Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Others [2006] QSC 4

SUPREME COURT OF QUEENSLAND CITATION: Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd & Others [2006] QSC 4 PARTIES: THE CHIEF EXECUTIVE OFFICER OF CUSTOMS (plaintiff) v LABRADOR LIQUOR WHOLESALE PTY LTD ACN 050 406 221 (first defendant) LAWRENCE ERIC WRIGHT (second defendant) JEFFREY ANDREW JOHN BRYCE (third defendant) FILE NO: BS 904/1997 DIVISION: Trial Division PROCEEDING: Civil Claim COURT: Supreme Court DELIVERED ON: 6 February 2006 DELIVERED AT: Brisbane HEARING DATES: 16 - 18 May 2005; 20 May 2005; 23 - 27 May 2005; 30 May - 3 June 2005; 6 June 2005 JUDGE: Fryberg J ORDER: Defendants convicted on all charges CATCHWORDS: TAXES AND DUTIES – Customs and excise – Penal provisions – Offences – Evasion of duty – Making false or misleading statements – Moving or interfering with goods – Aiders and abbettors – Procedure in customs prosecutions – Averments by prosecutor – “information, complaint, declaration or claim” – Statement of claim COUNSEL: R W Gotterson QC and F W Redmond for the plaintiff P E Hack SC and J M Jones for the defendants SOLICITORS: Australian Government Solicitor for the plaintiff Forde Lawyers for the defendants -- 1 of 79 -- 2 [1] FRYBERG J: The first defendant ("Labrador") was at all material times a company of which the second and third defendants (Messrs Wright and Bryce) were the only directors and employees. As such they had control over Labrador's business affairs and operations. Labrador operated a bond store (more strictly, a “licensed warehouse” under the Customs Act 1901) at Delta Street, Geebung. Its licence entitled it to store alcohol and cigarettes without paying customs and excise duty otherwise payable on them. It was also entitled to import bulk spirits and bottle them under its own brand without paying duty. It used its store to carry on business as a liquor wholesaler. All work was done by Messrs Wright and Bryce, with occasional help from friends or relations. [2] During the 1990s Labrador traded domestically, and in 1995 and 1996 (at least) it also exported goods. The plaintiff alleges that (expressing it broadly) on eight separate occasions Labrador evaded customs or excise duty on goods delivered into home consumption by falsely pretending they were being exported. He also alleges that on each occasion Labrador knowingly or recklessly made a statement to an officer that was false or misleading in a material particular; and moved, altered or interfered with goods which were subject to the control of customs. Evading duty, making such a statement and dealing with such goods were offences under the relevant Acts.1 Finally he alleges that Messrs Wright and Bryce are guilty as accessories for the same offences.2 He seeks declarations that each of the defendants is liable to conviction for such offences; the conviction of the defendants accordingly; recovery of statutory penalties; and either a reparation order for the Commonwealth's loss or judgment for debt for the amount of the duty evaded. 1 The Customs Act 1901 provided: “234 Customs offences (1) A person shall not: (a) evade payment of any duty which is payable; … (d) knowingly or recklessly: (i) make a statement to an officer that is false or misleading in a material particular; … (2) A person who contravenes subsection (1) is guilty of an offence punishable upon conviction … 33 Persons not to move goods subject to the control of the Customs (1) Except as authorised by this Act, a person shall not move, alter or interfere with goods that are subject to the control of the Customs. Penalty: $50,000.” Section 120 of the Excise Act 1901 was in terms materially identical to s 234. Section 61 of the Excise Act 1901 provided: “ 61 All excisable goods are, until delivered for home consumption or for exportation to a place outside Australia, whichever first occurs, subject to the control of Customs and must not be moved, altered or interfered with except as authorised by this Act. Penalty: $20,000.” 2 The Customs Act 1901 provided: “236 Aiders and abettors Whoever aids abets counsels or procures or by act or omission is in any way directly or indirectly concerned in the commission of any offence against this Act shall be deemed to have committed such offence and shall be punishable accordingly.” Section 5 of the Crimes Act 1914, which applied to prosecutions under the Excise Act 1901, was in materially the same terms, except that “knowingly” modified “concerned in”. -- 2 of 79 -- 3 [3] The case has been conducted by all parties on the basis that goods dealt with domestically (“delivered into home consumption” in the jargon of the legislation) attracted duty under the Customs Tariff Act 1987 or the Excise Tariff Act 1921 as in force at the time, while goods exported attracted no duty. That makes it unnecessary to elaborate upon the statutory provisions leading to that result. In relation to the charge of evasion the plaintiff submitted that the following were the essential steps in the evasion on each of the eight occasions already referred to: a. entering the goods for export from Australia; b. acquitting the goods from bond; c. not exporting the goods from Australia in accordance with the entry; d. delivering the goods into home consumption without entering them for home consumption; e. not paying customs duty or excise duty as the case may be. Steps a, b and e were admitted by the defendants. The parties were also agreed as to the amount of duty evaded if it were true that the goods had indeed been delivered into home consumption. [4] The plaintiff led no direct evidence in relation to step d. Its averments that the step was taken in relation to each of the eight occasions were denied. The defendants did not challenge the averment that they did not enter the goods for home consumption, but sought to overcome the prima facie case raised by the averments3 relating to step d by pleading and leading evidence that the goods were exported in accordance with the respective entries for export (step c). On this step the parties joined issue. The plaintiff pleaded and averred that the goods were not delivered for export. The defendants pleaded a positive case that they were exported. In the alternative they pleaded that if the goods were not exported, that occurred without their knowledge or consent. [5] The onus is on the plaintiff to prove beyond reasonable doubt 4 that the goods were not exported as the defendants allege. In theory the plaintiff could have relied upon the averments alone to satisfy that onus5 , but he did not do so. He mounted a substantial circumstantial case to demonstrate that the goods were not exported. The evidence of the defence witnesses, Mr Wright in particular, was directed toward showing that they were exported. If the plaintiff demonstrates that the goods were not exported, the only alternative conclusion open on the evidence and the averments will be that the goods were delivered into home consumption. There is no suggestion that any of them was entered for such consumption. It follows that if the plaintiff succeeds on each count in relation to step c, the fifteen counts of evasion will be proved against Labrador (a finding that the evasion was intentional would be inevitable). If he proves that Messrs Wright and Bryce were knowingly concerned in the evasion, the case against them on that charge also will succeed. [6] When Labrador dealt with alcohol and cigarettes from its warehouse, either by exporting them or by delivering them into home consumption, it was legally obliged to notify the Australian Customs Service (“Customs”). In the case of exports it did this by causing its customs broker, EDI Customs Brokers Pty Ltd (“EDI”), to enter information about the consignment into the Customs computer system called EXIT. That system allocated a unique identifying number, known as an export clearance 3 Customs Act 1901, s 255; Excise Act 1901, s 144. 4 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161. 5 Chief Executive Officer of Customs v El Hajje [2005] HCA 35 at para 40. -- 3 of 79 -- 4 number (“ECN”), to the transaction. Thereby Labrador satisfied its statutory obligation to enter such goods for export. If warehoused goods were to be delivered into home consumption, they were entered for home consumption by delivering an appropriate document to Customs who then issued an authority to deal with them. None of the goods the subject of the present charges was entered for home consumption, and no authority to deal with them in this way was issued. [7] The plaintiff's case, stating it broadly, accepted that on eight separate occasions Labrador placed goods in a container and exported it. The plaintiff alleged that on each occasion there were either fewer goods in the container than were listed in the entry for export or different goods from those so listed or both. The first seven occasions, referred to during the hearing as “Fiji 1” to “Fiji 7” for convenience, involved the export of a container to P A Lal Coachwork Ltd (“Coachwork”) in Fiji. The last, referred to as “Honiara 1”, involved the export of a container to QQQ Wholesale Ltd (“QQQ”) in Solomon Islands. The plaintiff's case, as it emerged from the evidence, was that on each occasion Mr Wright on behalf of Labrador created two invoices, one which truly set out the contents of the container and another which falsely stated them. He gave a copy of the false invoice to EDI which created an entry for export in accordance with it. He retained a copy of the false invoice and a matching packing list in Labrador's records and sent the true invoice to the consignee to enable it to take delivery of the goods which were in the container. He made entries in Labrador's stock registers reflecting the false invoices. The plaintiff sought to demonstrate the falsity of the invoices by proving that what actually arrived in the containers in Fiji and Solomon Islands were the goods listed in the true invoices. Because the containers had been sealed before leaving Labrador's premises, and arrived at their destination with seals intact, he submitted, their contents on arrival must have been the same as their contents when exported from Australia. [8] The defence case, again stating it broadly, centred on the evidence of Mr Wright. He denied creating two sets of invoices. He testified that the only invoices which he created were those in Labrador's records; those which were presented to Fiji and Solomon Islands Customs were not authentic. The typists who testified they had created those invoices on Mr Wright's instructions were mistaken. He had given samples of Labrador's letterhead to the respective consignees prior to each shipment, and these could have been used to forge the documents presented to overseas Customs. Fiji and Solomon Islands Customs officers either miscounted the contents of the arriving containers or failed to notice that their seals had been broken and contents removed prior to inspection. Their evidence was unreliable. When the containers left Labrador's premises they were packed in accordance with the invoices in its records. The defence accepted that if the case advanced against Labrador were proved that same evidence was capable of establishing the case against Mr Wright, but denied that it established the case against Mr Bryce. [9] It will be necessary in due course to refer in detail to the circumstances of each of the eight shipments. It is however convenient to begin by considering the various invoices purporting to relate to the shipments. The invoices and packing lists [10] It was common ground that at and about the relevant times Labrador had two distinct letterheads. These were referred to by the parties as “new-style” and “old- -- 4 of 79 -- 5 style”. The former was printed in green ink and had Labrador's name in italic font. The latter was printed in blue ink and had Labrador's name in a roman font. Almost all of the invoices taken from Labrador's records, which Mr Wright testified were authentic, were printed on new-style letterhead. Those given to Fiji Customs and to QQQ were printed on old-style letterhead and, according to Mr Wright, were not authentic. Mr Wright was the person who, on behalf of Labrador, ought to have known. He did all of the office work, while Mr Bryce worked in the store. Mr Wright testified that in early 1995 Labrador had no typewriter or word processor in its warehouse. He had documents created by two outside typists, Mrs Wood and Mrs Lapré. The direct evidence [11] Mrs Wood carried on a secretarial services business at Toowong, providing word- processing, photocopying, faxing and e-mail facilities for the public. She did work for Labrador almost from the time it commenced business. The procedure was that Mr Wright would drop off handwritten documents which she would type on her computer. She would print the documents on to Labrador letterhead paper, of which she was given a stock, both old-style and new-style. Mr Wright would return and collect the printed documents. Sometimes he would sign a document at her office and use her fax machine to fax it. She identified a considerable number of letters, invoices, pro forma invoices and statements of account which she thought she had typed. In particular she identified all of the invoices, pro forma invoices and packing lists relating to the eight consignments which were printed on new- style letterhead. On the other hand, with one exception she thought she had not typed any of the commercial invoices for the Fiji shipments which were on old-style letterhead. [12] The exception was the invoice in relation to the second Fiji shipment6 . This she thought she had typed, although she conceded in cross-examination that since she had no records to say that she had typed it, it was possible that she had not done so. Each of the two copies of that invoice in evidence bears transmit terminal identity information - what is popularly called a fax header. Mr Heath, a handwriting expert, compared that with samples from Mrs Wood's facsimile machine. They were the same. He was able to identify the header as characteristic of a Toshiba machine, the type owned by Mrs Wood. Mrs Wood had customised the heading to omit the name and telephone number of her business, so that her customers’ faxes would not appear to have come from someone other than the customer. The business name and number were also omitted from the invoice. The header shows that the invoice was transmitted on 13 October 1995. Telephone records show that on that date a call was made from Mrs Wood’s office to Coachwork’s fax number. I am satisfied that the invoice was faxed from Mrs Wood's machine. These matters make it even more likely that she was the typist who created the invoice. [13] Mrs Lapré learned to type in Holland, but subsequently developed her own style. She and her husband conducted an office services business at Zillmere, near Labrador’s warehouse. They sold and repaired office equipment and offered a typing service. Typing was done on any handy electronic typewriter, not on a word processor. Mrs Lapré typed documents for Labrador during 1995 and the first half of 1996 from hand-written originals delivered to her by Mr Wright. She testified 6 Documents Fiji2.0001.003 and Fiji2.0001.004. -- 5 of 79 -- 6 that she typed only on old-style letterhead and typed only invoices and packing lists and possibly some correspondence regarding a girl guides fund-raising project. She identified the old-style commercial invoices and packing lists for the consignments Fiji 1 and Fiji 3-7 as documents which she had typed.7 She thought that she had not typed the old-style pro forma invoice in respect of the consignment Fiji 6 but agreed in cross-examination that she could have done so. She specifically remembered typing documents on behalf of Labrador involving the name “Frantelle”, which appears on the old-style commercial invoice for the consignment Fiji 1; that was how she became familiar with the name. She had recognised it unprompted when shown the relevant documents in October 2004. [14] Neither Mrs Wood nor Mrs Lapré thought she had typed the commercial invoice and packing list for the Honiara shipment. However that fact does not necessarily weaken one's confidence in their evidence regarding the documents for the Fiji shipments. Labrador purchased its own computer from Mrs Lapré's firm in mid- 1996. Mrs Lapré assumed that that was why it stopped using her services. [15] The evidence of the two typists, if it is accepted, shows that the old-style invoices and packing lists for all of the Fiji consignments were typed on the instructions of Mr Wright. Mr Wright flatly denied this. He claimed he did not know how the old- style invoices and packing lists were created, and asserted that he had nothing to do with them. Only the new-style invoices and packing lists were genuine. He also testified that Mrs Lapré would have typed not only invoices, packing lists and girl guides correspondence, but also price lists, fax headers and general correspondence. Somewhat inconsistently he said that the reason Mrs Lapré typed some things and Mrs Wood others was that Mrs Lapré's office was very close. “If it was something that was very urgent,” he said, “it was a lot more convenient and faster to go to Mrs Lapré than to drive to Mrs Wood in Toowong.” [16] Mr Hack SC for the defendants submitted that I should tread cautiously about accepting the evidence of a witness who claimed to remember typing the name “Frantelle” 10 years ago. He submitted that this evidence, as well as her evidence regarding recognition of her typing style, could well be “the result of the questions that were being asked of her”, rather than the result of true recognition. However there is simply no evidence to support such a theory. I reject it. The opportunity for forgery – Fiji [17] To weaken the inference that the old-style invoices were typed by Mrs Wood and Mrs Lapré, the defence led evidence, and in the case of the Fiji shipments pleaded facts, designed to show that Coachwork and QQQ (the consignees in Fiji and Solomon Islands) were given copies of the old-style letterhead before their respective consignments were sent, thus giving them the opportunity to forge the old-style commercial invoices and packing lists. The principal officer of Coachwork was Mr Richard Lal. Mr Wright testified that in early 1995 Mr Lal was introduced to him at the Labrador warehouse as a potential purchaser by a mutual acquaintance. He showed Mr Lal around the premises and gave him price lists and another document. Asked if he gave anything else with the price lists, he replied: 7 Although she was not sure about one invoice, Fiji4.0001.024, she considered that she had probably typed it. -- 6 of 79 -- 7 “Yes. In order to create a good impression - we don't have the facilities of doing presentations, et cetera - I would take a letterhead and create a with compliments slip by tearing off a section and attaching it with a paper clip. It looked better, and I did that. Now, you are aware that in this case, we have used the terminology "old-style letterhead" and "new-style letterhead". Was this old-style or new-style at that time?-- I would have made use of the old-style letterhead because it was a way of constructively using what had already been paid for. Instead of throwing them in the rubbish bin, we used them.” I took that to imply that Labrador had not had with compliments slips printed. Labrador also had no typing or word-processing facilities at the warehouse at that time. I asked him about the making of the slip: “How did you manufacture the with compliments slip?-- Take a letterhead, and a ruler and you decide how much of it you need, and make sure that it's a straight line, and then with a pair of scissors----- No. I meant - sorry. Go on. Finish that?-- You just make sure that the line is straight and it looks like a compliments slip, your Honour. But did you - I mean did you type on it or write on it or what?-- I don't recall, your Honour. It's - sometimes I would have - yes, I would have said "regards Lawrie", or "with compliments" or "kindly reply" or - I don't - I don't know.” [18] In cross-examination a somewhat different picture appeared. Mr Wright was asked about the new-style letterhead: “And this was A4 and with compliments slips, I take it. Yes, you agree with that, don't you?-- I'm not sure if we had compliments slips printed at the same time. All right, anything else? HIS HONOUR: Did you eventually have with compliments slips printed?-- Might have had one or two batches of it, yes, but it's not standard stationery, your Honour. MR GOTTERSON: All right. I'll ask you to have a look at this document. It's miscellaneous 1.0086. If you look at that and will you agree with me, having seen it, that it is new-style letterhead with compliments slips?-- Yes. … MR GOTTERSON: I suggest to you, Mr Wright, that you had the with compliments slip and your A4 printed by your printer engaged once you worked out the new letterhead?-- It would seem so, yes. … HIS HONOUR: When was that, please, Mr Wright?-- I don't recall, your Honour. MR GOTTERSON: Well, could I suggest to you, Mr Wright, that you had your new-style letterhead as early as late 1994. -- 7 of 79 -- 8 … HIS HONOUR: Mr Gotterson wants you to comment on the suggestion that you had it by late 1994?-- I really can't recall, Mr Gotterson. MR GOTTERSON: Very well. I'm going to ask you to look now, Mr Wright, at document - defendant's document 0001.216, and would you agree with me that it is new-style letterhead?-- Absolutely, yes. It's a letter dated the 11th of November 1994, is it not?-- Correct. … So by November 1994 you obviously had your new-style letterhead?-- Yes. And you had stationery printed in it?-- Yes. And I suggest you had with compliments slips printed in it; didn't you?-- Most likely. Why is it then that you didn't give Mr Richard Lal a copy of the new- style with compliments slip when he visited, as you said in your evidence, in early 1995?-- It's quite possible that, at the time of his visit, we didn't have any more stock of the new - new-style letterhead. … I suggest you got your new-style letterhead in late 1994. Do you agree with that?-- Yes, it would seem so. And are you suggesting that by early 1995 you'd run out of it?-- It's possible, Mr Gotterson. Right. In any event, do you say you had run out of with compliments slips by then?-- That too is possible, yes. You don't know?-- I don't know for sure. No. Had you run out of new-style letterhead by then?-- It's possible. You don't know?-- No. If you had new-style letterhead, wouldn't you have given - even if you didn't have with compliments slips, given A4 with new-style letterhead on it to Mr Lal?-- In preference, if I had stock, of course, I would. Yes. In fact you've described your old-style letterhead as boring, didn't you, in your evidence-in-chief?-- Yes. You would, of course, give your new customer new-style letterhead?-- Yes. So the best you can put it, though you got new stationery in late 1994, by early 1995 you might have run out of with compliments slips and A4?-- Correct. … -- 8 of 79 -- 9 Mr Wright, I suggest you didn't give Richard Lal any letterhead at all? You didn't give him any sheet of A4 or torn off sheet of A4 with letterhead on it at all. That's the case, isn't it?-- I disagree with you, Mr Gotterson. … You say your preference or the course you took was to give him a torn off piece of old-style letterhead?-- Because if that's what I had available, that's what I would have done. Not a way to impress a new customer, I suggest?-- Mr Gotterson, if you don't have stock, you do your best.” He might equally have said, “If you don't have answers, you do your best.” Mr Wright's admission that if he had had stock his preference would have been to be use the new-style letterhead contradicted his evidence-in-chief that he selected old- style letterhead to avoid waste. That admission forced him to suggest that he might have run out of both new-style letterhead and new-style with compliments slips only a few months after having them printed. That seems unlikely, particularly as the slips were available in June 1995 when ex 46 was created. The cross- examination also dispelled the impression created by the evidence-in-chief that Labrador did not have with compliments slips printed. [19] Another problem with Mr Wright's evidence about giving letterhead to Mr Lal is that it was very much an afterthought. Pleadings in this case opened in 1997. In 1999 Mr Wright gave instructions to Labrador's solicitors in relation to the old-style commercial invoices relating to the Fiji shipments. A defence was subsequently delivered. In it the defendants admitted the existence of the old-style commercial invoices but denied their authenticity. They also denied that they were prepared with their authority or knowledge. They pleaded that they: “(c) say that a date well prior to 5 May 1995 the first defendant ordered copies of stationery bearing its letterhead to a servant or agent or associate of the P A Lal Group of Companies one Ram Singh; (d) the stationery was sent to Ram Singh in order for him to have letters written in Chinese so that the said Ram Singh could assist the first defendant in canvassing for business in China; (e) P A Lal Coachwork is one of the companies in the P A Lal Group of Companies; (f) the invoice was prepared by the said Ram Singh or at his direction and falsely; (g) deny that any such order was placed with the first defendant.” On the morning of the first day of the trial, leave was sought to amend the defence by deleting paragraphs (c), (d) and (f) and in lieu inserting paragraphs pleading the version given by Mr Wright in his evidence-in-chief. [20] Not surprisingly, Mr Wright was cross-examined about this. He said at first that he did not think he would have given his solicitor, Mr Forde, instructions that stationery had been sent to Ram Singh and that he had not in fact sent any. Later he admitted he had given such instructions but claimed that when he did so, he was confused. If that was the truth, he was very confused: I infer from the evidence of Mr Sharma (unchallenged on this point) and the context of the various references to -- 9 of 79 -- 10 Ram Singh that no such person existed. 8 Mr Forde was not called to give evidence, although he had earlier done so on the voire dire (when legal professional privilege had been waived) and was opened as a witness on the trial. Mr Wright admitted that it was possible that he had not given Mr Forde instructions about the with compliments slip until 29 March 2005, and that his first recollection of the with compliments slip had not arisen until he and his lawyers were preparing for trial a month or so before the trial started.9 The opportunity for forgery - Solomon Islands [21] Whatever the position regarding the with compliments slip, it could not explain a false commercial invoice in respect of the Honiara shipment. The defendants did not plead anything by way of explanation for that invoice, but Mr Wright raised an explanation in his evidence-in-chief. He said that the defendants were introduced to Mr Michael Quan, a director of QQQ. At first he could not recall ever having spoken to Mr Quan personally. He was then shown what purported to be a letter on new-style letterhead to Mr Quan dated 3 May 1996 and signed by him. The letter referred to a telephone conversation on that date. It informed Mr Quan that Labrador would have no objection to QQQ re-exporting product to the Republic of China and recommended that QQQ establish a regular supply of stock to China “prior to entering into an agreement of exclusive distribution/export rights to China”. Mr Wright said that he had not recalled the letter but in the light of it he must have spoken to Mr Quan. Asked to give the effect of the telephone conversation, he responded, “I recalled the whole issue of exclusive sales to China would go through his business, yes.” [22] Mr Wright was then shown another document, dated 7 May 1996 10 , and was asked what that document was. He replied, “It's a document sent to Mr Quan whereby we gave or - yes, we gave QQQ Wholesale the exclusive distribution for Regency Scotch Whisky for the Solomon Islands and also for the Republic of China, but for a limited period of six months for China.” Asked to recall the circumstances surrounding the handwritten note at the foot of the letter he said, “Mr Quan needed to do a translation of this sole and exclusive distributor agreement for his contacts, his people in China. I have no knowledge of Chinese and he said he would do it. He would do the translation, so, yes.” He added, “I provided him with letterheads to do it and apologised because I didn't have any new ones in stock at the time.” The following exchange then took place: “HIS HONOUR: Why would he need letterhead?