Bryce v Chief Executive Officer of Customs [2009] QSC 298 [2010] 2 Qd R 504

SUPREME COURT OF QUEENSLAND CITATION: Bryce v Chief Executive Officer of Customs [2009] QSC 298 PARTIES: JEFFREY ANDREW JOHN BRYCE (applicant) v CHIEF EXECUTIVE OFFICER OF CUSTOMS (first respondent) FILE NO: 7538 of 2009 DIVISION: Trial Division PROCEEDING: Originating Application ORIGINATING COURT: Supreme Court of Queensland DELIVERED ON: 18 September 2009 DELIVERED AT: Brisbane HEARING DATE: 28 August 2009 JUDGE: Applegarth J ORDERS: 1. The applicant have leave to amend the Originating Application to add as paragraph 2A the declaration sought in respect of the Corrective Services Act 2006 (Qld). 2. The State of Queensland be joined as a party for the hearing and determination of the separate question of law that was ordered to be decided separately pursuant to r 483. 3. The separate questions are decided as follows: (a) Section 19AB of the Act was applicable in respect of the sentencing of Mr Bryce upon conviction for offences against the Customs Act 1901 (Cth) and the Excise Act 1901 (Cth) by the Honourable Justice Fryberg on 15 March 2006 as varied by Order of the Court of Appeal made on 9 February 2007; and (b) There has been a failure to fix a non-parole period in respect of the said sentencing for the purpose of Section 19AH(1). 4. The respondent pay the costs of the applicant and the costs of the State of Queensland of and incidental to the application for the separate determination. CATCHWORDS: CRIMINAL LAW – JUDGMENT AND PUNISHMENT – SENTENCE – NON-PAROLE PERIOD OR MINUMUM TERM – where the applicant and others were convicted of 45 offences under the Customs Act 1901 (Cth) and the Excise Act 1901 (Cth) – where court ordered pecuniary penalties and -- 1 of 14 -- 2 ordered if the applicant failed to pay the penalties immediately he be imprisoned – whether the periods of imprisonment ordered in default of immediate payment constituted “federal sentences” that engaged the provisions of the Crimes Act relating to parole – whether sentences were imposed where they were conditional upon failure to pay monetary penalties immediately Crimes Act 1901 (Cth), s 3, s 15A, s 19AB Penalties and Sentences Act 1992 (Qld), s 182A Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors [2006] QCA 558, related/considered Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors [2006] QSC 4, related Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors [2006] QSC 40, related Labrador Liquor Wholesale Pty Ltd & Ors v Chief Executive Officer of Customs [2007] HCATrans 20, cited R v Booth [1998] 1 Qd R 656, cited Windsor v Boaden (1953) 90 CLR 345, cited COUNSEL: J A Griffin QC with P J Woods for the applicant R W Gotterson QC and C K Copley for the respondent G Handran for the State of Queensland SOLICITORS: Delaney’s Lawyers for the applicant Australian Government Solicitor for the respondent Crown Law for the State of Queensland [1] The applicant and others were convicted of evasion offences against the Customs Act 1901 (Cth) and the Excise Act 1901 (Cth). Substantial pecuniary penalties totalling in excess of $5,000,000 were imposed, and Fryberg J concluded that the purposes of both punishment and enforcement warranted an order for imprisonment in default of payment. The order for a default period of imprisonment was unsuccessfully opposed by the applicant and the second defendant in those proceedings (“Mr Wright”) on the basis that, had the legislature wished to expose an offender to such a period of imprisonment, it would have made direct provision for such a sentence in the Act. Fryberg J concluded that the legislature had indirectly made provision for such imprisonment. [2] The applicant and Mr Wright asked for 12 months to pay the penalties, but no basis was found to allow time to pay. They had no capacity to make any significant payment, and Fryberg J saw no point in allowing time to pay. As a result, his Honour ordered that if the applicant or Mr Wright failed to pay the penalties immediately, he be imprisoned for certain terms of imprisonment which totalled 1,806 days or approximately five years. The parties before Fryberg J did not make submissions about a non-parole period. No non-parole period was fixed. [3] The issue I am required to decide involves a point of law, namely whether the Court imposed on the applicant “a federal sentence that exceeds, or federal sentences that, in the aggregate, exceed three years” within the meaning of s 19AB(1)(b) of the -- 2 of 14 -- 3 Crimes Act 1901 (Cth) (“the Crimes Act”). The applicant submits that Fryberg J plainly imposed a sentence of imprisonment, and the order for immediate imprisonment in default of payment was intended as a form of punishment that imposed a term of imprisonment. The respondent submits that a sentence of imprisonment was not imposed on the applicant for any of the convictions. The respondent submits that the order to pay a monetary penalty was the only punishment which the law allowed upon conviction, and that the periods of imprisonment in default of payment of each monetary penalty do not constitute a “sentence” that engages s 19AB(1)(b). Background [4] On 6 February 2006 the applicant, Mr Wright and a company, Labrador Liquor Wholesale Pty Ltd, was each convicted on 45 charges of offences against the Customs Act 1901 (Cth) and the Excise Act 1901 (Cth) committed in 1995 and 1996. They included convictions for evasion. 