. There was a failure to explain in oral testimony before Judge Rackemann that some $2M only of $7M in funds coming into Australian were for the HUT and that the balance was probably for the sale of shares.  Therefore, it was unlikely that the funds over $2M were from an oversubscription to the HUT.
        2. The failure to Exhibit a letter 23 April 2003 to his affidavit to explain in part the matters referred to in (a).[32]
        3. There was a failure to refer to documents which would have established that none of the Carson (or NOSRAC) funds were referable to the NUT or HUT schemes.[33]
        4. There was a failure to mention that certain funds of $1M were likely to have come from a share option payment.[34]
        5. There was a failure to mention that there had been a sale of USSSIL share for $10m.[35]
        6. The failure to point out that the Carson group only received their funds after the sale of the shares by Gray Clare in USSSIL.[36]
        1. [19]
          I am satisfied that there was a lack of candour on the application before Judge Rackemann which was as a result of the failure to put before his Honour all of the relevant material in a comprehensible manner. On the facts of this case, I am not satisfied that there was any lack of good faith by the Director and moreover Mr. Fryer as the principal investigator for the Federal Police. In NSW Crime Commission v Ibrahim[37], Sperling J. was concerned with a failure to appear on an ex parte application due to human error.  The effect of this was that the parties opposing the order were not heard in opposition to the order.  His Honour made the following observation:

        “This was an ex parte application.  There was on obligation to inform the court of any material consideration not otherwise apparent.  A party who applies ex parte for an order in the exercise of judicial power is required to meet a high standard of candour and responsibility, in bringing all material matters to the notice of the tribunal including matters which the absent party would rely upon if present: Garrard v Email Furniture Pty Ltd (1993) 32 NSWLR 662 (per Mahoney AP at 676-677, with whom Clarke JA agreed).  An order obtained in breach of that duty will almost invariably be set aside even if, on a fresh application following full disclosure, the applicant would be entitled to an order in similar terms: ibid (at 678).  It has been said that an order obtained in breach of good faith is to be set aside ex debito justitiae, and that there is no discretion to refuse to set aside such an order:  Analby v Praetorius (1888) 20 QBD 764.”[38]

        1. [20]
          In Ibrahim’s case, a conversation between those instructing counsel and the solicitor for the respondent’s occurred concerning the appearance before the court. Had the information been relayed to the court, Sperling J. was of the view that the order would not have been made have been vacated. It was of no moment that there was a defence to the application for the forfeiture orders. It was a case where information was available but not brought to the notice of the court. In dealing with the comments of Sperling J., as quoted above, James J. in Mammone’s case stated:

        “Even putting aside the argument based on the immediate statutory effect of the restraining order and the lack of legislative machinery to permit it to be revoked, dissolved or otherwise set aside, and noting that restraining orders raise different considerations to those raised when considering assets forfeiture orders, it is apparent that his Honour’s remarks concerned orders in respect of the making of which the defendants were entitled under the Act to be heard.  It was only in that context that Pt 40 r9(3) might apply.  I do not consider that in the absence of, at least, a breach of good faith, the provisions of the Rules or his Honour’s observations should be taken to apply here where the Act expressly provides that the defendants need not be heard.”

        1. [21]
          With respect, I adopt his Honour’s reasoning in Mammone’s case.  A similar approach was adopted in Town & Country Sport Resorts (Holdings) Pty Ltd and Ors. v Partnership Pacific Limited[39] where reliance was placed upon the injunctive power under s. 80 of the Trade Practices Act and not the rules of equity applied by the courts in their traditional jurisdiction.  As observed in that case, in the traditional jurisdiction, the failure to make full disclosure on an ex parte application necessitated the discharge of the order granted.  Of course, the discharge of an injunction on that ground does not prevent a fresh application being heard and determined in the light of all relevant facts.[40]
        1. [22]
          The present case is a complex matter. On a chamber day, a judge relies heavily on the submissions of counsel particularly on an ex parte application. The Director was entitled to proceed ex parte for obvious reasons. It has been shown that the original suspicion was substantially wrong in that the evidence did not support an indictable offence against Australian law save for some $20,401.46. It does not follow that there is a lack of good faith or an abuse of process. Moreover, fraud has not been alleged by the applicants. Even if there was non-disclosure, James J. was of the view that the court must make the order.[41]  However, the following observation by his Honour deserves some attention:

        “It should be clear that nothing in this judgment should be taken as affording any comfort for slipshod practices or mistaken statements which mislead the court.  This judgment is confined to the legal effect of what occurred in this case, in particular in the circumstance that the alternative ground for the suspicion as founding the order was sufficient to support it.”[42]             

        1. [23]
          The present case is somewhat different to that dealt with by James J. In the present case there was no alternative ground available to found the order save in respect of a limited amount of money. The evidence before Judge Rackemann does not in retrospect provide grounds for the restraining of all of the assets which have been made the subject of the order. One of the bank accounts would have been directly relevant to maintaining the retraining order in part . In the present case, I find that the conduct of those representing was not such as to justify setting aside the order on the ground of non-disclosure or failing to direct the court’s attention to the real source of the proceeds. There is a discretion, even in the traditional jurisdiction “to continue an injunction, or to grant a new injunction in its place, notwithstanding that there may have been non-disclosure when the original ex parte injunction was obtained”.[43] The quality of the material to which reference was not made before Judge Rackemann is relevant.  The fact that the proceeds of the sale of the shares was the likely source of the funds to purchase the assets the subject of the proposed restraining order was quite significant.  The suspicion relied upon related to the unit trusts being the source of the funds.  In my view that is a factor to be taken into account in determining whether it is appropriate  in the circumstances to re-grant restraining orders  in similar terms assuming the existence of bad faith.[44]
        1. [24]
          In the present case, I am not satisfied that there was bad faith. The chartered accountant Mr. Mark Hall presented a report dated 10 November 2004.[45]  He carried out an extensive analysis of the accounts of the Hatcher Unit Trust and the Nanking Unit Trust, the sale of the shares in USSSIL and the accounts of NOSRAC and the use of the proceeds of the share sale and the NOSRAC funds.  Mr. Fryer could be forgiven for failing to appreciate the real source of the funds.  Ex parte applications have an air of urgency about them.  Without detracting from the need for the ‘heavy duty of candour and care which falls on persons making ex parte applications’[46], and having hear Mr. Fryer give evidence, I am not satisfied that there was such a breach of good faith to discharge the order and to refuse to deal with the remaining issue. The question remains, is the Director entitled to rely upon additional evidence as supporting new offences to maintain the order?  If the Director is entitled to rely on new offences and additional material, then the onus still lies with the applicants to establish that there are no grounds upon which the restraining order can be made at the present time.

        Submissions of the Parties

        The basis for the original order by His Honour Judge Rackemann

        1. [25]
          The applicants submit that a s. 42 application to revoke a restraining order does not allow the Director to seek the same order or to seek to maintain the same order on an entirely different basis in respect of a different suspect and a difference offence than that original “offence to which the restraining order relates”.[47]  A corollary of this is that the Director’s right pursuant to s. 42(4)  to adduce “additional material” must be limited to material supporting the suspicion that the proceeds relates to a particular offence upon which the order was based.[48]
        1. [26]
          It was submitted “that all of the affidavit evidence of Mr. Fryer sworn after 16 March which seeks to support the maintenance of the orders based upon a different submission is irrelevant” and not admissible.[49] That argument presupposes that the submissions in the previous paragraph are correct.
        1. [27]
          As discussed previously, apart from the $20,401.26 in the ANZ account held by NOSRAC, the orders made by Judge Rackemann can no longer be maintained on the grounds specifically referred to in the reasons for judgment. Counsel for the Director in his written submissions states:

        “Whilst Counsel did not disagree with His Honour’s statement that the order could not be sustained today with respect to a ‘breach of Australian law’, it was not conceded that that the orders could no longer be maintained…To the contrary, Counsel stated that “even on the affidavit material before His Honour, there was a case that these were proceeds of crime”.[50]

        1. [28]
          It appears that in the discussion with Counsel, Judge Rackemann referred to “foreign indictable offences”. Counsel referred to the paragraph 4 of Mr. Fryer’s affidavit. This referred to the New Zealand Securities Act 1978 and the Companies Act 1993.[51] It would be open to infer that his Honour was aware of “foreign indictable offences” but made no findings in relation to same. His Honour’s findings were limited to breaches of the Australian Corporations Law.
        1. [29]
          Paragraph 4 of Mr. Fryer’s affidavit (Sworn on 16 March 2004) states:

        “I suspect that that property referred to in paragraph 3 herein is the proceeds of foreign indictable offences (including offences against the New Zealand Securities Act 1978 , the New Zealand Companies Act 1993, the Criminal Code of Canada and the Securities Act of British Columbia) and the offences against the law of the Commonwealth and serious offences as defined in the Proceeds of Crime Act 2002, and that the offences were committed within the preceding six years.”

