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Goli v Blue 11 Pty Ltd[2018] QDC 108
Goli v Blue 11 Pty Ltd[2018] QDC 108
DISTRICT COURT OF QUEENSLAND
CITATION: | Goli v Blue 11 Pty Ltd; Goli v Thompson Residential Pty Ltd; Goli v Thompson Commercial Pty Ltd; Goli v Thompson; Goli v B & T Carpentry Pty Ltd; Goli v Thompson [2018] QDC 108 |
PARTIES: | In Appeal No 4985 of 2017: ELIZABETH GOLI (Appellant) v BLUE 11 PTY LTD (Respondent) In Appeal No 4986 of 2017: ELIZABETH GOLI (Appellant) v THOMPSON RESIDENTIAL PTY LTD (Respondent) In Appeal No 4987 of 2017: ELIZABETH GOLI (Appellant) v THOMPSON COMMERCIAL PTY LTD (Respondent) In Appeal No 4989 of 2017: ELIZABETH GOLI (Appellant) v BRENDAN THOMPSON (Respondent) In Appeal No 4990 of 2017: ELIZABETH GOLI (Appellant) v B&T CARPENTRY PTY LTD (Respondent) In Appeal No 4991 of 2017: ELIZABETH GOLI (Appellant) v BRADLEY THOMPSON (Respondent) |
FILE NO/S: | Appeal No 4985 of 2017 Appeal No 4986 of 2017 Appeal No 4987 of 2017 Appeal No 4989 of 2017 Appeal No 4990 of 2017 Appeal No 4991 of 2017 |
DIVISION: | Appellate |
PROCEEDING: | Appeal under s 222 of the Justices Act 1886 |
ORIGINATING COURT: | Magistrates Court at Brisbane |
DELIVERED ON: | 19 June 2018 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 1 June 2018 |
JUDGE: | Porter QC DCJ |
ORDERS: |
|
CATCHWORDS: | MAGISTRATES – APPEAL AND REVIEW QUEENSLAND – APPEAL – WHEN APPEAL LIES – where the appellant laid complaints against two natural person defendants and two natural person defendants alleging compliance and fraud offences – where counsel for the defendants submitted there was no case to answer – where the learned Magistrate accepted those submissions and dismissed all the charges – whether the Magistrate may dismiss a complaint under the Justices Act on a no case basis – whether the Magistrate erred in dismissing the charges on that basis – whether the prosecution’s evidence was capable of supporting a guilty verdict – whether the complaints should be remitted to the learned Magistrate or to another Magistrate. STATUTES – ACTS OF PARLIAMENT – INTERPRETATION – PARTICULAR WORDS AND PHRASES – GENERALLY – where executive officer is defined in the Taxation Administration Act 2001 (Qld) – whether being ‘concerned in’ the management of a corporation requires active participation in management – whether being a director of a company is sufficient for a person to meet the requirements of the definition. Legislation Justices Act 1866 (Qld) ss 146, 222, 223, 225 Payroll Tax Act 1971 (Qld) ss 53, 93 Taxation Administration Act 2001 (Qld) ss 5, 121, 131, 140 Cases Charlton v Rogers (1985) 82 FLR 40 Corporate Affairs Commission (Vic) v Bracht [1989] VR 821 Crosthwaite v Loader [1995] QCA 42 Evgeniou v The Queen (1964) ALJR 508 Fawkes v Shadwell [1966] Qd R 20 Grimaldi v Chameleon Mining NL (No 2) (2012) 287 ALR 22 May v Sullivan (1955) 92 CLR 654 McDonald v Queensland Police Service [2017] QCA 255 Morrison v Kiwi Electrix Pty Ltd (1998) 19 WAR 482 Power v Heyward [2007] QSC 26 R v Goldsworthy [2016] QSC 220 Upton v Commissioner of Police [2012] QCA 88 Other D C Pearce and R S Geddes, Statutory Interpretation in Australia (8th edn, 2014) at 2.26 Macquarie Dictionary (5th Ed, 2009, Macquarie Dictionary Publishers Pty Ltd) |
COUNSEL: | B J Power for the appellant S D Anderson for the respondents in Appeal Nos. 4989/17, 4990/17 and 4991/17 |
SOLICITORS: | Crown Law for the appellant JHK Legal for the respondents in Appeal Nos. 4989/17, 4990/17 and 4991/17 |
Introduction
- [1]The appellant, Ms Goli, is the Commissioner of State Revenue. She laid complaints against each of two natural person defendants (Bradley and Brendan Thompson) and four corporate defendants, alleging offences arising from provisions of the Payroll Tax Act 1971 (Qld) (the PTA) and the Taxation Administration Act 2001 (Qld) (the TAA). There were two categories of offences charged: compliance offences and fraud offences.
- [2]All the complaints were dealt with together and orders were made that evidence in one be the evidence in the other. The Thompsons and the one corporate defendant not in the liquidation (B&T Carpentry Pty Ltd: B&T Carpentry) were represented by the same counsel and solicitors. The other corporate defendants are in liquidation and took no part in the trial.
- [3]The Crown case was presented over 7 days. At the conclusion of the Crown case, Ms Anderson, counsel for the Thompsons and B&T Carpentry[1]submitted that:
- (a)There was no case to answer for Bradley Thomson in respect of any of the offences charged; and
- (b)No case to answer in respect of the fraud offences against Brendan Thompson and B&T Carpentry.
- (a)
- [4]The learned Magistrate accepted those submissions and dismissed all the charges, including those which had not been the subject of submission (being the compliance offences against Mr Brendan Thompson and the companies). No-one directed her Honour’s attention to this error. Ms Goli appeals those dismissals pursuant to Section 222 Justices Act 1886 (Qld).
- [5]In my respectful view, the learned Magistrate erred in dismissing the charges. I explain my reasons.
Statutory framework
- [6]Section 53 PTA provides:
53 Application for registration
- (1)An employer who is not already registered as an employer under this division and who meets the criteria for registration must, within 7 days after the end of the month during which the employer meets the criteria, give the commissioner an application for registration as an employer.
Maximum penalty – 100 penalty units.
- (2)The application must be in the approved form.
- (3)If -
- (a)the commissioner cancels the registration of person as an employer in a financial year; and
- (b)the person subsequently pays or is liable to pay taxable wages (otherwise than as a member of a group) during the financial year;
- (a)
the person may give the commissioner an application, in the approved form, for registration as an employer, even though the person is not required under subsection (1) to apply for registration as an employer.
- (4)If an employer applies under subsection (1) or (3) for registration as an employer, the commissioner must register the employer.
- [7]Section 121 TAA provides:
121 Failure to comply with information or lodgment requirement
A person must not fail, without reasonable excuse, to comply with an information or lodgment requirement.
Maximum penalty – 100 penalty units.
- [8]As can be seen, s. 121 TAA creates an offence in relation to “an information or lodgment requirement”. It was uncontentious in the appeal that those requirements arose under the PTA to lodge periodic and annual returns.
- [9]These two provisions gave rise to the compliance offences by the four corporate defendants.
- [10]Section 93 of the PTA provides:
93 Avoiding taxation
Any person who, by any willful act, default or neglect, or by any fraud, art or contrivance whatever, avoids or attempts to avoid payroll tax chargeable under this Act, shall be guilty of an offence.
Maximum penalty – 20 penalty units and treble the amount of payroll tax avoided or attempted to be avoided.
Note –
This provision is an executive liability provision under the Taxation Administration Act 2001, section 140.
- [11]This section gave rise to the fraud offences by the corporate defendants.
- [12]The charges against the Thompsons arose under s. 140 TAA. That section provides:
140 Executive officers must ensure corporation complies with tax laws
- (1)The executive officers of a corporation must ensure the corporation complies with the tax laws.
- (2)If a corporation commits an offence against a provision of a tax law, each of the corporation’s executive officers also commits an offence, namely the offence of failing to ensure that the corporation complies with the provision.
Maximum penalty – the penalty for the contravention of the provision by an individual.
- (3)Evidence that the corporation has been convicted of an offence against a provision of a tax law is evidence that each of the executive officers committed the offence of failing to ensure that the corporation complies with the provision.