-- My understanding, your Honour, was that he was doing a translation and wanted to look like the original, possibly because he was attaching a certified copy of the English version. What right did he have to use your letterhead? You only made him a distributor?-- I understood that he needed to prove to his people in China that he had that right to do that, to sell on an exclusive basis. 8 Paragraph [76]. 9 16 May 2005. 10 Document HON1.0001.004. Click on the link to view it: Letter 7 May 1996 -- 10 of 79 -- 11 Then couldn't he have got a letter from you like this one? Wouldn't that be proof?-- That wasn't how he put it to me. I just don't understand why he would have any need for letterhead. What did he say to you?-- Your Honour, I guess we got terribly excited because anyone that could get us a - get our products into the Chinese market, that was a ginormous jump forward. … What did Mr Quan say to you as the reason why he needed letterhead?-- To do a translation into Mandarin----- Of what?-- Of this letter to prove that he had the sole and exclusive distributorship for China for Regency Scotch Whisky. So the translation had to be on letterhead?-- That's what he explained to me, yes. But you wouldn't be signing it?-- No.” [23] In cross-examination Mr Wright was unable to remember the name of the printer who printed further stocks of new-style letterhead. He said that he would not necessarily have had the letterhead reprinted by the same printer who originally printed it. He had not looked for the invoice. No invoice was produced. Labrador would not necessarily have had an invoice because he might have bartered South African wine for the print work. He was not concerned about getting a tax deduction for the expense. [24] Michael Quan died in 2003. His brother and co-director of QQQ, Lawrence Quan, was called as a witness. He deposed that neither the letter dated 3 May 1996 nor the document dated 7 May 1996 was among the business records of QQQ. The opportunities for forgery - conclusion [25] I have come to the conclusion that Mr Wright's evidence about giving the handmade with compliments slip to Mr Lal and about sending the document dated 7 May 1996 to QQQ was not the truth. As to the former I take into account Mr Wright's initial attempt to imply that Labrador did not have with compliments slips; his changed explanation in cross-examination for why he used old-style letterhead; and the sheer unlikelihood that, if he had temporarily run out of with compliments slips, he would bother to tear the bottom from a page of old-style letterhead to try to imitate one. I also take into account the long delay which occurred before he told anyone of this incident and the inconsistency between it and the explanation which he first advanced to his solicitors. As to the latter I am satisfied that the document dated 7 May 1996 was created by Mr Wright for the purposes of the litigation. No copy existed in the records of QQQ despite Mr Wright's evidence that he both faxed a copy and mailed the original. The supposed distributorship agreement referred to in the document makes no commercial sense; nor is there any apparent reason why QQQ’s customers would wish to know of it, in Chinese or in English. Mr Wright's inability to produce invoices for the reprinting of the new-style stationery reinforces my conclusion that he had not exhausted his supply on 7 May 1996; this explanation for the absence of an invoice is a most unlikely one. If the letter dated 3 May is genuine (and I need not reach a conclusion on that point) the arrangement described four days later seems inconsistent with what is proposed in the letter. More -- 11 of 79 -- 12 importantly, new-style letterhead must have been available on 3 May. It was also available on 8 May, as it was used for the commercial invoice bearing that date which Mr Wright swore was genuine. I am satisfied it was also available on 7 May had it been needed. [26] Neither Mr Lal nor Mr Quan was provided with old-style letterhead. Mr Wright's evidence in that regard does not weaken the evidence of Mrs Wood or Mrs Lapré. It does weaken the defendants’ case. Conclusions regarding invoices and packing lists [27] I found Mrs Wood and Mrs Lapré convincing witnesses. Each recognised the documents typed in her own style and was able to give reasons for that recognition. Neither was dogmatic. Mrs Lapré was quite definite on some occasions, but appropriately cautious on others. Her memory of typing “Frantelle” is significant. The possibility that someone (and it would have to have been someone in Fiji associated with Coachwork) managed consistently and deliberately to fabricate old- style letterhead complete with printing flaws11 and imitate Mrs Lapré's style on six sets of documents and both Mrs Wood's style and her fax header on one set is remote; the possibility that such imitation occurred by coincidence is fanciful. The suggested motive, that it was done to defraud Fijian Customs, is unsupported by evidence.12 It is true that typing styles are not like fingerprints; they do not uniquely identify a document. However even bearing this in mind, I can perceive no rational explanation for the creation of the old-style invoices and packing lists other than that they were typed by the two witnesses. That being so, they must have been typed and sent to the consignees on Mr Wright's instructions. [28] That is not all that is improbable about the version propounded on behalf of the defendants. According to that version Labrador was the innocent exporter on whose letterhead commercial invoices were forged not only by its Fijian customer, but also by its Solomon Islands customer. There is no suggestion that the customers were in any way connected. It strains credulity to suggest that two unconnected customers in two different places should seize upon a similar fraud by chance. Moreover there was no reason why QQQ needed to forge the old-style commercial invoice if it were intent upon defrauding Solomon Islands Customs. It could and did obtain clearance and delivery of its goods by presenting a form which was a Combined Invoice and Certificate of Value and Origin.13 It would have had no need for an old-style commercial invoice. [29] Mr Hack submitted that even if I were satisfied that Mr Wright’s denial of having given the instructions to type the documents was not correct, I should not conclude that he had lied in his evidence. He submitted that with the passage of time Mr Wright may well have persuaded himself that what he said in his evidence was true. Testifying on the basis of a mistaken belief was not to be equated with telling a lie. With great respect I cannot accept that there is any scope for Mr Wright’s denial to have been innocent. To my mind it is most improbable that he could have forgotten giving the instructions for such documents, notwithstanding the lapse of time. It must be remembered that he became aware of the investigation relatively soon after the events took place. That conclusion is reinforced by his attempts to fabricate 11 See the evidence of Mr Heath. 12 In this context I have taken into account the evidence discussed below about the Fiji deliveries. 13 See para [207]. -- 12 of 79 -- 13 evidence to support an hypothesis that old-style letterhead sent to Mr Lal and Mr Quan could have been used to forge the old-style commercial invoices and packing lists. I reject the submission. I am satisfied that Mr Wright’s denial was a deliberate lie. [30] The findings that the documents were typed on Mr Wright's instructions and that he fabricated evidence are important circumstances to be taken into account in weighing the evidence in a circumstantial case. Mr Wright’s deliberate lies seriously detract from his credibility. [31] Mr Hack also submitted that even if the typists’ evidence were correct, it was “not a particularly compelling circumstance, in this case, because of the paucity of evidence, the quality of the evidence, in Fiji.” Even if the documents were created by Labrador, he submitted, they may have been created in an attempt to delude Fiji Customs about the import of goods rather than to delude Australian Customs about their export. On this hypothesis the defendant exported goods in accordance with the new-style invoices and created the old-style invoices to assist Coachwork to persuade Fiji Customs that it was importing less than it actually received. The hypothesis requires the possibility of the additional or different goods arriving in Fiji either without the knowledge of Fiji Customs or with the connivance of a number of customs officers. [32] In the support of the former possibility, Mr Hack referred to a number of weaknesses in the evidence relating to what was in the containers when they arrived at their destinations. I shall refer to that evidence in detail shortly, in the context of particular shipments. For the present it is sufficient to say that in my judgment that possibility simply is not raised on the evidence; any weaknesses in the prosecution evidence are not enough. Moreover it is improbable that Mr Wright could have hoped to repeatedly avoid scrutiny of the contents of containers imported into Fiji; and no explanation has been offered for why he should hazard his company and perjure himself to protect Coachwork and Mr Lal. [33] The evidence in support of the connivance hypothesis centres on a letter dated 26 August 1997 sent to Labrador by a Mr V Raikuna, an officer of Fiji Customs. At that time Mr Raikuna was Acting Director (Commercial) for Fiji Customs and was responsible for revenue collection. In summary the letter stated that continuing investigations by customs of the seven Labrador shipments to Fiji indicated that some fraudulent entries had been made in Fiji for goods received; that the exact details were difficult to ascertain because documentation was misplaced; that collusion of officers seemed apparent; and that “we” were of the opinion that the vast majority of product in Labrador's pro forma invoices entered Fiji.14 [34] Those are startling allegations. One would have expected that, if there were any substance in them, Mr Raikuna would have been called to give evidence. He was not called. The plaintiff did not call him because on his case, the statements in the letter were without substance. Mr Dean, currently the Director, Enforcement for Fiji Customs, said so in his evidence. At the relevant time Mr Dean was the Principal Collector, Enforcement Audit and Compliance. His duties included the 14 Exhibit 30. Click on the link to see it: Raikuna letter -- 13 of 79 -- 14 detection and investigation of offences against the customs laws of Fiji. He had been investigating the shipments for some 18 months when Mr Raikuna wrote the letter. He testified that Mr Raikuna was not involved in the investigation and that investigations were not part of his responsibilities. Mr Dean found out about the letter within a fortnight of its being sent. He spoke to Mr Raikuna and concluded that the letter was based on assumption only. He wrote at the time: “Mr Raikuna was not able to access to any of the Fiji Customs import entries relating to shipments as given in his letter. He assumed that there was fraud in order to avoid duties and taxes. Mr Raikuna is responsible for matters on tariffs and trade and not investigations.”15 That evidence is unchallenged. It explains why the defence did not call Mr Raikuna. [35] A considerable number of Fiji Customs officers gave evidence. They included officers with direct responsibility for counting and checking imported cargo. To none was it suggested that he or she had connived at fraud on the Fijian Customs. There is in my judgment no basis for such a finding. [36] I reject the submission that the old-style commercial invoices and packing lists were created to defraud Fiji Customs and the submission regarding the weight of the typists’ evidence.16 Fiji shipment one The documents [37] On the defence case, Labrador made a contract with Coachwork for the sale of considerably more product than appeared in the old-style invoice presented to Fiji Customs. The contract was propounded as an ordinary commercial dealing, but it displayed some unusual features. Mr Wright gave evidence that the transaction was initiated by an order, numbered 2624, received from Coachwork by facsimile on 19 April 1995. He could not remember speaking to anyone from Coachwork prior to receiving the order. The order was for 1,180 cases of eight different spirits. It was unpriced. The facsimile was seized in a raid by Customs officers 17 months later, by which time an attempt had been made to conceal the signature by the use of whiteout. Mr Wright had no explanation for why that was done. However he testified that following its receipt he checked Labrador's stock, costed the order and had Mrs Wood type a pro forma invoice on new-style letterhead. That invoice was faxed to Coachwork. There it was signed by way of confirmation and re-faxed to Labrador the same day. A photocopy of the re-faxed document was seized in the same raid. On it also the signature on behalf of Coachwork has been substantially obliterated. [38] Mr Wright further testified that when the container was packed, he prepared a commercial invoice and a packing list for the order. It was dated 4 May. For some unexplained reason a further eight cartons of Regency Scotch whisky were included in the consignment at the time of packing. That is an odd thing to do without 15 Exhibit 31 (emphasis in the original). 16 Para [31]. -- 14 of 79 -- 15 consulting the consignee. The additional whisky increased the total invoiced value by $260.00 to $70,358.00. As with all shipments, packing of the container took place at Labrador's warehouse and the container was sealed before removal for loading. On 9 May a container said to contain “spirituous liquor beverages” was received for carriage to Suva on the vessel Capitaine Kermadec at Brisbane. Its number was CRXU 294 7650 and it bore three numbered seals. [39] The new-style commercial invoice advised Coachwork of Labrador's bank details and set out terms of payment. The latter were, “Payment on presentation of bills of lading A$20,000 (per telegraphic transfer as discussed) and the balance, 30 days from the date of bills of lading.” Mr Wright said that he intended “presentation” to refer to receipt by Coachwork of the bill of lading, which he had couriered by air to that company on 10 May, the day it was issued. Those terms have an unrealistic air. This was the first dealing between these two companies. (Mr Wright claimed in his evidence-in-chief that there had been previous dealings, but that claim was demolished during cross-examination.) Mr Wright had met Mr Lal once, earlier that year. There is no evidence that he made any checks as to the financial soundness of Coachwork. Labrador held no security from Coachwork. It had its own cash flow problems and had three times been refused an overdraft facility by its bank. Mr Wright was experienced at his business. Yet if this invoice is genuine, Labrador had sent the documents of title to Coachwork in Fiji before it received a cent and on the latter's bare promise to pay. It seems a most uncommercial arrangement. The most Mr Wright could offer by way of explanation was, “I believed this was good business. It was opening an export market for us.” [40] There seems no doubt that Labrador couriered some documents to Coachwork on 10 May 1995. What those documents were is in dispute. There is also no doubt that on 12 May 1995 Coachwork's customs agent presented an old-style commercial invoice and an old-style packing list to Fiji Customs in respect of the container CRXU 294 7650. The invoice referenced order 2624 and was for 1,199 cases of Frantelle natural spring water and 58 cases of Regency Scotch whisky. The total amount claimed was $9,079. I have already found that it was typed by Mrs Lapré on Mr Wright's instructions. I infer that he sent it to Coachwork in the package couriered on 10 May. Delivery in Fiji [41] Sometime prior to 22 May the container was unloaded onto the wharf at Suva. There it was examined by Mr V Narayan, a Fijian Customs officer. At the time he was a newly appointed officer who “was taking care to make sure that I did the job properly.” His practice was to check the seal (or seals) on containers. In his 10 years in the service he has never encountered a broken seal. He opened the container, the contents were unloaded and he counted them. The contents were in accordance with the old-style invoice. In cross-examination Mr Narayan firmed up his evidence by asserting that he could actually recall checking the seal, and that there was only one seal on the container. Mr Hack submitted that his evidence of actual recall could not be regarded as reliable, and that the better view is that his evidence was based upon a combination of reconstruction and a recollection of standard practice. In relation to the seal I am inclined to think this submission is correct. Mr Narayan had the packing list, which listed three seals, during his check. He told Mr Hack that if on an examination he had checked against a document that had three seal numbers and there had been only one seal on the container, he would -- 15 of 79 -- 16 have reported the matter to his supervisor. He made no such report. I am satisfied that no seals were missing and that Mr Narayan checked them. [42] The purpose of this cross-examination was to support the hypothesis that someone might have tampered with the container before Mr Narayan inspected it. On this hypothesis the tampering must have involved the removal of 1,130 cartons of spirits and the substitution of 1,199 cartons of spring water from Queensland. The hypothesis seems fanciful. There is simply no evidence that it happened, nor even of how it could have happened. On the other hand there is evidence that at the relevant time Labrador had purchased sufficient spring water to constitute the consignment. Frantelle spring water [43] In 1995 Frantelle spring water was manufactured in Queensland by Bev-Pak Australia Pty Ltd. It was distributed by an associated company, Pure & Natural Juices Pty Ltd. Mr Kevin Holland was a director of both companies and worked as the warehouse manager for Pure & Natural Pty Ltd. Ms Judith Haslem was an invoicing clerk for Pure and Natural Pty Ltd. [44] In the same year Taira (T & T) Pty Ltd operated a chain of supermarkets called Cannon's Food Barns and a warehouse division called Australian Independent Wholesalers (“AIW”). Mr Michael Sirr was the general manager of AIW. Ms Bambi Sweeting (née Gageldonk) was employed by Taira as an accounts clerk. [45] These witnesses gave evidence on the basis of their employers’ records. The evidence of Ms Haslem and Mr Holland established that on 2 May 1995, 1,500 cartons of Frantelle spring water were dispatched from Bev-Pak’s Redbank premises consigned to Labrador at Geebung. Delivery was scheduled for 10.00 am. These facts appear from a Bev-Pak form called a Goods Delivery Docket (“GDD”) which Mr Holland filled out a couple of days before the consignment was dispatched. These dockets were on Bev-Pak stationery, which provided for multiple, differently coloured copies of each docket. The goods were packed on 22 CHEP pallets, that is pallets on hire from Brambles Ltd pallet division, called CHEP, which on 4 May were loaded onto a truck operated by Rowley Sullivan Transport. Mr Holland wrote out another delivery docket in a carbon book of dockets kept by or for the truck driver, and for his benefit. The docket which he wrote also provided for delivery to Labrador. The system required to the driver to obtain a signature for the delivery on the pink copy of the GDD and also on the delivery docket in the carbon book, and return the GDD and a copy of the carbon book docket to Bev-Pak. Signed copies of both dockets were returned in due course. Each has a signature, but the signatures are different. Neither signature has been identified in the evidence. That on the GDD suggests that it was signed at 4.45 am on 4 May. The system also required the driver to obtain 22 CHEP pallets to return to Bev-Pak in exchange for those on which the water was packed. Twenty- two pallets were duly returned. [46] Spring water included in that consignment had been ordered by Mr Sirr on behalf of Australian Independent Wholesalers. He was the person who instructed Bev-Pak to deliver it to Labrador. He gave that instruction because that was the requirement of -- 16 of 79 -- 17 the order which AIW had received. Taira paid Pure & Natural $12,405.3317 for the consignment and was itself paid. Taira’s business records for the relevant period had been destroyed and it was not possible by the time of the trial to use them to identify who ordered the consignment and who paid for it. However in 1998, before their destruction, Ms Sweeting had extracted copies of some of the documents relating to the transaction with Pure & Natural and had sent them to the solicitors for Labrador. These matters are established by the evidence of Mr Sirr and Ms Sweeting. [47] In the course of cross-examination of Mr Sirr, the following exchange took place: “Do you recall an occasion in 1998 speaking to a solicitor, Mr Michael Forde?18 -- No. In 1998 was your mobile number then 0418-651-621?-- That sounds familiar. Can I suggest that on the 5th of March 1998 Mr Forde spoke to you on the telephone. He introduced himself as a solicitor acting for Labrador Liquor. Does that remind you at all?-- No, I have no recollection of that. Do you recall telling Mr Forde that the water had been ordered by a Mr Harvey Treetle or Mr Harvey Cheetle?-- I know of that name. I do not have a recollection of that discussion. Was it the case that the water had been ordered by a Mr Harvey Feetle or Cheetle?-- Can you repeat the question, please. Was it the case that the water had been ordered by a Mr Harvey Feetle or a Mr Harvey Cheetle?-- I can confirm that the order was placed to me by a member of our staff. I can also confirm that I facilitated the payment of the order with Pure & Natural to the address on the document. I had no discussion with Harvey Cheetle, had no dealings with him and I do know of the name, but I do know in respect of certain liquor transactions our company had had dealings with Harvey Cheetle but I had no discussions with Harvey Cheetle. HIS HONOUR: Who was he, please, Mr Sirr?-- He was a liquor trader. As far as I can recall, he was based in South Australia. He was involved in the importing of - parallel importing of certain spirit products. He also sold wine. I have never met the man. Had your company had previous dealings with him?-- We had. MR HACK: Do you recall or do you not recall telling Mr Forde that it was Mr Harvey Cheetle who had ordered this water?-- I have no recollection of a discussion with the gentleman you refer to. And you don't recall telling him that it had been ordered by a company in South Australia?-- I don't recall having a discussion with that gentleman. 17 Pure & Natural’s invoice 23721 ($13,050) less “cruise allowance” and “settlement discount” of $391.50 and $253.17 respectively. 18 The solicitor for the defendants. -- 17 of 79 -- 18 HIS HONOUR: Supposing that you had had a discussion and supposing that you did say those things back in 1998, presumably, that would've been the position as you then recollected it; is that correct?-- Your Honour, I don't recall having a discussion with the lawyer that you are referring to. If your question is such that----- But if you did have that discussion would you have said the position as you then knew it?-- If I had had that discussion, and being eight years ago, I may have said words to that effect that Mr Cheetle may have facilitated that transaction. He may have made a call to our office. He was known to the company at that time on an ad hoc basis. If I had had that discussion, I might have said words like that. You had no reason not to tell anyone who you spoke to, such as Mr Forde, if you spoke to him, you had no reason-----?-- Yes. -----not to tell him the true position?-- Certainly not. MR HACK: Thank you. I have nothing further. MR REDMOND: No re-examination. HIS HONOUR: One question I had, Mr Sirr, if this was a telephone order?-- Yes. It was a rather large one, some $12,000, I think, or so. Would your company normally accept such a large order and have the goods delivered without some level of confidence as to the probability of payment?-- Definitely. What-----?-- Definitely. I would not have allowed an order to be delivered unless I had absolute confidence that the order was going to be paid for and the way in which I would've had absolute confidence was either dealing with someone like Harvey Cheetle, with whom we had had prior dealings, or a payment by the company in advance of the shipment being effected. It appears from your paper work that there was no payment in advance?-- The paper work I have doesn't show a deposit or a payment. All I have here, your Honour, is a remittance to the supplier of the product. I haven't been furnished with any other records. I see. I see what you mean. It's possible that you were paid in advance for this?