        1. [30]
          It was submitted that the list was inclusive and not exhaustive, thus leaving open the suggestion that other foreign indictable offences may have been committed. At that stage the exact nature of the USSSIL share sale transaction was not known.[52]
        1. [31]
          This application, therefore, can proceed on the basis that foreign indictable offences were referred to before Judge Rackemann but that no mention was made of the breaches of Japanese and New Zealand law which are now relied upon. In other words there were no specific offences nominated relating to fraud or theft legislation.
        1. [32]
          The Director’s position is that it is not acknowledged that Mr. Fryer’s suspicion is a “completely new suspicion which was not put before Judge Rackemann” as alleged by the applicants’ submissions. [53] The submission continues:

        “What is acknowledged however, is the fact that it is now known that the proceeds used to purchase the restrained assets, came from the sale of shares in USSSIL rather than flow from the sale of units in the Hatcher Unit Trust”.

        1. [33]
          It should not be overlooked that not all of the order by Judge Rackemann is challenged. In other words there was some basis for making the order in relation to the sum of $20,401.26. Therefore, on any basis, the submission that “it is a completely new suspicion” cannot be sustained. The Director contends that the term proceeds as defined in s. 329 means that the whole of the proceeds of the ANZ Bank Account can be restrained as the “proceeds” of the account were partly derived from proceeds of the offence. This aspect is dealt with later in these reasons. The question remains is whether any additional evidence to prove breaches of other foreign indictable offences can be relied upon. That question should also be considered in the light of the present facts, viz. it is common ground that not all of His Honour’s order should be revoked. Any additional evidence is really related to sustaining an order against the balance of the assets covered by the order.
        1. [34]
          In dealing with s. 19[54], the applicants have submitted that the order of Judge Rackemann was an order “predicated on a suspicion of the commission of indictable offences but not foreign indictable offences”. The breaches relied upon related to the  Unit Trusts not USSSIL.   Further, that the foreign indictable offences referred to by Mr.  Fryer are different to those now relied upon.  The latter of course refer to fraud and theft and breaches of Japanese and New Zealand law.  The applicants submit that the terms of s. 19(1)(d)(i) and s. 19(4) do not assist the Director.

        Relationship between the various sections of the Act

        1. [35]
          The approach to be adopted in the present case can be found in Project Blue Sky v ABA[55]:

        “The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole.” In Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390 at 397, Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning that the logic with which it is constructed.” Thus the process of construction must always begin by examining the context of the provision that is being construed.”

        1. [36]
          The thrust of the applicants’ submissions in respect of this part of the case was that certain sections of the Act require that there be a nominated suspect or nominated offences. It is now accepted by the applicants that restraining orders pursuant to s. 19 may be made by reference to property where the identity of the offender is not known.[56] The argument by the applicants is that the orders by Judge Rackemann are in breach of s. 22 of the Act by not nominating the suspects (s 22(1)) or offences (s 22(2)) . The fact is that the order was made under s. 19 which relates to property not suspects.  S. 22 requires the order to relate to one suspect.  Even then, the explanatory note to the section allows an order to be made even if the suspect is unknown.  Further s. 19(1)(d)(i) allows an order to be made “whether or not the identity of the person who committed the offence is known”. The applicants contend that s. 19 refers to “the offence” meaning the offence which the property is suspected on reasonable grounds to be the proceeds. Further it is contended that “all sections 18(4), 19(4) and 20(5) do is to make it clear that a restraining order may be made without proof of conviction or finding of guilt in respect of the specific offence which the property is suspected of being the proceeds.”[57]S. 19(4) says that the “reasonable grounds  in paragraph 1(d) need not be based on a finding as to the commission of a particular “indictable offence”.  In dealing with the latter, the applicants submit that this is “referring to a “finding” by a Court of competent jurisdiction, not to a requirement that the Court on a section 19 Application make any “finding” as to the commission of an offence”.   The applicants submit[58] that “without the identification of the offence, the necessary link to the property to establish that it is the proceeds of an offence cannot be demonstrated”.   This requirement is of more importance where there is an allegation of a foreign indictable offence as it might raise questions of jurisdiction as to where the offence is committed and the nature of the offence.  The Director’s position as submitted by Counsel was that it does not have to specify a particular offence.

        “If the offence changed or the suspect changed the only relevant factual inquiry is does this property continue to be the proceeds of crime and if it’s the proceeds of crime if it’s proceeds of any type of indictable offence nominated in s. 19(1)(d).”[59]

        1. [37]
          S. 22(2) does speak of an offence rather than the generic term crime as is contended for by the Director.
        1. [38]
          The purpose of the Act is to allow property to be seized which is found and suspected of being proceeds of crime[60]  S. 49 relating to forfeiture does not require the identification of the offender or a particular offence. S. 49 can be contrasted to s. 20 which leads to the literary proceeds provision in s. 152 and requires a finding of a specific offence. The Director contends that if s. 49 does not require a finding as to a specific offence why should s. 19 be so interpreted. One answer to that may be that in the first instance the Court needs to be satisfied it has jurisdiction e.g. where did the conduct occur. S. 335(3) of the Act which relates to proceeds jurisdiction does not provide the answer if the conduct occurred both inside and outside Australia.  S. 19(4) does not require a “finding as to the commission of a particular indictable offence”.  This could be seen to exclude “foreign indictable offences” as the asterisk next to “indictable offences” as defined in s. 338 does not include foreign indictable offences. S. 20(5) includes reference to “foreign indictable offences” and so it seems the legislature intended to distinguish the different offences. S. 20 is certainly concerned with s. 152, but it does distinguish “indictable offences” from “foreign indictable offences” unlike s. 19(4).   The applicants contend that if a restraining order is offence related, then it is submitted that the Director cannot nominate an alternative offence on a s. 42 application.[61]  The Explanatory Memorandum refers to the “material supporting the grounds for the restraining order ...at the time an applicant seeks to have it revoked”.[62]  S. 42(4) speaks of “additional material” not “additional or new offences”.
        1. [39]
          The applicants’ submission is that s. 42(2) is predicated on “the” order being the relevant order and that “the applicant can proceed on the basis of the suspicion in respect of which the Court was satisfied, quae “the offence”.  Further, the discretion to revoke the restraining order pursuant to s. 42(5) is enlivened if the court is satisfied that there are no grounds on which to make “the” order “at the time of considering the application to revoke the order.”  It is submitted that “the order” obviously refers to the order actually made.  The applicants submit that s. 42(4) and s. 42(5) do not allow the Director to obtain what is in effect a new restraining order.  The Director, it is submitted, cannot seek to maintain a restraining order based on a different suspicion based on a new foreign indictable offence as that would be a new application. The Director maintains that “the restraining order under s. 19 does not need to be based on any findings as to a particular offence.”[63] If the offence changes the inquiry still relates to whether it is the proceeds of a crime.
        1. [40]
          Counsel for the Director submits[64] that the applicants have misconstrued the legislation and have confused the operation of the civil based regime with the conviction based regime.  With the civil forfeiture regime (s. 49), there is no need for a particular suspect to be charged or that the offence be specific.  S. 19 requires that “there are reasonable grounds to suspect that the property is the proceeds of an indictable offence, a foreign indictable offence or an indictable offence of Commonwealth concern.” As to what constitutes a suspicion will be dealt with elsewhere.  It is submitted by the Director that the Act contemplates “an ongoing investigation and does not confine the DPP to any offence that may be indicated at the restraint stage”.   It is further submitted that the provisions of s. 42 contemplate changes in the offences that the property is suspected of being the proceeds of (s. 42(4) and 42(5)).  The fact that s. 42(5) provides  that the relevant time for the court to consider the evidence as to whether there are grounds for the suspicion is at the time of the hearing of the application of revocation envisages that an investigation will continue after the restraining order has been obtained. I accept that submission but would relate the ongoing investigation and additional material to those offences dealt with at first instance. If there are new offences, then specific provision should be made in the Act to allow them to be introduced on an application for revocation.
        1. [41]
          Of particular interest in supporting this argument is s. 49(2)(b) of the Act which provides that:

        “A finding of the court for the purposes of paragraph (1)(c):

        1. (a)
          need not be based on a finding that a particular person committed any offence and
        2. (b)
          need not be based on a finding as to the commission of a particular offence, and can be based on a finding that some offence or other of a kind referred to in paragraph 1(c) was committed.”
        1. [42]
          Of course, ‘of a kind referred to’ in paragraph (1)(c) includes indictable offences, foreign indictable offences and indictable offences of Commonwealth concern. The applicants contend that the use of the word “finding” has different meanings for s. 19 and s. 49. The latter does not require a finding as to a particular offence in relation to indictable offences or foreign indictable offences. S. 19(4) is confined to “indictable offences” as defined. The Director submits that when in s. 19(4) there is reference to “reasonable grounds” as referred to in s. 19(1)(d), it need not be based on the finding of a particular offence. It means that one can have a reasonable suspicion but it need not be in relation to a particular offence.
        1. [43]
          It is clear that s. 19 is a property based section. It is not a conviction based provision unlike s. 17 for example. Sections 17, 18 and 20 specify that a restraining order must relate to property of a suspect or property of a person other than a suspect.

        S. 22 & s. 180 (1) (b)

        1. [44]
          The Director’s primary position is that s. 19 is not concerned with a particular person or a particular offence. S. 22 in terms of the explanatory note does not require a suspect to be named although s. 22(2) allows a restraining order to relate “to more than one offence” in relation to that suspect. There is reference to “the offence” in the explanatory note where the suspect is unknown.
        1. [45]
          An examination under s. 180(1)(b) may make an order for the examination of any “person whom the restraining order states to be a suspect for the offence to which the restraining order relates.” The applicants contend[65] that “the provisions of s. 180(1)(b) are predicated on a restraining order relating to “the” offence viz. a particular offence not any offence.” The Director contends that s. 180(1)(b) can only be referable to ss. 17, 18 & 20 where the property of a suspect can be restrained if they are convicted or charged with a criminal offence. It is not referable to an application under s. 19. I agree. It would be fair to say that both sides have presented arguments which are persuasive. Any repetition of the submissions in these reasons can be explained by the fact that some six different submissions, oral and written, were made often on the same point.

            Construing penal legislation

        1. [46]
          The applicants have argued that as the Proceeds of Crime Act is penal in nature that it should be construed strictly.[66]  In Jeffrey v Director of Public Prosecutions (Cth)[67], Cole JA with whom Handley JA agreed stated:

        “PRINCIPLES APPLICABLE TO THE CONSTRUCTION OF THE PROCEEDS OF CRIME ACT 1987

        The Proceeds of Crime Act permits the confiscation of the property of a citizen without compensation if he be convicted of a serious offence.  The appellant correctly submitted that the enjoyment of property is a fundamental right under our legal system and any statutory derogation of it is exceptional:  NSW Crime Commission v Younan and Anor (1993) 34 NSWLR 44 at 48. In those circumstances, when construing the provisions of a statute which purports to effect confiscation or derogation from property rights, the following principles of construction are applicable:

        1. An intention to abrogate or curtail fundamental property rights will not be imputed by the courts.  It must be “clearly manifested by unmistakable and unambiguous language.  General words will rarely be sufficient for that purpose if they do not specifically deal with the question because, in the context in which they appear, they will often be ambiguous on the aspect of interference and fundamental rights”: Coco v The Queen (1994) 179 CLR 427 at 437; Clissold and Ors. v Perry (1904) 1 CLR 363 at 373.
        2. A legislative intention to take away property without compensation requires expression of that intention with “irresistible clearness” because it is presumed that the legislature would not “overthrow fundamental principles, infringe rights, or depart from the general system of law, without expressing its intention with irresistible clearness.”  Accordingly such an intention is not to be ascribed from the use of “general words, simply because they would have that meaning in their widest, or usual, or natural sense, because so to construe those words would be to ”give them a meaning in which they were not really used”: Bropho v State of Western Australia and Anor (1990) 171 CLR 1 at 17-18.
        3. Any statutory ambiguity should be interpreted so as to respect a person’s property rights: DPP v Saxon (1992) 28 NSWLR 263 at 270; Saffron v DPP (Cth) (1989) 87 ALR 151 at 155.  Unless no other interpretation is possible, justice requires that statutes should not be construed so as to enable the confiscation of an individual’s property without payment of just compensation.  A fortiori where the statute does not provide for any compensation: Attorney General v De Keyser’s Royal Hotel Ltd. (1920) AC 508 at 576.
        4. In construing a penal statute, and confiscation of property without compensation constitutes a penalty, if there are two reasonable interpretations, the more lenient of which will avoid the imposition of the penalty that more lenient construction must be adopted:  Tuck and Sons v Priester (1887) 19 QBD 629 at 638 per Lord Esher MR.”
        1. [47]
          The provisions of s. 42(4) allow the Director “to adduce additional material to the court relating to the application to revoke the restraining order”. The restraining order originally related to breaches of the Australian Corporations Law. The section makes no mention of the Director being able to “adduce additional material to the court relating to the application to revoke the restraining order which concerned indictable offences or any other foreign indictable offences which have been raised by the additional material.” It is open, I find, to adduce additional material on the present application to maintain those offences relating to the Australian Corporations Law, and so justify the suspicion held by the authorised officer up to the present time. As the present application is not concerned with those foreign indictable offences referred to in argument before his Honour, it is unnecessary to decide whether additional material could be adduced to establish those offences which were not the subject of any findings by his Honour. Construing the Act strictly, it is not open to the Director to now rely upon new foreign indictable offences raised by the additional material adduced for the first time on the application to revoke. Once an order is revoked, a new application could be made alleging new foreign indictable offences. The assets the subjects of the new foreign indictable offences are in South Australia. It is intended to deal with the merits of the case even though I have found it is not open to the Director to rely on the new foreign indictable offences.

        Jurisdictional Question

        1. [48]
          The applicants have argued that if the submissions of the Director are correct and new foreign indictable offences are raised then the District Court of Queensland may lack the necessary jurisdiction to hear the matter. The original order was made on the basis that there were Queensland investors in the NUT scheme. Since that order was made only some $20,401.26 related to the NUT and it cannot be shown if any of those monies belong to Queensland investors.
        1. [49]
          The jurisdictional point is raised, say the applicants, as it shows that to allow the Director to rely on any foreign indictable offence which is not defined as to how or where it occurred, does not establish any jurisdiction in this court to determine the matter. S. 335 of the Act requires the courts which hear the matter to have proceeds jurisdiction which in the present case would now be South Australia as that is where the assets are. There is no evidence that any of the offending occurred in Queensland. The applicants contend that as it is an order to revoke, it is necessary to come back to the District Court of Queensland.
        1. [50]
          The applicants submit that the additional material adduced related to an offence by a person whose identity is not known and is not based upon a finding as to the commission of a particular offence. The Director relies on the accrued jurisdiction of the District Court.[68] In Burgundy Royale Investments Pty Ltd there were claims both under the Trade Practices Act 1975 (Cth) and at common law. The statute was held not to apply in that case. The common law claims were an alternative to the claims under the statute. The Federal Court held that it has an accrued jurisdiction to hear the claims. I adopt a similar approach. To hold otherwise “would involve the extremely inconvenient result”[69] that the District Court would be deprived of jurisdiction because the original claim which was within its jurisdiction has been substantially changed. It is not contested that part of the original order still stands. In that event, s 335(3)(b) is of limited assistance. However, the Director contends that this section gives the District Court of Queensland jurisdiction “if all the conduct constituting an offence to which the order relates occurred outside Australia.” That proposition is certainly correct in so far as the foreign indictable offences are concerned.
        1. [51]
          The jurisdictional argument does raise the important point that allegations of foreign indictable offences should not be so nondescript so as to leave a court in doubt as to whether it has jurisdiction to hear the matter.