1 On 3 March 2006 a penalty hearing was held. The plaintiff (the respondent in the present proceeding) submitted that Fryberg J should order imprisonment in default of payment of pecuniary penalties. It placed reliance on s 15A(1) of the Crimes Act that “picks up” a law of a State or Territory “relating to the enforcement or recovery of a fine imposed on an offender”. 2 Section 182A of the Penalties and Sentences Act 1992 (Qld) relevantly provides that a court that orders an offender to pay a penalty may also order that, if the offender fails to pay the penalty immediately or within the time allowed by the court in its order, the offender is to be imprisoned for a term calculated under subsection 182A(2)(a). Fryberg J accepted that s 15A(1) of the Crimes Act applied s 182A of the Penalties and Sentences Act so that he had a discretion to order the applicant and Mr Wright to be imprisoned. [5] The defendants’ criminality was described as “gross, extensive and unredeemed”. 3 The evidence was that none of the defendants would be able to pay even the minimum penalties which had to be imposed for the evasion offences. 4 Fryberg J decided to exercise the discretion to order imprisonment. His Honour identified two purposes for making such an order: to aid in the enforcement of payment of the penalty and to provide an alternative form of punishment for the offence. 5 As to the latter his Honour stated: “It is no doubt correct that the primary punishment which may be imposed for an offence under s 234 of the Customs Act is a pecuniary penalty; there is no power to order imprisonment directly for an offence under that section. However the Act contemplates that an offence may be indirectly “punishable” by imprisonment. It includes provisions which permit the imposition of extremely high monetary penalties and in some cases (such as the present) mandate them. It will frequently be the case where such penalties are imposed that the offenders are incapable of paying them. Many offenders may be expected to ensure that they are incapable of paying anything toward the penalty. Not to impose imprisonment in default in such a situation would be to grant immunity for impecuniosity. In my 1 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors [2006] QSC 4. 2 By s 3(2) of the Crimes Act, a reference to a fine includes a reference to a pecuniary penalty. 3 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors (No 2) [2006] QSC 40 at [31]. 4 Ibid at [19]. 5 Ibid at [48]. -- 3 of 14 -- 4 judgment both punishment and enforcement are purposes for which imprisonment in default of payment of a pecuniary penalty may be ordered. Having regard to the seriousness of the offences and the paucity of mitigating circumstances in the present case, I have come to the conclusion that I should make an order under s 182A of the Penalties and Sentences Act 1992.”6 [6] The periods of default imprisonment were determined having regard to the appropriate total period of default in the event that no part of any of the penalties was paid, and so as to apportion it among all of the offences. A total default period of five years was adopted having regard to the penalties imposed for offences of defrauding the Commonwealth in comparable circumstances. A total default period of about five years was achieved by imposing default periods calculated at the rate of one day for every $2,800 of penalty.7 [7] The applicant and Mr Wright asked that if (contrary to their submissions) a period of default imprisonment was imposed, they be given 12 months to pay the penalty. The only basis for this request was that otherwise they would be liable to imprisonment immediately, whereas with time to pay there might be a chance of their paying at least some of the penalties. They did not suggest that this was their intention and on the evidence they had no capacity to make any significant payment. Fryberg J saw no point in allowing such a period. [8] The orders of the Court were set out as a schedule to his Honour’s reasons. The first order was that each defendant pay the penalties set out in a table. The second order was: “I order that if the second defendant or the third defendant fails to pay any such penalty immediately, he be imprisoned for the term set against that penalty in column 3 (in respect of the CA penalties) or column 6 (in respect of the EA penalties).” These periods totalled 1,806 days. No non-parole was sought at the penalty hearing, and no non-parole period was fixed. The appeal [9] On appeal to the Court of Appeal, the applicant’s conviction for evasion in respect of “the Honiara shipment” was set aside as was the order for payment of the monetary penalty imposed in respect of it ($416,858.50). 