- (4)However, it is a defence for an executive officer to prove –
- (a)if the officer was in a position to influence the conduct of the corporation in relation to the offence – the officer exercised reasonable diligence to ensure the corporation complied with the provision; or
- (b)the officer was not in a position to influence the conduct of the corporation in relation to the offence.
- (a)
- [13]Ms Goli relied upon s. 140(2) as giving rise to offences by the Thompsons arising out of the corporate offences charged against the corporations of which they were directors at the relevant time. This required Ms Goli to establish that each of the Thompsons were executive officers of those corporations. “Executive officer” is defined in the TAA as follows:
Executive officer, of a corporation, means a person who is concerned in, or takes part in, the management of the corporation, regardless of the person’s designation and whether or not the person is a direction of the corporation.
- [14]This appeal also involves consideration of the averments in the complaints. The relevant section is s. 130, which provides:
130 Statement in complaint
A statement made by or for the commissioner in a complaint starting a proceeding is evidence of the matter stated.
The appeal under s. 222
- [15]Section 146 provides:
Where defendant pleads not guilty
- (1)If the defendant pleads not guilty then the court may—
- (a)proceed to hear the complainant and the complainant’s witnesses, and the defendant and the defendant’s witnesses, and the complainant and such witnesses as the complainant may examine in reply if the defendant has given evidence other than as to the defendant’s general character and, upon consideration of all the evidence adduced, determine the matter and shall convict the defendant or make an order against the defendant or dismiss the complaint as justice may require; or
- (b)upon good reason appearing therefor, before any evidence is adduced, adjourn the hearing.
- (2)A hearing may be adjourned pursuant to subsection (1) from time to time provided no evidence has been adduced before any court in respect of the complaint.
- (3)When a hearing is adjourned pursuant to subsection (1) the provisions of section 88 shall, with all necessary adaptations, apply thereto.
- (4)The hearing so adjourned may proceed at the time and place to which it is adjourned before a court constituted in accordance with this Act by such justices as may then be present, notwithstanding that the defendant has pleaded to the complaint.
- [16]Section 222 Justices Act provides:
Appeal to a single judge
- (1)If a person feels aggrieved as complainant, defendant or otherwise by an order made by justices or a justice in a summary way on a complaint for an offence or breach of duty, the person may appeal within 1 month after the date of the order to a District Court judge.
…
- [17]The correct approach to the appeal provided for by that section was recently stated by the Court of Appeal as follows[2] (footnotes omitted):
[46] A failure on the part of a District Court judge, on an appeal under s 222 of the Justices Act, to conduct a rehearing is an error of law, which would warrant the intervention of this Court to correct an injustice.
[47] However, in this case, the District Court judge did conduct the appeal appropriately, in accordance with law, by way of a rehearing, in the technical sense of a review of the record of proceedings below, rather than a completely fresh hearing. It is well established that, on an appeal under s 222 by way of rehearing, the District Court is required to conduct a real review of the trial, and the Magistrate’s reasons, and make its own determination of relevant facts in issue from the evidence, giving due deference and attaching a good deal of weight to the Magistrate’s view. Nevertheless, in order to succeed on such an appeal, the appellant must establish some legal, factual or discretionary error.
- [18]Also relevant to the disposition of this appeal is s. 225 Justices Act which provides:
225 Powers of judge on hearing appeal
- (1)On the hearing of an appeal, the judge may confirm, set aside or vary the appealed order or make any other order in the matter the judge considers just.
- (2)If the judge sets aside an order, the judge may send the proceeding back to whoever made the order or to any Magistrates Court with directions of any kind for the further conduct of the proceedings including, for example, directions for rehearing or reconsideration.
- (3)For subsection (1), the judge may exercise any power that could have been exercised by whoever made the order appealed against.
- (4)An order made under subsection (1) has effect, and may be enforced in the same way, as if it had been made by whoever made the appealed order.
Background
- [19]The four corporate defendants were part of the Thompson Construction Group. At the relevant time, Bradley Thompson was the sole director of two of the corporate defendants: Thompson Residential Pty Ltd and Blue 11 Pty Ltd. Brendan Thompson was, and is, the sole director of the other two corporate defendants: B&T Carpentry and Thompson Commercial Pty Ltd. As noted above, all the corporate defendants apart from B&T Carpentry are in liquidation.
- [20]The trial ran over five days broken by a weekend starting 12 October 2017. The sixth day of the trial was on 10 November 2017 and the seventh and eighth days were on 28 and 29 November 2017.
- [21]The evidence of the compliance offences by the corporate defendants came from the complainant and from various exhibits tendered at trial. The appellant accepted on appeal that there was a prima facie case of those offences by the companies. The appellant also accepted that there was a prima facie case against Brendan Thompson under s. 140(2) TAA in respect of those offences in respect of B&T Carpentry and Thompson Commercial Pty Ltd.
- [22]The learned Magistrate dismissed the compliance offences against each corporate defendant and against Bradley Thompson on the basis that there was no case to answer. The appellants contend that no submission was made that those charges should be dismissed on that basis. Ms Goli does not accept that. I will return to that matter below. Suffice it to say, it is accepted that the compliance offences other than in respect of Bradley Thompson were wrongly dismissed by her Honour.
- [23]The evidence of the fraud offences depended substantially on the evidence of Mr David Hyman. Ms Goli relied on his evidence to establish that Mr Hyman was given instructions by Mr Brendan Thompson to prepare documents for submission to the OSR which deliberately understated the payroll tax liability for the Thompson Construction Group. The documents said to evidence the fraud were tendered and Mr Hyman gave evidence and was cross examined at length at the trial.
- [24]It is convenient at this point to say something about the documents tendered to the OSR which are relied upon by the prosecution as giving rise to the offence under s. 93 PTA.
- [25]The documents comprised a submission to the OSR as a result (in general terms) of an audit process in respect of the Thompson Construction Group and the companies which comprised it (the OSR Submission). It appears uncontentious that the defendant companies were properly treated as a group under the PTA.
- [26]The OSR Submission was exhibit 5 at the trial. It contained, relevantly for this appeal:
- (a)A covering letter dated 7 November 2011 signed by Mr Brendan Thompson as “Director and Controlling Individual” (the Covering Letter);
- (b)Payroll Tax Audit questionnaires in respect of each individual company signed by the relevant director, including questionnaires signed by Bradley Thompson for Thompson Residential. The exception is Blue 11, which was signed by Brendan Thompson as “controlling associate” even though Bradley Thompson was sole director;
- (c)Payroll Tax Reconciliation Schedules in respect of each individual company signed as in 2 above, with Mr Bradley Thompson signing for Thompson Residential as director but Brendan signing for Blue 11;
- (d)A spreadsheet headed “Thompson Building Group- Contractors and Suppliers for FY ending June 2010” (the Taxable Labour Spreadsheet); and
- (e)An extract of a General Ledger for the Group for “Specified Accounting for Contract Materials and Suppliers” for the 2010 year (the GL Extract.)
- (a)
- [27]The key document in relation to the alleged fraud was the Taxable Labour Spreadsheet. As I understand the position, in the course of inquiries by the OSR, Mr Hyman provided another version of that document prepared by him (the Hyman Spreadsheet). It contains 23 entries missing from the Taxable Labour Spreadsheet. The effect of the 23 omissions was said to be to reduce the payroll tax liability of the Thompson Group. It is the prosecution case that these were removed on Mr Brendan Thompson’s instructions notwithstanding that they were not exempt from payroll tax so as to fraudulently reduce the exposure of the Group to Payroll Tax in the 2010 year.
- [28]It was also said by the prosecution that even though all but six of the 23 omitted items were included in the GL Extract, the information in that extract was amended from the ordinary General Ledger information to remove or rename payments made to the omitted contractors, to hide payments liable to payroll tax and to remove payments to directors liable to payroll tax.
The no case submission: Bradley Thompson
- [29]At the conclusion of the prosecution case, Ms Anderson made a no-case submission in respect of Mr Bradley Thompson. The submission was based on two propositions.