        The Sale of Shares in USSSIL

        Background circumstances

        1. [52]
          The Hatcher Unit Trust and the Nanking Unit Trust were operated by Mr.Phillips, Mr. John Carson and Mr. Woolgrove. Judge Rackemann found that these schemes which attracted investors were operated in breach of the Australian Corporations Law. The funds held in the ANZ Bank Account referred to in the amended application was a mixed fund consisting of proceeds from these schemes and the sale of shares in USSSIL.
        1. [53]
          Mr. Michael Carson, the son of John Carson, swore an affidavit filed on 14 July 2004. He made the following statements:
        1. He was the sole director of NOSRAC.  It was set up by him as an investment vehicle but was used conveniently by his father to receive monies from NSA Ltd. or Mr. Phillips arising from the sale of shares in USSSIL.  The money is alleged to have been gifted to Michael Carson from his father.
        2. Mr. John Carson had provided some historical material on wrecks and Mr. Phillips agreed to pay him from the sale of the shares.
        3. Mr. Phillips had incorporated USSSIL for the purpose of undertaking marine salvage activities in conjunction with Mr. Hatcher.
        4. Mr. Phillips sold his shares in USSSIL for $10m.
        5. NOSRAC was also paid for assisting in the preparation of a prospectus for USSSIL.
        6. HUT and NUT were trusts operated by Mr. Phillips in New Zealand.
        1. [54]
          Counsel for the Director contends that by his evidence, Mr Michael Carson was attempting to establish that Mr Carson, his father, was entitled to this money because “Mr Phillips had agreed to give him one third of the shares, therefore if he sold part of the shares Mr Carson would be entitled to the proceeds.”[70]
        1. [55]
          The submission continues to plead that “it can’t stop being proceeds of crime simply because someone did some library research for someone. It’s never going to be sufficient consideration. So it stays proceeds of crime.”[71]
        1. [56]
          As discussed with Counsel, the value of the information provided is unknown. The amount paid may have been excessive.[72] “Sufficient consideration” is defined in s 338 as follows:

        “an acquisition or disposal of property is for sufficient consideration if it is for a consideration that is sufficient and that reflects the value of the property, having regard solely to commercial considerations.”

        1. [57]
          In the present case one cannot readily suspect that the funds received were therefore the proceeds of a foreign indictable offence because there is some doubt about whether there is sufficient consideration. This is more so where the conduct of Mr Phillips vis a vis. Mr Clare has specifically been abandoned by Mr Fryer as the “authorised officer” as forming the basis for his suspicion.[73]
        1. [58]
          The Director contends that the proceeds of a crime does not stop being the proceeds unless certain provisions of s 330(4) apply. S 330(4) provides:

        “Property only ceases to be * proceeds of an offence or an * instrument of an offence:

        1. (a)
          if it is acquired by a third party for* sufficient consideration without the third party knowing, and in circumstances that would not arouse a reasonable suspicion, that the property was proceeds of an offence or an instrument of an offence (as the case requires);
        1. [59]
          “Sufficient consideration” is defined above. It is submitted that there was no sufficient consideration given by Mr Phillips for the $17 million paid to him through USSSIL. The only asset of USSSIL was the agreement with Mr Hatcher. The argument assumes that there are grounds for suspecting that the property is the proceeds of a foreign indictable offence. In my view, there are no such grounds as the evidence is lacking to even ground a suspicion as to any offence. Mr Fryer specifically stated he did not have the necessary suspicion concerning the Phillips – Clare transaction.[74] Whatever Mr Clare reported as coming from Mr Phillips is of no assistance.

        What is a foreign indictable offence?

        1. [60]
          S. 337A of the Act provides as follows:

        “337A  Meaning of an indictable offence

        (1)  If:

        1. (a)
          an application (the current application) is made for a restraining order or confiscation order in relation to conduct that constituted an offence against a law of a foreign country; and
        2. (b)
          if the conduct had occurred in Australia at the testing time referred to in subsection (2), the conduct would have constituted an offence against a law of the Commonwealth, a State or a Territory punishable by at least 12 months imprisonment:

        then for the purposes of the current application, the conduct is treated as having constituted a foreign indictable offence at all relevant times.” 

        1. [61]
          Expert evidence has been tendered from two experts[75] who confirm respectively that s. 246 of the Criminal Code of Japan and ss. 219 and 240 of the Crimes Act of New Zealand are foreign indictable offences within the meaning of the Act.   I accept that evidence.  It is not challenged.  The equivalent section in Queensland to s. 219 for example is s. 408C of the Criminal Code.  The section provides for imprisonment for up to five years.

        What are reasonable grounds for suspicion that the property is the proceeds of crime?

        1. [62]
          The relevant authorised officer is Mr. Fryer. A suspicion requires a lesser standard than “belief”. One can suspect but not be in a position to prove.[76] The High Court quoted with approval the passage in Hussien v. Chong Fook Kam.[77]  In Hussien’s case, Lord Devlin stated in referring to the word ‘suspicion”:

        “In its ordinary meaning  is a state of conjecture or surmise where proof is lacking: ‘I suspect but I cannot prove’.”

        1. [63]
          Further assistance in understanding the concept can be found in Queensland Bacon Pty. Ltd. v Rees[78]:

        “A suspicion that something exists is more than a mere idle wondering whether it exists or not; it is a positive feeling of actual apprehension or mistrust, amounting to “a slight opinion but without sufficient evidence”, as Chamber’s Dictionary expresses it. Consequently, a reason to suspect that a fact exists is more than a reason to consider or look into the possibility of its existence. The notion which “reason to suspect” expresses in sub-s. (4) is, I think, of something which in all the circumstances would create in the mind of a reasonable person in the position of the payee an actual apprehension of fear that the situation of the payer is in actual fact that which the sub-section describes- a mistrust of the payer’s ability to pay his debts as they become due and of the effect which acceptance of the payment would have as between the payee and the other creditors.”

        1. [64]
          This understanding of the term should be looked at in light of the facts of this case.
        1. [65]
          Annexure A to the affidavit of Mr. Fryer[79] provides the factual basis relied upon to found the suspicion that the sale of the shares in USSSIL to Japanese parties for $US 17,498,566.80 million involved fraud.  The evidence relating to the shares in the company USSSIL at the relevant time based on the evidence of  Michael Carson[80] was that they were worthless.  The only asset referred to was the Marine Salvage Agreement with Mr. Hatcher.  Mr. Peter Speakman, a solicitor from New Zealand told Mr. Jeremy Hodgson, an investigator, that Mr. Phillips told him (Speakman) that 10% only of the investor’s funds were to be available to Mr. Hatcher.  The balance was to be paid to USSSIL or as it directed.[81]  Mr. Speakman said that Mr. Phillips told him not to tell Mr. Hatcher of the division of the investor’s funds.  The sale of the shares followed the HUT investment of funds.  USSSIL was involved at that stage, but the sale of the shares had not occurred when those directions were given to Mr Speakman.
        1. [66]
          A summary of the evidence in Annexure A appears in Exhibit 3[82]:

        “43. The evidence discloses that it was represented to agents of the Japanese investor that the monies supplied by the investor would be applied to salvage operations by Hatcher. Specifically, agents of the Japanese investor were told that if money was invested, these funds would be given to Hatcher to finance his salvage operations, purchase a new ship and buy equipment and pay his wages etc. For its investment, the investor was told it would get back US$100 million per year. The suspected fraud is therefore that Phillips utilizing the proceeds from the sale of the shares for purposes other than Hatcher’s salvaging operations.

        44. Other facts which could reasonably ground suspicion include that Phillips has a previous conviction for conspiracy to defraud the Commonwealth. This conviction was recorded on 19 April 2000. He was sentenced to three years imprisonment. Further, Phillips’ activities are the subject of an investigation by the New Zealand Serious Fraud Office who have already interviewed Gray Stewart Clare who was an intermediary between the Japanese investor and Phillips. Further, Phillips has left New Zealand and is presently believed to be residing in Brazil. Further, it is a significant circumstance that Phillips took steps to keep Hatcher away from the Japanese investor.”