8 As a consequence, the default period of imprisonment to be served abated by 149 days. [10] The defendants also appealed against sentence. The appeal against sentence was dismissed for the reasons given by Jerrard JA (with whom the Chief Justice and Williams JA agreed). However, the Court of Appeal was divided on whether s 19AB of the Crimes Act required a non-parole period to be fixed. The Chief Justice differed from Jerrard JA who concluded that s 19AB applied. The Chief Justice stated that s 19AB was inapplicable because “the imposition of any 6 Ibid at [52]-[53]. 7 Ibid at [54]-[56]. 8 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors [2006] QCA 558. -- 4 of 14 -- 5 imprisonment here has been done only contingently upon non payment”.9 Williams JA stated: “If the second and third appellants are imprisoned in default of payment of the penalties imposed, and that period of imprisonment is for more than three years, then it is arguable they could apply pursuant to s 19AB of the Crimes Act 1914 for a non-parole period to be fixed; but it is not appropriate to determine such entitlement at this stage.”10 The reasons of Jerrard JA contain a detailed consideration of the grounds of appeal against penalty, including the provision for imprisonment in default of payment of penalties that arose because s 182A of the Penalties and Sentences Act was “picked up” by s 15A(1) of the Crimes Act. The appellants argued that the power to impose default imprisonment was “limited to an aid in the enforcement of the payment of fines, and not available as an alternative form of punishment”. 11 Jerrard JA surveyed earlier authority to the effect that “where a fine is otherwise properly imposed, immediate imprisonment in default of payment may be ordered even though it is known that the offender will serve a default term”.12 Jerrard JA concluded that the penalties ordered were properly imposed, and observed: “...the immediate imprisonment in default of payment was ordered because of the inability of either Mr Wright or Mr Bryce to pay any of those properly imposed fines. They could hardly expect to get a benefit because of their having arranged their affairs so that they had no property against which execution could be levied. General and specific deterrence is relevant both when ordering pecuniary penalties and fixing the amount of those, and also when ordering default periods of imprisonment if those penalties are not paid, and in fixing the amount of those default terms.” 13 Default periods totalling up to five years were appropriate in view of the defendants’ overall criminality.14 [11] The appellants argued that Fryberg J failed to apply s 19AB of the Crimes Act when imposing sentences. Section 19AB relevantly provides: “When court must fix non-parole period or make a recognizance order (1) Subject to subsection (3), where: (a) a person is convicted of a federal offence, or of 2 or more federal offences at the same sitting; and (b) a court imposes on the person a federal life sentence, or a federal sentence that exceeds, or federal sentences that, in the aggregate, exceed 3 years; and 9 Ibid at [2]. 10 Ibid at [48]. 11 Ibid at [99]. 12 Ibid at [101]. 13 Ibid. 14 Ibid at [102]. -- 5 of 14 -- 6 (c) at the time the sentence or sentences are imposed, the person is not already serving or subject to a federal sentence; the court must either: (d) fix a single non-parole period in respect of that sentence or those sentences; or (e) make a recognizance release order. (2) … (3) Where, but for this subsection, a court would be required by this section to fix a non-parole period, or make a recognizance release order, in respect of a person, the court may decline to do either if, having regard to the nature and circumstances of the offence or offences concerned and the antecedents of the person, the court is satisfied that neither is appropriate. (4) Where the court decides that neither a non-parole period nor a recognizance release order is appropriate, the court must: (a) state its reasons for so deciding; and (b) cause the reasons to be entered in the records of the court.” (emphasis added) The respondent argued that s 19AB had no application because