- [30]First, it was submitted that there was no case to answer in respect of Mr Bradley Thompson in relation to any of the offences charged because:
- (a)His criminal responsibility arose only under s. 140 TAA in respect of the two companies of which he was a director;
- (b)His criminal responsibility depended on him meeting the definition of “executive officer” under the TAA; and
- (c)There was no evidence of that element sufficient to establish a prima facie case against him.
- (a)
- [31]That submission was developed in this way:
- (a)On the proper construction of the definition, the fact that Mr Bradley Thompson was a director was irrelevant;
- (b)No averment was made to the effect that Bradley Thomson had instructed Mr Hyman and no evidence was given to that effect; and
- (c)Otherwise the prosecution evidence established that Mr Bradley Thompson was not concerned in or taking part in the management of the relevant companies.
- (a)
- [32]Second, it was submitted that the lack of evidence of an instruction by Mr Bradley Thompson to Mr Hyman also meant that there was no evidence to sustain conviction under s. 140 TAA of the s. 93 PTA fraud offences alleged against the companies of which he was a director. That submission was incorrect. The liability imposed by s. 140 TAA does not depend on the executive officer taking part in the particular affairs of a company which gives rise to an offence under s. 140. Her Honour did not accept that submission and it was not pressed on the appeal.
- [33]Ms Goli’s counsel submitted in response:
- (a)That on the proper construction of the definition, it was sufficient that Mr Bradley Thompson was a director to meet that definition;
- (b)It was irrelevant that Mr Bradley Thompson did not give instructions to Mr Hyman if he was otherwise an executive officer; and
- (c)There was prima facie evidence he was an executive officer because of certain documents he signed and emails he received relating to the payroll tax issues.
- (a)
- [34]Her Honour concluded there was no case to answer by Bradley Thomson and dismissed all charges against him. Her reasons, relevantly, were as follows:
Mrs Anderson, the counsel acting on behalf of Mr Bradley Thompson, has made a no case submission at the conclusion of the prosecution’s case when evidence has been given by four people: three employees from the Office of State Revenue which were Erica Ross; Ms Phan Pham; Kim John Gilbert Easton, the chief investigator; Mr Hyman, the bookkeeper; and Michelle Stedman, a former senior bookkeeper in that particular firm.
In could be right to say that in relation to active participation and direction of the company, there is no evidence that Bradley Thompson took any such role in the particular transactions that resulted in the submission to the Office of State Revenue.
Interestingly enough, executive officer – and I find this to be a curious definition given the Commonwealth legislation – contained in schedule 2 of the dictionary of the Taxation Administration Act 2001 describes as an executive officer and defines it as:
An executive officer of the corporation means a person who is concerned in, or takes part in, the management of a corporation regardless of the person’s designation, and whether or not the person is a director of the corporation.
On my interpretation of that, and applying general statutory provisions,...concerned in involves, from my view – concerned is not defined. But given its general or ordinary meaning, it means a person who is – has some active engagement. This is somewhat confirmed by:
… or takes part in –
so a concerning issue means a person who is involved or takes part in the management of the corporation. And it is interesting that both:
…. Concerned in and/or takes part in, the management –
that word follows:
of the corporation –
and ... my view of that particular executive officer is further confirmed by the following paragraph, which reads:
regardless of the person’s designation, and whether or not the person is a director of the corporation.
I’m not given any decided decisions in relation to this particular unique definition of executive officer. But merely the way in which the section is worded allows me to arrive at the view that, in fact, there needs to be some activity or management. There is no evidence before the court in relation to Bradley Thompson that he did anything in respect to the management of this company other than two specific issues. One is signing a document that’s prepared by Mr Hyman. The other one is, of course, his being copied into two emails. But there is no evidence as to reply or otherwise.
So in respect of the definition section and the evidence that is currently before the court, there is no evidence that he was actively – Mr Bradley Thompson was actively involved in the management of the company as contemplated within the definitions section. So there is no evidence in respect of that particular point.
If I’m unable to determine that he, as the definitions section suggests, was concerned in or takes part in the management of the corporation, I cannot then move to the next logical step involved in section 140 of the Taxation Administration Act:
An executive officer must ensure the corporation complies with the tax law.
So in relation to the matter am I satisfied that a jury properly instructed according to law would convict Mr Bradley Thompson in the application of the test, which is, undoubtedly, the objective test. I find that in relation to all the charges against Bradley Thompson, there is no case to answer and he will be discharged in respect of the offences as outlined.[3]
The no case submission: Mr Brendan Thompson and the companies
- [35]Ms Anderson also made a no case submission in respect of Mr Brendan Thompson and her client B&T Carpentry. It was accepted that if that submission were accepted, it should properly apply to each of the insolvent corporate defendants as well.
- [36]It was contentious at the appeal whether this submission was limited only to the fraud offences. That is important because as I have noted, it is accepted by the appellant that the dismissal of the compliance offences against other than Mr Bradley Thompson was an error. Ms Anderson’s oral submissions were expressly limited to the s. 93 offences.[4]
- [37]In summary, Ms Anderson submitted that there was no case to answer in respect of the fraud offences because:
- (a)Mr Hyman’s evidence that Mr Brendan Thompson told him to omit certain entities from the Taxable Labor Spreadsheet was such that, looking at the evidence as a whole, a “jury, properly instructed, on the evidence before the Court, could not convict”;
- (b)That the circumstances relied upon by the prosecution in respect of the GL Extract could not permit any inference of fraud because it included 16 of the omitted entries and this was such a hopeless attempt at concealment that a jury could not conclude there was a fraudulent intention in relation to the Taxable Labour Spreadsheet; and
- (c)Ms Steadman, a long term and trusted employee, gave evidence that she knew nothing of the alleged fraud and had no part in it. It was improbable Mr Brendan Thompson would rely on Mr Hyman (who was only employed for 3 months) over Ms Steadman if this was the intention.
- (a)
- [38]The prosecution’s submission was brief:
- (a)There was evidence from Mr Hyman which if accepted could sustain a conviction; and
- (b)Mr Hyman’s explanation for the GL Extract showing most of the entries was that he did not do a very good job of making consequential changes to the GL Extract to hide the omitted items.
- (a)
- [39]Her Honour considered the submission overnight. Her reasons relevantly provided as follows:
- (a)Her Honour noted the reliance on Mr Hyman’s evidence as follows:
- (a)
Mr Easton was clear in his evidence in cross-examination that he relied upon – what he relied upon for the basis of this prosecution. In simple terms, the information he received exclusively from David Hyman from his interviews on the 6th of June 2012, the 26th of April 2013, the seizure of documents from the Thompson building group, the subcontractors list, sums and submissions as told by David Hyman where to find these documents and the deleted 23 contractors from the financial year ended June 2010. Also, the export import document exhibit number 25 and also in relation to the changes of codes which he said was “to hide subcontractors’ payments” and made it more difficult for the Office of State Revenue to identify payments. It is interesting to note that in relation to the Tax Administration Act 2001, for which the Commissioner sent section 87 notices, the request for information to the companies required – and this is at item number 4-5 – for financial years 2008/2009, 2009/2010, for the period 1st of July 2010 to the 30th April 2011, a schedule whether by detailed general ledger, transaction list or otherwise, detailing all payments made to service providers other than employees (date, payee, description of payment amount or payment) including those recorded in a profits and loss statement under any of the following accounts/items:
- Contractors, subcontractors, outside contractors
- Labour hire
- Consultants/management fees
In a covering letter, page 2 of the Thompson group’s submission to the Office of State Revenue, this is of relevance to the evidence. This is exhibit number 5 dated 7.11.11, a letter to the Office of State Revenue which reads:
The way in which this information has been entered into the Timberline software package has made it difficult to extract information in relation to payment to contractors:
- (1)All payments in relation to construction costs have been allocated to one account, being Contract (contract materials and supplies). This includes payment to contractors as well purchases of material and expense reimbursements.