        1. [67]
          However, on close scrutiny it will be shown there are no grounds or evidence upon which one can rely to find out what misrepresentations, if any, were made to Ultramarine Holdings and by whom.
        1. [68]
          The evidence of Mr. Hatcher was that he had made requests for funding from Mr. Phillips and had only received $US 409,925 from USSSIL.[83] In his submissions, Counsel for the applicants made a fairly telling point in relation to the Marine Salvage Agreement of 22 June 2002.[84] Under that agreement, USSSIL had an obligation to pay up to $2 million to the salvor, Mr Hatcher. USSSIL would then share in the proceeds. Mr Hatcher was required to provide evidence of expenditure to the satisfaction of USSSIL before payments were made. It was submitted that the evidence of Mr Hatcher established that there was no default by USSSIL under that agreement. In fact he had received some $5 million.
        1. [69]
          Therefore, it is open to find, and I do so, that USSSIL has not been found to be in breach of its agreement with Mr Hatcher. Further, as was stated, Mr Fryer does not now rely on any conduct of Mr Phillips for his suspicion for any foreign indictable offences concerning Mr Clare.

        Evidence of Mr. Fryer at hearing   16 November 2004

        1. [70]
          The evidence of Mr. Fryer in cross examination was quite surprising. It reads as follows:

        “But you appreciate, do you not, that the revocation application with that amendment now relates only to restrained property, the proceeds of which you now know to have been acquired from funds which in your view, which is the view you now hold, came from the sale of shares by Phillips  and USSSIL? – And their subsequent sale from Phillips to Gray Clare and from Gray Clare to the Japanese investors.

        Yes.  So you accept, will you not, for the purpose of my questions that we’re in this revocation application that we’re dealing with restrained assets purchased – for present purposes let’s agree, purchased with moneys which were sent to NOSRAC by the accountants or by Phillips, but which funds were sourced from the proceeds of sale of shares in USSSIL by Mr. Phillips? –Yes.[85]

        “Right.  Do you seriously tell this Court you hold a suspicion on reasonable grounds that the property restrained, being property from the proceeds of the sale of shares by Mr. Phillips to Mr. Gray Clare, is somehow related to theft by a person in a special relationship contrary to section 220 of the Crimes Act of New Zealand?—Not at this time.

        No.  So the answer is that there are none of these specified offences in paragraph 10 of your affidavit of the 27th of October 2004 that relate to your suspicions about the conduct of Mr Phillips in selling his shares to Mr Gray Clare, correct?  That is correct.”[86]

        1. [71]
          One could infer from those answers that the only relevant transaction in respect of which Mr. Fryer could have a suspicion would be the sale by Mr. Gray Clare of shares held by his company Aquanorin[87] to the Japanese company Ultramarine Holdings Ltd. involving Mr. Saeki.  In fact Mr. Saeki appointed Aquanorin as its agent for the purchase of the shares.[88]  However, in order to understand the latter transaction it is necessary to look at the earlier transaction involving Mr. Phillips and USSSIL selling its shares to Mr. Gray Clare. Mr. Phillips was the sole shareholder of USSSIL.[89] Mr. Fryer contends that Phillips misrepresented the facts to Mr. Gray Clare who misrepresented the situation to Mr. Saeki.[90] Then the following cross examination occurred:

        “It is your case then – and presumably you have always suspected, since you came to know about it, that Mr Gray Clare was misrepresented – had misrepresentations made to him by Mr Phillips? – That’s correct.

        And he – you have known and know today that he was the purchaser of these shares?  -- He purchased those shares on behalf of somebody else.

        Yes, and it was to him that the misrepresentations were made?  --That’s correct, and those representations were further expanded upon.

        Yes, but the offence by Mr Phillips was the misrepresentations?  --That’s correct.”

        1. [72]
          Mr Fryer abandoned the Phillips – Clare transaction as providing any grounds for his presently held suspicions.[91]
        1. [73]
          The nature of the representations are referred to by Mr. Fryer in his affidavit material.[92] The following passages are also relevant:

        “So your suspicion in relation to the commission of the enumerated foreign indictable offences in paragraph 10 of your affidavit of 27th of October 2004 is a suspicion in relation to the sale of shares by Phillips to Gray Clare, and the basis of that suspicion – or at least what you say is suspect about that is in paragraphs D and E of your affidavit of – which you sworn on 27th August? – And also the subsequent sale.  The actual reference - that 27th October affidavit is for the actual subsequent sale from Gray Clare to the Japanese and that’s where you get the Japanese offences listed in Paragraph 10”.[93]

        “Yes, yes.  So what we have in relation to your suspicion, in so far as the new foreign indictable offences are concerned, is that you suspect that Phillips told Mr Clare, when he was selling the shares to him, that Hatcher had received the money he was entitled to in order to salvage wrecks?  -- Yes”.[94]

        So, look, stripped of its essentials does your suspicion get down to this:  that Mr – that you suspect that Mr Gray Clare defrauded the Japanese by selling them shares in USSSIL - whether to a company or to them directly doesn’t matter – selling them shares in USSSIL for a very substantial amount and at the same time telling them the process of the shares would be used to further the interests of the company?  --That’s correct”.[95]

        Evidence of Mr. Gray Clare as told to the New Zealand Serious Fraud Squad

        1. [74]
          It is necessary to look at that affidavit material to understand the misrepresentations and thus the grounds for the suspicion that a foreign indictable offence had been committed. The interview between Mr. Hodgson and Mr. Osborn and Mr. Clare is of very little assistance in determining whether there were any misrepresentations by Mr. Clare to the Japanese interests.[96]
        1. [75]
          Mr. Clare spoke to Mr. Ngai who was a nominee director representing Japanese interests. Mr. Clare set up an option facility for entities to buy shares. Not all of these were through Mr. Ngai. The entity representing the Japanese would deposit funds into an account of Mr. Clare as their agent and he would then transfer those funds to either Paramount or Gibraltar companies as they were the owners of the option. They would then pay Mr. Phillips directly. Some monies may have been paid by Mr Clare to Mr Phillips at first through a Hong Kong company.
        1. [76]
          With reference to the salvage operations, Mr. Clare stated that “some of the funds from the sale of shares would be applied to that as well. Not that that is I guess a legally required but it was certainly something they were told”.[97]  The following question was asked by Mr. Osborn:

        “…and was there any agreement with Mr. Phillips that he was to use those funds in any particular way to support what it was you’d purchased.

        Clare: No.”[98]

        1. [77]
          Mr. Clare was of the view that either the Japanese were going to make a lot of money or lose a lot of money.[99]

        Affidavit evidence of Mr. Fryer in relation to the alleged misrepresentations

        1. [78]
          Mr. Fryer deposed that he had been told by Mr Jeremy Hodgson of the New Zealand Serious Fraud Office that Mr Clare had informed him that Mr. Phillips had told him (Clare) that all of the conditions of the contracts between USSSIL and Mr. Hatcher had been met.[100] Of more relevance is the conversation between Mr. Hodgson and Mr. Speakman as deposed to by Mr. Fryer.[101] The transaction being referred to at that stage was the HUT scheme. However, pursuant to the Marine Salvage Agreement, USSSIL was not required to give more than $2M to Mr. Hatcher for salvage operations. Mr. Speakman suspected that “Mr. Phillips had made fraudulent misrepresentations to Mr Clare and his investors and that Mr Clare and the investors he represented relied on these misrepresentations when they purchased shares in USSSIL”. That is mere surmise by Mr Speakman. It is not supported by Mr Clare’s statements or admissions.
        1. [79]
          The Director argues that Ultramarine Holdings purchased the shares on condition that the monies received by Mr Gray Clare be used for a specific purpose viz. to further the marine salvage work to be carried out by Mr. Hatcher. The applicants say that the monies were paid for shares which the Japanese purchaser received.