Fryberg J “was not (directly) imposing federal sentences exceeding three years”. The respondent submitted that no sentences of imprisonment were imposed. Jerrard JA stated: “In my respectful opinion, it is appropriate and just to look at the effect of the orders made, imposed on the assumption that there would be no payment of any pecuniary penalty. No time to pay was allowed, and the effect of the orders is that cumulative terms of imprisonment of nearly five years result. In those circumstances the learned judge did imposed (sic) federal sentences that exceed in the aggregate three years. A judge directly imposing aggregate terms totalling more than three years on these offences could not avoid fixing either [a] single non-parole period, or making a recognizance release order, without giving reasons for doing that, and there seems no reason here for excluding the operation of a non-parole period or a recognizance release order. In New South Wales v Commonwealth of Australia (2006) 231 ALR 1, the joint judgment quotes, at [228] of those reasons, from the judgment of Gleeson CJ in Re Pacific Coal; Ex parte CFMEU (2000) 172 ALR 257 at paragraph [29], where the Chief Justice wrote: “In law, as in life, there are many examples of things that can be done indirectly, although not directly. The true principle is that ‘it is not permissible to do indirectly what is prohibited directly’.” Imposing aggregate terms totalling in excess of three years without either a non-parole period, a recognizance release order, or an -- 6 of 14 -- 7 explanation, is prohibited directly by Part 1B of the Crimes Act, and for that reason I consider it is not permissible to effect that result without one or other of those steps. In R v Booth [1998] 1 Qd R 656 this Court expressly adverted to the availability of parole for a “State” offender sentenced to cumulative default terms of imprisonment for non payment of fines. It was appropriate to make orders under 19AB. I would fix a single non-parole period of two and a half years in respect of each of those sentences, in accordance with the standard sentencing regime for offenders who contravene State laws.”15 Application for special leave to the High Court [12] The unsuccessful appellants before the Court of Appeal sought special leave to appeal to the High Court both against their convictions and against the sentences. Special leave was refused. As to the challenge against sentence Kirby, Hayne and Crennan JJ stated “we do not consider that there would be reasonable prospects of success in that challenge to the holding below that the State law on default sentences, namely, the Penalties and Sentences Act 1992 (Qld), section 182A, was picked up and applied in federal jurisdiction to the federal offences in question here”.16 Their Honours continued: “So far as s 19AB of the Crimes Act 1914 (Cth) is concerned, the applicants state no ground of appeal founded on that provision. We express no view on the point, which is a point that divided the Court of Appeal. In particular, we express no view on whether an application may now be made in reliance upon that section.”17 The present application [13] The applicant was imprisoned on 12 September 2008. By an Originating Application filed on 14 July 2009, he seeks, by way of primary relief, an order pursuant to s 19AH(1)(b) of the Crimes Act 1901 fixing a non-parole period. [14] On 6 July 2009, the court ordered that the following questions of law be decided separately pursuant to r 483 of the UCPR: “(a) whether Section 19AB of the Act was applicable in respect of the sentencing of Mr Bryce upon conviction for offences against the Customs Act 1901 (Cth) and the Excise Act 1901 (Cth) by the Honourable Justice Fryberg on 15 March 2006 as varied by Order of the Court of Appeal made on 9 February 2007; and (b) whether there has been a failure to fix a non-parole period in respect of the said sentencing for the purpose of Section 19AH(1).” 15 Ibid at [106]-[107]. 16 Labrador Liquor Wholesale Pty Ltd & Ors v Chief Executive Officer of Customs [2007] HCATrans 20. 