- (b)Her Honour then referred to certain inconsistencies in relation to the 2009 year materials, which I found difficult to follow without explanation of the documents used. So far as I could see, this aspect was not relied upon on appeal. Thereafter, however, her Honour referred to the GL Extract and observed it seemed that all but 6 of the omitted 23 were able to be found in the GL Extract;
- (c)Her Honour then held:
There were only six not seen in the general ledger, but never examined by the State Revenue. In the words of O'Sullivan and May, that fantastic 1955 High Court case, and using their words:
The burden of proving guilty beyond reasonable doubt rests on the Prosecution from first to last. A finding that a prima facie case has been made out is a finding of law, but on the evidence as it stands, the Defendant could lawfully be convicted of the offence changed.
Those are the – they are those elegant words of the High Court. Or, to put it more in general terms, as is often referred to frequently in this Court’s jurisdiction, would[6] a jury, properly instructed according to law, convict the accused? The question is could Mr Brendan Thompson and these companies be convicted on the evidence adduced. This question also implies that, of course, the most favourable view of the Prosecution’s evidence is reasonably open. In the conduct of this matter, 23 names of the subcontractors removed from the list of the 2010 financial year were identified from the list prepared by Mr Heinan, an employee of short duration, who had been responsible for the preparation of all documents for State Revenue. Of this list, only three of the 2010 were traced by the State Revenue’s Chief Investigator, Mr Easton.
As to why no further efforts were made to trace the remaining 20 is a mystery. As in all cases involving money, the devil is in the detail. Sadly, in this Prosecution, no forensic accountant was employed and at the conclusion of the Prosecution’s case, the accounting evidence could be described as woeful. It is not the Court’s job to be the forensic accountant, to try and work out which figure matched what figure and when, and how it all added up. But essentially, the vast majority of the people on the list of the 23 contractors were contained within the list of the bulk of the documents prepared, if anybody had bothered to look. Mr Easton had not pursued the total submission – had not perused the total submission of the company for the relevant tax years, 2009, 2010, 2011.
It was only in cross-examination that Mr Easton identified a substantial amount from the list of the missing contractors found within the bulk of the documents for the relevant financial years. So the Court is left with, at the Prosecution’s best evidence, six on a list of 23 not seen but no – in the general ledger, but not examined, other than in a cursory way, until cross-examination for the relevant financial years. Later in the day in this Prosecution, further documents relevant to these matters came to the proceedings. And yesterday in cross-examination, the – Mr Heinan [sic] – Mr Easton was re-examined as to the contemporaneous submission that the company group had made to the Workplace Health and Safety, which was lodged around approximately the same time.
This document, of course, unsurprisingly revealed entries for contractors from the magical 23 list of missing contractors. This document was given cursory regard by Mr Easton and it did not raise any concerns but, of course, it is a factor in relation to the consideration of intent contained within the relevant legislation. The document examined by State Revenue failed to encompass all documents provided in the submission. A close examination of section 93 and a statement of the law – it could be said that this is the first Prosecution ever undertaken by the Office of State Revenue, so the Court has indeed no interpretations required, nor has any other Magistrates Court ever examined the relevant sections for Prosecution. However, taking the ordinary or [indistinct] meaning of section 93, it reads:
Any person who, by any willful act, default, or neglect, or by any fraud, art, or contrivance whatever, avoids or attempts to avoid payroll tax chargeable under this Act will be guilty of an offence.
So willful, default, neglect, or fraud, art, or contrivance. Those are the key words to consider. And the charges in respect of section 93 offences are nearly identical for each of the companies as well as the individuals. Mr Heinan [sic], in his evidence, said he was directed to delete some contractors, but he could not say which [indistinct] any decision on a no case submission does not include any assessment of any witnesses of credit. That goes without saying. In relation to an overall assessment of the Prosecution’s case, I find that a prima facie case has not been made out, according to law. The Defendants could not, on the evidence as it stands, be lawfully convicted of all of the offences as charged, and therefore, Mr Brendan Thompson and, as against the following companies – and they are as follows: Thompson Residential Proprietary Limited, Thompson Commercial Proprietary Limited, Blue 11 Proprietary Limited, and B & T Thompson Carpentry – on all those charges, the company and the individual, Mr Brendan Thompson, will be discharged. Yes, costs.[7]
[Underlining added]
- [40]Her Honour’s dismissal of all the charges was not what was sought by Ms Anderson. However, it was odd that neither counsel adverted to her Honour’s misunderstanding during the ensuing submissions on costs issues which were lengthy. One would have thought that consideration of costs issues would have alerted the parties to the error. Her Honour could properly have expected such an oversight to have been corrected by counsel. That is particularly so given that Ms Anderson expressly confirmed the dismissal of the charges not subject to submission in the course of the costs argument (see TS8-34).
No case submissions: the law
- [41]A preliminary issue which might be thought to arise is whether a Magistrate hearing a complaint following a not guilty plea by a defendant has power to dismiss the proceedings on a no case basis. Section 146 Justices Act contains a requirement on the court on a not guilty plea (despite the use of the word may, it is probably a mandatory requirement[8]), to hear and determine the matter on all the evidence or to adjourn the hearing. This statutory direction appears inconsistent with the no case procedure.
- [42]
- [43]The place of the no case procedure in summary trials in Queensland was also dealt with by the Full Court in Fawkes v Shadwell [1966] Qd R 20. There Gibbs J[11](as his Honour then was) held that though there was no extant Queensland authority on the no case procedure in summary trials before Magistrates, other authorities supporting the application of that practice in summary trials should be applied. His Honour relied on May v Sullivan (1955) 92 CLR 654 where the High Court dealt with the question of onus of proof after the close of the Crown case. That case did not involve a no case submission to a Magistrate, but did proceed on the plain assumption that such a procedure applied in a summary trial before a Stipendiary Magistrate. His Honour also referred to Evgeniou v The Queen (1964) ALJR 508, a case concerned with the no case procedure in a judge alone trial conducted by Mann CJ in Port Moresby. None of these cases deal with s. 146 Justices Act or any similar provision. Nonetheless, it seems to me correct to proceed on the basis of the law as articulated in those cases, particularly given the decision in Power v Heyward.
- [44]The principles applicable when considering a submission that there is no case to answer on closing of the prosecution case were recently summarised by Burns J in R v Goldsworthy [2016] QSC 220 where his Honour said (footnotes omitted):
[5] When a no case submission is made, the question of law to be decided is “whether on the evidence as it stands [the accused] could lawfully be convicted”. If the answer to that question is in the affirmative, the case must be left with the jury. If not, it is the duty of the trial judge to direct a verdict of acquittal.
[6] The approach that must be taken to the determination of that question was authoritatively laid down by the High Court in Doney v The Queen, as follows:
“[I]f there is evidence (even if tenuous or inherently weak or vague) which can be taken into account by the jury in its deliberations and that evidence is capable of supporting a verdict of guilty, the matter must be left to the jury for its decision. Or, to put the matter in more usual terms, a verdict of not guilty may be directed only if there is a defect in the evidence such that, taken at its highest, it will not sustain a verdict of guilty.”
[7] It follows that a trial judge who is called on to rule on a no case submission must take the Crown case at its highest. Furthermore, questions of credibility, reliability or the weight to be accorded particular evidence are all matters within the exclusive province of the jury. So, too, are inconsistencies in the evidence; they are for the jury to resolve. Nor is it for a trial judge to consider whether a verdict of guilty returned by the jury on the evidence comprising the Crown case might later be determined by the Court of Appeal to be unsafe or unsatisfactory. That is not the test.
[8] The jury is the arbiter of the facts. As the Court remarked in Doney, it is fundamental to the determination of the facts that “the jury be allowed to determine, by inference from its collective experience of ordinary affairs, whether and, in the case of conflict, what evidence is truthful”. As to questions concerning the reliability of particular evidence, the Court accepted as correct the following proposition taken from R v Galbraith: “Where however the prosecution evidence is such that its strength or weakness depends on the view to be taken of the witness’s reliability, or other matters which are generally speaking within the province of the jury and where on one possible view of the facts there is evidence upon which a jury could properly come to the conclusion that the defendant is guilty, then the judge should allow the matter to be tried by the jury.”