-- That's correct. I certainly - I can be 100 percent certain I would not have allowed that delivery to go through unless I was absolutely satisfied that we were going to get paid.” The clear inference from that evidence is that on Mr Hack’s instructions, Mr Sirr told Mr Forde that the order had been placed by Mr Cheetle. Mr Wright has known Mr Cheetle since at least 1995. At least two of the latter's companies have had dealings with Labrador, although only rarely during the past 12 months. Mr Cheetle conferred with Mr Wright and Mr Forde in (on Mr Wright's estimate) 2003. Mr Cheetle lives in Adelaide and has retired. He would know whether he placed the order. He was not called as a witness and no explanation for failing to call him has been advanced. In these circumstances I have no hesitation in finding that it was Mr Cheetle who placed the order for the spring water with AIW. -- 18 of 79 -- 19 [48] Mr Wright could not think of any reason why Mr Cheetle would have ordered a quantity of spring water to be delivered to Labrador. He denied speaking to Mr Cheetle about the delivery before or during May 1995. He denied that Labrador had ordered or received the consignment and he denied asking Mr Cheetle to order it for Labrador. He testified that Labrador did not have CHEP pallets to exchange at the time of the consignment (he said it had no account with the owner of the pallets) and that it was not Labrador's practice to open at 4.45 am. He denied that Labrador had placed 1,199 cartons of spring water in the container for the first Fiji shipment. [49] Mr Bryce (who was responsible for loading and unloading goods) accepted that that in 1995-6 goods were delivered to Labrador on CHEP pallets. He added, unresponsively, “I believe that we didn't have CHEP pallets [to exchange] at that time.” A little later in his evidence he said he believed that during those years Labrador never had CHEP pallets because it had no account with the pallet owner. He explained that when goods arrived on pallets, it was not the practice to provide the transport company with exchange pallets; rather, the transport company would come back later to collect the pallets which it had brought. Finally, he testified that Labrador had never purchased water nor had it at its premises. [50] No one advanced any rational explanation, let alone evidence, of what happened to the spring water if it was not delivered to Labrador. It is difficult to imagine an explanation without drifting into fancy. [51] Mr Hack submitted that the plaintiff had failed to prove delivery of Frantelle spring water to Labrador. He pointed to the absence of evidence that any of the defendants had ordered or paid for the water. It is unfortunate that Taira’s records were destroyed before Customs enquired for them; though I note that they were still in existence when the solicitors for the defendants made their inquiry. It is true that there is no record of any payment in Labrador's books; but one would hardly expect to find such a record whatever the true position. It is unnecessary for present purposes to determine precisely how the order was placed and paid for. What matters is whether the 1,500 cartons of spring water were delivered to Labrador. Mr Hack submitted that delivery at 4.45 am was inconsistent with the manner in which Labrador conducted its business. That submission reflected Mr Wright's evidence, but it is noteworthy that Mr Wright was not asked whether he (or anyone else to his knowledge) had ever been at the premises at that time, or more particularly, whether he was at the premises at that time on 4 May 1995. Mr Hack also submitted that there was no evidence that Labrador had access to 22 CHEP pallets and that the exchange of such pallets was inconsistent with the manner in which Labrador conducted its business. That may well be so. However there is no inconsistency between Mr Bryce's description of how pallets were handled by Labrador and the evidence of Ms Haslem and Mr Holland. They assumed an exchange of pallets because 22 pallets were returned. They could not have known whether the driver actually received exchange pallets or went back and collected the ones on which the goods delivered had been transported. [52] Mr Hack criticised the failure of the plaintiff to call the driver of the delivery vehicle. Mr Holland was uncertain whether the driver was Rowley Sullivan himself or his son-in-law. Both sides interviewed Mr Sullivan and either could have called him. Mr Hack foreshadowed in his opening statement that he was going to call Mr Sullivan and that Mr Sullivan would say, “I didn't deliver it. My drivers didn't -- 19 of 79 -- 20 deliver it.” In the event neither side called him or his driver. I gain no assistance from their omission. [53] I have come to the conclusion that the matters the subject of these submissions by Mr Hack are insufficient to rebut the inference that the Frantelle spring water consigned by Mr Holland was delivered to Labrador. I have no confidence in the reliability of Mr Wright's evidence and to the extent that it is inconsistent with that inference, I reject it. I also reject the evidence of Mr Bryce that Labrador never had water at its premises. I am satisfied that the consignment of 1,500 cartons of Frantelle spring water was delivered to Labrador. Labrador had that consignment on hand when the container for the first Fiji shipment was packed. Payment [54] The amount payable for the shipment in accordance with the old-style invoice was $9,079.00. The amount payable in accordance with the new-style invoice was $70,358.00. The defendant's case is that Coachwork paid that latter amount. It is common ground that on 11 May 1995 Coachwork requested Westpac bank in Suva to send $20,000.00 to Labrador's account with ANZ bank at Geebung, and that this amount (less $10.00 handling fee) appears on Labrador's bank statement on 15 May. On the defence case that is consistent with Coachwork's obligation under the new- style invoice. The defence further contends that the balance of the amount in that invoice, $50,358.00, was included in a deposit of $51,692.00 made into Labrador's account on 25 May 1995. The plaintiff, on the other hand, has been unable to identify any payment which can be directly linked to the old-style invoice. [55] On their face the deposits into Labrador's bank account appear consistent with the new-style invoice. There are, however, some unusual features about the deposit of 25 May. The deposit was wholly in cash and was made up in the following denominations: $100 notes $11,100.00 $50 notes $40,300.00 $20 notes $ 260.00 $10 notes $ 20.00 $2 coins $ 10.00 $1 coins $ 2.00 $51,692.00 The deposit was made at 10.01 am at a branch of the ANZ bank in Parramatta Road, Annandale, New South Wales. The identity of the person who made the deposit is unknown and the signature on the deposit slip is indecipherable. It is plainly not that of Mr Richard Lal, nor was Mr Lal in Sydney at the time. Austrac, the Commonwealth agency responsible for administering the Financial Transactions Reports Act 1988, has no record of the transaction, as it would do had the money being brought into Australia legally. The deposit slip used was a generic slip, not one preprinted for Labrador; but according to Mr Wright, most of Labrador's customers, including it seems Coachwork, had been given preprinted slips to use. [56] These features make it quite unlikely that the payment was made by Coachwork. The defendants advanced no alternative explanation for it. On any view it is a highly suspicious transaction. It does not in my judgment support the defence case. If anything it casts suspicion upon that case. -- 20 of 79 -- 21 [57] Mr Hack submitted that there were a number of inconsistent features about the plaintiff’s contentions regarding payment. Not only was the plaintiff unable to identify any payment directly related to the old-style invoice amount of $9,079.00, but it had also not explained why Coachwork would have paid $20,000.00 in respect of that invoice. Moreover on the plaintiff's case, Labrador paid at least $8.70 per carton for the Frantelle water, yet in the old-style invoice it charged Coachwork only $6.00 per carton. Additionally, Mr Hack submitted, it may be wondered where the remainder of the spring water had gone. As to the last point, it is true that there is no evidence to show what happened to the 301 cartons which Labrador received but did not send to Coachwork, but that hardly weakens the plaintiff's case. One would not think it too difficult for Labrador to have disposed of them, not necessarily for money. The other inconsistencies are not so easily explained. I can see no explanation for them in the evidence. They are circumstances favouring the defence. Conclusions regarding Fiji shipment one [58] Having regard to all of the circumstances discussed above, I have reached the conclusion that the plaintiff has proved his case. The circumstances supporting that case overwhelm those favouring the defence. I can conceive of no rational hypothesis consistent with innocence. The old-style invoice for the first Fiji shipment was typed by Mrs Lapré on the instructions of Mr Wright. The goods listed in that invoice were in the container when Mr Narayan inspected it on or immediately before 22 May 1995. They were placed in the container at Labrador's premises before the container was exported. Mr Bryce was the person who packed all containers at those premises. Except for the 58 cases of Regency Scotch whisky common to both invoices, the goods listed in the new-style invoice for the shipment were not exported and the export clearance submitted by Labrador to Customs in accordance with that invoice was false and misleading. As Labrador's stock book shows, they ceased to be part of the stock held under bond. I infer they were delivered for home consumption. The plaintiff’s averment to that effect is correct. That process must have involved moving them while they were subject to Customs control. I am satisfied of these conclusions beyond reasonable doubt, and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. In respect of the first shipment the six charges alleged by the plaintiff against Labrador are proved. Fiji shipment two The old-style commercial invoice and packing list [59] The second Fiji shipment involved container number ITLU 821518-1, shipped by Labrador on the vessel Barbican Star on 4 October 1995, when the bill of lading issued. The original old-style commercial invoice and packing list for this consignment were, as I have already found, typed and sent by facsimile by Mrs Wood on Mr Wright's instructions. According to those documents the consignment comprised 57 cases of Black Imperial Scotch Whisky, 34 cases of Red Imperial Scotch Whisky and 1,138 cases of beer. Mr Wright denied that this invoice was prepared at his direction, but I have rejected that denial. On 13 October he sent some documents by air to Coachwork. I infer that if the old-style invoice and packing list and the bill of lading had not already been sent to Coachwork, they were included in that package. -- 21 of 79 -- 22 The new-style invoices [60] In evidence-in-chief, Mr Wright was shown what purported to be a pro forma invoice dated 22 September 1995. That document, which was seized by Customs Officers from Labrador in September 1996, was also typed by Mrs Wood on Mr Wright's instructions. It was addressed to “Mr B. Ram, purchasing officer” at Coachwork. It referenced “Our Telephone Discussion of Today”. It purported to be for a consignment of 1,198 cases of 14 different lines of spirits at a total price of $67,475.00, to be shipped on the Barbican Star (voyage 99), ETD Brisbane 2 October 1995. The terms of payment were, “deposit of $20,000 (per telegraphic transfer) or [sic] presentation of bills of lading and the balance 30 days from the date of bills of lading.” It concluded, “Kindly acknowledge acceptance and confirmation of this our pro forma.” He testified that he recognised the document: “And what events led up to that document?-- It's a pro forma based on a verbal order given, I assume, to me by the telephone from Fiji. Now, it makes reference to a Mr B Ram?-- Yes. Described as purchasing officer?-- Yes. Can you recall that conversation?-- No. The document of the 22nd of the September, do you infer from that you had a conversation?-- I say so in my letter, so I must - I must assume so. Yes. What did you do with the document that was FIJ1? Was it the - sorry - FIJ2.001 that we are looking at, did you adopt the same process that you have spoken about earlier?-- Yes. And did you receive that back with a confirmation? That's - I think there is not a confirmation in this one?-- It would seem not. There isn't one here.” Mr Wright's reluctance to vouch positively for the document is understandable. There are a number of indications which suggest it does not reflect any genuine transaction. First there is no evidence that it was ever sent to Coachwork. Given the reference to urgent confirmation, one would have expected Mr Wright to have asked Mrs Wood to fax it to Coachwork as soon as it was typed. Second, there was no evidence in Labrador's files and no documentary evidence has been led by which the order was accepted or varied. Third, Mr Balwant Ram, to whom the letter was addressed, knew nothing about the purchase of alcohol. He was a delivery driver who worked in the coachwork side of the business and the most he ever ordered for the company were things like nuts and bolts. He could not have had the conversation referred to in the pro forma invoice and in cross-examination of him counsel for the defendants did not suggest otherwise. I am satisfied that the document is bogus and that it was created to give a spurious air of verisimilitude to the transaction. [61] The evidence-in-chief set out above continued: “Can I take you to FIJ2.001.005?-- Yes. That's described as a commercial invoice?-- Correct. And it speaks of your confirmed order 23/9/95?-- Yes. -- 22 of 79 -- 23 What would lead you to put or to describe it in that way?-- I must assume, Mr Hack, that I received a call after they had my pro forma and they had accepted it. Now, did Labrador send to Fiji the goods that are set out in that commercial invoice, FIJ2.0001.005 and 6?-- Yes.” Mr Wright did not testify explicitly that this was a genuine commercial invoice in respect of the second Fiji shipment, but that was the clear thrust of his evidence. The document which he was shown listed the goods which Labrador caused to be included in the entry for export lodged on its behalf with Customs in respect of the shipment. It was a new-style commercial invoice dated 29 September, for the same voyage as the pro forma invoice, but with a number of alterations of what was in that document. The number of cases of spirits was now 1,229. The total price of the goods was $68,575.50. However the invoice receipted payment of $20,000.00 by TT on that day, so it was for an amount of $48,575.50. Payment terms also changed: Payment was now due “On presentation of bills of lading (per telegraphic transfer as discussed) or within 30 days from date of bills of lading.” There is no evidence to indicate how these changes came about, nor why the much harsher terms of payment were required of a customer which, according to Mr Wright, was trusted. Payment [62] At about 3.00 pm on Friday 6 October 1995, a man walked into the Annandale branch of the ANZ bank and consulted Ms Lena Arabi, a full-time service adviser. He was a stranger to her and, I infer, to other bank staff. Whether he was the same man as made the deposit on 25 May is unknown. Ms Arabi described him as a white male, definitely not Fijian or Indian in appearance. He said he wished to make two telegraphic transfers for approximately $100,000.00 cash to Labrador's account. Under the bank's procedure the money was required to be deposited into an account of the bank called the direct remittances account. Ms Arabi interviewed the man, obtained the necessary details, filled in two deposit slips in accordance with those instructions for $48,605.50 and $58,018.50 respectively19 and began filling in the form necessary to generate the telegraphic transfers. On that form she wrote the name of Coachwork as the applicant. The man signed the deposit slips. The signature is indecipherable, but it is not that of Mr Richard Lal. Ms Arabi then gave the man a Significant Cash Transaction Report to fill in and directed him to a teller. She then continued with her work. [63] A Significant Cash Transaction Report is a form which a person undertaking a cash transaction in excess of $10,000.00 is required to complete under the Financial Transactions Reports Act 1988. The form which Ms Arabi handed the man required not only disclosure of the name of the person conducting the transaction but also the verification of that person's identity and the recording of such information as a driver's license number, bank account number, passport number or credit card number. The man took the form, went to the teller, deposited the cash into the direct remittances account and left the bank without completing the report. That threw Ms Arabi into a state of “panic”. Nevertheless the transfers were effected and were credited to Labrador's account on that day. Mr Wright subsequently brought them to account as payment for the second and third Fiji shipments. The source of 19 Each of those amounts included $30 bank commission. -- 23 of 79 -- 24 the funds is unknown but they were not lawfully transferred into Australia by Coachwork or anyone associated with it. [64] Ms Arabi's first step to rectify the situation was to contact Coachwork. She could not remember whether she did so that afternoon or the following Monday, but having regard to time zone differences it was probably the latter. Whomever she spoke to gave her the Brisbane telephone number of Mr Richard Lal (Mr Lal had his own premises in Brisbane). She rang him and explained the need for the form to be filled in. She arranged to fax him a copy of the first page of the form. He told her that he was going to have a meeting with Labrador and he would get them20 to fill out the form and send it back to her. She faxed him accordingly on 10 October. Two days later she received a facsimile of the first page, sent by Labrador. Near the top of the form someone (Mr Wright admitted in evidence that it was he) had written her first name and telephone number. The form had been partly completed and showed the identity of the person who conducted the transaction as “Balwant Ram”. It purported to have been signed by Mr Ram. No verification of identity was given. The signature was a forgery.21 [65] Not surprisingly, Mr Wright was asked about the document: “Now, what can you recall about this document? Where did it come from? What was said to you about it?-- Mr Hack, I recall very little. I really do. Well, do you - did you at the time recognise it as being a document which involved the deposit of more than $10,000.00 in cash into your account?-- Yes, I know what it is, yes. And did that surprise you?-- No. Why not?-- I've never really queried how I get paid, as long as the company has paid for the goods, and if Mr Balwant Ram wished to deposit funds, that was - that's what he was doing for on behalf of PA Lal, so be it. Can I----- HIS HONOUR: Didn't strike you as odd that there would be money being deposited in Sydney?-- I'm sure I would have thought that at the time.” Later he said that Mr Lal had either brought the document to him or faxed it to him. He was sure he would have discussed it with Mr Lal; it seemed strange that Mr Lal was asking him to fax one of his documents. He was sure he asked Mr Lal the reason for the request, but he could not remember the answer. He could not explain why Mr Lal did not simply fax the document to the bank himself. He knew the document related to money being paid to Labrador, but could not recall if he asked Mr Lal why it was being paid into a branch at Sydney rather than in Brisbane. 20 My emphasis. 21 Document FIJ2.0001.064. Ms Arabi completed the second page of the form. Click on the link to see it: SCTR -- 24 of 79 -- 25 [66] I do not believe Mr Wright's evidence. I am satisfied that he was at least a party to the creation of the forged form, probably in collusion with Mr Lal. It is not possible to determine who made the deposits in Sydney, but it was not Coachwork or Mr Lal. [67] It was the defendants’ case that the deposit of $48,605.50 represented payment of the balance due under the new-style commercial invoice. It will be recalled that the invoice provided for the balance to be paid “on presentation of bills of lading (per telegraphic transfer as discussed) or within 30 days from date of bills of lading.” Obviously those words provide for two different and inconsistent dates for payment. Mr Wright testified that he expected payment on the earlier of the two dates but it is more likely that the failure to omit the words “on presentation of bills of lading (per telegraphic transfer as discussed) or” was a mistake, brought about by inattention to the logical consequences of the alleged deposit having been paid before the date of the document. However even on Mr Wright's view, payment of the balance was not due before Coachwork received the bill of lading. It seems unlikely that this occurred by 6 October, the date of the deposit at Annandale. There is no evidence of any consignment of documents by Labrador until 13 October. That is also the date when Coachwork's customs agent, Cargo Brokers International (Fiji) Ltd (“CBI”), began work on the import entry for both this shipment and for the third shipment (which was made on the same vessel). If the defendants’ case is to be accepted, Coachwork not only made no protest when Labrador unilaterally changed the agreed terms of payment, it also probably paid the balance before it was due. That seems unlikely. Entry of goods to Fiji [68] The old-style commercial invoice and packing list and the bill of lading reached Coachwork by 13 October.22 Its accountant, Mihendra, gave them to CBI and instructed it to prepare the documentation necessary to have the cargo released by customs and transferred to a bond store called Suncourt Bond.23 CBI prepared the necessary entry based on the information in the old-style commercial invoice and the packing list. Mr Sharma, its managing director, signed the entry that day and by the following Monday it and the other documents were lodged with Fiji Customs. It was checked by an officer quaintly known as the comparing officer, who, on Tuesday 17 October, endorsed the instruction, “Examine to verify quantity and description.” That instruction defined the scope of the examination required. The entry was then passed to another officer, Mr Lewatoro, to carry out the examination. Mr Lewatoro was in fact a warehouse officer, but no one else was available at the time. He was an experienced examination officer, having previously served in that section. [69] The examination took place the same day. Still under customs control, the container was brought to the Suncourt Bond warehouse. Mr Lewatoro testified that he checked that the container number and seal number matched the documentation and that the seal was intact. He then removed the seal and the container was unloaded in his presence by Suncourt workmen. He checked the contents as they did so and counted the number of cartons for each line of the entry. The contents 22 Paragraph [59]. 23 For a more detailed description of that store, see para [119]. -- 25 of 79 -- 26 were placed onto pallets and taken into the store. A representative of CBI named Pramesh was present during the examination. [70] Mr Lewatoro testified that he wrote the result of his examination on the back of the entry. He noted that he found surplus cargo consisting of three cases of Black Imperial Whisky, 220 cases of canned beer and 237 cases of beer with twist tops; and a short shipment of three cases of Red Imperial Whisky. He issued a detention notice in respect of the surplus and on 19 October wrote a report of his findings for the Collector. He then re-examined the three surplus cartons of whisky. They were unmarked. Upon opening them he found that they contained Red Imperial Whisky. They were therefore not surplus to the entry, so he amended his report and the detention notice accordingly. It was recommended that the question of the surplus beer be referred back to CBI. By then, however, CBI must already have been aware of the problem. On 18 October Mr Sharma signed a new entry which included the surplus beer. [71] On the same day three documents were sent by facsimile from Labrador to Coachwork. They were an old-style commercial invoice for 220 cases of canned beer and 237 cases of beer with twist tops, an old-style packing list for the same cargo and a letter. The packing list specified the container and seal numbers used for the shipment. The invoice and packing list had been typed by Mrs Lapré. The letter referred to the container by number and explained that there had been an error resulting in two orders being combined and dispatched in the one container. Who typed it is unknown. It is signed “D Nara”. Nobody of that name worked at Labrador. It could not have been sent from Labrador without the involvement of either Mr Wright or Mr Bryce. There is no reason to think that Mr Bryce was directly involved. The selection of an Indian-sounding name for the signatory and a certain clumsiness in the style suggests an attempt to make it seem as though the letter was written by a Fijian Indian, but Mr Lal was not in Australia at the time. Mr Wright denied that any of the three documents was typed on his instructions; indeed, he claimed to be unable to remember the incident of the over-shipment: “And I will suggest to you that it was the fact that you were told in about October - in October 1995 that Fiji customs was claiming that there was an over-shipment of beer in what we have called the FIJ2 shipment. That happened, didn't it?-- I don't recall that, Mr Gotterson. I'm suggesting to you that at that point you didn't protest and say there must be a mistake because the shipment didn't contain any beer at all?-- I don't remember the instance, Mr Gotterson.” I have already found in relation to the commercial invoice and packing list that his denial was a lie. So was his profession of ignorance regarding the over-shipment. I infer that CBI informed Coachwork of the over-shipment on 17 October and that Mr Lal immediately told Mr Wright about it. I am satisfied that Mr Wright was responsible for the letter of 18 October. [72] Coachwork faxed the commercial invoice and the packing list to either CBI or Fiji Customs at 4.34 pm local time. It also faxed the letter, apparently about an hour and a half later. CBI acted less swiftly. On 20 October it lodged the new entry, a fresh copy of the original commercial invoice and (if they had not been sent direct to Fiji Customs by Coachwork) the three facsimile documents sent by Labrador. This time the comparing officer endorsed the entry, “Examine to verify quantity and -- 26 of 79 -- 27 T/C [tariff classification].” Before that could be done, however, Coachwork discovered that there had been a further error in the Labrador documentation. The original commercial invoice had included 200 cases of Fosters beer with twist tops and the supplementary commercial invoice included 237 cases of Fosters beer with twist tops. In both cases the invoice specified the contents of the cases to be 375ml containers. In fact they were 250ml containers. CBI was informed and immediately wrote to Fiji Customs requesting approval to examine the contents to verify this information. Presumably that happened. On 24 October Mr Sharma signed and lodged a third entry. In this entry all of the cartons of twist top containers (both Fosters and Victoria Beer) were specified to contain “6L/carton”, which implied that the beer was in 250ml containers. This time the comparing officer instructed an examination of contents per carton and quantity. Mr Lewatoro carried out a further examination the same day. He found that the actual content of the twist top cartons was in accordance with the entry, not the invoices. Thereafter the goods were released into bond. [73] The versions of Mr Sharma and Mr Lewatoro described above were not the only versions which those witnesses had given of these events. Each had made a one- page affidavit in mid-2001. The formats of the affidavits are similar and I infer they were prepared by the same person. Mr Sharma’s affidavit contained a number of statements inconsistent with his evidence and with the agreed facts. They were: “3. THAT I also recall dealing with Mr Ram Singh who operated a section of the business also called International Liquor Traders that imported several containers of liquor from Australia. 4. THAT I have checked records and can state that the following containers were attended to by me on behalf of my clients. [There followed a list of the containers used for the seven Fiji shipments by Labrador]. 