17 Ibid. -- 7 of 14 -- 8 The primary issue [15] The applicant and the respondent are agreed that the primary issue for determination is whether the Court imposed on the applicant “a federal sentence that exceeds, or federal sentences that, in aggregate, exceed three years” within the meaning of s 19AB(1)(b). The Corrective Services Act issue [16] In its original submissions the respondent contended that the fact that s 19AB(1) was inapplicable did not have the consequence that the applicant was precluded from the benefit of parole. It advanced submissions that Chapter 5 of the Corrective Services Act 2006 (Qld) (“the CSA”) provides a mechanism for parole of a person imprisoned, by way of enforcement, in default of fine payment. It contended that s 15A(1) of the Crimes Act that picks up State law “relating to the enforcement or recovery of a fine” picked up both s 182A of the Penalties and Sentences Act and also the CSA parole provisions applicable to enforcement. The result was that the applicant was eligible to apply for parole under the CSA. [17] The applicant’s submissions in reply pressed his primary submission that s 19AB applied. In addition, they adopted the respondent’s submission concerning the CSA as an alternative argument. He foreshadowed seeking leave to amend the Originating Application to add the following paragraph: “2A A declaration that sections 178, 179, 180 and 184 and Schedule 4 of the Corrective Services Act 2006 (Ald) apply to the imprisonment currently being served by the Applicant in consequence of the Judgment handed down by Fryberg J on 15 March 2006 as varied by Order of the Court of Appeal made on 9 February, 2007.” [18] The respondent subsequently resiled from its submissions in relation to the eligibility for parole under the CSA. There appears to have been some uncertainty within the administration of Corrective Services Queensland concerning the parole eligibility of the applicant and Mr Wright. 18 However, the State of Queensland does not accept the correctness of the submissions initially made by the respondent, and further developed in supplementary submissions on behalf of the applicant as to the availability of parole to the applicant pursuant to the provisions of the CSA. The State of Queensland appeared at the hearing and presented submissions to the effect that s 19AB of the Crimes Act applies to the applicant and that the parole provisions of the CSA do not. Because the State has an interest in the issues, including the applicant’s alternative contention concerning the application of the CSA, and actively participated at the hearing in respect of both the applicant’s primary argument and his alternative argument, it is appropriate that the State be joined as a respondent in respect of the hearing and determination of the separate question of law raised by the applicant’s primary argument and, if necessary, the determination of his alternative argument concerning the application of the CSA. The provisions of the Crimes Act [19] The primary issue, earlier defined, involves two related aspects. The first is whether the order for imprisonment if the applicant or Mr Wright failed to pay the penalties immediately involved “federal sentences” that in aggregate exceeded three years. If they were, the second issue is whether those sentences were “imposed” in 18 Affidavit of Scott Alexander Kerrigan filed by leave 28 August 2009. -- 8 of 14 -- 9 circumstances in which any imprisonment was conditional upon non payment. The terms of relevant provisions of the Crimes Act and the structure of the Act are relied upon by the respondent to contend that there were no “federal sentences”. [20] Section 15A is in “Part 1A – General” of the Crimes Act. Section 15A(1) provides: “A law of a State or Territory relating to the enforcement or recovery of a fine imposed on an offender applies to a person convicted in the State or Territory of an offence against a law of the Commonwealth. The law applies: (a) so far as it is not inconsistent with a law of the Commonwealth; and (b) with the modifications made by or under this section” [21] Part 1B of the Act encompasses s 16 – s19AZD inclusive, and is headed “Sentencing, imprisonment and release of federal offenders”. This part includes the following divisions: • Division 1 – Interpretation (s 16); • Division 2 – General sentencing principles (s16A – s 16D); • Division 3 – Sentences of imprisonment (s16E – s 19AA); and • Division 4 – The fixing of non-parole periods and the making of recognizance release orders (s19AB – s 19AK). The relevant terms of s 19AB are set out in paragraph [11] above. The critical subparagraph for present purposes is s 19AB(1)(b): “a court imposes on the person a federal life sentence, or a federal sentence that exceeds, or federal sentences that, in the aggregate, exceed 3 years;” Definitions for Part 1B are set out in s 16 (Division 1). The expression “federal sentence” is therein defined to mean “a sentence imposed for a federal offence” and the expression “federal offence” is defined to mean “an offence against the law of the Commonwealth”. The word “sentence” is also defined in s 16 to mean “in sections 16B to 19AZD, a sentence of imprisonment”. 