[9] Of course that is not to say that a trial judge should not consider whether evidence that has a “tenuous character” or an “inherent weakness or vagueness” should be the subject of a warning to the jury but, even if such a warning is given, that evidence will still be available for use by the jury subject to that warning. It is then a matter for the jury to decide what weight should be given to that evidence.
[10] Where the Crown case rests either wholly or partly on circumstantial evidence, a no case submission is to be decided on the basis of such inferences that are reasonably open in support of the Crown case. It is not the function of a trial judge to choose between inferences which are reasonably open to the jury. Just as the determination of the facts is a matter for the jury, so too is the drawing of inferences based on those facts. The judge must therefore proceed on the basis that “the jury will draw such of the inferences which are reasonably open, as are most favourable to the prosecution”. That however does not mean that reasonable hypotheses consistent with innocence arising on the Crown case can in every instance be ignored. To the contrary, the task of the trial judge is to determine whether the evidence is capable in law of supporting a verdict of guilty. Thus, if the evidence in the Crown case is incapable of excluding all reasonable hypotheses consistent with innocence, the evidence will not be capable in law of proving the charge and there will be no case to answer in relation to it. That is just another way of saying that it is only if the evidence is such that an inference of guilt is incapable of being drawn beyond reasonable doubt that it might be concluded there is “in law no material on which a verdict of guilty might be found”, however that point is not reached merely by the existence of a “possible inference consistent with innocence”. It follows that the question whether the Crown has excluded every reasonable hypothesis consistent with innocence is a question for the jury; whether the evidence as a whole, and taken at its highest, is capable of doing so is one for the judge.
[11] For completeness it should be said that what is required of the Crown in discharging the onus of proof of guilt is not that every possibility of innocence be excluded by the evidence but only that every reasonable possibility be excluded. As such: “The existence of an admitted possibility but one that is assessed by experts in the field as being ‘extremely unlikely’, or ‘very remote’, or the result of a ‘very rare coincidence’ is not sufficient to introduce a reasonable doubt precluding the jury from being satisfied to the requisite standard of proof of guilt.”
- [45]I respectfully adopt his Honour’s summary.
- [46]I should add the following matters. No authorities were put to me suggesting any different approach should be adopted by a Magistrate sitting as the tribunal of law and fact. It might be thought that the above statements of principle, based as they are on the primacy of the jury as the fact finding body in a trial on indictment, sit a little uneasily with the position of a Magistrate hearing a summary charge. However, Fawkes v Shadwell proceeded on the basis that the same approach should be applied to a no case submission before a Magistrate hearing a summary charge as in trial before judge and jury.[12] I therefore proceed on that basis. Neither counsel on the appeal suggested otherwise.
- [47]I also observe that whether there is a case to answer is a question of law. It does not involve issues of discretion. While her Honour had the advantage of hearing the whole of the evidence, I have before me both her Honour’s reasons and the submissions of counsel on that question of law.
Mr Bradley Thompson has a case to answer
- [48]On the appeal, the contentions for both parties were similar to those advanced before her Honour. In my view, her Honour erred in concluding that Mr Bradley Thompson had no case to answer in respect of the charges under s. 140(2).
- [49]The prosecution’s first contention in this regard was that on the proper construction of the definition of executive officer, the mere fact of being a formally appointed director of the company is sufficient for Mr Bradley Thompson to meet the requirements of the definition. I will deal with that issue last as it is unnecessary for me to decide that interesting question in the prosecution’s favour to uphold the appeal in respect of Mr Bradley Thompson. This is because, in my view, there was a prima facie case even if that contention was rejected. I explain my reasons.
- [50]It is to be recalled that her Honour considered that to be an executive officer as defined, one must have some active participation in the management of the company, as opposed to just being a de jure director. Of course, the precise question posed by the definition is whether someone is concerned in, or takes part in, the management of the corporation. In my view there was sufficient evidence of that element of the offence to establish a prima facie case.
- [51]First, even if the mere fact that Mr Bradley Thompson was a director is not sufficient of itself, the fact that he was a director, and indeed the sole director, is important evidence. In my view, if a person is the sole director of a company, it would be open to a tribunal of fact to draw the inference that that person was concerned in or takes part in the management of the company. His statutory duties required him to do so and, by undertaking the role as sole director, once could reasonably infer that he complied with those duties.
- [52]Second, there was evidence referred to before me that Mr Bradley Thompson’s role in the Group was in respect of sales. This was relied upon by the appellants as supporting the conclusion that there was no evidence he was concerned in management of the companies of which he was a director. In my view, that evidence could reasonably support the opposite inference.
- [53]The evidence in this respect did not limit his role to a minor one, or one in which he was managed and directed by his brother. Further, this was a small family business in which both brothers worked together. Accordingly, it would be open to the tribunal of fact to infer that Mr Bradley Thompson was involved in the management of the sales side of the Group’s business.
- [54]In that regard, it has been recognised that whether a person is a de facto director of a company must be considered in the context of the size and complexity of the company and the nature of its affairs.[13] Further, it has been recognised that the fact that a person undertakes tasks of importance to a company with broad authority and independence can constitute them a de facto director.[14] I can see no reason why similar considerations could not inform the assessment of the question of fact posed by the definition of executive officer.
- [55]Third, there is the evidence that Mr Bradley Thompson signed the Audit Questionnaire and Reconciliation Statements for Thompson Residential. This is also evidence which could rationally support a conclusion that he was an executive officer as defined. Both documents involved declarations of the truth of information about the company involved and provided to the OSR. These were, in my view, acts in the management of the company of a kind which an executive officer would ordinarily undertake. Even the conclusion that Mr Thompson had not read the documents when he signed them does necessarily not rob those acts of their managerial character. Taking responsibility for the company’s affairs arising from signing the documents itself could be sufficient. It is not uncommon for directors and senior managers to adopt the work of others and to do so because the responsibility for the work lies with them, even if they choose to rely on the work done by others without properly reviewing it.
- [56]Fourth, given those other pieces of evidence, the inclusion of Mr Bradley Thompson as an addressed in respect of two emails sent relating to the audit process could also rationally support the inference that he was an executive officer as defined.
- [57]Fifth, the relevant fact was averred in the complaints relating to Mr Bradley Thompson. For example, paragraph 7 of Charge one alleged “At all relevant times, Bradley Thompson was concerned in, or took part in the management of Blue 11”. Those averments were also evidence of that fact in each Charge. There was no directly contradictory evidence.[15] On the contrary, in my view there was considerable evidence capable of being properly relied upon as supporting that averment.
- [58]Finally, there was very little, if any, evidence that Mr Bradley Thompson gave instructions to Mr Hyman. However, it is being concerned in, or taking part in, management generally, not management of the particular matter the subject of the charge against the corporation, which is the focus of attention of the definition.
- [59]Accordingly, in my respectful view, her Honour erred in law in concluding that Mr Bradley Thompson had no case to answer in respect of the offences under s. 140(2) charged in the complaints.
- [60]I now turn to the point in paragraph [50] above. The definition of executive officer uses two phrases to describe the connection between a person and the management of a corporation which will constitute that person an executive officer. It is orthodox statutory construction to approach the definition on the basis that the two limbs should be given some work to do.[16] The requirement for active involvement contemplated by her Honour’s approach is apt to describe what is covered by “taking part in the management” of a corporation. Her Honour’s approach seems to have “concerned in” doing the same work.
- [61]Concern/concerned is defined relevantly as follows in the Macquarie Dictionary (5th edn):
- (a)“Concern” means:
- (a)
- 1.to relate to; be connected with; be of interest or importance to; affect: the problem concerns us all.
…
- 3.that which relates or pertains to one; business; affair.
…
- 4.concern oneself, (sometimes followed by with or in) to interest, engage, or involve oneself: to concern oneself with a matter; to concern oneself in a plot.
…
- 9.concern oneself, (sometimes followed by with or in) to interest, engage, or involve oneself: to concern oneself with a matter; to concern oneself in a plot.
- (b)“Concerned” means:
- 2.involved: the children concerned should report to the office. – phrase.
…
- 4.concerned with, paying attention to: this department is concerned with quantity rather than quality.