7. THAT the above-mentioned containers, after the fulfilment of the legal requirements were delivered to Ram Singh for collection/pick-up.” The affidavit made no mention of Coachwork or of Mr Lal. [74] It is agreed by the parties that Liquor Traders International (“LTI”) was the name of a business run by Coachwork. Coachwork applied for registration of the name on 15 July 1996 and it was registered 10 days later. It did not hold a licence to make retail sales of alcohol in Fiji. Its address, facsimile number, telephone numbers and post box address were the same as Coachwork’s. In his evidence before me Mr Sharma said that he never met, nor had any discussions with, a person by the name of Ram Singh from Coachwork; and that para 7 quoted above was not true. The defendants do not allege that any shipment but the seventh was consigned to LTI. [75] Under cross-examination Mr Sharma, having tried to deflect the question, said that Mr Lal asked him to sign the affidavit and that he spoke about it with a lawyer named Mehboob Roza. He testified that the reason given by Mr Lal for wanting the affidavit was that “he wants to send it to his lawyer overseas because he had done some shipments from Australia and these were confirmation.” [76] The affidavit advances three false propositions: • The seven containers were imported by LTI. -- 27 of 79 -- 28 This was untrue. Only the seventh is even alleged to have been imported by LTI. The others were imported by Coachwork in its own name. • Ram Singh operated LTI and Mr Sharma dealt with him. Mr Sharma's testimony that he had never met, nor had any discussions with, a person named Ram Singh from Coachwork was unchallenged and was, I find, the truth. Mr Sharma further testified that he would have expected to have met or talked to anyone who had a significant role within Coachwork in the purchase of goods from overseas and their importation into Fiji. That testimony too was unchallenged. I infer that no such person as Ram Singh existed. • The listed containers were delivered to Ram Singh. This was also untrue, for the reasons just stated. [77] It is apparent that in mid-2001 Mr Lal was attempting to collect evidence for use in Australia. I infer that he was the source of the false information contained in Mr Sharma's affidavit. He must have known that information was false when he obtained the affidavit. [78] The affidavit signed by Mr Lewatoro in mid-2001 uses a similar typeface, and follows the same style, as that signed by Mr Sharma. I infer that it too was prepared by Mehboob Roza on instructions from Mr Lal. It appears that at the time of its preparation those responsible for it did not know who would be swearing it. I infer that from its opening words and from the form of the first three paragraphs: “I, Rusiate Tuisovivi make oath and say as follows:- 1. THAT I am a Customs Officer employed by Fiji customs since 2. THAT I was a Customs Officer employed by Fiji customs from about to about 3. THAT in my role as Customs Officer it is/was my duty to perform the duties of an Examining Officer of imported cargo coming through into Fiji ports.” The words in italics were handwritten. They comprise Mr Lewatoro’s given names but not his family name. At the relevant time Mr Lewatoro was not an examining officer. With the possible exception of para 6, the remaining paragraphs described in general terms procedures said to be adopted by Fiji Customs. Any customs officer would have been in a position to make those statements if they were true. Even para 6 was in fairly general terms: “THAT I recall containers of liquor being imported in Fiji in 1995 and in 1996”. I am satisfied that Mr Lal had the affidavit prepared, then went looking for a Customs officer to sign it. [79] The remaining paragraphs of the affidavit were as follows: “4. THAT as Examining Officer and in accordance with Fiji Customs regulations all containers with incoming goods can only be opened by Customs Department in the presence of the owners of the goods or the owner’s duly appointed agent. 5. THAT the procedure to be followed when opening a container is to visually check the goods and calculate the carton quantity inside the container based on the height of the cartons and number of rows of cartons as viewed from the front of the -- 28 of 79 -- 29 container. This calculated quantity is then checked against the commercial invoice. 6. THAT I recall containers of liquor being imported in Fiji in 1995 and in 1996. 7. THAT containers of liquor in cartons are not physically unpacked and checked by Customs Department. Cartons are also not opened to verify the contents because duty on liquor is based on type e.g beer is different to spirits and the quantity of litres. 8. THAT containers containing liquor in cartons are delivered to bond stores where the unpacking takes place.” [80] Mr Lewatoro testified that in various respects those paragraphs were not correct. As to para 4 he said that he was not an examining officer at the time. He was not asked about para 5 as such, but it is plainly inconsistent with what he said he did to check the container for the Labrador shipment.24 Counsel for the defendants suggested that what he had said in this paragraph was true, but he denied it. He testified that para 6 was inaccurate because he recalled only the one container, imported in 1995. He testified that para 7 was wrong in that the cartons were physically unpacked from the container and some were opened. Plainly he was referring to what he did. He testified that para 8 was wrong because cartons entered for home consumption were not delivered to bond stores. [81] Mr Lewatoro explained how he had come to sign the affidavit: “27. What happened was that one Saturday night a year or so ago, Mr Bill Raikuna came to my home in his car. He was by himself. My wife was in the room when this happened. He handed me a piece of paper and told me to sign it. It was folded in such a way that I could not see the contents. He did not let me see the contents. He did not tell me what it was for and I have not heard from him since on the matter. 28. Mr Raikuna was a very senior officer in the Fiji Islands Customs Service. I think he was Director General at the time and the reason I signed the document was that I felt intimidated into signing the document.25 ” He demonstrated how he said the affidavit was folded. He claimed that when he signed it the word affidavit was not written at the top, his name was not written on it and it was undated, that it was not signed in the presence of the Commissioner for Oaths and that he did not know what was in it because he was not given the opportunity to read it before signing. He also said that the two words of his name in the affidavit were not in his writing. [82] The defendants mounted a substantial attack on Mr Lewatoro's credibility. They pointed to the inconsistency between his evidence of what was and was not in the affidavit when he signed it and his claim that he did not see the affidavit’s contents at that time. They called evidence from the solicitor before whom the affidavit purported to be executed. Mr Mohammed Khan testified by telephone. He testified 24 Paragraph [69]. 25 Mr Raikuna’s position is described at paras [33]-[34]. -- 29 of 79 -- 30 that a Fijian claiming to be Rusiate Tuisovivi (not Lewatoro) was, in accordance with the local practice, brought to his firm by a clerk from the firm Mehboob Roza & Associates to have the affidavit executed. That deponent duly executed it in front of him. It was open and able to be read at the time of execution. Mr Lewatoro denied that this occurred. [83] Mr Hack submitted that I should proceed on the basis that the 2001 affidavit contains the truth and in particular that I should find that the procedure for checking involved a visual check and a count by reference to height and rows. I reject that submission. I have deep suspicion about the circumstances in which the affidavit was created. As noted above, Mr Raikuna was not called and his absence was unexplained. The affidavit is not corroborated by evidence from any other customs officer, nor by the evidence of Mr Sharma who dealt with Fiji customs. The identity of the person who attended Mr Khan’s office was not proved. The version in the 2001 affidavit seems improbable. [84] I am unable to determine the precise method adopted by Mr Lewatoro for counting the contents of the container. He initially made an error regarding the classification of three cartons of whisky, but that error was corrected by his recount. His count of the beer is corroborated by the supplementary commercial invoice and packing list which were typed by Mrs Lapré on Mr Wright's instructions and faxed from Labrador's premises to Coachwork. It was, I find, correct. In the end it does not matter how much beer was in the container. There was undoubtedly a very large amount. Its existence is confirmed by the records of Suncourt Bond Store. On the defendants’ version there should have been none. I am satisfied that whatever method Mr Lewatoro adopted, his count was correct. [85] I found it very difficult to make an assessment of Mr Lewatoro. English was not his first language. Culturally he would have identified himself as Fijian. He seemed nervous and uncomfortable in the witness box. Even assuming that any evidence given by Mr Roza would not have assisted the defendants (as their unexplained failure to call him entitles me to do), the inconsistencies within Mr Lewatoro’s evidence were substantial and serious. I have decided that, without making a definite credibility finding, I should not act on Mr Lewatoro’s evidence unless it is supported by a contemporaneous note or corroborated in some other way. However I note that it was not suggested that Mr Lewatoro was in any way corrupt; only that his count was slipshod. [86] It follows that I do not accept that Mr Lewatoro had a specific memory of checking the seal on the container in question. I am unable to find whether or not he checked the seal on the relevant container. There is however no evidence that the seal had been tampered with in any way. Common sense suggests that it is unlikely that most of the spirits the subject of the new-style invoice were replaced by beer while the container remained under Customs control at some time before Mr Lewatoro's inspection. Until the day of the inspection the identity of the examining officer (and therefore, his or her level of thoroughness) was unknown. The risk of detection would have been high. Coachwork and Mr Lal were engaged in villainy, but it did not take this form. [87] For the plaintiff Mr Gotterson QC submitted that I should infer from the defendants’ failure to call Mr Lal that any evidence he could have given would not have supported the defendants’ case. One does not need to rely upon the defendants’ -- 30 of 79 -- 31 failure to call Mr Lal for that inference. The defendants’ case involves the proposition that Mr Lal was engaged in criminal activity in Fiji. It is improbable that he would have given evidence in support of that case, even if (indeed, particularly if) that case represented the truth. I am not assisted by the defendants’ failure to call Mr Lal. [88] Mr Hack submitted that in relation to this shipment, as with the first shipment, the payment of $20,000.00 by Coachwork to Labrador made no sense if the price for the goods actually supplied was only $14,679.50 (the sum of the amounts in the two old-style commercial invoices, $11,734.50 and $2,945.00). As in that case I see no explanation for such a payment in the evidence. That is a fact which favours the defendants. [89] Mr Hack further submitted that there was no evidence of how Labrador acquired the beer which was placed in the container. There is however no reason to suppose that the acquisition of less than a container load of beer would pose any difficulty for a liquor merchant. He further submitted that presumably, if the plaintiff's case were correct, it paid non-bonded prices for the beer, prices which were much higher than those charged to Coachwork. There was no evidence of the economics of the operation. It would be useful to look at the comparison of prices suggested by Mr Hack only if one also took into account the profit which might be made on the sale of the spirits withheld from export. That is not possible on the evidence, although it may be inferred that the excise duty on the beer was less than the customs and excise duty on the spirits in the new-style invoice. Mr Wright conceded that that was true in relation to the third shipment and there is no reason to think the position was any different for the second shipment. I do not think these submissions assisted the defence case. Conclusions regarding Fiji shipment two [90] The old-style commercial invoices produced to Fiji Customs by CBI were typed in Brisbane on the instructions of Mr Wright by Mrs Wood and Mrs Lapré. Together they reflect the contents of container ITLU 821518-1 sent by Labrador from Brisbane to Fiji. The container was packed at Labrador's premises before it was exported by Mr Bryce. The goods listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with that invoice was false and misleading. In Labrador's records the goods were taken out of stock held under bond and the only available inference is that they were delivered for home consumption. That inference accords with the plaintiff’s averments to that effect. That process must have involved moving the goods while they were subject to Customs control. I am satisfied of those conclusions beyond reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the six charges which he alleges in respect of the second shipment. Fiji shipment three The new-style invoices and packing list [91] Container ITLU 821518-1 was not the only container shipped by Labrador to Coachwork on the Barbican Star on 4 October 1995. The other was container -- 31 of 79 -- 32 SCZU 7433220. As was the case with what has been called the second shipment, documents seized from Labrador's records suggest that Labrador dealt with Mr Balwant Ram on behalf of Coachwork in respect of the shipment. The first such document is a letter (the original letter, not a facsimile) on Coachwork's letterhead dated 2 August 1995. Addressed to Mr Wright, it purports to be signed by Mr Ram as purchasing officer and seeks a quotation for a large amount of spirits. It refers to unspecified telephone discussions. It is a forgery. Mr Ram neither wrote nor signed it and, as I have already found, he was not employed by Coachwork as purchasing officer for such goods (he was a driver/messenger). Mr Wright recalled no such discussions. In fact he did not recall ever having spoken to Mr Ram. He said, however, that in the light of the letter, he must have done so. On the other hand Mr Ram denied any knowledge of Coachwork importing liquor, and it was not suggested to him that any conversation in fact occurred. I am satisfied no such discussion occurred. Mr Wright was being disingenuous. The letter was probably given to him by Mr Lal, who was in Australia at the time. [92] Mr Wright testified that whether or not such discussions had occurred, he would have processed the order provided (as he claimed was the case) Labrador had been paid for the previous shipment. He said that having received the order, he “checked to see if there was money outstanding, what stock was available, what needed to be bought in, what prices we could obtain the stock for, and issued a pro forma invoice.” On the following day, he said, he created a new-style pro forma invoice for the shipment and faxed it to Mr Ram. Mr Ram did not receive it. There were some significant differences between the letter and the pro forma invoice. Mr Wright made no attempt to explain what happened in one day to bring those differences about and there is no evidence of any conversation or correspondence in respect of them. The terms of payment were, “Deposit of A$20,000 (per telegraphic transfer as discussed) or [sic] presentation of Bills of Lading and the balance 30 days from date of Bills of Lading.” Shipment was to take place on the “Barbicon [sic] Spirit (Voyage 98) ETD Brisbane 1/9/95”. [93] On 10 August Coachwork faxed a copy of the document back to Labrador. Typed at the foot were the words, “We accept your Proforma Invoice and confirm our order to be shipped on Barbican Spirit ETD Brisbane 1/9/95.” Mr Ram's purported signature then appeared over his typed name. That signature was also a forgery. By 10 August Mr Lal had returned to Fiji. [94] If Mr Wright had believed those documents to be genuine, one would expect he would have bent his efforts toward fulfilling the contract represented by them. There is no evidence that he made the slightest effort to send such a consignment on the voyage in question. If the Barbican Spirit sailed in early September, it sailed without this consignment. At the very least one would expect some indication on Labrador's files of an attempt to have its Customs agent (or someone) book space on the voyage and procure a container for loading, and some correspondence explaining to Coachwork why the consignment had not been sent. Counsel made no attempt to elicit from Mr Wright what he did about the order for the rest of August. This may in part reflect the general style of questioning during Mr Wright's evidence-in-chief. He was not asked to recount his actions chronologically. Usually, he was taken from document to document and asked to describe the document. That might be explained by Mr Wright having no memory of what he did and not being able to do more than to describe the document; but it was a less than satisfactory approach if the aim was to convince me that Mr Wright had in fact -- 32 of 79 -- 33 acted in the way suggested by the document. In any event, there is no explanation for why the transaction did not proceed as apparently agreed. [95] Nothing relevant happened from 10 August until 26 September 1995. On that day Coachwork sent $20,000.00 by telegraphic transfer to Labrador's bank account. On the defendants’ case that money was the deposit required to be paid for this consignment. However on 26 September no bill of lading had been issued. Indeed there is no evidence that Labrador had even begun to pack a container. Why Coachwork should suddenly have remitted $20,000.00 to Labrador is a mystery. Certainly it was not required under the terms of the pro forma invoice. Mr Wright agreed that commercially, a customer paying early was a very unusual event. He could not remember why this had happened, although he suggested he might have “asked that they help us out”. It seems a bit improbable. [96] The bank's written instruction for the transfer records that Labrador was to be informed of the payment immediately. On the defence case, Labrador prepared a commercial invoice and packing list on 28 September, for that is the date of the new-style commercial invoice and packing list covering the goods which Mr Wright testified comprised this shipment. This invoice differed from the pro forma invoice in three significant respects: the number of cases of Black Imperial Scotch Whisky increased from 60 to 74; the number of cases of Johnnie Walker Black Label Whisky decreased from 20 to 15; and 10 cases of Athena Ouzo were added. The invoice price reflected receipt of $20,000.00 on 26 September and provided for payment of the balance “on presentation of Bills of Lading (per telegraphic transfer as discussed) or within 30 days from the date of Bills of Lading”. There is no evidence of any communication regarding these changes between Labrador and Coachwork, although Mr Wright opined that there must have been such communication. He advanced two reasons for the changed quantities. The first was: “On packing the container, for the sake of packing the container to its full capacity to avoid movement and potential damage of goods, it's possible that we were able to put in additional stock.” The second was that Labrador had increased the number of cases of Black Imperial Scotch Whisky to make up for a decrease from 150 to 128 in the number of cases of Teachers Scotch Whisky. If the first reason were true the commercial arrangement between Labrador and Coachwork must have been very unusual. There is no evidence of any such arrangement. Terms of trade covering a series of shipments were never discussed; or if they were the discussions have not been referred to in the evidence. In the absence of some sort of agreement, using product as filler material makes no commercial sense. Significantly, Mr Bryce did not suggest in his evidence that this occurred. The effect of his evidence was that he would be given a list of what had to be packed and would pack it. As to the second suggestion, the decrease was not a decrease from the pro forma invoice to the commercial invoice but from the order of 2 August to the pro forma invoice. If the explanation were correct the increase in the Black Imperial Whisky would have appeared in the pro forma invoice. Moreover there is no reason why the replacement product should not have been provided in the same quantity as the omitted product; Black Imperial Whisky was Labrador's own label. All of these considerations lend support to the hypothesis that the new-style commercial invoice and packing list were bogus. -- 33 of 79 -- 34 [97] On or about 28 September Mr Wright instructed EDI to prepare and lodge an entry for export for the 1,147 cases of spirits listed in the new-style invoice. EDI did so. [98] Mr Hack submitted that the existence of the order of 2 August 1995 was inconsistent with the plaintiff's case. I do not think that is correct. On the plaintiff's case Coachwork was in collusion with the defendants. On that case it is no surprise that it should send such a letter. The old-style commercial invoice and packing list and the bill of lading [99] Mrs Lapré typed a commercial invoice and a packing list for this consignment on old-style letterhead. The invoice is dated 28 October, but that is plainly a mistake. I infer she intended to type 28 September. The packing list is dated 29 September and that date accords with the export receival advice issued on behalf of the shipowner, which records the packing date as 29 September. (The new-style packing list was undated). Each document records the goods sold as being 74 cases of Black Imperial Scotch Whisky, 500 cases of Fosters beer (cans) and 989 cases of Victoria Bitter beer (cans). That is a total of 1,563 cases, compared to 1,147 cases in the new-style commercial invoice. By 13 October at the latest, these documents were sent by air to Coachwork from Labrador. I infer they were accompanied by the bill of lading and were delivered by Coachwork to CBI. [100] It is necessary to say a little more about the bill of lading. There are three versions contained in the agreed documents. The first,26 which is unsigned and appears to be a draft, was written by an employee of EDI and was seized from EDI's premises. The second27 is the non-negotiable carbon-impregnated copy issued by Barbican Marine Agencies Pty Ltd on 4 October 1995. It was seized from Labrador. In both of those documents the cargo is listed as “1 x 20' CONTAINER(S) STC 28 1147 CASES SPIRITUOUS BEVERAGES”. The third29 is a photocopy of the original bill of lading, only one copy of which was, according to the tenor of the bill, signed. It was obtained from Fiji Customs. The copy is of indifferent quality, but it is apparent that 1,147 has been altered to 1,563, whether by over typing or carefully by hand is uncertain. This document was issued by the shipping line to Labrador and, as I have already found, sent by it to Coachwork. [101] Unlike the second shipment, which was consigned to Suva, the third shipment was consigned to Lautoka, on the opposite side of Fiji's main island. It seems that the Barbican Star arrived there on 10 October. CBI had an office in Lautoka. The licensed clerk at that office was named Rajenda Sharma and it was he who prepared an import entry for submission to Fiji Customs on behalf of Coachwork. He was not called as a witness and what he did must be inferred from the documents and the evidence of Mr Davendra Sharma, the principal of CBI. Mr Rajenda Sharma signed the entry on Friday 13 October and lodged it with customs at Lautoka either on that day or on the following day. The entry contains three lines. Line 1 was for 74 cases of Black Imperial Whisky; line 2 was for 340 cases of Fosters beer; and line 3 was for 733 cases of Victoria Bitter beer. The total number of cases was specified as 1,147, the same total as was shown in the new-style invoice. That invoice, of course, contained no beer. Two different officers looked at the entry and each 26 FIJ3.0001.035A. 27 FIJ3.0001.035B. 28 Said to contain. 29 FIJ3.0001.036. -- 34 of 79 -- 35 endorsed an instruction to CBI on it. The first instruction was to “recheck receiving warehouse code” (he had written the wrong code for Reddy’s Bond Store, the warehouse in which the goods were to be housed). The second instruction was to “check Qty for lines 1 and 2”. Those lines referred to the whisky and the Fosters beer. The instruction evidently referred not to the number of cases but to the calculation of the number of litres of alcohol in them. The first instruction was endorsed on 14 October and the second on that day or shortly afterwards. The entry form was then returned to Mr Rajenda Sharma. He corrected the code, recalculated the litres of alcohol for lines 1 and 2 and relodged the form, but it is unclear on what date he did that. [102] It is also unclear whether Mr Rajenda Sharma had lodged a copy of the commercial invoice and the packing list at this stage. He probably had not done so; the copy of the invoice retrieved from Fiji Customs bears CBI's facsimile transmission identifier and on the same line the date 18 October 1995. More importantly, the quantities of beer were at odds with those in the commercial invoice. That discrepancy is so obvious that it would surely have been noticed by one or other of the customs officers. I infer that the entry either was not accompanied by a commercial invoice when first lodged or was accompanied by a different commercial invoice in which the quantities were the same as those in the entry. The latter possibility is speculative, as no such document was produced to the plaintiff by Fiji Customs. [103] Relodgment of the form was not the end of Mr Rajenda Sharma's woes. On 18 October the first customs officer further endorsed the entry, “Check VFD30 calculation [indecipherable]”. By now, however, Mr Rajenda Sharma had the commercial invoice, and he must have realised that lines 2 and 3 incorrectly stated the quantities of beer. He told Customs he would lodge an amended entry, and he prepared a fresh document. It specified the quantities in accordance with the commercial invoice although the box requiring specification of the total number of packages had to be corrected from 1,147 to 1,563. For unexplained reasons he dated it 13 October. On 20 October it was endorsed, “Please re-check the insurance calculation”, but that endorsement does not seem to have produced any alteration to the document. No endorsement requiring examination of the container was made, and no examination was carried out. On the same day the entry was passed and permission was given to transport the container to Reddy's Bond Store. [104] This leaves unanswered the question of why Mr Rajenda Sharma initially thought that the consignment contained 1,147 cartons. One may speculate that he had been provided with a commercial invoice which showed the quantities set out on the three lines of his first entry, but there is no direct evidence of that. I am unable to make a finding in answer to that question. Delivery at Lautoka [105] Reddy's Bond Store was operated by Reddy's Wines & Spirits Limited, the general manager of which was Diwikar Reddy. The store would be open for business for only a few hours on a few days per week, at set times. Two keys were required to open the store. One was held by Mr Reddy, the other by Fiji Customs. Both had to be present for the store to be opened. The customs officer in question was designated the warehousing register officer. The officer’s duties included counting 30 Value for duty. -- 35 of 79 -- 36 the goods and recording them in a register maintained by Fiji Customs. Mr Reddy would also count the goods and record the receipt in a register maintained by his company. [106] On 20 October 1995, container SCZU 7433220 was taken to Reddy's Bond Store. There it was unloaded and the contents taken into the warehouse. This was done in the presence of Mr Reddy and Ms Laisani Drauna, the warehousing register officer at the time. Each of them counted the consignment and recorded the results of the count in their respective registers. In each case the record matched the old-style commercial invoice. [107] One other unexplained matter, described by Mr Hack as a “curiosity”, must be mentioned. Mr Reddy deposed: “I remember that in one of the containers that arrived, there were a lot of empty cartons in it marked Napoleon Brandy. There were about a hundred of these empty cartons. I asked Momlesh why they were in there but I did not receive any answer.” (Momlesh was an employee of CBI.) It appears from exhibit A437175 to Mr Reddy’s affidavit that the container to which he referred was container SCZU 7433220 and