        Evidence of Mr. Fryer on 10 December 2004

        1. [80]
          Before touching upon the oral evidence, it is timely to recall the information received by Mr. Fryer from the German lawyers, Messrs. Wadenback and Newschitzer. The following passages appear in paragraph 4 of the affidavit[102]:

        “(o)  In approximately June 2003, the Japanese investor was approached and asked if they wished to invest a large amount of money in the company USSSIL.  The Japanese investor was told that if they invested the money, the funds they invested to purchase the 40 percent holding in USSSIL would be given to Michael Hatcher to finance his salvage operations, purchase a new ship and buy equipment, pay his wages and so on.  For their investment, they were told they would get back one hundred million USD per year.

        (x) No share certificates for the transaction referred to in paragraph w have been issued to date”

        1. [81]
          In fact, Ultramarine is registered as a shareholder as at the date of this hearing of the said 40%.
        1. [82]
          In evidence, the facts alleged by Mr. Fryer were less clear. After being told that his suspicion as at the time of the questioning was the relevant time the following evidence was given[103]:
        1. That the German lawyers were acting for a Mr. Fujimura who only got involved after the purchase of the shares by the Japanese (Ultramarine being the ultimate purchaser).
        2. The Japanese had never told Mr Fryer of the nature of any alleged misrepresentations.
        3. The only representations the Japanese say were made were from what the German Lawyers told Mr. Fryer what Mr Fujimura had told them.
        4. As at 6 October 2004, Ultramarine holds 40 per cent of the shares in USSSIL.
        5. The German lawyers asserted that the money they were paying was for Mr Hatcher’s benefit so they did not think they were buying shares.
        6. It was the last assertion that gave rise to Mr Fryer’s suspicion.
        7. Mr. Clare had told the German lawyers that he had made no promises to the Japanese when they brought the shares.
        8. It was Mr. Oki, an employee of Mr Saeki of Ultramarine who had introduced the idea of investing in the HUT and subsequently the USSSIL shares.
        9. There was no suggestion that Mr. Clare was dealing directly with Mr. Saeki.
        1. [83]
          It is of some interest to record the following admissions by Mr. Fryer:

        “Right. So in relying upon the Germans, you had to rely upon – and your current suspicion depends upon, as you’ve told us, acceptance of the Germans’ account? – Yes.

        Which is essentially that Mr. Saeki invested in these shares in USSSIL because of something Mr Oki told him?  -- Yes. And representations made by Mr Clare and Mr Fraser and Mr Shepherd.

        Well, they never mentioned anything about that, did they?-- No, that’s correct.

        But they told you it was Mr. Oki who was responsible for this investment?  --He came to Mr Saeki, yes.

        So it wouldn’t have mattered if Mr Oki had perpetrated a fraud because Mr Saeki wouldn’t want to lose face by uncovering the fact that his right-hand man – or one of his right-hand men had defrauded him.  That was what they were saying, wasn’t it?  --Quite possibly.[104]

        1. [84]
          Mr. Fryer referred to Mr. Clare as being involved in a misrepresentation but the event to which he was referring occurred after the shares had been purchased.[105]  The German lawyers had not spoken to Mr.Saeki or Mr. Oki.  It seems that the German lawyers were acting on instructions from Mr. Fujimura but they did not inform Mr. Fryer of what Mr. Fujimura had told them.
        1. [85]
          It is clear that the Japanese had entered into the Private Placement Memorandum relating to the sale of shares.[106]  It seems that the German lawyers had access to documents pointing to the sale of shares. [107] It is submitted by Counsel for the Director that the Private Placement Memorandum is relied upon as part of the misrepresentation. If one looks at exhibit 16 p. 712 & 714 it is clear that the document refers to the sale of shares in USSSIL. Even Mr Phillips has directed the intention of the investor to that fact.  It is stretching the imagination to even suspect that the Japanese were getting some equity in USSSIL when in fact the documents establish that they were buying shares. To have reasonable grounds to suspect that the property is the proceeds of a foreign indictable offence, there must be some evidence of reliance by the Ultramarine of some statement made which led, for example, Mr. Saeki to purchase the shares. Even if a representation is both false and fraudulent, if Ultramarine Holdings did not rely upon it, there is no fraud. The representation must have played some part in inducing Ultramarine Holdings to by the shares.[108]  Given the knowledge of Ultramarine Holdings as can be gleaned from the share transaction being completed, any inference that there was a misrepresentation relied upon is more readily rebutted. If any misrepresentations were made, they could have been made by Mr Oki and have related to the monies being used for salvage purposes only. Apart from the profit to which USSSIL may have been entitled, there may have been other reasons for paying such an  excessive amount for the shares. Tax advantages often flow down from research and development. The latter suggestion is just as speculative as attempting to determine whether a foreign indictable offence has occurred. In the present case it is more likely that there was a risky and speculative investment made by Ultramarine.  Counsel for the Director conceded that the “risks were huge” for the Japanese investors.  Mr. Clare shared that view.[109] It does not follow that as huge losses were suffered by Ultramarine as a shareholder in a speculative investment, someone was fraudulent.
        1. [86]
          There is further evidence which satisfies me that Ultramarine has at all times been a shareholder in USSSIL with no claim to the equity. In an action in Singapore, it maintains that it is a shareholder in the company. There is no allegation of fraud against Mr. Clare[110], or that the funds or assets of USSSIL are held on account of Ultramarine.
        1. [87]
          For completeness, it is necessary to recall Mr. Fryer’s answer to a question in cross examination.[111]  He accepted that none of the offences of fraud or theft referred to in his affidavit[112] related to his suspicions about Mr. Phillips in selling his shares to Mr. Clare.  Mr. Fryer attempted to explain this answer in his later re-examination:

        “At the time I noted that those offences there listed in paragraph 10 were the foreign indictable offences that we believe  that – sorry , the AFP believed that Mr Clare has perpetrated on the foreign investor.”             

        1. [88]
          The answer was equivocal to say the least and of no probative value. Therefore, the examination of the evidence has been focussed on the actions of Mr. Clare and his relationship to those dealing with or acting for Ultramarine.

        Is there a foreign indictable offence?

        1. [89]
          Mr. Gray Clare resided in New Zealand and USSSIL and Aquanorin were registered there. All of the payments made by Ultramarine were paid into Aquanorin Ltd’s ANZ account in Wellington, New Zealand.[113]  As a relevant act occurred in New Zealand, then s. 220 of the New Zealand Crimes Act would apply which is similar to s. 408C of the Criminal Code (Qld) is relevant:

        “Theft  by person in special relationship –

        1. (1)
          This section applies to any person who has received or is in possession of, or has control over, any property on terms or in circumstances that the person knows require the person--
        1. (a)
          to account to any other person for the property, or for any proceeds arising from the property: or
        2. (b)
          to deal with the property, or any proceeds arising from the property, in accordance with the requirements of any other person
        1. (2)
          Every one to whom subsection (1) applies commits theft who intentionally fails to account to the other person as so required or intentionally deals with the property, or any proceeds of the property, otherwise than in accordance with those requirements.”
        1. [90]
          It is not open to find to the requisite standard, that there are reasonable grounds to suspect that Mr. Gray Clare received the funds from Ultramarine Holdings subject to certain requirements viz. that the funds would be used by USSSIL to further the marine salvage work. Mr Clare and AQUANORIN were only shareholders. They did not control USSSIL. There is no acceptable evidence to found any suspicion that there was reliance by those acting for Ultramarine Holdings on misrepresentations made by persons who had access to the proceeds of the sale of shares in USSSIL. If a person holds funds subject to a trust or condition and breaches the condition, then it is fraud for the purposes of s. 408C.[114] In that case the accused or his company ought to have held the monies in trust for or on account of a party to pay for tiles.  Instead, he paid the monies to meet various liabilities, of his company or companies in which he was interested.  In so doing, he applied that money or property to his own use or to the use of another person within the meaning of s. 408C.[115]
        1. [91]
          Reference to the Japanese law of defrauding a person of property does not take the matter any further. If Mr. Phillips had defrauded USSSIL of funds, then New Zealand law is apposite. That is not the case presented in the present instance. It is not known what Mr. Oki told Mr. Saeki which may have been relevant to an inquiry into a foreign indictable offence in Japan and which may be similar to provisions of the Criminal Code. It is important in dealing with possible breaches of foreign law that the place, parties and nature of the conduct be established. This is relevant not only on questions of jurisdiction but also whether there are reasonable grounds to suspect that the property is the proceeds of a foreign indictable offence.

