Coeur de Lion Investments Pty Ltd v Lewis & Ors

This judgment considered whether a right of private prosecution for offences under the Corporations Act 2001 (Cth) persisted due to the operation of s 13 Crimes Act 1914 (Cth). Section 13 Crimes Act 1914 (Cth) preserves a right of private prosecution generally, unless an Act containing an offence expresses a “contrary intention”. The Court of Appeal unanimously concluded that s 1315 Corporations Act 2001 (Cth) does express the intention to preclude the private prosecution of an offence under the Corporations Act 2001 (Cth).

Philippides JA and Bond and Bowskill JJ

29 May 2020

Background

In May 2019 the applicant filed complaints in the Magistrates Court against a number of directors of a company (“the respondents”), of which it was a shareholder. The complaints alleged that the company had operated an unregistered managed investment scheme, contrary to s 601ED of the Corporations Act 2001 (Cth), and that the respondents had aided, abetted, counselled or procured that offence. [3]. The respondents successfully applied to have the complaints struck out, on the basis that the applicant had no standing to bring a private prosecution against them. [4]. The applicant appealed to the District Court but was unsuccessful. [5]. By this proceeding, the applicant sought leave to further appeal to the Court of Appeal. [6].

The essential question was whether there remains a right of private prosecution for offences under the Corporations Act 2001 (Cth). [7]. The Court of Appeal unanimously concluded that there was not (per Bowskill J; Philippides JA and Bond J agreeing). [1]–[2], [71].

The provisions / issues

The applicant contended that a right of private prosecution for offences under the Corporations Act 2001 (Cth) persisted due to s 13 of the Crimes Act 1914 (Cth), which provides that “[u]nless the contrary intention appears in the Act or regulation creating the offence”, any person may institute proceedings “for the commitment for trial” or “for the summary conviction” of any person. [9].

Notably, however, s 1315 of the Corporations Act 2001 (Cth) (headed “Proceedings: how taken”) provides that “[s]ubject to this Act, in any proceedings for an offence against this Act, any information, charge, complaint or application may be laid or made by” a number of specified persons/entities, including ASIC or a person authorised in writing by the Minister (emphasis added). [11].

The question was whether s 1315 of the Corporations Act 2001 (Cth) exhibited a “contrary intention” so as to preclude the availability of a private right of action under s 13 of the Crimes Act 1914 (Cth). In contending that it did not, the applicant emphasised the principle of legality (such that clear and unambiguous language was said to be required), and the use of the of the word “may” (as italicised above) rather than “must” in s 1315 Corporations Act 2001 (Cth) (which it said demonstrated that the provision was “facultative, not restrictive”). [17], [26].

The Court of Appeal’s conclusion

The Court of Appeal considered that s 1315 of the Corporations Act 2001 (Cth) “clearly exhibits a contrary intention for the purpose of s 13 of the Crimes Act 1914 (Cth)so as to preclude the private prosecution of an offence against the Corporations Act ”. [71]. That conclusion arose by reason of both textual and contextual considerations.

As to the textual considerations, Bowskill J considered that, “[o]n its face”, s 1315 appeared to make “exhaustive provision for how proceedings” may be taken. [2]. In particular the use of the word “any” (as underlined above) in s 1315 tended to suggest “that the purpose of the section was to define how any [in the sense of all] proceedings for an offence against the Corporations Act 2001 (Cth) may [in the sense of capacity] be taken”. [25]. Contrary to the applicant’s submission, her Honour considered that in the context of s 1315, the use of the word “may” simply conveyed the capacity to bring the proceedings, and that there was a discretion to do so. [27]. Her Honour also noted that the heading to s 1315 – “Proceedings: how taken” – was supportive of the view that it defined, exclusively, how proceedings for offences under the Act may be taken. [29]. Her Honour also referred to other provisions in the Act which she considered supported her conclusion (but which it is not possible to succinctly summarise here). [35]–[46].

As to the contextual considerations, her Honour reviewed the legislative history, which indicated an intention to remove the private right to bring proceedings. For example, the Companies Act 1931 had expressly preserved the right of private prosecution, but this had been removed by successor legislation in 1961, which instead provided that proceedings for an offence could only be brought “by any person” (other than those otherwise stipulated) with the written consent of the Crown Law Officer. [50], [54]. Separate Commonwealth legislation in 1980 also provided that proceedings for any offence “may be instituted only” by specified persons/entities. [59]. The draft Bill for what became the Corporations Act 1989 (Cth) had a provision to similar effect, but prior to being enacted, the word “only” was removed. However, her Honour considered that the purpose of that amendment was “to preserve the statutory functions and powers of the Director of Public Prosecutions”. [70]. In summary, the legislative history indicated that the purpose of s 1315 Corporations Act 2001 (Cth), and its predecessors, was “to confine the persons” who could bring proceedings for Corporations Act 2001 (Cth) offences. [70].

Accordingly, there had been no error in the striking out of the applicant’s case. In the result, leave to appeal was allowed, but the appeal dismissed with costs. [73].

W Isdale