that there were in fact 199 empty cartons. Mr Hack submitted that this was consistent with there having been some interference with the container before its contents were put in to bond. The new-style invoice referred to 30 cases of Cheval Napoleon Brandy, but to only 30. It is far from clear that the “cartons” referred to by Mr Reddy were cases fit for a dozen bottles rather than individual cartons for improved presentation of single bottles; but even if they were cases their presence cannot be explained by hypothesising the removal of the contents of 30 cases of brandy. Neither side called Momlesh and the topic was not raised with Mr Sharma from CBI. The matter remains no more than a curiosity. I reject the submission. Payment of the balance in the new-style invoice [108] The balance due under the new-style commercial invoice was $57,988.50. I have described above how that sum, together with $30.00 for bank commission, was paid in to the Annandale branch of the ANZ bank. 31 What I have said there also applies here. Indeed, the present payment was if anything odder. The date of the payment, 6 October, was four days before the Barbican Star arrived at Lautoka. I am satisfied the whole purported transaction was a sham. Conclusions regarding Fiji shipment three [109] My conclusions regarding the third shipment are the same as those regarding the second. The old-style commercial invoice produced to Fiji Customs by CBI was typed in Brisbane on the instructions of Mr Wright by Mrs Lapré. It sets out the contents of container SCZU 7433220 sent by Labrador from Brisbane to Fiji. The container was packed at Labrador's premises before it was exported by Mr Bryce. The goods listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with that invoice was false and misleading. In Labrador's records the goods were taken out of stock held under bond and the only available inference is that they were delivered for 31 Paragraphs [62] to [67]. -- 36 of 79 -- 37 home consumption. That inference accords with the plaintiff’s averment to that effect. That process must have involved moving the goods while they were subject to Customs control. I am satisfied of those conclusions beyond reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the six charges which he alleges in respect of the third shipment. Fiji shipment four [110] The fourth Fiji shipment took place in container number IEAU 240762-1. According to the plaintiff it contained 1,779 cases, being 80 cases of Imperial Scotch Whisky and 1,699 cases of beer of various types. According to the defendants it contained 1,212 cases of 12 different sorts of spirits. Labrador caused EDI to enter its contents for export on the latter basis. Its destination was Suva. The new-style invoices and packing list [111] The starting point appears to be a new-style letter and pro forma invoice both dated 6 November 1995 but faxed by Labrador to Coachwork the following day. Both had been typed by Mrs Wood. 32 Features of the letter were: a. It was addressed to Mr B. Ram, purchasing officer, at Coachwork; b. It referenced “pro formas/telephone discussion 31 October”; c. It claimed to be accompanied by three pro formas for perusal and confirmation; d. It noted that shipping has been booked for three containers on the “Captain Kermadec” ETD Brisbane 26 November. The pro forma invoice contained the reference “LW F3/6”33 . It quoted prices for 1,150 cases of 11 different types of spirits, although the last entry was for “approximately 30” cases “dependant [sic] on F.C.L. packing”. The price was $75,030; destination port was Suva; and terms of payment were, “As discussed -- a percentage deposit (to be agreed) paid on shipment and the balance payable within 30 days of the date of Bill of Lading”. On 8 November Coachwork faxed the invoice back to Labrador. At the bottom appeared the following memorandum: “WE ACCEPT YOUR PRO FORMA INVOICE AND CONFIRM OUR ORDER TO BE SHIPPED ON CAPTAIN KERMADEC (VOYAGE 11) ETD BRISBANE 26/11/95. [SIGNED] BALWANT RAM PURCHASING OFFICER”. [112] It was clearly established by Mr Ram's evidence that he had nothing to do with purchasing liquor. He was a driver. There is no direct evidence of any telephone discussion between Mr Wright and anybody in Fiji on 31 October. Mr Wright 32 The letter was faxed by her, presumably to Labrador, on 7 November. The invoice was not faxed by her; presumably it was hand delivered to Mr Wright. Precisely how Labrador received the documents does not matter. 33 The letter purported to be accompanied by two other pro forma invoices. Two other invoices, referenced “LW F3/7” and “LW F3/8” respectively exist. The former of these two relates to shipment 5 and will be discussed below. The latter relates to a consignment of beer which is not in dispute. It is dated 10 November, so presumably it could not have accompanied the letter. It will be necessary to refer to these orders in analysing payments made to Labrador. -- 37 of 79 -- 38 assumed there would have been a telephone call or letter to prompt the invoice, but that assumption is inconsistent with his perception of Mr Ram: “I always understood that Mr Ram, as purchasing officer, merely processed the document. He was not a decision maker as such.” The memorandum purporting to come from Mr Ram was forged. [113] The memorandum is one of a number made at about this time purporting to be signed by Mr Ram. Each of the three pro forma invoices just referred to contained a similar memorandum and the same signature. Labrador's files also contained a faxed letter on new-style letterhead from Labrador to Coachwork offering to sell an additional 20 cases of Finlandia vodka. That letter had been re-faxed by Coachwork and it also bore a memorandum of acceptance purporting to be signed by Mr Ram. This time the signature was different. It has been identified as that of Mr Lal. [114] Mrs Wood typed a new-style commercial invoice and a packing list for this shipment; they were dated 24 November. In addition to 12 cases of Finlandia vodka they included a further 50 cases of Black Imperial Whisky, neither of which was in the pro forma invoice. The total payable became $78,113.00. The terms of payment were varied by inserting the figure of $16,403.73 as the deposit. Again there is no written record of Coachwork’s having agreed to the changes, nor any evidence beyond assumption of its having been discussed. The amount of the deposit is also curious. The pro forma invoice had foreshadowed a deposit which would be a percentage of the invoice price. This amount constitutes 21.000051% of the total price. Mr Wright was asked in evidence in chief: “Is there an explanation for what seems to be an odd deposit?-- I would think that that percentage wise is odd and the reason would be obviously. We must have had it - a cash flow problem or had been put under pressure by suppliers and I applied to have x amount of dollars into our account in order to pay suppliers and calculated out that so be it, let that be the deposit. HIS HONOUR: Why not ask for 20,000?-- Your Honour, I've - very valid point. Maybe you have - it would appear to be too pushy. I don't know, your Honour.” The plaintiff submitted “that Mr Wright must be a peculiar businessman to be able to work out his required cash flow to exactly $16,403.77.” I agree with that submission. Mr Wright's explanation is nonsense. That conclusion is reinforced when one has regard to the similar provision contained in the new-style commercial invoice, also prepared on 24 November, in respect of the fifth Fiji shipment. As will be seen, the amount of the deposit provided in that case was $14,486.53, 21.999954% of the invoice total. [115] The container must have been packed around the date of the invoice. It was received for carriage on the Capitaine Kermadec on 30 November. At the same time another container holding the consignment of 1,741 cartons of beer covered by the reference “LW F3/8” was loaded onto the same ship. A curiosity of that shipment is that there exist in respect of it both an old-style and the new-style invoice in identical terms. Mrs Lapré thinks she typed the old-style commercial invoice; Mrs Wood typed the new-style one. The former was the invoice presented to Fiji Customs when the cargo arrived. What is material for present purposes is that both this container and that the subject of the fourth Fiji shipment were destined for Suva and were included in the same bill of lading. In the case of the beer -- 38 of 79 -- 39 Labrador told the ship owner (or its agent) the precise number of cartons in the container, and that was recorded on the bill of lading in the usual form. In the case of container IEAU 240762-1, however, all that was declared was “1 CONTAINER STC 1200 PLUS CASES BEVERAGES”. No explanation for this is apparent. [116] The whole arrangement is so uncommercial it compels the conclusion that the new- style commercial invoice and packing list for the latter container were bogus. The old-style commercial invoice and delivery in Fiji [117] Mrs Lapré identified an old-style commercial invoice dated 24 November 1995 as one typed by her. The amount of that invoice was $16,432.00 and it covered 80 cases of Black Imperial Scotch Whisky and 1,699 cases of six types of beer. Both it and the bill of lading (as well as the commercial invoice for the other container included in the bill of lading and the commercial invoice for shipment 5) must have been either sent by air to Coachwork or delivered to Mr Lal in Australia34 in early December. [118] The Capitaine Kermadec arrived in Suva about 8 December. On the same day Mr Sharma of CBI, on behalf of Coachwork, signed an import entry for the goods in container IEAU 240762-1. It listed three lines (80 cartons Imperial Scotch Whisky, 1,501 cartons canned beer and 198 cartons pressed top beer) – the goods set out in the old-style commercial invoice. The goods were destined for Suncourt Bond and that is where, on 11 December, they were taken. They were not subjected to a full inwards examination by Customs, but were checked by a Customs officer for the purposes of the Customs warehouse register. The warehouse officer who did the checking was Mr Lewatoro. He was not cross examined about that check. The register records the receipt of the goods in accordance with the old-style commercial invoice. [119] The Suncourt Bond store was operated by a firm named Suncourt Hardware. It rented space in the bond store to other people, and also stored some of its own goods. One company which rented space was Coachwork. The bond store was normally locked and no one worked in it. Two keys, one held by Fiji Customs, the other by Suncourt Hardware, were needed to open it. Mr Craig Pillay was the customs clerk for that firm. It was part of his duties to open the store when required. In his evidence he described the system for receiving goods. A time would be arranged in advance. The customs officer, Suncourt's goods received clerk and its warehouse manager, the truck driver, any necessary labourers and he himself would be present. Goods might be either in a container or loose on the truck. They would be unloaded and stacked in their various lines as shown on the customs entry. The customs officer and the goods received clerk would check them against the documentation by description and number. When the delivery was concluded the clerk would write out a goods received note recording the number and description of the goods received. That note would be signed by the clerk, the customs officer and the warehouse manager. The clerk would then enter his count in the Suncourt bond register, which was quite separate from the customs warehouse register. 34 Mr Lal left Australia on 5 December; see para [125]. -- 39 of 79 -- 40 [120] Suncourt’s building burned down in 2001, but in 1997 Mr Pillay had given some of its records to Customs. Among them was the goods received note for this shipment. The goods as recorded by the clerk were in accordance with the entry and hence, the old-style commercial invoice. [121] I have no doubt that the contents of the container when it arrived at Suncourt Bond accorded with the old-style invoice. As to the period before that time, there is not the slightest evidence that the container was opened and beer substituted for spirits between the time the ship reached Suva and the time it arrived at the Suncourt warehouse. The logistics of such an exercise would be formidable and the risks enormous. It would be necessary to corrupt not only customs officers, but also officers of either or both the stevedore and the transport company. In the absence of evidence the idea seems fanciful. There is no suggestion that any substitution could have taken place between the time when the container left Labrador's premises and when the ship arrived at Suva. Payment [122] It will be recalled that Labrador sent three containers to Coachwork on voyage 11 of the Capitaine Kermadec and that the new-style commercial invoices in respect of those three containers were referenced LW F3/6, LW F3/7 and LW F3/8. The first of these is Fiji shipment four, the second Fiji shipment five and the third the undisputed shipment of beer. Labrador received two payments into its account with the ANZ bank which the defendants submit were in satisfaction of those three invoices. They were: 7 December 1995 $ 46,912.00 11 December 1995 $110,977.00 $157,889.00 The first, which was recorded by Austrac, was telegraphically transmitted by Coachwork from Fiji. The second originated in a cash deposit made by an unknown person at the Mount Druitt (NSW) branch of the bank in the following denominations: $100 notes $ 30,400.00 $50 notes $ 80,550.00 $20 notes $ 20.00 Coins $ 7.00 $110,977.00 Austrac has no record of that amount being brought into Australia, which it would do had the money been lawfully brought to this country from overseas. The total of the amounts in the three new-style invoices was $157,889.00. [123] It is convenient to tabulate the payments which would have been due in accordance with the new-style invoices: -- 40 of 79 -- 41 Payment Date due Amount Amount Deposit F 3/6 30 November 1995 $16,403.73 Deposit F3/7 $14,486.53 Full price F3/8 1-7 December 1995 $13,928.00 Balance F3/6 By 30 December 1995 $61,709.27 Balance F3/7 $51,361.47 TOTAL $44,818.26 $113,070.74 Mr Wright did not in his evidence explicitly nominate a purpose for the payment of $46,912.00 made on 7 December. However it seems to be the defence position that it represented the deposits for F3/6 and F3/7 and the full price for F3/835 , together with an overpayment of $2,093.74. Mr Wright did not attempt any explanation for why Coachwork should have made such an overpayment, nor for why the balance should have been paid nearly 3 weeks early. [124] The old-style invoices for the same three containers all provided for payment in full upon receipt of the bill of lading. If one tabulates the payments due in accordance with them, a different picture appears: Payment Date due Amount Full price F3/6 1-7 December 199536 $16,432.00 Full price F3/7 1-7 December 1995 $16,552.00 Full price F3/8 1-7 December 1995 $13,928.00 TOTAL $46,912.00 That total is the precise amount of the first payment, the one remitted by Coachwork. The inference that the payment was intended in satisfaction of the three old-style invoices is overwhelming. [125] It is impossible to say who made the payment on 11 December ($110,977.00), but it could not have been Mr Richard Lal. He was in Australia from 18 November to 5 December 1995 and did not return until 10 February 1996.37 Whoever made the payment must have been aware of both the total amount due under the new-style invoices and of the “overpayment”, for the balance due under the new-style invoices was reduced by the amount of the latter. The payment was sinister and I am satisfied that Mr Wright was in some way connected to it. Conclusions regarding Fiji shipment four [126] My conclusions regarding this shipment are similar to those reached for earlier shipments. The old-style commercial invoice produced to Fiji Customs by CBI was typed in Brisbane on the instructions of Mr Wright by Mrs Lapré. It sets out the contents of the container IEAU 240762-1 sent by Labrador from Brisbane to Fiji. The container was packed by Mr Bryce at Labrador's premises before it was exported. The goods listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with that invoice was false and misleading. In Labrador's records the goods were taken 35 In accordance with the commercial invoice the price was payable in full upon receipt of the bill of lading. That must have occurred sometime in the period 1-7 December 1995. 36 See para [117]. 37 See documents Misc.0001.0158 and Misc.0001.0159. -- 41 of 79 -- 42 out of stock held under bond, and the only available inference is that they were delivered for home consumption. That inference accords with the plaintiff's averment to that effect. That process must have involved moving the goods while they were subject to customs control. I am satisfied of those conclusions beyond reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the six charges which he alleges in respect of the fourth shipment. Fiji shipment five [127] The fifth Fiji shipment took place in container number IEAU 247243-7. According to the plaintiff it contained 1,779 cases, being 80 cases of Black Imperial Scotch Whisky and 1,714 cases of beer of various types. According to the defendants it contained 1,211 cases of 12 different sorts of spirits. Labrador caused EDI to enter its contents for export on the latter basis. Its destination was Lautoka. The new-style invoices and packing list [128] Among Labrador's files seized by Customs was a new-style pro forma invoice referenced “LW F3/7”. Like its twin referred to above38 , it was typed by Mrs Wood. The goods listed in it were the same as those listed in LW F3/6 save that in place of the Chivas Regal Whisky and the Pipers Whisky it included 100 cases of White Heather Whisky and 100 cases of Teachers Whisky. The destination port was Lautoka instead of Fiji, but other terms were the same. It carried the same memorandum purporting to be signed by Mr Ram and had undergone the same faxing and refaxing. This signature too was forged. [129] Mrs Wood also typed a new-style commercial invoice and a packing list with the same reference. Again there were changes between the two invoices which are completely undocumented. The number of cases of Black Douglas Whisky was reduced by six and the number of cases of Black Imperial Whisky was increased by 30. The invoice total increased by over $2,000.00 to $65,848.00. The amount specified for the deposit was $14,486.53. The specified container was received for carriage on the Capitaine Kermadec on 30 November and a separate bill of lading was issued for it, specifying Lautoka as the destination. Again the shipping line was told that the container held “1200 PLUS” cases of beverages. [130] My conclusions set out above in relation to the other commercial invoice and packing list apply also to these documents. The old-style commercial invoice and delivery in Fiji [131] Mrs Lapré identified an old-style commercial invoice and an old-style packing list dated 24 November 1995 as typed by her. The amount of that invoice was $16,552.00 and it covered 80 cases of Black Imperial Scotch Whisky and 1,714 cases of six types of beer. Both it and the packing list cited the container number IEAU 247243-7. Together with the bill of lading, they must have been either sent by air to Coachwork or delivered to Mr Lal in Australia in early December. 38 Paragraph [111]. -- 42 of 79 -- 43 [132] The Capitaine Kermadec arrived at Suva about 8 December. Container IEAU 247243-7 was unloaded. It was subsequently taken by road to Reddy’s Bond Store at Lautoka, probably on 27 December. On 11 December Mr Rajendra Sharma of CBI signed an import entry for the goods in the container. He listed seven lines (80 cases of whisky and 1,714 cases of six lines of beer) – the goods set out in the old- style commercial invoice. I infer that he lodged the entry with Fiji Customs on that day, together with a copy of the old-style commercial invoice and the old-style packing list. On the following day the comparing officer endorsed a memorandum to CBI requiring an age certificate for the entry. CBI faxed that certificate the same day and the comparing officer then endorsed an instruction (to the examining officer), “Please verify quantity.” [133] The examination was carried out on 27 December by Mr Sanjay Raj, who was a warehousing officer at Lautoka. He had worked in Fiji Customs for almost a year, but this was one of his first examinations. He gave evidence that he was concerned to ensure that he did everything properly. He deposed that his first step in carrying out an examination was always to check that the seal was intact. Only once in his career had he found a broken seal, and that was not on this occasion. I accept the accuracy of that evidence and infer from it that the seal on container IEAU 247243- 7 was intact when checked by him. 39 Although the container was in Fiji for some 2½ weeks before it was inspected, there is no evidence that it was interfered with in any way. The container was emptied by workmen from the back of the truck which brought it to Lautoka and the contents were stacked according to the lines in the import entry. The quantity and type of goods accorded with the import entry and, therefore with the old-style commercial invoice. I have already described how Mr Reddy also counted goods taken into his store and kept a register of those goods.40 His count also accorded with the import entry. Payment [134] My findings regarding payment for this shipment are set out above.41 Conclusions regarding Fiji shipment five [135] Again, my conclusions regarding this shipment are similar to those reached for earlier shipments. The old-style commercial invoice produced to Fiji Customs by CBI was typed in Brisbane on the instructions of Mr Wright by Mrs Lapré. It sets out the contents of the container IEAU247243-7 sent by Labrador from Brisbane to Fiji. The container was packed by Mr Bryce at Labrador's premises before it was exported. The goods listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with that invoice was false and misleading. In Labrador's records the goods were taken out of stock held under bond and the only available inference is that they were delivered for home consumption. That inference accords with the plaintiff's averment to that effect. That process must have involved moving the goods while they were subject to Customs control. I am satisfied of those conclusions beyond 39 I have some difficulty accepting that he still positively remembered inspecting the seal when he gave his evidence, as he seemed to suggest was the position. It may be that he misunderstood the precise questions which he was being asked in that regard. In any event, I do not rely upon that evidence for my conclusion. 40 Paragraph [105]. 41 Paragraphs [122] to [125]. -- 43 of 79 -- 44 reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the six charges which he alleges in respect of the fifth shipment. Fiji shipment six [136] The sixth Fiji shipment took place in container number TPHU 615912-4. According to the plaintiff it contained 1,104 cases of beer and eight cases (less one bottle) of eight different types of spirits. According to the defendants it contained 728 cases of 17 different types of spirits. Mr Wright on behalf of Labrador caused EDI to enter its contents for export, and acquitted the goods out of Labrador's bond register, on the latter basis. The pre-contractual documentation [137] The first two documents relating to this shipment which were placed before the Court were letters from Labrador to Coachwork typed by Mrs Wood and dated 8 and 14 December 1995 respectively. They referred to a shipment to a client of Coachwork in Kiribati. The subject matter is innocuous enough: shipping arrangements and stock availability. By the time of the second letter Mr Wright had (he wrote) booked shipping space on the Highland Chief, scheduled to depart Brisbane on 10 January 1996. There are however some oddities about the first letter. It refers to a telephone discussion, but the “Attention:” line is blank after that word. It was signed by Mr Wright 42 , but the signature is completely different from his usual signature; the difference is unexplained. It was seized by Customs Officers from Labrador's premises in September 1996. In Mr Wright's evidence-in- chief there was no claim to have sent it to anyone: “Can I take you now to a shipment described as Fiji 6, in particular, FIJ6.0001.001?-- Yes. It makes reference in the heading to your client in Kirabati?-- Yes. Do you recall what preceded that?-- I remember Mr Lal and the PA Group were intending to expand their exports into the Pacific rim sovereign states and this was an order that they would place for a client in Kirabati. And the next document FIJ6.0001.002?-- Yes. Is that a letter that you sent to PA Lal?-- Yes. Do you recall who it was that you were dealing with in relation to this shipment?