- [62]It seems to me consistent with a number of these definitions to conclude that a person who is a director, especially the sole director, of a company is concerned in the management of the company because it is a matter of interest to that person, given his/her statutory role and duty in respect of the company and the consequences which flow from breach of that duty. Such a construction also seems appropriate to give “concerned in” an area of application distinction from the second limb of the definition, which deals with idea of actual participation.
- [63]In my view, therefore, a director is always a person “concerned in” the management of a company in that sense. Accordingly, in my view, there was a prima facie case that Mr Bradley Thompson was an executive officer by reason of his role as sole director alone.
- [64]I accept that this involves a different approach to the expression concerned in from that adopted by Ormiston J in Commissioner for Corporate Affairs Commission (Vic) v Bracht [1989] VR 821 especially at 832. There his Honour was considering a provision in similar, but not identical, terms to the definition of executive officer in this case. However the particular section was concerned with identifying the scope of the prohibition of a bankrupt from involvement in management of a corporation. In that context his Honour held:
Nevertheless the concept of "being concerned in" a particular activity connotes participation at a variety of levels and at differing intensities. Essentially the section is protective and, as was said by Quilliam J in R v Newth, at 761, it prohibits a person "from taking any hand in the real business affairs of the company". Perhaps I have given the word "management" a somewhat wider meaning, but the level of participation to which the section refers may be relatively modest. In this context I would not consider its meaning to be as wide as "having something to do with", as had been adopted in the context of a civil contract in George Hill and Co v Hill (1886) 55 LT 769, at 771: cf Pioneer Concrete Services v Galli ([1985] VR, at 707). On the other hand it should not be construed as requiring some financial interest or material benefit in the corporation as might flow from an adaptation of the authorities relating to "concern" in contracts of municipalities, prohibited under sections such as s 53 of the Local Government Act 1958: cf Allen v Tobias (1958) 98 CLR 367, at 377-8 and Attorney-General v Keating [1971] VR 719, at 723-4.
[Underlining added]
- [65]It can be seen, however, that the context of the section and its protective purpose was important to his Honour’s construction. His Honour made clear that issues of context were important to his construction task. The context of this definition is quite different. It is concerned generally with identifying those person upon whom the TAA will impose responsibility for the state taxation affairs of corporate tax payers. In my view, the construction I articulate above is consistent with that purpose. One of the persons appropriately contemplated as executive officers of a corporate tax payer is a person who is a director of that company and should properly be concerned in (in the sense of being concerned with or about) corporate compliance. To paraphrase his Honour, in this context I would consider its meaning to be as wide as “having something to do with”.
- [66]Mr Power made the further submission that the strictness of the obligation which might arise from that construction is ameliorated by the defences in s. 140(4) TAA. That provides only limited assistance in construction given that the definition applies in a number of other contexts.
- [67]I should finally observe that the phrase “whether or not the person is a director of the corporation” does not lead me to a different construction. That phrase can be just as easily read as communicating that a person who has the role identified in the balance of the definition is an executive officer even if the person is not a director.
- [68]I accept that a countervailing argument to my construction could be that if Parliament intended to catch directors per se and others, the definition could just as easily have said that an executive officer “is a director or a person who etc.”. While this point has some merit, on balance I consider the construction articulated in these reasons to be the correct one.
There is a case to answer on the s. 93 PTA offences
- [69]The above summary of the submissions to her Honour and indeed her Honour’s reasons on the fraud offences, do not fully encompass Ms Anderson’s submissions in support of her Honour’s conclusions on appeal on this aspect of the matter. It is useful therefore to set out the submissions made to me in a little more detail.
- [70]Ms Anderson submitted in writing as follows (footnotes omitted):
- 13.There is no evidence that David Hyman acted on behalf of the Companies. He was employed for a total of three months. He was employed as an accounts assistant. There is no evidence that he was empowered to take steps on behalf of the Companies. He signed no documents on behalf of the companies. There was no evidence that he had any authority. He gave evidence that he was directed to delete some contractors if exemptions could not be found. He could not say which contractors he was directed to deleted [sic], but he said he could remember Kentwall trust and Gregory Wilson.
- 14.Mr Hyman accepted that he was told Scott Shellshear, the external accountant that payments to Directors and to Trusts were not subject to payroll tax. It is irrelevant whether that advice was correct. He, and Brendan Thompson relied upon that advice. He changed his evidence and said that he deleted payments to Kentwall Trust because it was a payment to a director relying on that advice. A number of the other deletions related to payments for which exemptions could have been applied.
- 15.Mr Hyman’s evidence that he was directed to make changes to the financial documents to attempt to avoid the payment of payroll tax is unreliable. He was often evasive in his answers. He was motivated by his animus for Michelle Steadman. He says that Mr Brendan Thompson was directing him to commit fraud, and yet even if that were true (which is expressly denied), he was willing to, and did, accept a job continuing to work and be supervised by Mr Thompson. He only sent the email telling Brendan Thompson where the submissions to the Office of State Revenue were and that they were ready to go two days after he left. He later sent two offensive emails to Thompson staff which referred to Michelle Steadman as a “bitch” and a “psychopath”. He was willing to go to extraordinary lengths to hurt her. His evidence at the Office of State Revenue and to this Court is more of the same. His evidence is internally inconsistent. A conviction cannot safely stand on his evidence.
- 16.Her Honour accepted that there was no reason why Mr Brendan Thompson would not reply upon the work of Mr Hyman. He was working on the OSR audit. He had the advice and assistance of an external accountant. Mr Thompson was working on the same time on an audit for Workcover and for the Building Services Authority. He needed the assistance of a skilled accounts assistant and the thought he was receiving it. He had no reason to suspect that Mr Hyman would go to the extraordinary steps of submitting deliberately false documents to the Office of State Revenue.
- [71]Mrs Anderson also took me to a number of sections of the cross examination of Mr Hyman in which he appeared to accept that some of the 23 items omitted were omitted by him because he believed that those items were in fact exempt based on advice he says he was given by the Thompson’s accountant, Mr Shellshear, now deceased.
- [72]Her Honour consistently taxed Ms Anderson her with the uncontentious proposition (accepted by Ms Anderson) that issues of credit were not properly to be resolved on a no case submission. It can be seen from the above submissions that many of them comprise challenges to the credibility of Mr Hyman’s evidence or the challenges persuasiveness of inferences consistent with guilt. To that extent, they are irrelevant to sustaining her Honour’s dismissal, as her Honour recognised.
- [73]However, with respect, I find it difficult to understand exactly how her Honour then reasoned to the conclusion that there was no case to answer. It seems that her Honour considered the evidence as a whole could not sustain a conclusion that there had been a willful act by Mr Brendan Thompson to avoid payroll tax.
- [74]Her Honour seems to have based this on:
- (a)The weakness of Mr Hyman’s evidence as to exactly what he had been told to delete and why;
- (b)The lack of any effective concealment of the deletions in the GL Extract delivered as part of the submission to the OSR, and the description of the approach taken in the GL Extract in the Covering Letter and inclusion of omitted contractors in Workcover returns; and
- (c)Other sloppiness in the forensic testing of the fraud hypothesis by OSR prior to bring the complaints.
- (a)
- [75]In my view, these are all matters which go to the persuasiveness of the case advanced by the prosecution, not to whether there is a prima facie case made out. Accordingly, with respect, I do not see how the no case conclusion is sustained on her Honour’s reasons.
- [76]Both parties recognised that the case for the prosecution depends on Mr Hyman’s evidence that he was instructed by Mr Brendan Thompson to deliberately omit items from the Taxable Labour Spreadsheet which were not otherwise exempt to reduce payroll tax liability in 2010. In my view, the real question is whether, by the end of the cross examination, Mr Hyman could no longer be said to have given evidence of that instruction from Mr Brendan Thompson.