19 Were the default periods of imprisonment “federal sentences”? [22] The respondent submits that a sentence of imprisonment was not imposed on the applicant for any of the convictions. It submits that in respect of each federal offence of which he was convicted, the applicant was ordered to pay a monetary penalty, and that a monetary penalty “was the only punishment which the law allowed upon conviction”. The applicant submits in reply that this is not so because s 182A of the Penalties and Sentences Act was relevantly “picked up” by s 15A(1) of the Crimes Act. As found by Fryberg J at first instance and by all members of the Court of Appeal, s 15A(1) permitted default imprisonment to be ordered. The State similarly submitted that a monetary penalty is not the only punishment that the law allowed upon conviction. Imprisonment if the offender failed to pay the monetary 19 This definition accords with what the High Court held in Winsor v Boaden (1953) 90 CLR 345 at 347, said the word “sentence” connotes, namely, “a judicial judgment or pronouncement fixing a term of imprisonment”. -- 9 of 14 -- 10 penalty immediately was provided for by s 182A of the Penalties and Sentences Act, and imprisonment was so ordered. I accept the submissions of the applicant and the State in this regard. The law allowed punishment by imprisonment to be ordered upon conviction if the offender failed to pay the monetary penalty. [23] Section 182A of the Penalties and Sentences Act provides: “Court may make order for default payment of penalty (1) A court that orders an offender to pay a penalty may also order that, if the offender fails to pay the penalty immediately or within the time allowed by the court in its order, the offender is to be imprisoned for a term calculated under subsection (2)(a). (2) The term of imprisonment – (a) must be – (i) the term that, in the court’s opinion, will satisfy the justice of the case; but (ii) not more than 14 days imprisonment for each penalty unit, or part of a penalty unit, that the offender was ordered to pay; and (b) must be served cumulatively with any term of imprisonment the offender is serving, or has been sentences to serve, unless the court orders otherwise.”20 The order made by Fryberg J pursuant to s 182A(1) provided for a sentence of imprisonment if the relevant monetary penalty was not immediately paid. Each was a sentence of imprisonment contingent upon the failure to make immediate payment. Each sentence was for a “federal offence”. Each sentence qualified as a “federal sentence” and in the aggregate these federal sentences exceeded three years. [24] The order for imprisonment was intended as a punishment for the offences. This is apparent from the reasons for judgment of Fryberg J and the reasons for judgment of the Court of Appeal from which special leave was refused. I therefore do not accept the respondent’s submission that the only punishment the law allowed upon conviction was a monetary penalty, and that a sentence of imprisonment was not ordered upon the applicant’s conviction. The Court applied s 182A of the Penalties and Sentences Act, as the respondent urged it to do as a “surrogate law” that applied by virtue of s 15A(1), and the Court exercised its discretion under s 182A as a means to both enforce the monetary penalty and to punish the applicant for his offences. Section 182A expressly provides for an order that the offender be imprisoned for a term calculated under s 182(2)(a), and that is the order that Fryberg J made. Imprisonment upon failure to pay the monetary penalty immediately was ordered so as to punish the applicant for his offences, rather than as a penalty for non payment. The terms of s 182A make it clear that a sentence of imprisonment was entailed, being a “sentence” for the purpose of Part 1B of the Crimes Act. It is unnecessary to have further reference to the definition of “term of imprisonment” in the Penalties and Sentences Act, and my conclusion that 20 This is s 182A as enacted at the time (reprint no 9). Section 182A of the Penalties and Sentences Act was amended by Act No 3 of 2007. -- 10 of 14 -- 11 Fryberg J ordered a number of “federal sentences” does not rest on the definition of “sentence” in s 4 of the Penalties and Sentences Act. It rests on the terms of s 182A(1), being the section that was applied so as to order imprisonment upon failure to immediately pay the relevant monetary penalties. [25] The fact that s 15A appears in “Part 1A - General” of the Crimes Act, and not in Part 1B does not detract from the conclusion that “federal sentences” within the meaning of s 19AB(1)(b) were ordered. The respondent submits that the location of s 15A and that section’s concern with laws relating to the enforcement or recovery of fines implies that it does not form part of the Commonwealth law for sentencing upon conviction for the purposes of Part 1B of the Crimes Act. Section 15A is a general provision that “picks up” and applies a law such as s 182A of the Penalties and Sentences Act, so far as it is not inconsistent with the