-- I believe it was Mr Lal.” There is no documentary record of the discussions referred to in the letters. [138] The sequence of events thereafter it is obscure. Although stock supply problems were said to have been substantially settled by the time of the second letter, it seems that no pro forma invoice was prepared until at least 2 January 1996, the date on such an invoice found in Labrador's records. That invoice was on old-style letterhead. Mr Wright's explanation for that unusual fact was, “I would assume that either Mrs Wood or Mrs Lapré at that particular time didn't have enough of the new- 42 Statement of agreed facts, para 327. -- 44 of 79 -- 45 style, so you used what they had available until new stocks were available.” I do not accept that explanation. Mrs Wood (the only typist who used new-style letterhead) had supplies of it on 14 December and 5 January. More importantly, neither Mrs Wood nor Mrs Lapré typed the document, which makes one wonder who did. That invoice envisaged shipment on the Highland Chief on 11 January, destination Tarawa in Kiribati. Payment was to be “a percentage deposit paid on shipment and the balance within 30 days from the date of Bill of Lading”. The invoice covered 728 cases of 17 different types of spirits. It was faxed to Coachwork by Labrador, but there is no evidence of when that was done. [139] If Labrador ever genuinely intended to send the shipment to Kiribati, it had abandoned that intention by 5 January. On that date it instructed EDI to prepare an entry for export of the same goods to Coachwork in Fiji. Mr Wright also instructed Mrs Wood to type a new-style commercial invoice and a new-style packing list for the goods, bearing that date. Mrs Wood did that. The invoice envisaged shipment on the Capitaine Kermadec (voyage 13) estimated to depart from Brisbane for Suva on 16 January. The container number and seal number were specified. [140] Mr Wright explained the changed destination by reference to a letter to Coachwork dated 8 January 1996. The letter suggested that that he had orally agreed with Coachwork not to ship the goods to Kiribati due to non-receipt by Coachwork of payment from its “client”.43 Mr Wright testified: “I remember an issue about letters of credit and the Kirabati client paying Lal or paying us via Lal. There was a whole rigmarole with bills of - letters of credit, et cetera, which I don't understand, and the bottom line was, ‘You sell to your client. We'll ship to you. We'll invoice you and you pay us and what you do with your client is your business.’” That suggests an unlikely level of commercial naivety on the part of Mr Wright. [141] There is another odd feature about this letter. Mr Wright wrote, “Due to the irregularity of shipping to Kiribati, we have cancelled the shipment scheduled for collection today and will advise alternative shipping dates in the near future.” The relevance of alternative shipping dates in the near future is obscure, for in the next sentence Mr Wright advised that the goods had been rebooked for shipment to Suva in eight days time. The words seemed to be pointless. [142] It is instructive to consider Labrador's position on 5 January if the correspondence and other documentation is genuine. In the three days since 2 January, Mr Wright and Mr Bryce between them had discussed Coachwork’s problem with payment by its client; had agreed to reroute the container to Suva; had cancelled space on the Highland Chief and booked it on the Capitaine Kermadec; had arranged for Mrs Wood to type the new-style commercial invoice and packing list with the container and seal numbers; and had arranged for EDI to lodge an entry for export. The facts that the commercial invoice and packing list could be typed and the instructions to EDI could be given suggest that packing was by then complete. The fact that a 43 Click on the link to see the letter: Kiribati letter -- 45 of 79 -- 46 commercial invoice could be typed suggests that the final price for the goods was known. [143] What makes all of that extraordinary is that by 5 January Labrador had received nothing in writing from Coachwork regarding this transaction – there is not even a note of a telephone conversation. Coachwork did not respond to the pro forma invoice until 11 January. It did so by refaxing the second page of the invoice upon which had been typed the additional words, “WE ACCEPT THE ABOVE OFFER”. Beneath those words was what purported to be the signature “R Singh”. I have already found that no such person as Ram Singh existed.44 Asked if he had ever spoken to Mr Singh, Mr Wright replied, “I don't think so and I can't be definite.” He did not explain how Labrador was able to pack the container and complete the documentation without having received an order or confirmation of the pro forma invoice from Coachwork. As counsel for the plaintiff pointed out in his final submissions, the letter of 14 December 1995 stated that the stock to be provided would be detailed on the pro forma invoice. [144] There was one significant difference between the pro forma invoice dated 2 January and the new-style commercial invoice dated 5 January. In the latter, terms of payment were said to be “as discussed: Aus. $8,905.00 paid per telegraphic transfer on shipment and the balance payable within thirty (30) days of the date of Bill of Lading.” Under the former, “a percentage deposit” was to be paid on shipment. $8,905.00 was 22.889089% of the invoice amount of $38,905.00. Mr Wright conceded that at no time did he discuss that percentage, but maintained that he “would have had a discussion” - he could not recall with whom. [145] The bill of lading for the shipment was issued on 18 January 1996, which was presumably the date upon which the goods were received for carriage by the ship or ship’s agent. It specifies the goods as “1 CONTAINER STC 725 PLUS CNTS BEVERAGES”. Again, no explanation has been offered for this uncommercial phraseology. The old-style commercial invoice and delivery in Fiji [146] On Mr Wright's instructions, Mrs Lapré typed an old-style commercial invoice and an old-style packing list for the goods in container TPHU 615912-4. They bore the container and seal numbers. They were dated 10 January and covered 1,104 cases of beer and eight cases (less one bottle) of eight different types of spirits. The invoice amount was $8,905.00. Payment was required by telegraphic transfer of the full amount owing on shipment. Later that month the documents were used to obtain import clearance from Fiji Customs. Mr Wright admitted that on 19 January he sent the bill of lading, a commercial invoice and a packing list to Coachwork by air. Contrary to his evidence I am satisfied that the invoice and packing list which he sent were these old-style documents. [147] The Capitaine Kermadec arrived in Suva on or about 23 January 1996. On 25 January Coachwork signed an importer’s declaration form and on or about the same day, CBI lodged it, an entry for import, the old-style commercial invoice and the old-style packing list with Fiji Customs. The entry was, of course, in respect of the goods in the old-style invoice, that is, 1,104 cases of beer and eight cases of spirits. 44 Paragraph [76]. -- 46 of 79 -- 47 As a result of technical deficiencies in the entry it was twice returned to CBI, on 26 and 27 January respectively. The deficiencies were corrected and on 29 January the comparing officer instructed that the container be examined to verify description, quantity and tariff classification. That examination took place on 2 February at Suncourt Bond store. It was conducted by Mr Patrick Mitchell, now a member of the British army but at that time an assistant customs officer in Fiji Customs, with about one year’s experience. It was Mr Mitchell's practice always to check the container number and the seal on any container he was examining. He did not find a broken or missing seal on a container during the eight years or so that he worked for Fiji Customs. Mr Mitchell had the container unloaded, counted the number of cartons, opened a sample of them to check the description against the entry document and noted the result of his examination: “Examination revealed that goods were correctly classified as entered. Qty of 1,112 cases found to be correct as entered.” His evidence was unchallenged in cross-examination. [148] Mr Mitchell conceded that he had virtually no recollection of the examination, and that his evidence was based upon looking at the documents. For the defendants it was submitted that his evidence did not amount to cogent proof of what was actually imported into Fiji. I disagree. The contemporary record embodied in the documents and verified by Mr Mitchell convincingly demonstrates the contrary. I accept Mr Hack's submission that one of the curiosities of the shipment was the odd collection of spirits in the container, sent at “sample” prices. Perhaps the spirits were indeed sent as samples. Whatever the explanation, the curiosity does not make me doubt the accuracy of Mr Mitchell's evidence. Payment [149] It will be recalled that under the new-style commercial invoice, terms of payment were $8,905.00 by telegraphic transfer on shipment (18 January) and the balance within 30 days of the date of bill of lading (that is, by 16 February). On the other hand, the old-style commercial invoice required payment of the full amount owing under the invoice, $8,905.00, on shipment. Coachwork made no payment on 18 January. On 2 February the Bank of Hawaii remitted that amount, via Commonwealth Bank of Australia, to Labrador's account with ANZ bank at Virginia. By the time it reached that account, $15.00 had been deducted for bank fees. There is no evidence of any attempt by Mr Wright to chase up the $8,905.00 between 18 January and 2 February, despite Labrador’s alleged cash flow difficulties, nor is there any evidence to explain, if that sum were truly a deposit, how it was calculated. However neither of those matters constitutes the most surprising aspect of the transaction, on the defendant's version of it. That description is attracted by the circumstances surrounding the payment of the alleged balance of $30,000.00. [150] At about 2.20 pm on 29 January an unidentified person deposited $30,000.00 in $100.00 notes in the Balmain branch of ANZ bank. The money was deposited for credit to Labrador's account at the Virginia branch of the bank, using a hand written (as opposed to preprinted) deposit slip. The person was not Mr Lal - he was not in Australia on that date - and there is no record of Coachwork’s sending such an amount into Australia. Unsurprisingly, Mr Wright was unable to explain why the balance would have been paid four days before the deposit; he had never heard of such a thing happening. He did not attempt to explain why such a balance would have been paid 18 days early and in cash. -- 47 of 79 -- 48 [151] I have no doubt that the payment of $8,905.00 was made to discharge the liability evident from the old-style commercial invoice. It is impossible to identify who made the deposit of $30,000.00, but it was someone who knew the details of Labrador's bank account, including the account number. Mr Wright was in some way involved in it. Conclusions regarding Fiji shipment six [152] My conclusions regarding this shipment are similar to those reached for earlier shipments. The old-style commercial invoice produced to Fiji Customs by CBI was typed in Brisbane on the instructions of Mr Wright by Mrs Lapré. It sets out the contents of the container TPHU 615912-4 sent by Labrador from Brisbane to Fiji. The container was packed by Mr Bryce at Labrador's premises before it was exported. The goods listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with that invoice was false and misleading. In Labrador's records the goods were taken out of stock held under bond and the only available inference is that they were delivered for home consumption. That inference accords with the plaintiff's averment to that effect. That process must have involved moving the goods while they were subject to Customs control. I am satisfied of those conclusions beyond reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the six charges which he alleges in respect of the sixth shipment. Fiji shipment seven [153] The seventh and last Fiji shipment took place in container number TRIU 252094-0. According to the plaintiff it contained 1,800 cases of beer and 67 cartons of cigarettes. According to the defendants it contained 1,185 cases of 12 different types of spirits, 200 cases of beer and 3,030 cartons of cigarettes. Mr Wright on behalf of Labrador caused EDI to enter its contents for export, and acquitted the goods out of Labrador's bond register, on the latter basis. At the beginning of the trial the plaintiff abandoned reliance upon the exportation of cigarettes to found the charges against the defendants. The documentation [154] The earliest document in Labrador’s files which related to the seventh shipment was a pro forma invoice on new-style letterhead dated 11 March 1996.45 The invoice was addressed to LTI 46 , attention Mr Ram Singh and signed by Mr Wright. It referenced “your order JN036” and opened by referring to “the above order per our telephone discussion”. It had been typed by Mrs Wood, faxed by Labrador and refaxed on 13 March by Coachwork. It covered 1,155 cases of 12 different types of spirits and 200 cases of Victoria Bitter beer in cans. The invoice amount was $76,205.00. It proposed shipment on the Capitaine Kermadec ETD Brisbane 23 March 1996, ETA Lautoka 8 April 1996. The terms of payment were: 45 Click on the link to see the invoice: Pro-forma invoice 11 Mar 96 46 See para [74]. -- 48 of 79 -- 49 “As discussed - percentage deposit paid on shipment (to be advised but no more than 30%) and the balance payable within 30 days from the date of Bill of Lading.” Another paragraph provided: “We are currently obtaining export prices for the cigarette brands you requested and will indicate a fixed price per 1,000 units soonest. However you should on-quote to your client no less than Aus $68.00 as indicated during our telephone conversation.” Beneath the signature appear the words “WE CONFIRM OUR ORDER AS PER YOUR QUOTATION” and beneath those words was what purported to be the signature of Ram Singh. [155] Under cross-examination Mr Wright could not remember to whom he had spoken regarding this order; he said he remembered the discussion “very vaguely”. He had received the order number by telephone; there was no written order. That is somewhat surprising having regard to the size, length and complexity of the order. I have already held that no such person as Ram Singh existed.47 The terms of payment are very odd. If the deposit was to be paid on shipment, it would have been necessary for the amount of the deposit to have been agreed some time prior to shipment. Mr Wright said that he would have put that amount in writing to Ram Singh. However he never did so. (The only document specifying the deposit was the subsequent commercial invoice and it was Mr Wright's practice to send that to Coachwork with the bill of lading.) Further, Mr Wright was unable to advance any commercially sensible explanation for why he did not specify the deposit in the pro forma invoice: “HIS HONOUR: What's the commercial logic of saying deposit - percentage deposit paid on shipment to be advised with no more than 30 per cent? Why don't you agree on a deposit at the time of these conversations?-- Why could I----- Why could you and whoever you were talking to-----?-- Yes. -----not agree on the deposit?-- Your Honour, I would think that I hadn't worked out my cash flow situation as to who I had to pay and how soon and, therefore, didn't know exactly how much I required. But why not just say 30 per cent?-- I don't know why I didn't, your Honour. Are you saying that your deposit was only ever fixed by reference to your cash flow needs?-- Generally, yes. Did you do any cash flow projections?-- I - we - I tried, yes. Do you still have those?-- I don't think so, your Honour. They were rough - rough workings. … Well, couldn't you have said something like 20 per cent or whatever you wanted of the above plus amount to be determined for the cigarettes?-- Yes, I could have, your Honour, but I didn't.” 47 Paragraph [76]. -- 49 of 79 -- 50 [156] Mrs Wood also typed a new-style commercial invoice dated 2 April 1996 in respect of this shipment (the shipping line had apparently delayed the sailing date of the voyage from 23 March to 6 April). Unlike all previous commercial invoices, it prefaced the list of goods with the words “We refer to the above order and confirm our shipment:”. No reason for this change of format was suggested. The words imply that, even if the container had not been loaded on board the vessel, the goods had at least been dispatched from the warehouse by the time the invoice was created. On the other hand they may represent only an insignificant flourish. [157] The invoice differed from the pro forma invoice in a number of respects: • the number of cases of Black Douglas Scotch whisky was reduced from 200 to 192 • the number of cases of Chautelle [sic] Napoleon brandy was increased from 25 to 30 and the price of each case was increased from $60 to $65 • the price of the 200 cases of Jim Beam bourbon was increased from $95 to $98 • 33 cases of Red Coat rum at $43 per case were added • 67 “shipping cases” of cigarettes of 11 different types were added • terms of payment and shipping dates were changed. The net effect of the changes to the spirits order was to increase the charge for liquor to $78,034.00. This was almost precisely five times the amount in the old- style invoice, to which I shall refer shortly. According to the defendants, the changes were documented in three letters sent to LTI by Mr Wright on behalf of Labrador on 18, 20 and 25 March 1996. The three letters were all typed by Mrs Wood and signed by Mr Wright. Each refers to “our telephone discussion” and is marked for the attention of Mr Ram Singh. In the first Mr Wright urged Mr Singh to consider adding 33 cases of Red Coat rum to his order. In the second Mr Wright expressed his thanks for “your favourable consideration of our special offer”. In the third Mr Wright confirmed Mr Singh's acceptance of the 33 cases of Red Coat rum and unilaterally notified Mr Singh of the other changes listed above. There is no evidence that LTI expressly accepted the notified changes, although it is implied that Mr Singh did so by the references to telephone discussions in the letters. The changes were comparatively minor. [158] The added cigarettes comprised the following: “18 shipping cases (720 ctns) Winfield Red 9 shipping cases (450 ctns) Benson & Hedges S/Filter 14 shipping cases (560 ctns) Winfield Extra Mild 1 shipping case (50 ctns) Camel K.S.F. 10 shipping cases (500 ctns) Benson & Hedges Extra Mild 2 shipping cases (100 ctns) Peter Stuyvesant K.S.F. 1 shipping case (50 ctns) Rothmans K.S.F. 9 shipping cases (450 ctns) Dunhill K.S.F. 1 shipping case (50 ctns) Camel Plain 1 shipping case (50 ctns) Dunhill Deluxe E/M 1 shipping case (50 ctns) Winston K.S.F. 67 shipping cases (3030 ctns) @ $68.00 per 1000 Subtotal (Cigarettes) Aus.$45,560.00” -- 50 of 79 -- 51 The circumstances surrounding the added cigarettes are more curious. First, the note on the pro forma invoice referred to “the cigarette brands you requested”. Labrador’s files contained no list of the brands requested, which is odd in the light of the fact that 11 different types of cigarettes were ultimately invoiced. Second, the files did not contain any evidence of price enquiries by Labrador, which is odd in the light of the assertion in the note “We are currently obtaining export prices” for those brands. Third, the note stated that Labrador would indicate a fixed price “soonest”. None of the three letters contained a price. In the letter dated 20 March, Mr Wright wrote, “We are still attempting to purchase the stock at a better price in order to reduce your costs but to date cannot confirm any reduction on the previously quoted figure.” However no figure had been previously quoted (the only figure mentioned was $68.00, that being the amount which Mr Wright said LTI should on-quote to its client.) In the letter of 25 March Mr Wright wrote, “Confirmation of brand name cigarettes and prices to follow shortly/soonest”. No such confirmation was ever written. [159] Mr Wright at first said that the reason no such confirmation was ever sent was “because we stuck to the original quote.” Confronted with the improbability of a contract under which a customer purchased over $45,000.00 worth of cigarettes without knowing what brands were being purchased or how many of each, he said he would have given that information to Mr Lal or Mr Singh on the phone. That seems quite inconsistent with the flavour of the correspondence. I gained the impression that it was an answer which he thought of on the run. I do not believe any such telephone conversation took place. [160] The other changes in the commercial invoice were to the ETD (now 10 April) and the ETA (now 16 April); and to the terms of payment. These were now as follows: “1. Cigarette payment in full (Aus.$45,560.00) prior to departure of container from warehouse. Insurance/Moisture damage STRICTLY the client’s responsibility 2. Deposit by telegraphic transfer o [sic] twenty (20) percent (Aus$15,606.80) of the balance of Aus.$78,034.00 on shipment (currently 10 April 1996) 3. Balance outstanding of Aus.$62,427.20 payable within thirty (30) days from date of Bill of Lading.” The old-style commercial invoice and packing list [161] On Mr Wright's instructions, Mrs Lapré typed an old-style commercial invoice and an old-style packing list for the goods in container TRIU 252094-0. The packing list bore the container and seal numbers. They were dated 3 April and covered 1,800 cases of beer and 67 cartons of cigarettes. The container had been packed the previous day.48 The invoice amount was $15,606.86. No terms of payment were specified, but the inclusion of Labrador's bank details implies that some form of direct deposit was envisaged.49 Later that month those documents were used to obtain import clearance from Fiji Customs. Mr Wright denied sending them to 48 See the receival advice signed on behalf of the ship's agent, document Fij7.0001.049. 49 Click on the link to see the invoice: Old-style invoice 3 Apr 96 -- 51 of 79 -- 52 Coachwork, but I reject his evidence. In accordance with his usual practice he probably sent them by air, together with the bill of lading, shortly after the latter issued on 11 April. [162] At this point it is convenient to draw attention to an ambiguity in the unit of measure adopted for the cigarettes in the old-style commercial invoice and the old- style packing list. Both documents used the abbreviation “crts” to refer to cartons. However “carton” was a term of indefinite denotation in this trade. That arose from the way in which cigarettes were packaged. To take the size used in the present case as an example, individual cigarettes (or “sticks”) were packed in boxes of 20. Ten such boxes, containing 200 cigarettes, were packed together into what was variously described as a “brick”, a “sleeve” or a “gross carton”. From 40 to 50 (depending upon the brand) of these were boxed in what was described as a “shipping case” or “shipping carton”. Thus, depending upon the context, “carton” could refer to a package containing 200 cigarettes or one containing 8,000 to 10,000 cigarettes. [163] In the new-style commercial invoice great care was taken to draw this distinction.50 No such care was taken in the old-style invoice, but it is apparent from the price per carton that the term must refer to a gross carton, not a shipping case. 67 such cartons would easily fit into two shipping cases. Payment [164] On the defendant's case the new-style commercial invoice was satisfied by three payments made into Labrador's bank account. The first in time was an amount of $45,560.00 deposited at the Mona Vale, NSW branch of the ANZ bank on 2 April. According to the deposit slip the deposit was made by “Geoff Bryce”. Mr Wright denied the signature was that of the latter (curiously, Mr Bryce does not seem to have been asked about it) and I have no basis for doubting the denial. On the butt of the deposit slip Labrador's telephone number was written. It is impossible to determine the identity of the person who made the deposit. The amount deposited was in cash, mainly $100 and $50 notes. On the defendant's case it represented the amount owing for the cigarettes under the new-style invoice. If so, it was due before the container left Labrador's premises on 2 April. If the commercial invoice is genuine, the defendants must have had a very busy day. [165] The absence of any documentation informing LTI of the amount owing between 25 March and 2 April is therefore important. It shows that Mr Wright's original response to the question why no confirmation of price was sent was inadequate for a second reason: if LTI did not know the amount owing for the cigarettes it could not have made that payment. Had he been asked, Mr Wright would no doubt have said that he told Mr Lal or Mr Singh not only the types and quantities of cigarettes but also their prices in the alleged telephone conversation. I have rejected his evidence of that conversation.51 It follows that the amount deposited could not have been payment for the cigarettes. That conclusion is reinforced by the inherent improbability of the method of payment attributed to LTI. [166] The second payment was an amount of $15,606.86 sent by Coachwork to Labrador by telegraphic transfer on 2 May 1996. $15,596.86 was credited to Labrador's 50 See para [158]. 51 Paragraph [159]. -- 52 of 79 -- 53 account the same day. According to the defendants that amount represented the deposit payable under the new-style commercial invoice. According to that document the deposit was payable on (the date of) shipment, a date which Mr Wright seems to have taken to be the date of departure of the ship from the port of loading.52 That was 11 April. According to the defendants the explanation for the delay is to be found in a document seized by Customs from Labrador in September 1996. That document was a fax from LTI to Labrador dated 15 April and apparently signed by Ram Singh requesting “an extension of time to pay the deposit of $15,606.86 which is due”. Mr Wright said that he granted the extension because Labrador had no real choice. [167] On the plaintiff's case this payment represented satisfaction in full of the old-style commercial invoice dated 3 April. As noted above, it would have been received by Coachwork shortly after 11 April. No set time for payment was provided. More significantly, the amount of the old-style invoice, $15,606.86, was the precise amount remitted by LTI. The amount of the deposit as specified in the new-style commercial invoice was $15,606.80. One can imagine that an odd number of cents might be rounded to the nearest 10 cents. It seems most improbable that an amount ending in 80 cents would be rounded or otherwise adjusted to 86 cents. I am satisfied that the payment was made in discharge of the old-style invoice. The facsimile from the non-existent Ram Singh was spurious. [168] The third payment was an amount of $62,427.20 deposited in to Labrador's account at the Brookvale, NSW branch of the ANZ bank on 8 May 1996. Whoever made the payment knew Labrador's address, telephone number and bank account details. Again this was a cash deposit, primarily comprising $100 and $50 notes. The identity of the person who made the deposit is unknown; the signature on the deposit slip is indecipherable. Austrac has no record of the money having been brought into the country. On the defendant's case this payment represented the balance owing under the new-style commercial invoice. According to that document the balance was payable on 11 May. Mr Wright offered no explanation for why LTI or Coachwork should have telegraphically transferred over $15,000.00 on 2 May but adopted this odd method of payment on 11 May. [169] I am satisfied that the first and third payments were made with the connivance of Mr Wright. The new-style commercial invoice and packing list were spurious documents designed to explain those payments. Preparation for delivery in Fiji [170] By early 1996 Labrador's activities had aroused suspicions in Customs. When it was realised in early April that a further consignment was imminent, a request was sent to Mr Dean, the Principal Collector (Enforcement Audit and Compliance) for Fiji Customs to examine container TRIU 252094-0 when it arrived and to compare the quantities said to have been exported with those which arrived in Fiji. As a result Mr Dean telephoned Mr Naiker (the Collector at Lautoka, the port of arrival) and requested that he ensure that the container was subjected to a full examination. He also spoke to Mr Vosa, the senior examination officer at Lautoka and told him that it was important that he check this container thoroughly. This was unusual. Mr Vosa deposed, “Knowing that a very senior customs officer was interested in the 52 See p 3 of the new-style commercial invoice, document Fij7.0001.008. -- 53 of 79 -- 54 examination and its results, I was concerned to ensure that my examination was thorough and in accordance with the procedures of the Fiji Islands Customs Service.” [171] The container was received for carriage on the Capitaine Kermadec at Brisbane on or about 11 April. According to the bill of lading it was said to contain “67 CIGARETTES 1450 PLUS SPIRITUOUS BEVERAGES”. The ship must have sailed on that or the following day. While it was in transit CBI, on Coachwork's instructions, prepared the import documentation required for the consignment. I infer that it did so on the basis of the old-style commercial invoice, the old-style packing list and the bill of lading provided to it by Coachwork. Mr Davendra Sharma in Suva instructed his Lautoka office to do the work. Pursuant to that instruction Momlesh prepared two entries: a warehousing entry in respect of the liquor and an entry for home consumption for the cigarettes. The liquor in the warehousing entry was that shown in the old-style commercial invoice. In the entry for home consumption he described the goods simply as cigarettes and stated the number of packages to be “PART FCL STC 67 CRTS”. As his workings on the old- style invoice show, he calculated the weight of the cigarettes to be 20.1 kg, based on 300 g per gross carton. The entries were signed by Mr Rajenda Sharma and lodged with Fiji Customs on 17 April, together with a copy of the old-style commercial invoice and packing list. [172] The entries came before Mr Naiker. He was dissatisfied with having been provided only a copy of the invoice. He endorsed the warehousing entry to require CBI to submit the original invoice and evidence of payment, order sheet and sales confirmation. Both entries were returned to CBI and resubmitted two days later, possibly accompanied by clean copies of the entries. Rajenda Sharma had noted on the warehousing entry that according to the importer the copy was the only original invoice it had; and the account was to be paid after 30 days. That satisfied Mr Naiker who then endorsed a memorandum to the comparing officer and the senior examining officer (Mr Vosa) on a copy of the warehousing entry: “Please accept entry subject to 100% examination for quantity, description, value and weight. (Refer to me before release.)”53 He wrote the word “Examine” on the front of that copy and also on the front of a copy of the entry for home consumption. So endorsed, the entries were passed to Mr Vosa. [173] The Capitaine Kermadec reached Lautoka on Thursday 18 April 1996. In due course the container was unloaded and on 22 April it was taken to Reddy's bond store in accordance with the instruction on the warehousing entry. Two officers of Fiji Customs were present at that store on that day. Mr Vosa attended as examining officer to carry out the instructions given to him. Ms Drauna attended as warehousing officer. Her task was to check the bonded goods into the warehouse for the purposes of the customs bond register. Mr Reddy attended on behalf of his company. I have already described the system which operated at the warehouse.54 The container was unpacked outside the warehouse. Mr Vosa deposed that he checked the container number and the seal number and verified that the seal was intact. Ms Drauna testified that she specifically remembered seeing the seal opened. Mr Reddy testified that Customs officers always checked the seal on a container. 