- [77]This was the way Mr Power for Ms Goli approached the matter. The key paragraph of his submission was paragraph 40 which provided (footnotes included but renumbered):
The central document that was altered by Hyman on Brendan Thompson’s instructions was a spread-sheet entitled “Thompson Building Group – Contractors and Suppliers for FY ending June 2010.”[17]The version of that document sent to OSR as part of a submission on behalf of the group of companies (the Thompson building Group) contained 23 fewer contractors than was the true position. Had the omission of those 23 contractors been a deliberate omission, it would demonstrate fraud. It was Hyman’s evidence that the omissions were deliberate and that Brendan Thompson had directed him to amend the document for the purposes of falsely reducing the payroll tax that would otherwise be owing.[18]
- [78]Ms Anderson challenged, as she had to, the last sentence of the paragraph. If there was evidence which it was open to the tribunal of fact to accept that Mr Brendan Thompson had so directed Mr Hyman, then in my view a prima facie case existed. I have read each of the transcript references referred to in Mr Power’s submissions and, with the exception of 5-21.35, they make good Mr Power’s submission. They also contain evidence as to the way in which the omitted contractors were dealt with in the GL extract to make detection harder.
- [79]Probably the low point of Mr Hyman’s evidence on the instruction to delete contractors to wrongfully reduce payroll tax liability is the following passage:
MR VAN DER WALT: I’d just like some further evidence from you in relation to our statement that you were told by Brendan? --- Yes.
Where did this discussion occur? Was it in person, on the phone, at the offices? To the best of your recollection? --- This happened over the course of several – just focusing on the deleted ones ---
Yes? --- - - - this happened over the course of several – several meetings with Brendan.
Where were those meetings? --- Probably at my desk.
All right? --- Or his. Several because there’s one for each year and so I would do one year and then go on to the next and see him again. The – the reason why it was several meetings is because I was going over the other exemptions. I had a tally down the bottom which gave a rough estimate as to how much payroll tax liability the company was up for.
Right? --- And when he saw that, he kept pressing me to lower it to find more exemptions. And then at one point when – when there were no more exemptions to be – there was nothing that we could really come up with, he suggested that certain subcontractors just get deleted off that list.
All right. Did he identify which contractors? --- Yes.
How did he do that? --- He would point to them. I forget the names, exactly, but there was – there was a couple that – that he – he relented and realised that there was no exemption to – to use so just get rid of it.
All right. So how many entries – how many names did he tell you to take off the list? --- That was not specific. The end result – the goal was to lower that liability.
Right? --- So there would’ve been five or 10. And then if wanted it any lower, well, then I would just pick one.[19]
- [80]Although Mr Hyman’s evidence was otherwise challenged as to its detail, I was not taken to any evidence in cross examination where Mr Hyman abandoned his assertion that Mr Brendan Thompson instructed him as sworn in this passage.
- [81]In those circumstances, I do not agree that Mr Hyman’s evidence, taken at its highest and ignoring contrary evidence, could not sustain a verdict of guilty.
- [82]Given Ms Anderson’s cross examination, it might be that a tribunal of fact would not conclude that every one of the 23 deletions was made for the fraudulent purpose, though it seems that there might be arguments as to why, despite some of Mr Hyman’s concessions in that regard (such as in respect of the trusts), it might still be open to a tribunal of fact to reach the necessary conclusion. However, it is not essential to making out the charge that evidence be led which makes out each and every of the 23 fraudulent omissions alleged in the complaints.[20] Even evidence to sustain one such omission will be sufficient to make good the charge as a matter of law. It might be her Honour did not act on this basis, though I am not certain of that from the reasons.
- [83]It seems to me that the balance of the matters raised by her Honour and by Ms Anderson on appeal go to the question of whether, in all the circumstances, the conclusion of fraud should be drawn, not whether it was open rationally to be drawn. In that regard, the failure properly to conceal the omitted subcontractors in the GL Extract and to conceal the omitted subcontractors in Workcover returns are matters which might, not must, cause a tribunal of fact to doubt that the instructions were given as Mr Hyman swore. However even these matters do not strike me as all one way. Some fraudulent schemes are badly planned and poorly carried out. They can be done with a naïve optimism that they will not be detected. Incompetence is rife in fraudulent undertakings.
- [84]In my view, there was sufficient evidence led by the complaint to establish a prima facie case in respect of the s. 93 offences and her Honour erred in dismissing those charges.
Dismissal of the compliance charges against Brendan Thompson and the companies
- [85]It is common ground that her Honour erred in dismissing these charges.
Other grounds of appeal
- [86]The appellant raised other grounds of appeal.
- [87]First, she contended that her Honour failed to give adequate reasons for dismissing the charges. If this is directed to the dismissal of the compliance offences other than those dismissed against Bradley Thompson, I agree with that submission. Her Honour gave no reasons for dismissing those charges. However this appears to have been the result of an oversight by her Honour which no-one brought to her attention. Otherwise I am unpersuaded that her Honour gave insufficient reasons, although on occasion some more explanation might have been useful.
- [88]Second, it was said her Honour erred in failing to recuse herself on Ms Goli’s application for apprehended bias and that her Honour gave inadequate reasons for refusing that application. I do not need to decide either ground of appeal given my conclusions above. I express no opinion on either ground.
Disposition of the appeals
- [89]Given the above, uphold the appeals in each matter and I set aside each of the orders dismissing the charges in each matter made by her Honour pursuant to s. 225(1) Justices Act. This leaves the question of what further orders I should make in the appeals.
- [90]That question has to be determined in the following procedural context:
- (a)First, there has been no determination that goes to the efficacy or fairness to either party in of the presentation of the prosecution case. The respondents contend, correctly in my view, that in theory the trial could proceed on the extant record of the Crown case; and
- (b)Second, the next step in the trial (if there is no re-trial) is for the defendants to be called upon. The matter cannot proceed to a verdict until that step is taken.[21]
- (a)
- [91]The respondents contend that the matter should be remitted to her Honour or, in the alternative, that the matter be determined in this Court on the basis of the record, with the trial to be completed in this Court. The appellant contends that the matter should be remitted to the Magistrates Court for re-trial before another Magistrate.
Matter should not be remitted to her Honour
- [92]The respondents contend that the matter could properly be remitted to her Honour because:
- (a)The matter can proceed on the basis of the record to date;
- (b)There was no finding in this Court that her Honour erred in dismissing the recusal application accordingly there is no prejudice to the prosecution in remitting the matter to her Honour; and
- (c)Doing so avoids the prejudice to the respondents of the cost of a re-trial (the respondents refer to an 8 day trial, though at least one day, perhaps more, was concerned with the no case submission and cost consequences of the dismissals).
- (a)
- [93]I accept that her Honour is best placed to proceed on the basis of the record to date and that remitting the matter to her Honour would avoid the costs thrown away if the case was retried or re-considered by another Magistrate. The difficulty with remitting the matter to her Honour, however, is that I am not satisfied that it would be fair to the complainant to do so.
- [94]Where a no case submission is based solely on a point of law, it might be appropriate to send the case back for further hearing by the same Magistrate, to simply pick up the trial where it left off. However, each case has to be considered on its merits. Given that the Magistrate decides both fact and law, residual concerns might properly be held by the successful complainant on appeal that the Magistrate would find it difficult, even doing his or her best, to bring an impartial mind to bear on the further hearing of the trial once he or she has dismissed the complaint, whatever the reason.
- [95]However, in my view this is not a case involving just a point of law. It seems to me, with respect to her Honour, that reaching the conclusion that no case existed on the fraud charges involved, albeit unintentionally, adopting a view on the inferences which were open on the evidence and adopting a view on whether Mr Hyman’s evidence could, ultimately, be safely acted upon. In short, I consider her Honour expressed views on the merits of the case, the credibility of Mr Hyman and the weight to be given to inferences which arise on the evidence. The same is true, to a somewhat lesser degree, in respect of the conclusion in relation to Mr Bradley Thompson.
- [96]I do not consider it necessary to go further than this to conclude that it would be unfair to the prosecution to direct the matter return to her Honour for further hearing. In particular, I reject the submission from the respondents that absent a finding of apprehended bias, the matter should properly be remitted to her Honour. Apprehended bias is a sufficient but not necessary condition to remittal to another judicial officer in the context of these appeals.