        Intermingling of Proceeds

        1. [92]
          The Director contends that as $20,401.26 is intermingled with other funds in the term deposit, that the whole of the account should be frozen. S. 329 defines proceeds as follows:

        “(1)  Property is proceeds of an offence if:

        1. (a)
          it is wholly derived or realised, whether directly or indirectly, from the commission of the offence; or
        2. (b)
          it is partly derived or realised, whether directly or indirectly, from the commission of the offence;”
        1. [93]
          It is submitted that subclause 330(1) of the Explanatory Memorandum deals with “proceeds” by providing that property becomes the proceeds of an offence if it is wholly or partly derived or realised from, or acquired with, the proceeds of an offence. The example given is where monies are used to purchase a house and part of those monies are proceeds of crime. That is quite different. The amount referable to the HUT scheme could be excused from other proceeds. However, “property” (as defined in s. 329) includes personal property which can include money. The monies in the ANZ account are partly derived from the commission of an offence. The monies in the account are therefore the “proceeds” (as defined in s. 329) of an indictable offence.

        Conclusions

        1. [94]
          The applicants did discharge their onus of proof and establish that in respect of the order of Judge Rackemann that the order could not stand (save for the $AUD20,401.26). The Director then by additional evidence attempted to establish that there was another foreign indictable offence which ordinarily would provide grounds for an order being made. I am satisfied that there are no grounds for suspecting that the property which is the subject of the restraining order is the proceeds of a foreign indictable offence relied upon by Mr Fryer on the present hearing. In order to find that there is some ground to suspect under s. 19, it is necessary to have regard to the definition of indictable offence. The question which is found to be answered in the negative is “if the conduct had occurred within Australia would it have constituted an offence”. If one does not know the nature of the indictable offence how can one have reasonable grounds to suspect that the property is the proceeds of a foreign indictable offence. The appropriate time to consider such material under s. 42(5) was at the time of considering the application to revoke the order. Further, I am not satisfied that the Director is able, under the Proceeds of Crime Act, to rely on new offences to thwart the making of a revocation order. The applicants have established that there are no grounds on which to make the order relation to the indictable offences involving the Australian Corporations Law relied upon by his Honour Judge Rackemann save for the proceeds in the ANZ bank account containing the $20,401.26. The only additional material in relation to the offences involving the Corporations Law was limited to the sum of $20,401.26 and which was conceded by the applicants at the outset to be properly restrained.

        Orders

        1. Save for the monies in ANZ Bank Account number 015 310 3523 53336 held by the Fifth Respondent NOSRAC (SA) Pty Ltd (ACN 062 562 314), pursuant to section 42 of the Proceeds of Crime Act, 2002 the order made by His Honour Judge Rackemann on 16 March 2004 as against the fifth and sixth respondents is revoked.
        1. Liberty to apply in writing on the question of costs. Submissions are to be exchanged and faxed to the Associate Forde DCJ by 24 January 2005.

        Footnotes

        [1] ss 42(5), 317(2) of the Act.

        [2] ibid s. 42(4).

        [3] Briginshaw v Briginshaw (1938) 60 CLR 366 as discussed in Director of Public Prosecutions (Cth) v Tan [2003] NSWSC 717 at para. 20

        [4] Order of Judge Rackemann of 16th March 2004.

        [5] Osborn ‘A Concise Law Dictionary’ 5th ed. p. 283.

        [6] Webster’s Third New International Dictionary.

        [7] para. 4 affidavit filed 16 March 2004.

        [8] Exhibit 5 written submissions of Director para. 7.

        [9] Exhibit 13 para.2.2.

        [10] pp. 5-7 of Exhibit MS 1 to the Affidavit of Matthew Selley filed 30 August 2004.

        [11] Exhibit 2 and concessions from both sides.

        [12] Exhibit 2 p. 2.

        [13] para.10 affidavit of Mr. Fryer filed 27 October.

        [14] Ex.B to the affidavit of Mr. Longworth. That affidavit is now Exhibit 9.

        [15] Exhibit A to the affidavit of Ms. Lamont-Messer which is now Exhibit 10.

        [16] Transcript p. 267.50-60

        [17] Letter from the solicitors for the applicant to the Director of 20 May 2004 and referred to in Exhibit 3 p. 4.

        [18] Transcript p. 212.22-41.

        [19] A summary of the background to these allegations can be found in Annexure A to Exhibit 3.

        [20] Written submissions of applicants Exhibit 6 p. 3;s. 180(1)(b) of the Act.

        [21] Transcript p 7ff.

        [22] Exhibit 2: The sum of $20,416.26 in the ANZ Account is excepted from the application to revoke.

        [23] (1998) 157 ALR 301 at 315 per Ipp J. with whom Malcolm C.J. agreed.

        [24] per James J. in NSW Crime Commission v Mammone [2003] NSWSC 950 para.31.

        [25] ibid. paras 39-41.

        [26] ibid paras. 45-46.

        [27] op.cit.

        [28] op.cit.para.26.

        [29] per James J. in Mammone op. cit. para. 30.

        [30] NSW Crime Commission v Mammone op.cit. 46.

        [31] op. cit. para 24.

        [32] T.224.5-32.

        [33] T.225.30-226.5.

        [34] T227.27-228.11.

        [35] T229.25-231.28.

        [36] T231.42-237.44.

        [37] [2002] NSWSC 791.

        [38] ibid. para. 55.

        [39] (1988) 20 FCR 540 at 545.

        [40] ibid. p. 543.

        [41] op.cit. para 46.

        [42] op. cit. para. 55.

        [43] Behbehani and Ors. v Salem and Ors (1989) 1 WLR 723 at 727.

        [44] ibid. Behbehani’s case at 728H.

        [45] Exhibited to his affidavit dated 11 November 2004.

        [46] ibid. Behbehani p. 728C.

        [47] Exhibit 6 para 5.7 of written submissions of Applicants.

        [48] Ex.6 para. 49.

        [49] Ex. 6 para. 51.

        [50] Para. 17 of the submissions which were received as Exhibit 11.

        [51] The relevant references to the transcript are to be found in Exhibit 11 paras. 7 and 8.

        [52] ibid. paras. 47 and 48.

        [53] Exhibit 11 para.22.

        [54] Exhibit 6 para.22.

        [55] (1998) 194 CLR 355 at 381.

        [56] Transcript 297.30.

        [57] Exhibit 13 para 21.

        [58] Exhibit 13 para. 15.

        [59] Transcript 282.39-47.

        [60] Explanatory Memorandum p. 9 which is marked Exhibit 12.

        [61] Exhibit 13 para. 16.

        [62] Exhibit 12 discussing s. 42.

        [63] Transcript 282.54-60.

        [64] Exhibit 11 para. 40.

        [65] Exhibit 6 para 7.

        [66] See Murphy v Farmer (1988) 165 CLR 19 at 27; Director of Public Prosecutions v Logan Park Investments Pty Ltd and Anor [1995] 37 NSWLR 118 at 125-126; Fowkes v. Director of Public Prosecutions [1997] 2 V.R. 506 at 517; Jeffrey v Director of Public Prosecutions (Cth) BC9505150- C.A. 3 August 1995 at pp. 2-3.

        [67] Ibid.

        [68] Burgundy Royale Investments Pty Ltd & Ors v Westpac Banking Corporation & Ors (1987) 76 ALR 173 at 179(f).

        [69] ibid. p 181.

        [70] Transcript 276.50-59.

        [71] Transcript 277.1-5.

        [72] Transcript 276.48.

        [73] Transcript 123.10-15.

        [74] Transcript 123.10-15.

        [75] Exhibits 9 and 10.

        [76] George v Rockett (1990) 170 CLR 104 at 115-116.

        [77] [1970] AC 942 at 948.

        [78] (1966) 115 CLR 266 at 303 referred to in George v Rockett ibid.115.

        [79] sworn 27 October 2004.

        [80] affidavit filed on 14 July 2004 para. 6.8.