53 Abbreviations expanded. 54 Paragraph [105]. -- 54 of 79 -- 55 Delivery of liquor pursuant to the entry for warehousing [174] In his affidavit Mr Vosa described what happened when the container was opened: “I recall that all the goods in the container wrapped in black shrink wrap plastic [sic]. This had to be removed so that I could check the goods. The goods were taken out of the container by the labourers hired for that purpose by the importer. I instructed them to pack the goods in such a fashion that would allow them to be counted and checked against the entry documents. This involved each type of goods to be stacked separately so that I could check that what was described in a particular line of the entry document could be checked and counted without any confusion as to other lines of entry. I cannot now recall whether they were packed in stacks of 100 or 200, but there would not have been more than 200 cartons in a particular stack. I opened about 20 to 30 percent of the cartons to check the contents matched the description on the entry document itself and other supporting documents such as the commercial invoice.” He testified that he subsequently told Mr Dean about the plastic wrapping. Following his examination he filled in a cargo examination report. In that report he recorded, “Nil errors found.” In cross-examination he conceded that if the registers kept by Mr Reddy and Ms Drauna showed only 791 cases of Fosters beer and 895 cases of Victoria Bitter beer, it may suggest that he made a mistake in his count. He could not explain such a shortage: he had counted every case. Recalled a day later, he testified in further cross-examination that the only possible way a discrepancy could have arisen between the counts would be if he counted the beer by pallets, multiplying the number of cases in each dimension to determine the number on the pallet. When the goods were moved inside they were not supposed to be palletised, but were broken up and stacked differently. [175] Like Mr Vosa, Ms Drauna did not remember any other Customs officer being present when she did her count. That is odd, but it was not suggested that either officer was not there on 22 April 1996. It seems that after the container was opened Ms Drauna went into the warehouse and did her checking from there. The quantities of beer received into the warehouse were those specified above. Mr Reddy also checked what entered the warehouse and his count agreed with hers. Ms Drauna did not supervise the devanning of the container and was unsure whether any cartons could have been taken without her knowledge. On the other hand Mr Vosa thought it was not possible for any cartons to have been misappropriated from outside the warehouse. In cross-examination Ms Drauna gave this description of what happened on the day: “Can you describe the unloading process, please?-- The goods inside the container is palletised and it's been wrapped in plastics; so they take out the palletised cargo outside, just in front of the door, and then they disband it and then they bring the loose cargo inside.” Mr Reddy was not asked to describe the condition of the goods inside the container. [176] On behalf of the defendants Mr Hack submitted that there were many reasons to doubt the veracity of Mr Vosa's evidence. He relied upon three: first that Mr Vosa invented the detail that all of the goods were wrapped in black plastic; second that Mr Vosa altered his evidence overnight; and third that Mr Vosa’s description of the -- 55 of 79 -- 56 unloading and counting of the goods was diametrically opposed to that of Ms Drauna. [177] The first submission was based on an inconsistency between the evidence of Mr Vosa and that of Mr Dean. Mr Vosa said that he told Mr Dean about the plastic wrapping. Mr Dean was referred to a facsimile message which he had sent to Customs containing the sentence, “Your information of using dark plastic on pelletised [sic] cargo did not eventuate.” He agreed that this information was provided to him by Mr Vosa. Mr Hack suggested that Mr Vosa was induced to fabricate his evidence by being shown the message from Customs to which Mr Dean was replying. The former message, on which someone (not Mr Dean) has written “ATT: LORIMA”, raised the possibility that Labrador “shrink wrap their pallets with black plastic making it difficult to determine what the goods are.” Mr Vosa denied having ever seen the document and denied reading the information contained in it before compiling his affidavit. [178] On behalf of the defendants Mr Wright gave evidence that Labrador did not use pallets or plastic wrapping when packing a full container (FCL). It did do so when packing less than a container load (LCL). The inference relied on by the defendants was that, since this consignment was FCL, no pallets or plastic were used. Of course, as Mr Wright did not have responsibility for packing, he could not have testified directly about the state of the particular consignment. Mr Bryce, who might have been able to do so, was not asked about it. [179] In summary, the evidence in support of the proposition that the goods in this consignment were not on pallets, nor wrapped in plastic, was that of Mr Wright and Mr Dean. That against the proposition was that of Mr Vosa and Ms Drauna. Witnesses who might have assisted, but were not asked, were Mr Bryce and Mr Reddy. On balance I prefer the evidence of Mr Vosa and Ms Drauna. Theirs is direct evidence. Mr Dean's evidence of a previous inconsistent statement by Mr Vosa is hampered by the possibility of a misunderstanding. Ms Drauna's evidence was not challenged in cross examination. Whatever Mr Vosa's position, she had no evident motive to fabricate her evidence. I take into account the fact that each of the entries was “part FCL”: some of the goods in the container were destined for warehousing and others for home consumption, thus giving rise to the possibility that the procedure used for LCL consignments was adopted in this case. I reject the submission that this evidence impugned Mr Vosa's veracity. [180] There is more force in Mr Hack's second point. On the first day of his evidence, Mr Vosa testified that he had counted each individual case. On the second day he testified that he had counted by pallets, by multiplying the cartons in each dimension. This change came about because late in his evidence on the first day, he was confronted with the registers compiled by Ms Drauna and Mr Reddy. He was asked to explain the discrepancy. Caught unawares he could not do so. There were only two possibilities: either he had counted incorrectly or goods had been misappropriated after his count and before being taken into the store. He thought the latter an impossibility. His explanation that he had counted the goods by pallets was really an admission against interest, since it demonstrated a non-compliance with the instruction which he had been given. It was probably the truth. That means that his original assertion that he had counted individual cartons was incorrect. The assertion was an exaggeration calculated to protect his apparent reliability as a customs officer. It has led me to consider his evidence carefully on -- 56 of 79 -- 57 controversial matters before accepting it. It does not cause me to doubt his veracity in general. [181] The inconsistencies between Mr Vosa's evidence and that of Ms Drauna are in my judgment trivial and are easily explained on the basis that in each case one or other of them was not really in a position to observe in detail. Mr Vosa thought that the goods were taken into the warehouse on pallets by forklift. Ms Drauna said that the pallets were unloaded outside the front door of the warehouse and that the goods were carried inside on trolleys. Mr Vosa said that the forklifts drove into the container, which was on the ground. It was put to Ms Drauna that the forklifts would not reach the back of the container. Initially she responded to that proposition, “They would be dragging it to the front and then the forklift would lift the container down on to the-----.” That response seemed to imply acceptance, but shortly afterward, asked to describe the unloading process, she said that dragging would happen if the forklift could not go into the container. That is consistent with her evidence that she did not have the process under continuous observation or consideration. In my judgment nothing turns on these inconsistencies. [182] In any event, it is difficult to see where an attack on Mr Vosa's veracity takes the defendants. All of the witnesses who checked the contents of the container agreed that they consisted of beer and cigarettes, not predominantly spirits as, on the defendant's case, they should have done. At best for the defendants, the attack could cast doubt on Mr Vosa’s evidence that he remembered inspecting the seal and finding it intact. Such a doubt would assist the defendant's case, but only marginally. I need not analyse that assistance further, however, for I have no such doubt. Mr Vosa's evidence about the seal is corroborated by that of Ms Drauna and Mr Reddy.55 I accept it. There is no evidence that the container was tampered with between the time the seal was applied in Brisbane and the time its contents were inspected in Fiji. Delivery of cigarettes pursuant to the entry for home consumption [183] When the cigarettes were removed from the container, they were initially stacked outside the warehouse. Subsequently they were removed from the premises. Before that happened Mr Vosa counted the number of packages. He found 67, in accordance with the number specified in the documents given to him. The following day he reported that he found 67 gross cartons. However when he came to make his affidavit, he formed the view that his report had been incorrect. He did so because he had a positive memory of cigarettes packed at the back of the container, in one or two rows of cartons. Each row extended almost to the full width and height of the container. The cartons of cigarettes which he saw were not gross cartons, but were much larger. That evidence was corroborated by the evidence of Mr Reddy. [184] That Mr Vosa in his affidavit acknowledged his earlier error reflects well upon his honesty. In making that acknowledgement Mr Vosa recognised that there were plenty of signs available to him at the time of his examination which ought to have alerted him to an error. The cartons which he saw must (assuming they were full of cigarettes) have weighed more than the 20.1 kg stated in the entry; and on the same assumption, they must have been worth much more than the $4.58 shown on the 55 Paragraph [173]. -- 57 of 79 -- 58 old-style commercial invoice. To explain his error he deposed, “I can only think that I was concentrating on the number of cartons and did not think to check these other matters.” This seems likely, and Mr Vosa confirmed it in his cross- examination. The entry for the cigarettes simply had the word “Examine” written on its face, in marked contrast to the detailed instruction in respect of the liquor given on the entry for warehousing. I am satisfied that in relation to the cigarettes Mr Vosa checked only the number of cartons; he did not check the description, the value or the weight of the goods. [185] What was in the 67 cartons which Mr Vosa saw? Mr Vosa estimated that if filled with cigarettes, each shipping carton of the size which he saw would have contained 10 gross cartons. 56 That makes a total consignment of 670 gross cartons. That is far more than the 67 on the old-style commercial invoice; but it is also far less than the 3,030 on the new-style commercial invoice. [186] For the defendants Mr Hack submitted that it was not necessary to reach a concluded view on the quantity of cigarettes in the container. On any view, he submitted, it was far more than appeared on the old-style commercial invoice. That was consistent with the defendant's case that it was Coachwork which was seeking to delude Fiji Customs and that the old-style invoice was forged in Fiji. Second, it also deprived the plaintiff's argument about the relationship between the telegraphic transfer of $15,606.86 sent by Coachwork and the amount shown in the old-style commercial invoice of any force. If in reality Labrador had sent significantly more than 67 gross cartons the invoice could not be a genuine recording of the transaction and payment of that sum was no more than an attempt to create a paper trail. [187] I do not accept these submissions. Even assuming the shipping cartons were full of cigarettes, they would have contained about 20% of the quantity which the defendants claim was shipped. To perpetrate a fraud it would have been necessary for Coachwork to have gained access to the container while it remained under customs control, opened it (relying upon the carelessness of the subsequent examination to prevent observation of the breaking of the seal), and substituted 67 smaller shipping cartons containing about 670 gross cartons for 67 much larger cartons containing 3,030 gross cartons. There would remain a severe disconformity between the substituted cargo and the forged commercial invoice, which a careful examination would easily discover. Such a scheme makes no sense and would be fraught with risk. The second submission can be valid only if Labrador did indeed send 3,030 gross cartons (no one suggests it sent 670). It therefore depends upon the correctness of the first submission. [188] More fundamentally, both submissions depend upon the assumption that the cartons seen by Mr Vosa were full of cigarettes. There is no evidence of this. It is quite possible, even likely, that (say) seven of them contained a total of 67 gross cartons of cigarettes and that the others contained ballast. It would not be surprising if cartons of ballast had been used to “pack-out” the contents to a full container load; and that they were packed at one end of the container. In my judgment, while it is not possible to determine with certainty how many cigarettes were contained in the consignment, it was certainly nothing like 3,030 gross cartons. 56 From the dimensions which he gave I calculate eight gross cartons per shipping carton; but nothing turns on the difference. -- 58 of 79 -- 59 Conclusions regarding Fiji shipment seven [189] My conclusions regarding this shipment are again similar to those reached for earlier shipments. The old-style commercial invoice produced to Fiji Customs by CBI was typed in Brisbane on the instructions of Mr Wright by Mrs Lapré. It sets out the contents of the container TRIU 252094-0 sent by Labrador from Brisbane to Fiji. The container was packed by Mr Bryce at Labrador's premises before it was exported. The goods listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with that invoice was false and misleading. In Labrador's records the goods were taken out of stock held under bond and the only available inference is that they were delivered for home consumption. That inference accords with the plaintiff's averment to that effect. That process must have involved moving the goods while they were subject to Customs control. I am satisfied of those conclusions beyond reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the six charges which he alleges in respect of the seventh shipment. Honiara shipment [190] The Honiara shipment took place in container number TPHU 824197-2. According to the plaintiff it contained 1,000 cases of beer, 360 cases of whisky and 136 gross cartons of cigarettes. According to the defendants it contained beer and whisky as alleged by the plaintiff and 136.5 shipping cartons, containing 6,445 gross cartons, of cigarettes. Mr Wright on behalf of Labrador caused EDI to enter its contents for export, and acquitted the goods out of Labrador's bond register, on the latter basis. [191] The earliest-dated documents in Labrador's files when they were seized by Customs in September 1996 were the letter on new-style letterhead dated 3 May 1996 and the letter on old-style letterhead “To whom it may concern”, dated 7 May, to which I have referred earlier. My findings in relation to the latter document are set out above.57 The new-style commercial invoice and packing list and other documents [192] It is common ground that on 8 May 1996 Mr Michael Quan on behalf of QQQ faxed an order to Labrador for “1 FCL assorted products” comprising the beer and whisky referred to above “plus various cigarettes available as discussed by phone”. As to payment, the order specified “Documents to be sent to our bankers National Bank of Solomon Islands for payment ten (10) days after arrival of vessel.” Confirmation by return fax was requested. [193] Labrador's records contained, but those of QQQ did not, a letter purporting to have been faxed to QQQ, dated 8 May and signed by Mr Wright. It referred to the order and advised that Labrador would attempt to ship “per your verbal request on the Highland Chief (V84)”. It confirmed prices in accordance with the order and noted that cigarette prices would be $68.00 per thousand units. It concluded, “Confirmation of quantity will be advised per telephone as soon as possible.” It is unnecessary to determine if this document is genuine; but it seems unlikely. 57 Paragraph [25]. -- 59 of 79 -- 60 [194] The next documents (by date) in Labrador's records (but missing from those of QQQ) are a new-style commercial invoice and a new-style packing list. They were typed by Mrs Wood and dated 8 May 1996. The invoice58 has a number of features worth noting: • it was addressed to QQQ’s post office box number, not to its facsimile number • it included seven lines of cigarettes for an invoice price of $92,820.00 and carefully distinguished between 136.5 (shipping) cases and 6,445 (gross) cartons • it added $2,868.28 for “Freight (per our detailed quote)” • it specified the vessel, the container number and one seal number (22269248) but the estimated times of departure and arrival were left blank • payment terms were unusual. The payment terms were: “Part payment (as agreed) of seventy four per cent (74%) total $91,170.00 paid directly into our account in Australia prior to sailing of vessel on supply of proof of container departing warehouse. Balance in full and final settlement ten (10) days after arrival of vessel in Honiara via the National Bank of Solomon Islands.” [195] It was originally common ground that the container was packed on or about 10 May. 59 When Mr Bryce gave evidence he asserted a belief that packing took place on 17 May. At first he claimed not to recall the basis for this belief. Then he asserted that certain stock had not arrived until the day before the container was packed. He also claimed that there was a problem with the container and that the shipping company delayed sailing. Mr Bryce's belief does not accord with the documentary evidence. First, according to Labrador's bond registers, the beer and the whisky in the container (and for that matter the cigarettes which Labrador claimed were also in the container) were acquitted on 10 May. Second, the Export Receival Advice (a document created by Mr Leggett of EDI on behalf of Labrador to be given to the driver taking the container to a storage depot on the wharf60 ) specified 10 May as the date the container was packed. Third, the bill of lading was issued on 15 May when, as the bill records, the container was received for carriage by the ship or ship's agent. I am satisfied that packing did not take place on 17 May. [196] It is an agreed fact that on or about 8 May 1996 Mr Wright on behalf of Labrador instructed EDI to prepare an entry for export in respect of the goods to be exported to Honiara.61 He gave this instruction by sending Mr John Leggett by facsimile a handwritten list of the goods to be included in the entry. Two versions of this document (or at least of the first page of it) were seized by Customs from EDI in September 1996.62 It is apparent from the handwritten alterations on the second version that it is a later transmission of the first. The first version consisted only of page 1 of the facsimile message. It specified the vessel and voyage number and one 58 Click on the link to view it: Commercial invoice 8 May 1996 59 Statement of agreed facts, para 404. 60 Mr Bryce recognised Mr Leggett's handwriting; see also statement of agreed facts, para 65. 61 Statement of agreed facts, para 401. 62 Documents Hon1.0001.051 and Hon1.0001.001. -- 60 of 79 -- 61 seal number (22269248). It listed the beer and the whisky; then it listed “17 ▄ Dunhill King Size Filter Cigarettes $11,560”. It is impossible to read what was originally written underneath the blacking out. After that there is an entry for “Winfield Red Cigarettes”, but the quantity and value are not stated (someone has inserted question marks). [197] The second version specified an additional seal number. As well as the beer and the whisky, it listed the seven lines of cigarettes set out in the commercial invoice. At the left of each line was a numeral representing the quantity of goods and at the right a dollar value for the goods. In the case of the cigarettes the numeral was unaccompanied by a unit of measure. This was in stark contrast to the liquor where the unit was specified as “cases”. Having regard also to the blacking out of the unit of measure of Dunhill cigarettes, the omission appears deliberate. There has been considerable crossing out and substitution of the quantities. Mr Wright said that he made those crossings out and substitutions “based on what had come in”. The appearance of the document is consistent with its having been amended from time to time after its initial creation and I accept Mr Wright's evidence on that point. According to Labrador's bond registers, the last of the cigarettes arrived on 10 May, so that is the earliest date when quantities could have been finalised. Not until then was Mr Wright in a position finally to nominate the goods to be included in the entry for export. [198] However there is reason to think that Mr Wright probably did not send the second version, and that EDI did not lodge the entry for export, until 13 May. It is common ground that prior to the container’s leaving Labrador's premises, two seals (nos 22269248 and 005996) were attached to it.63 One of the alterations which Mr Wright made to the list was the addition of the second seal number (005996). Mr Wright testified that this seal was couriered to Labrador’s premises on 13 May and on this point I accept his evidence.64 It is unlikely that this alteration could have been made before that date. Mr Wright probably sent the facsimile on that day. (The container was also transported from Labrador's premises on that date,65 and the bill of lading was issued on 15 May, so it is unlikely to have been later than 13 May.) I am conscious that this involves an elastic reading of the agreed facts that the instruction was given on or about 8 May and that EDI lodged the entry for export with Customs on or about 11 May.66 However I make the findings in reliance upon the words “or about” in the agreed facts, and make them more readily because they are findings which favour the defendants.67 [199] The new-style commercial invoice and packing list were probably prepared on 11 or 12 May. They could not have been prepared until the quantities intended to be included in the entry for export were finalised, and some of the goods listed did not arrive in Labrador's store until 10 May. Because the documents refer only to one 63 Statement of agreed facts, para 405. For the moment, I leave open the questions whether the period during which the first seal was attached overlapped the period during which the second was attached; and whether the first was still attached at the time the container left Labrador's premises. 64 See the invoice from EDI, document Hon1.0001.031. 65 Ibid. 66 Statement of agreed facts, para 402. 67 See para [238]. If the agreed dates are precisely correct, the evidence of Mr Wright, Mr Bryce and Mr Stonehouse regarding the presence of Customs officers King and Holiday must be fabricated, as the earliest date on which those officers were present at Labrador's premises after 8 May was 13 May. -- 61 of 79 -- 62 seal (22269248), they were prepared before the delivery of the second seal on 13 May. It is unclear why they should have been backdated. [200] Under the prevailing system, a Customs broker lodged an entry for export by entering details of the export transaction directly into a computer maintained by Customs. The information required to be entered included the seal number on the container. The computer automatically allocated an export clearance number to the transaction and the details, including that number, could be printed out. The printout of the Honiara shipment shows that the only seal number entered by EDI was 005996. When the container arrived at Honiara, that was the only seal on it.68 No witness from EDI gave evidence; but the fact that only the later seal number was entered notwithstanding the initial provision of the earlier one to EDI suggests that EDI was aware of the change of seal. That in turn suggests that the change occurred before the container left Labrador's premises. Neither Mr Wright nor Mr Bryce gave evidence of exactly what happened to bring about that change. It is not possible to reach any conclusion as to whether the container was unlocked at the time the seals were changed. The old-style commercial invoice and packing list [201] Mr Michael Quan, the director of QQQ who placed the order for the Honiara shipment, died in 2003. Evidence about the affairs of QQQ was given by his brother and co-director, Lawrence. He examined certain business records of QQQ relating to its transaction with Labrador. They included an old-style commercial invoice and an old-style packing list. The typist who produced these documents was neither Mrs Wood nor Mrs Lapré, but by this time Labrador had its own computer. 