State of Queensland v Reid[2006] QSC 67

[1] HER HONOUR: This is an application by the State of Queensland for an order pursuant to section 184 of the Criminal Proceeds Confiscation Act 2002 ("the Act''), that the Court assess $12,000, as the value of the benefit derived by the respondent, Peter Reid, from the commission of an offence that falls within the definition of ''confiscation offence" for the purpose of the Act and an order that the respondent pay the State of Queensland the sum of $12,000 by way of pecuniary penalty order.

[2] The respondent has appeared today for himself, in order to oppose the making of a pecuniary penalty order in the sum of $12,000. The respondent properly conceded that an order should be made against him, but argued that it should be for a much lesser sum, such as a sum in the vicinity of $500 up to $2,000, on the basis that any finding as to the benefit he gained from the transaction should be limited to the amount of a dollar to $4 per tablet involved in the supply. There were 501 tablets and that is where the figures of $500 to $2,000 come from.

[3] The respondent was convicted after tal before a jury of one count of supply of a dangerous drug on 17 February 2000. The trial was conducted before me. I was the sentencing Judge. I have a recollection of the basic facts that came out in evidence and the sentencing remarks that I made upon the respondent's conviction have reminded me about some of the details of the matter.

[4] There was a covert police operative from New South Wales who contacted a police officer, one Catton, seeking to purchase Ecstasy tablets. Catton approached the respondent.There had been a previous trial involving Catton and the respondent, at which Catton was convicted, but there was a hung jury in relation to the respondent.

[5] The respondent had given evidence in that trial and has placed before me today the transcript of his evidence, which sets out the explanations he gave to the jury in the first trial for the finding by the police on him of one of the marked $50 notes that had been passed by the covert police operative to Catton. Mr Reid in the hearing today, confirmed that he maintained his reliance on that explanation he gave in that trial.

[6] The respondent did not give evidence in the trial before me. By saying that, I am not in any way suggesting that he should have. As Mr Reid acknowledged in submissions today, that was his right and he availed himself of it.

[7] The evidence on the trial before me focused on the transaction involving the covert police operative from New South Wales, Catton and the respondent.The evidence in no way dealt with the possible sources of supply of the 501 Ecstasy tablets that the respondent was found guilty of supplying to Catton for the purpose of on supply to the covert police operative.

[8] The covert police operative paid $12,500 to catton; catton paid $12,000 to the respondent. The tablets, according to Catton, were passed to him by the respondent in exchange for the sum of $12,000.    The tablets were then passed on to the covert police operative.

[9] Shortly after the passing of the tablets to the covert police operative, the police raided the respondent's home. They found a $50 note which, as I have already referred to, was one of the marked $50 notes, which the respondent explained he obtained from Catton as part repayment of a debt of $100 that Catton owed to him. The sum of $12,000 was not located at the respondent's home, on his person or in his office.

[10] On this application, the applicant relies on section 187 subsection 1, paragraph (a) and points to the sum of $12,000 that passed through the respondent's hands and seeks to have the pecuniary penalty order assessed in that amount.

[11] Under section 193 of the Act, any expenses or outgoings of the person in connection with the commission of the offence must be disregarded.  That is understood in the context of a supply of drugs as requiring the Court to disregard the cost to the supplier of purchasing those drugs.

[12] In a recent decision of the Court of State of Queensland v­ Cooper and Another [2005] QSC 55, a distinction was drawn between a supplier who returned the proceeds from sale of drugs received by the supplier to a principal, because the supplier was, in effect acting as a commission agent and a supplier who paid to a third person the cost of the drugs that were supplied by the supplier. In that case it was recognised that the persons against whom the pecuniary penalty orders were sought were ones who had an arrangement with their principal in that they received the drugs from the principal, sold them, returned the proceeds to the principal and were given payment for their services. They were not assessed for the value of the sales.

[13] The respondent argued that the circumstances of the evidence that arose at the trial were such that it was equally open for me to infer that he was acting either as a commission agent, or as a party who purchased the drugs and that the onus was on the Crown to show in which capacity he was acting and that the Crown has failed to discharge the onus in this case and that the respondent should get the benefit of the most favourable characterisation of the transaction.

[14] The problem with this approach is that the evidence of the transaction before me at the criminal trial, concentrated on the actual supply by the respondent to Catton for passing on to the covert police operative.

[15] There was no evidence directed at the arrangement that the respondent may have had with the source of the 501 Ecstasy tablets that he passed to Catton.

When I sentenced the respondent, I acted on the basis of submisisons that were made on sentence, to which the respondent has referred today and I stated that:

"The Prosecutor asks that I infer that profit was your motive. What I can say from the facts that were before the Court as a result of the evidence given in this trial is that the covert police operative managed to persuade Catton to arrange a supply of drugs to him. Catton could arrange that supply of drugs only by going to somebody else to get the drugs. Catton 2 r went to you. I accept that you must have been higher up the chain than Catton. It is reasonable to infer that you were involved in this activity, because you were getting something from it. As you were higher up the chain than Catton, profit must have been your motive. There is no indication, however, on the evidence that came out in this trial, as to how much profit you obtained from the transaction, which was the supply of approximately 112 grams of Ecstasy tablets, containing 4 grams of methylamphetamine for a price of $12,000".

[16] I do not make any definitive findings as to the characterisation of the respondent in that chain of supply and neither was it possible to make, as I indicated, any finding as to the quantum of profit.

[17] I was asked by the respondent to draw an inference from the fact that there was little time between the transaction involving the covert police operative and the raid on his house, that it is more likely than not, that he was acting as a commission agent, rather than a person who purchased the drugs from another supplier.The evidence that is before me is equivocal. I do not feel I can draw that inference in favour of the respondent on this application.

[18] I do not consider that the respondent has discharged the evidentiary onus of showing that there is a possibility that he was a commission agent.

[19] On that basis, I should proceed to assess the benefits, having regard to the value of cash that came into the possession of the respondent at the time of the transaction with Catton.The value of cash was $12,000.  That should be the value of benefits assessed by me and the subject of the pecuniary penalty order.

[20] HER HONOUR: I will make an order as per the draft, initialled by me and placed with the file.