- [97]I was referred by the respondents to Morrison v Kiwi Electrix Pty Ltd (1998) 19 WAR 482 in this respect. I do not think, however, that that case assists the respondents. In that case, the Magistrate hearing an occupational safety prosecution was found to have erred in two ways in dismissing the charges on a no case submission. First, it was found that the Magistrate had erred in concluding that there was no evidence which could sustain an inference of guilt of one element of the charge (that there was no safe system of work in place) and second, it was found that the Magistrate erred in excluding certain evidence. It was the combination of these factors which led the Full Court to conclude that the matter had to be remitted to another judicial officer. There is some similarity between the first ground upheld by the Court in that case and grounds upon these appeals have been upheld. In any event, the case provides no comfort to the respondents.
- [98]Further, it must be kept firmly in mind that it was the respondents’ choice to make a no case submission. They could have continued with the trial and made submissions to her Honour on a final determination of the matter on all the evidence. They chose not to do so. Unlike the situation where a no case submission is successfully made in proceedings on indictment (where the Crown might enter a nolle prosequi or a verdict of acquittal might be directed), there was always the prospect of an appeal under s. 222 Justices Act from the dismissal on a no case basis. That prospect included the possibility of the matter being heard afresh. The no case submission was a forensic decision made by the respondents with all the attendant risks, including the risk of a re-trial should a dismissal be set aside on appeal.
- [99]I do not think that the prejudice to the respondents of another trial of the prosecution case is such as to offset the reasonable perception of unfairness to the complainant of remitting the matter to her Honour. I say that meaning no disrespect to her Honour.
- [100]That is not to say that the cost of a further trial to the respondents is not a relevant consideration, it is just an insufficient one to justify remittal to her Honour in this case.
Hearing on the existing record
- [101]I now turn to the respondents’ alternative submission: that the matter proceed on the record to date in this Court. The respondent’s submit that as the matter could proceed on the record to date, this Court could call on the defendants, hear the evidence and decide the matter.
- [102]There are two considerations which arise.
- [103]The first is this: if this course was to be adopted, there is no sufficient reason why the matter should proceed in this Court. The advantage of having heard the appeal is of limited utility. It was plain to me from considering the arguments on appeal that there is a great deal more to the case than the limited issues considered in the contentions on appeal. Further, the trial could continue for some considerable time if the Thompsons go into evidence. While there is no reason in principle why this could not be heard in this Court, the Magistrates Court is the Court with primary responsibility for the hearing of the complaint and, other things being equal, is the appropriate court for the further hearing of the trial.
- [104]The second matter which arises is whether it would be appropriate for the matter to proceed before another Magistrate on the existing record. I have found this aspect of the matter difficult. The attraction of proceeding on the existing record might be said to be twofold:
- (a)The costs of re-hearing the prosecution case will not be incurred; and
- (b)The prosecution will not have the advantage of a second opportunity to present its case.
- (a)
- [105]On balance, however, I do not think that remitting to the Magistrates Court on that basis is the appropriate exercise of my discretion.
- [106]First, I think that the costs which will be avoided are likely to be much less than the respondents contend. The premise of the respondents’ submission seems to be that there will be no material additional costs if the matter is remitted to continue on the existing record. In my opinion, that premise is flawed. This is not a case which could easily be picked up by another judicial officer.
- [107]Documents are central to this case. My experience in the appeal was that the documents do not speak for themselves. They are very difficult to understand without the explanations given in evidence in chief. Similarly the critiques of those documents and related evidence in cross examination are difficult to pick up without the context given by cross examination. Further, I found it difficult to do so by reading the transcript alone. It would be a painstaking process for a judicial officer to try to reconstruct the evidence and pick up the important subtleties in the evidence just from reading the transcript. This would be expensive in judicial time. It would also require very detailed and lengthy submissions at trial, much lengthier than would otherwise be required. Considerable time would be required just to explain the evidence given over the seven days to the trial judge with sufficient clarity and detail that the trial judge could confidently apprehend and rule on the submissions at trial.
- [108]Second, as I have said, while the cost to both parties of a re-trial is to be regretted and avoided if otherwise appropriate, this point is less compelling where the situation has arisen from a forensic decision made by the respondents in the circumstances outlined in paragraph [99] above.
- [109]Third, it is plain that credibility and reliability of witnesses, especially Mr Hyman, is central to the trial of the complaints. Having the opportunity to observe a witness giving evidence remains important in assessing that witness’ evidence. Proceeding on the existing written record would rob the fact finder of that opportunity. Further, it seems somewhat unfair for the prosecution witnesses to speak only from the paper, while the defendants’ witnesses (if the defendants go into evidence) will give their evidence to the fact finder in person.
- [110]However, these considerations do justify particular orders being made in respect of the costs of days one to seven of the first trial. If the respondents[22]were to succeed in any subsequent trial, it might be unfair that they should pay the costs of the retrial of the prosecution case. A fortiori if no further prosecution is brought. In those circumstances, the costs of the first trial should be reserved to the trial judge in the second trial or, failing further prosecution, the respondents should have leave to bring the matter back before me on the question of costs of the first trial.
- [111]I will hear the parties on the costs of the appeals.
Conclusion
- [112]In the circumstances, the orders I make are:
- The appeals in each matter are upheld;
- The order of the learned Magistrate made on 28 November 2017 in proceedings 4991/17 dismissing the complaints against Bradley Thompson be set aside;
- The orders of the learned Magistrate made on 29 November 2017 in proceedings 4985/17, 4986/17, 4987/17, 4989/17, 4990/17 dismissing the complaints be set aside;
- The orders made in respect of costs in proceedings 4989/17, 4991/17 and 4990/17 be set aside and the costs of the days one to seven of the trial (the first trial costs) be reserved to the trial judge in any further hearing on the complaints;
- If there is no further hearing on the complaints, the respondents in proceedings 4989/17, 4991/17 and 4990/17, respectively, have leave to apply to this Court for an order in respect of the first trial costs;
- Each matter be remitted to the Magistrates Court for rehearing by a different Magistrate.
- [113]I will hear the parties on the costs of the appeals.
Footnotes
[1] Hereafter, references to the respondents are references to these three respondents unless otherwise specified.
[2] McDonald v Queensland Police Service [2017] QCA 255.
[3] TS 7-75.15 to 76.32.
[4] TS 7-77; TS 7-81.25.
[5] Decision of Magistrate Coates dated 29 November 2017 at 3-20 to 4-14.
[6] I do not assume that this reference to “would” discloses error by her Honour. If it is accurately transcribed, it appears a slip of the tongue rather than a misunderstanding of the legal test, as the next sentence tends to confirm.
[7] Decision of Magistrate Coates dated 29 November 2017 at 5-22 to 6-44.
[8] See Power v Heyward [2007] QSC 26 at [15].
[9] Power v Heyward [2007] QSC 26 at [16] to [24].
[10] See Power v Heyward [2007] QSC 26 which recognises implied power to take procedural steps similar to considering a no case submission and see Upton v Commissioner of Police [2012] QCA 88 which proceeds on the assumption that such a power exists: see [22].
[11] Lucas J agreeing and Hart J concurring in separate reasons.
[12] At 21 per Gibbs J (Lucas J agreeing) and 22 per Hart J.
[13] Grimaldi v Chameleon Mining NL (No 2) (2012) 287 ALR 22 at [66] and [73].
[14] Grimaldi at [90] to [92].
[15] See Charlton v Rogers (1985) 82 FLR 40.
[16] D C Pearce and R S Geddes, Statutory Interpretation in Australia (8th edn, 2014) at 2.26.
[17] Exhibit 8 was tendered at 3.39.
[18] Hyman at 4-120.35, 4-121.30, 5-7.45, 5-21.35, 5-22.35, 5-24.05, 5-38.10, 5-94.40, 6-02.40.
[19] TS 4-121.10-.45.
[20] Crosthwaite v Loader [1995] QCA 42, especially at p. 9 per McPherson JA with whom Macrossan CJ agreed, Thomas JA dissenting but on the factual inferences open not the law.
[21] Upton v Commissioner of Police [2012] QCA 88.
[22] That is, the represented respondents.