law of the Commonwealth. For the reasons discussed by Fryberg J and Jerrard JA, s 182A applies to permit imprisonment to be ordered for a federal offence. The location of s 15A in Part 1A does not make the imprisonment ordered pursuant to s 182A something other than a “sentence” as defined in s 16 of the Crimes Act, namely a sentence of imprisonment. As such, s 19AB(1)(b) is engaged, subject to the issue of whether the sentence can be said to be imposed when it is conditional upon failure to pay the penalty. [26] Section 16A of the Crimes Act prescribes matters to which the Court is to have regard when passing sentence or making an order in respect of any person for a federal offence. The respondent submits that “a construction of Part 1B which characterises enforcement as sentencing would require s 16A to be applied, first, in respect of the imposition of the monetary penalty and, then, in respect of the enforcement”. It submits that an application of s 16A at both imposition and enforcement is unlikely to have been intended. I do not accept that an exercise which “characterises enforcement as sentencing” is involved. Instead, a law relating to the enforcement or recovery of a penalty, and that provides that the Court may order the offender to be imprisoned if he or she fails to pay the penalty, applies according to its terms. As appears from the reasons of Fryberg J in the present matter, s 16A was applied as part of a process of determining the orders to be made for the federal offences for which the applicant was convicted and these orders included imprisonment in default of payment. [27] The fact that Commonwealth law makes provision for imprisonment “indirectly” does not alter the conclusion that the Court’s order involves a sentence of imprisonment. Fryberg J undertook a careful analysis of the power to imprison in default of payment and concluded that the Customs Act contemplates that an offence may be indirectly punishable by imprisonment. 21 His Honour concluded, “the legislature has made provision for such imprisonment, but indirectly”. 22 In the Court of Appeal Jerrard JA concluded that it was appropriate and just to look at the effect of the orders made, imposed on the assumption that there would be no payment of any pecuniary penalty.23 No time to pay was allowed and the effect of the orders was that cumulative terms of imprisonment of nearly five years 21 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors (No 2) [2006] QSC 40, particularly at [45]. 22 Ibid at [55]. 23 See paragraph [106] of the reasons for judgment quoted in paragraph [11] above. -- 11 of 14 -- 12 resulted. 24 Federal sentences that exceeded in the aggregate three years were imposed and, as Jerrard JA observed, a judge “directly imposing aggregate terms totalling more than three years on these offences could not avoid fixing either [a] single non-parole period, or making a recognizance release order, without giving reasons for doing that...”. His Honour then invoked the principle that “it is not permissible to do indirectly what is prohibited directly”, and stated: “Imposing aggregate terms totalling in excess of three years without either a non-parole period, a recognizance release order, or an explanation, is prohibited directly by Part 1B of the Crimes Act, and for that reason I consider it is not permissible to effect that result without one or other of those steps.” The respondent submits that the principle that “it is not permissible to do indirectly what is prohibited directly” is inapplicable to a provision such as s 19AB(1) which is not a “prohibitory provision”. I find it unnecessary to characterise s 19AB(1) as a “prohibitory provision” or otherwise. By its terms s 19AB requires a court to fix a single non-parole period or make a recognizant release order where each of subsections 19AB(1)(a), (b) and (c) are engaged, unless the Court decides that neither a non-parole period nor a recognizant release order is appropriate and then states its reasons for so deciding. Section 19AB can be seen as prohibiting a court from imposing terms totalling in excess of three years without either a non-parole period, a recognizant release order or an explanation, which was how Jerrard JA summarised its requirements. The point of substance being made by Jerrard JA was that s 19AB applied whether “federal sentences” that exceeded in the aggregate three years were imposed directly or indirectly. I respectfully agree with his Honour’s conclusion. [28] My conclusion on the first issue is that the default period of imprisonment ordered by Fryberg J and the default periods of imprisonment ordered by the Court of Appeal when it amended those orders with respect to the Honiara shipment were “federal sentences”. Were federal sentences