        [81] Para. 7 affidavit of Mr. Fryer filed 3 September 2004.

        [82] Exhibit 11, being Director’s submissions dated 12 November 2004 paras. 43-44.

        [83] Exhibit MH 13 to his affidavit filed on 5 October and p. 194 of transcript.

        [84] Transcript 295.48; Exhibit 16 p. 0185.

        [85] transcript 112.39-62.

        [86] transcript 123.5-15.

        [87] Transcript 131.

        [88] Transcript 131.30-40.

        [89] Transcript 115.39.

        [90] Transcript 116.30-40

        [91] Transcript 123.10-15.

        [92] In oral evidence he referred to paragraphs 11 to 17 of his affidavit filed on 17 October 2004.  This referred to other affidavits and exhibits.

        [93] Transcript 120.29-40.

        [94] Transcript 121.40-50.

        [95] Transcript 130.32-40.

        [96] Exhibit A to the Affidavit of Mr.Fryer filed 27 October 2004.

        [97] p. 32 Exhibit A.

        [98] p. 48 Exhibit A.

        [99] p. 58 Exhibit A.

        [100] Para (h) to affidavit of Mr. Fryer filed 3 October 2004.

        [101] para. 7 ibid.

        [102] filed on 5 October 2004 p. 2.

        [103] pp. 245(f).

        [104] Transcript 248.50-249.50.

        [105] Transcript 251.20-252.30.

        [106] Exhibit 16 p. 704-741.

        [107] Transcript 254.5-255.40; Exhibit 15 p. 131-132.

        [108] Gould v Vaggeles (1983-1985) 157 CLR 215 at 236 per Wilson J.

        [109] Transcript 270.9.

        [110] Transcript 262.2-50.

        [111] Transcript 123.10.

        [112] filed 27 October 2004 para.10.

        [113] Transcript 272.40 submissions of Director.

        [114] R v Morales BC9701720 being a decision of the Queensland Court of Appeal 29 April 1997.

        [115] ibid. p4.

Close

Editorial Notes

  • Published Case Name:

    Commonwealth Director of Public Prosecutions v Garcia & Ors

  • Shortened Case Name:

    Director of Public Prosecutions (Cth) v Garcia

  • MNC:

    [2004] QDC 523

  • Court:

    QDC

  • Judge(s):

    Forde DCJ

  • Date:

    17 Dec 2004

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Anlaby v Praetorius (1888) 20 QBD 764
1 citation
Jump To
Cite 1 - (1888) 20 QBD 764
Attorney-General v De Keyser's Royal Hotel (1920) AC 508
1 citation
Jump To
Cite 1 - (1920) AC 508
Behbahni & Ors v Salem & Ors [1987] 1 WLR 723
1 citation
Jump To
Cite 1 - [1987] 1 WLR 723
Behbehani v Salem (1989) 1 WLR 723
3 citations
Jump To
Cite 1 - (1989) 1 WLR 723
Cite 2 - (1989) 1 WLR 723
Cite 3 - (1989) 1 WLR 723
Briginshaw v Briginshaw (1938) 60 CLR 366
2 citations
Jump To
Cite 1 - (1938) 60 CLR 366
Cite 2 - (1938) 60 CLR 366
Bropho v Western Australia (1990) 171 CLR 1
1 citation
Jump To
Cite 1 - (1990) 171 CLR 1
Burgundy Royale Investments Pty Ltd & Ors v Westpac Banking Corporation & Ors (1987) 76 ALR 173
3 citations
Jump To
Cite 1 - (1987) 76 ALR 173
Cite 2 - (1987) 76 ALR 173
Cite 3 - (1987) 76 ALR 173
Clissold v Perry (1904) 1 CLR 363
1 citation
Jump To
Cite 1 - (1904) 1 CLR 363
Coco v The Queen (1994) 179 CLR 427
1 citation
Jump To
Cite 1 - (1994) 179 CLR 427
Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390
1 citation
Jump To
Cite 1 - (1955) 92 CLR 390
Crime Commission v Ibrahim & Anor [2002] NSWSC 791
2 citations
Jump To
Cite 1 - [2002] NSWSC 791
Cite 2 - [2002] NSWSC 791
Director of Public Prosecutions (Cth) v Tan [2003] NSWSC 717
2 citations
Jump To
Cite 1 - [2003] NSWSC 717
Cite 2 - [2003] NSWSC 717
DPP (Cth) v Tan & Anor [2004] NSWSC 856
1 citation
Jump To
Cite 1 - [2004] NSWSC 856
DPP v Logan Park Investments Pty Ltd (1995) 37 NSWLR 118
1 citation
Jump To
Cite 1 - (1995) 37 NSWLR 118
DPP v Saxon (1992) 28 NSWLR 263
1 citation
Jump To
Cite 1 - (1992) 28 NSWLR 263
Fowkes v Director of Public Prosecutions [1997] 2 VR 506
2 citations
Jump To
Cite 1 - [1997] 2 VR 506
Cite 2 - [1997] 2 VR 506
Garrard v Email Furniture Ltd (1993) 32 NSWLR 662
1 citation
Jump To
Cite 1 - (1993) 32 NSWLR 662
George v Rockett (1990) 170 CLR 104
3 citations
Jump To
Cite 1 - (1990) 170 CLR 104
Cite 2 - (1990) 170 CLR 104
Cite 3 - (1990) 170 CLR 104
Gould v Vaggelas (1985) 157 CLR 215
2 citations
Jump To
Cite 1 - (1985) 157 CLR 215
Cite 2 - (1985) 157 CLR 215
Hussien v Chong Fook Kam (1970) AC 942
2 citations
Jump To
Cite 1 - (1970) AC 942
Cite 2 - (1970) AC 942
McCleary & ors v DPP (Cth) (1998) 157 ALR 301
2 citations
Jump To
Cite 1 - (1998) 157 ALR 301
Cite 2 - (1998) 157 ALR 301
Murphy v Farmer (1988) 165 C.L.R 19
2 citations
Jump To
Cite 1 - (1988) 165 C.L.R 19
Cite 2 - (1988) 165 C.L.R 19
NSW Crime Commission v Mammone [2003] NSWSC 950
12 citations
Jump To
Cite 1 - [2003] NSWSC 950
Cite 2 - [2003] NSWSC 950
Cite 3 - [2003] NSWSC 950
Cite 4 - [2003] NSWSC 950
Cite 5 - [2003] NSWSC 950
Cite 6 - [2003] NSWSC 950
Cite 7 - [2003] NSWSC 950
Cite 8 - [2003] NSWSC 950
Cite 9 - [2003] NSWSC 950
Cite 10 - [2003] NSWSC 950
Cite 11 - [2003] NSWSC 950
Cite 12 - [2003] NSWSC 950
NSW Crime Commission v Murchie [2000] NSWSC 591
1 citation
Jump To
Cite 1 - [2000] NSWSC 591
NSW Crime Commission v Younan and Anor (1993) 34 NSWLR 44
1 citation
Jump To
Cite 1 - (1993) 34 NSWLR 44
Project Blue Sky v Australian Broadcasting Authority (1998) 194 C.L.R 355
1 citation
Jump To
Cite 1 - (1998) 194 C.L.R 355
Queensland Bacon Pty Ltd v Rees (1966) 115 CLR 266
1 citation
Jump To
Cite 1 - (1966) 115 CLR 266
Saffron v DPP (Cth) (1989) 87 ALR 151
1 citation
Jump To
Cite 1 - (1989) 87 ALR 151
The Queen v Morales [1997] QCA 89
1 citation
Jump To
Cite 1 - [1997] QCA 89
Town & Country Sport Resorts (Holdings) Pty Ltd v Partnership Pacific Ltd (1988) 20 FCR 540
2 citations
Jump To
Cite 1 - (1988) 20 FCR 540
Cite 2 - (1988) 20 FCR 540
Tuck v Priester (1887) 19 QBD 629
1 citation
Jump To
Cite 1 - (1887) 19 QBD 629

Cases Citing

Case NameFull CitationFrequency
Commonwealth Director of Public Prosecutions v Queensland Jewellery and Gift Company Pty Ltd & Ors [2005] QDC 2991 citation
1

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