imposed? [29] Section 19AB(1)(b) applies if the Court “imposes” certain federal sentences. As the Chief Justice observed in this matter “the imposition of any imprisonment here has been done only contingently upon non payment”. The issue for my determination is whether, despite this contingency, federal sentences that in the aggregate exceeded three years were imposed so as to engage s 19AB(1)(b). [30] In the circumstances of this case, the condition of non payment was certain to eventuate. The order was for the applicant to be imprisoned for the specified periods if he failed to pay penalties that totalled in excess of $5,000,000 “immediately”. The evidence was that the applicant had no ability to pay immediately, and this was the basis upon which he sought time to pay.25 In those circumstances I consider that federal sentences that in the aggregate exceeded three years were imposed. It is unnecessary to consider the position that might obtain in 24 As the respondent noted in its submissions, the authority to which Jerrard JA referred, R v Booth [1998] 1 Qd R 656 concerned State offences and did not bear upon the construction of s 19AB(1). Reference to Booth by Jerrard JA illustrated how parole provisions may operate in respect of cumulative default terms of imprisonment for non payment of fines. 25 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Ors (No 2) [2006] QSC 40 at [17]-[19] and [58]. -- 12 of 14 -- 13 other circumstances, for example, where time is given to pay. In such a case the contingency of non payment may not eventuate. In this case, where it was certain that the applicant would fail to immediately pay $5,000,000, the orders had the practical effect of imposing federal sentences of imprisonment that exceeded three years, and s 19AB(1)(b) was engaged. Conclusion on the separate question for determination [31] Section 19AB of the Crimes Act applied in respect of the sentencing of the applicant. There has been a failure to fix a non-parole period. [32] The questions of law to be decided separately pursuant to r 483 of the UCPR should each be answered “yes”. The Corrective Services Act issue [33] It is unnecessary to determine this issue in the circumstances. Costs [34] Subject to the submissions of the parties in respect of costs, I consider that the appropriate order is for the respondent to pay the costs of the applicant and the costs of the State of and incidental to the application for the separate determination. Relevant considerations are that the applicant succeeded on the primary issue. The respondent was unsuccessful on the primary issue. The State was also successful in respect of the primary issue. The applicant’s contentions in respect of the Corrective Services Act issue cannot be said to have been hopeless since, after all, they were originally advanced by the respondent. However, it has been unnecessary to determine the Corrective Services Act issue and, even if I had determined it contrary to the applicant’s submissions that would not necessarily have disentitled the applicant to the costs of and incidental to the application. Ordinarily, the fact that a successful party fails on particular issues does not mean that it should be deprived of some of its costs.26 However, the applicant cannot be said to have failed on the Corrective Services Act issue. It was unnecessary to decide it. [35] If any party wishes to make further submissions in respect of the issue of costs then short written submissions should be filed and served within seven days or arrangements should be made for listing the matter for submissions on costs. Orders [36] Subject to any further submissions on costs the orders of the Court will be: 1. The applicant have leave to amend the Originating Application to add as paragraph 2A the declaration sought in respect of the Corrective Services Act 2006 (Qld). 2. The State of Queensland be joined as a party for the hearing and determination of the separate question of law that was ordered to be decided separately pursuant to r 483. 3. The separate questions are decided as follows: (a) Section 19AB of the Act was applicable in respect of the sentencing of Mr Bryce upon conviction for offences against the Customs Act 1901 (Cth) and the Excise Act 1901 (Cth) by the 26 BHP Coal Pty Ltd and Ors v O & K Orenstein & Koppel AK and Ors (No 2) [2009] QSC 64 at [8]. -- 13 of 14 -- 14 Honourable Justice Fryberg on 15 March 2006 as varied by Order of the Court of Appeal made on 9 February 2007; and (b) There has been a failure to fix a non-parole period in respect of the said sentencing for the purpose of Section 19AH(1). 4. The respondent pay the costs of the applicant and the costs of the State of Queensland of and incidental to the application for the separate determination. -- 14 of 14 --