69 The old- style invoice, like the new-style invoice, was dated 8 May 1996 and addressed to QQQ 's post office box number, not its facsimile number. It covered the same lines of beer and whisky as the new-style invoice and referred to the same vessel and container number. There were, however, some important differences between the two invoices. The old-style invoice specified the numbers of both of the seals on the container. The line of cigarettes was stated: “136 cnt. ROTHMANS King Size Filter 1,849.60 @ $ 68.00 per 1000”. Payment terms were, “Settlement ten (10) days after arrival of vessel in Honiara, direct to our bank via the National Bank of Solomon Islands.” No additional amount was charged for freight or handling, but prices were specified to be “CnF Solomon Islands in Australian dollars”. QQQ kept this invoice in its records; it did not lodge it with Solomon Islands Customs. [202] It is difficult to understand how or why this invoice was created unless it was created by Mr Wright. Mr Michael Quan had no reason to create it; it was not needed for Solomon Islands Customs. Moreover it would constitute a remarkable coincidence that he should have created a false invoice using the same superseded letterhead as was used (on the defendant's version) by an unconnected person in Fiji to create other false invoices. 68 Paragraph [231]. 69 See para [14]. -- 62 of 79 -- 63 QQQ's market and the nature of its business [203] On the plaintiff's case, 136 sleeves (gross cartons) was a quantity which QQQ might have hoped to have sold in the Solomon Islands; 136 shipping cases was not. To support that case the plaintiff led evidence from Lawrence Quan to the effect that there was no market in the Solomon Islands for the quantities of the brands specified in the new-style commercial invoice. The defendants did not challenged that evidence and I have no hesitation in accepting it. Plainly QQQ would not have imported 136 shipping cases for the domestic market. [204] The defendants advanced a different hypothesis. They suggested that Michael Quan might have been importing the cigarettes for re-export to Australia. In support of that hypothesis they called evidence from Mr Graeme Stonehouse. In 1995 Mr Stonehouse operated a company which was a licensed cigarette wholesaler in Queensland. During that year his company purchased 2,000 to 3,000 shipping cases of cigarettes from QQQ in 10 to 15 shipments. He dealt with Michael Quan. Mr Stonehouse explained (and Mr Lawrence Quan confirmed in general terms) that at that time cigarette manufacturers such as Rothmans charged Australian wholesalers approximately $55.00 per thousand cigarettes, but charged wholesalers in the Solomon Islands (and other developing nations) only $20.00 per thousand cigarettes. It was therefore economically feasible for Mr Stonehouse to buy his cigarettes from QQQ rather than from the manufacturer. On that basis, Mr Hack submitted that QQQ, through Mr Michael Quan, might have purchased the cigarettes for re-export to Australia. [205] There are three difficulties with that theory which in my judgment are sufficient to dispose of it. First, the scheme would be economically feasible only if QQQ were buying from the cigarette manufacturer. It could not work with cigarettes initially purchased in Australia at the price charged by the manufacturer to Australian wholesalers. That was all the more true in the present case, given that Labrador purchased not from the manufacturers but from other dealers. Second, there is no evidence that QQQ continued this business after 1995. If it did so, it was not through Mr Stonehouse. The business which he conducted slowed at the end of 1995 or in early 1996, to the extent that he went to Honiara “to try and resurrect [it]”. He was unsuccessful and in early 1996 his business ceased trading in imported cigarettes. There seems no reason why QQQ should not have continued to deal with him if it were still re-exporting to Australia. The explanation may be that, as Mr Lawrence Quan suggested in his evidence, Rothmans limited the quantities which it would sell to the Solomon Islands because it had a policy of not overloading the market and not allowing stock to remain for too long on shelves. Third, Mr Lawrence Quan thought that his brother was re-exporting only Winfield cigarettes, not other brands. [206] In my judgment there was no commercial reason why QQQ would have entered into a contract to buy the quantities of cigarettes specified in the new-style invoice. The Invoice and Combined Certificate of Value and Origin [207] Although not a form uniquely for use in the Solomon Islands, an Invoice and Combined Certificate of Value and Origin was a form which an importer in that country was required to lodge. Investigation by Customs turned up two versions of such a form relating on their face to the shipment presently being considered. One -- 63 of 79 -- 64 was among the documents seized from Labrador in September 1996.70 The other was lodged with Solomon Islands Customs on or about 11 June 1996.71 Both versions nominated Labrador as the exporter and supplier and QQQ as the purchaser. Both nominated the port of loading as Brisbane, the vessel as the Highland Chief, the final destination and port of discharge as Honiara and the date of departure as 15 May 1996. Both specified the container number (but no seal number) and the two lines of alcohol in the consignment. Both specified an amount of $2,868.28 for freight. (This was the amount for freight in the new-style commercial invoice, but the additional amounts for courier and administrative fees in that invoice were not included in either version.) Both claimed to have been issued at Brisbane on 15 May 1996. However there were some important differences between the two versions. [208] In the Honiara version: • in the box requiring the name of the authorised signatory of the words “N Cole Director” are typed • the scrawl in the signature box is indecipherable • what appears to be the common seal of Labrador has been stamped beside the signature • the scrawl in the box providing for the signature of a witness is indecipherable • the document bears a date stamp and serial number applied by Solomon Islands Customs • the third line of goods covered by the invoice was: “136.5 ctn. Rothmans King Size Filter 13.55 1849.60 total net weight 20.4 kg @ 13.55” • the total price, freight and invoice amount have been converted to Solomon Islands dollars and the conversion amounts handwritten on the document by Mr Limnanigau, an employee of QQQ • the only original writing or marking comprises Mr Limnanigau’s figures, the seal impression, the two scrawls in the signature boxes and the Solomon Islands Customs stamp72 • the quality of the copied part of the document is somewhat degraded and high contrast, suggesting either multiple recopying or copying by facsimile transmission • the bottom margin of the page has been cut off. This is where a facsimile transmit terminal identity would appear if the document had been faxed (upside down). 73 [209] In the Labrador version: • in the box requiring the name of the authorised signatory of the words “Director L. Wright” are typed 70 Document Hon1.0001.027, ex 41. 71 Document Hon1.0001.043, ex 16. I found it helpful to examine the original of this exhibit, as well as the original of ex 41. 72 There are also some red question marks and a tick which I infer were applied by Solomon Islands Customs and which are irrelevant. 73 Mr Marheine, the handwriting expert called by the defendants, thought it had been cut with a bladed instrument such as scissors. I agree with his opinion that the document exhibits features characteristic of production by a facsimile machine. -- 64 of 79 -- 65 • Mr Wright signed the form in the signature box • no common seal has been applied • there is no witness signature • no copy of the document was given to Solomon Islands Customs • the third line of goods covered by the invoice read simply: “Balance outstanding 1849.60” • the document not having been among the records of QQQ, Mr Limnanigau’s writing did not appear upon it. However Mr Wright had written upon it in pencil, “Std Bank of Solomon Islands as requested per fax ex Michael” • everything appears to be a photocopy apart from the pencil annotation, having regard to the appearance of the signature and the absence of printing on the back. [210] Mr Wright testified that the Labrador version was sent to him from the Solomon Islands and that Mr Michael Quan asked him to sign it. He had mailed or faxed it back to QQQ. He said he “understood it to be a document whereby QQQ Wholesale could obtain foreign exchange in order to pay Labrador Liquor.” He agreed he had looked at the Exporter's Declaration on the form above his signature. In his evidence-in-chief he was asked about the absence of any reference to the cigarettes: “Did you - now, it makes no reference to the cigarettes. Do you know why that is?-- I believe the cigarettes had already been paid.” That could not have been correct. The first payment alleged by the defendants to be in respect of this shipment was received on 20 May and the second on 29 May. Only after that date could anything like $31,000.00 have constituted the remaining invoice total. In cross-examination Mr Wright was pressed to explain what goods were represented by the line “Balance Outstanding” (this was Labrador's only dealing with QQQ). He was unable to do so. Obviously, if the cigarettes had already been paid for, there was nothing outstanding apart from the two lines of liquor specified. It was suggested that this item would have appeared strange: “Did it not appear to you to be strange to have as a description of goods ‘Balance outstanding’?-- My customer requested this and I did it.” He advanced no explanation for this enigmatic statement. [211] On the other hand, Mr Wright denied any involvement in the Honiara version of the form. In particular he denied applying Labrador's corporate seal and sending the document to QQQ. He agreed that only he or Mr Bryce could have applied the seal to the document. The question arose whether the impression on the document had really been made by Labrador's seal. It was not possible to get the seal and make comparative impressions with it because, according to Mr Wright, the seal went missing sometime prior to April 1997, when a replacement was purchased. There were however a number of documents bearing impressions which it was agreed were made by the seal before it was lost (“the genuine impressions”). It is possible to compare those impressions with the impression on the Honiara document (“the Honiara impression”). To assist in that regard each side called a handwriting expert. The plaintiff called Mr Heath. The defendants called Mr Marheine. There was no challenge to the expertise of either man. -- 65 of 79 -- 66 [212] There were three aspects to the examinations which the experts conducted. First, they compared the general design and characteristics of the Honiara impression with those of the genuine impressions (or in Mr Marheine's case, one of those impressions). Mr Marheine explained that general design referred to the size relationship, the positioning of the text and the positioning of information within the stamp; and characteristics referred to the size, the layout of the information and the relationship and the proportions of that material in the stamp. As he put it, “If we had a transparency of one and placed it over the other, they would be good fits, perfect fits.” Second, they looked for individual identifying features existing in common between the genuine impressions and the Honiara impression. Third, they looked for individual identifying features differentiating the genuine impressions from the Honiara impression. [213] Mr Heath found the general features and characteristics of the impressions entirely consistent and identified a number of common individual identifying features. On the other hand he saw no differences between the Honiara impression and the genuine impressions sufficient to suggest that different stamps were used to make them. He concluded that the impression on the Honiara document was produced using the same common seal stamp as was responsible for producing the genuine impressions. [214] Mr Marheine also found the impressions identical in general design and characteristics. He did not suggest that there were any significant differences between the Honiara impression and the genuine impression. However in his opinion the individual identifying features relied on by Mr Heath were insufficiently defined and distinguished in the Honiara impression to permit a conclusive opinion. This was due to the degradation of the impression on that document because of “shadowing” or multiple imaging. [215] Mr Heath nominated three individual identifying features. First, the “I” in “LIQUOR” revealed a tapered terminal feature whereas the top revealed a much thicker construction. Second, there was a narrow initial stroke of the “N” in “A.C.N.”. Third, there was a (relatively) narrow and thin bottom left point on the star formation at the centre base of the seal. He highlighted these on attachment 4 to his second report, a photographic enlargement of two impressions. Mr Marheine accepted that these three features, clearly discernible in the genuine impressions, did amount to individual identifying features. His point was that one could not be sufficiently sure of their presence on the Honiara document. [216] In deciding whether the Honiara impression was made by the same stamp as made the genuine impressions, I must not only form an independent judgment on the issues in contest between the experts, but also consider the matter from the point of view of all the other evidence in this case. Both experts considered the question in the abstract; but I must consider it in the context of the other evidence. It seems to me that the individual similarities identified by Mr Heath are strongly indicative of the impressions having been made by the one stamp, but I would hesitate, for the reasons advanced by Mr Marheine, to express that as a scientific conclusion from the document examination in isolation. However the law does not require scientific certainty. Moreover, in the context of this case I can see no other reasonable hypothesis capable of explaining not only the indicative similarities but also the absence of any significant differences between the impressions. The idea that someone in Honiara (for example Mr Michael Quan) might have been able to -- 66 of 79 -- 67 manufacture a common seal without incorporating some significant difference from the genuine article, observable under a microscope, I find incredible. I can see no reason why anyone should have attempted to do so. I can see no coherent hypothesis which could explain how anyone could have benefited from doing so. [217] In my judgment the Honiara impression was made by Labrador's common seal. That being so, it was probably Mr Wright rather than Mr Bryce who applied it. I am satisfied that the Labrador version was a fake created by Mr Wright and that the Honiara version was the genuine document. I shall consider why Mr Wright might have created the Labrador version below. 74 Documents sent by Labrador to QQQ [218] Mr Wright testified that he would have received the bill of lading about 16 May (it issued on 15 May). He testified that he would have sent it and the new-style commercial invoice and packing list to Honiara (he was unsure whether he sent the Invoice and Combined Certificate of Value and Origin at the same time). He sent documents to Honiara by courier on 22 May. Lawrence Quan deposed that QQQ received the old-style commercial invoice and packing list, a certificate of age and the Honiara version of the Invoice and Combined Certificate of Value and Origin, but he could not say exactly when. I have already found that Mr Wright did not provide old-style letterhead to Mr Michael Quan.75 I am satisfied that it was he who sent the old-style commercial invoice and packing list to QQQ, in the courier package sent on 22 May. That package also contained the Honiara version of the Invoice and Combined Certificate. The voyage [219] The bill of lading issued on 15 May 1996. In the ordinary course the Highland Chief would have departed Brisbane within a day or two of that date. There is no reason to think that the ordinary course was not followed on this occasion. Mr Bryce suggested that there had been a delay in the sailing; but this was in the context of his attempt to assert that the container had been packed on 17 May. On that point he was wrong.76 On the other hand a letter from Customs to Solomon Islands Customs dated 14 May stated that the shipment would be departing Brisbane on 17 May. It probably did depart on or about that date. [220] There is conflicting evidence as to the date of arrival of the vessel at Honiara. The entry for warehousing filled out by Mr Limnanigau, an employee of QQQ, on 5 June stated the date of arrival as 19 May. The plaintiff relied upon that date in its submissions. I do not think it can be correct, as it is about 1,150 nautical miles from Brisbane to Honiara. Moreover, as Mr Hack pointed out in his submissions, a report by Mr Tom Waihere, Senior Collector (Investigations) for Solomon Islands Customs, made on 12 June stated the date of arrival as 28 May. That seems rather a long time for the voyage, but the route may have been indirect, eg via Papua and New Guinea or New Zealand. Payment 74 Paragraph [226]. 75 Paragraph [26]. 76 Paragraph [195]. -- 67 of 79 -- 68 [221] Labrador received four payments which it claims were in respect of the goods covered by the new-style commercial invoice: DATE AMOUNT PAID AT METHOD PAYER 20 May $25,000.00 ANZ Virginia, Qld Cash deposit Unidentified 29 May $36,170.00 ANZ Dee Why NSW Cash deposit Unidentified $30,000.00 ANZ Frenchs Forest NSW Cash deposit Unidentified 18 July $31,867.88 Labrador’s store Bank draft QQQ TOTAL $123,037.88 Only the last of these payments was made by QQQ. [222] The first payment was a deposit forming part of a total deposit of $25,700.28 made into Labrador's account at its own branch of the ANZ bank. The deposit slip which accompanied the deposit was written out and signed by Mr Wright. The payment was entirely in $50 notes. The balance of the deposit was constituted by a cheque for $700.28 in favour of Labrador from the Indooroopilly Hotel. Mr Wright recorded the receipt in Labrador's books on the day of the deposit. He gave evidence that a man brought the money to Labrador's premises. His account, given in evidence-in-chief, is extraordinary: “The man was brought to my - shown into my office. I don't recall his name. He had come to pay part payment for Mr Michael Quan of QQQ Wholesale. I expected a cheque, et cetera, and the man had a briefcase with a lot of money in it. I'm not used to dealing that - that quantity of cash. So I immediately asked him to come with me and we went down the road to the ANZ and deposited the money and I credited my books accordingly. Can you - was there any----- HIS HONOUR: Did you write a receipt for the cash?-- I think I did, your Honour, on a letterhead. We don't have receipt books, but I would have certainly have given him a handwritten receipt. Yes. MR HACK: Now, did you have any other dealings with this person?-- No. How would you describe him? Short, tall, fat, thin?-- Early thirties, mid-thirties, my height. HIS HONOUR: Which is?-- 5 10, of Indian extraction. MR HACK: Did he speak with an accent?-- Nothing that sticks to mind. It was matter of, "Oh, my God, look at all this money. Get to the bank fast." That was my top priority. Did you have any other dealings with this person at that time?-- No. Can I take you then, please, to Honiara 1----- HIS HONOUR: Was this - when you went down to the bank, how did he get to the bank?-- We drove in my car, your Honour. Mmm hmm, and after you'd banked it, what did you do?-- We drove back and he had a taxi waiting. He got in the taxi and left. -- 68 of 79 -- 69 He had kept the taxi waiting the whole time you'd gone to the bank?- - Yes. MR HACK: How far is the bank from your premises in time terms?- - Less than five minutes.” I simply don't believe him. The story is inherently incredible. [223] The circumstances surrounding the second and third payments are also suspicious. In each case the person who made the payment is unidentified. In each case the payment was in cash, comprising a mixture of $100 and $50 notes. In each case the deposit was made using preprinted deposit slips bearing Labrador's name. Mr Wright recorded the payments in Labrador's books two days after they were made. He was able to work out that the three payments (totalling $91,170.00) should be attributed to QQQ because their sum was the amount of the part payment required under the new-style invoice. He said it was not surprising that QQQ used Labrador's preprinted deposit forms, as he had given these forms out to a number of customers (I note however that such forms were never used by Coachwork.) [224] The final payment of $31,867.88 was made by QQQ. It purchased a bank draft on 25 June and sent it to Labrador, which banked it on 18 July. According to Mr Lawrence Quan, that payment was in satisfaction of the amount set out in the Honiara version of the Invoice and Combined Certificate. It will be recalled that that invoice was made up of $28,999.60 for the price of the goods and $2,868.28 for freight. It was the only amount which QQQ ever paid Labrador. That rather suggests that the goods in that invoice were the only goods which QQQ ever purchased from Labrador. [225] As the above table shows, that payment brought the total amount which Labrador attributed to the Honiara transaction to $123,037.88. However the amount in the new-style invoice was $123,038.28. The discrepancy is small, but it is unexplained except on the basis that the new-style commercial invoice was not genuine. [226] That discrepancy is significant in another respect. If the new-style commercial invoice were genuine, the balance owing from the payment of the part payments of $91,170.00 until receipt of the bank draft in July would have been $31,868.28. Among the documents seized from Labrador's premises was a handwritten list of outstanding debtors as at 30 June 1996. It is common ground that the list was written by Mr Wright. Included in the list was an item “Solomon Islands 31,867.88”. Asked about the “source of the list” in his evidence-in-chief, Mr Wright replied, “I would go through my invoice books, my retail sales books, my export files.” That seemed an extraordinary way for a company of Labrador's size to maintain its accounts. One would have thought at the very least that it would have maintained a debtors’ ledger. To help explain that oddity, Mr Wright was asked if Labrador had an accounting package back in 1996. He responded, “No, Mr Hack. It's all done manually.” That was probably quite true; Labrador acquired a computer only in early 1996. However it does not explain why a business with trade debtors of about $210,000.00 77 would not have kept a debtors’ ledger manually. Such a document would have recorded (if the new-style commercial invoice were genuine) the amount of that invoice and the amounts of the three payments allegedly received by 30 June in respect of it. It would have shown a balance of $31,868.28 on that 77 Exhibit 52. -- 69 of 79 -- 70 basis. Absent a ledger one would have expected that Mr Wright would have had to calculate the balance owing using the same figures. A calculation would have produced the same balance. [227] But that is not what Mr Wright said he did. According to his testimony, “I would have gone to my export file for Solomon - for Honiara and had a look to see what was the outstanding balance which would have been the balance as per the final amount still owing to come from Solomon Islands bank.” That file held “copies of all correspondence, faxes, the pro forma invoice, copies of the commercial invoice, the packing list, whatever had to do with that shipment.” To find the outstanding balance in the file in the absence of a ledger or a calculation required the existence of a document setting out that balance. Mr Wright was led to such a document in his evidence-in-chief: “Could I take you back, please, to HON1.0001.027 78 ?-- Yes, sir. What can you say about that in relation to the Honiara folder?-- That was the amount - copy was in the file - in the folder and there's your outstanding amount that still hasn't been paid which is a debtor at the 30th of June.” That was his explanation for why the debtors’ list showed what on his evidence was an incorrect figure. [228] I have already held that the Labrador version of the Invoice and Combined Certificate was fabricated by Mr Wright.79 The probable reason for this was to provide a source document which might explain the entry in his handwritten debtors’ list in a way which shifted responsibility for originating the “Solomon Islands” figure from him. Mr Wright needed a document showing a figure equal to the amount which he had written. That was why, despite the date on the Invoice and Combined Certificate, it could not show the cigarettes set out in the new-style commercial invoice. [229] I am satisfied that the cash payments made on 20 and 29 May were not made in respect of the goods in the new-style commercial invoice. Their provenance and appropriation are unexplained; but they are sinister. They do not support the proposition that container number TPHU 824197-2 held those goods. I am satisfied that only the July payment was made in respect of the contents of that container. That payment was made on the Honiara version of the Invoice and Combined Certificate. It supports the plaintiff's claim that the goods in the container were those set out in that document. 80 Delivery in Honiara [230] On 14 May 1996 Mr K J Logan, an officer of Customs, wrote to the Acting Comptroller-General of Customs for Solomon Islands regarding the shipment. He nominated the container number and seal number 005996 and requested that officers from Solomon Islands Customs examine the container and forward details of the 78 The Labrador version of the Invoice and Combined Certificate of Value and Origin. 79 Paragraph [217]. 80 Those are the same goods as were set out in the old-style commercial invoice. That invoice made no provision for freight. It is true that it stated itself to be “CnF”, but when one compares the prices for the liquor and alcohol with those charged in the two most recent shipments to Fiji, it is obvious that this was a mistake. The prices must have been calculated FOB. -- 70 of 79 -- 71 container number, seal number, whether the seal was intact and an itemised list of the contents of the container including brands and quantities. Copies of documents and other information were also sought. [231] There is no evidence to establish the date upon which the container was unloaded. After it was unloaded it remained in a secure area of the port of Honiara controlled by Solomon Islands Customs. It was examined by a team of four officers led by Mr Waihere on 11 June. Mr Limnanigau was also present on behalf of QQQ. There was only one seal on the container (005996) and it was intact.81 Mr Waihere described the examination process in his affidavit: “46. I recall that my officers and I unpacked the whole container. The cigarettes were packed at the front of the container. Then there were the cartons of whisky with the cartons of beer at the back. 47. I counted the number of cartons of cigarettes, whisky and beer. I specifically recall that there were two cartons of whisky shortshipped. The number declared was 360, but there were only 358 in the container. 48. There was only one type of cigarettes in the container. The cartons of cigarettes were all Rothmans brand. There were 136.5 sleeves of cigarettes. 49. The examination took one (1) day. Following the examination, we (i.e. the other customs officers and I) repacked the container and locked it. Two locks were applied; one from QQQ Wholesale Pty Ltd and the other was a Crown Lock from Solomon Islands Customs. The key for the Crown lock was then given to the Senior Collector in charge of the Private Warehouse section.” [232] The evidence of Mr Limnanigau was to somewhat different effect. His affidavit referred simply to cartons, without identifying whether he was referring to gross cartons (sleeves) or shipping cartons (shipping cases). In cross-examination he maintained that the cartons which he saw were shipping cartons. Obviously both he and Mr Waihere cannot be correct. [233] I unhesitatingly prefer the evidence of Mr Waihere as to what was in the container at the time of the inspection. There was no suggestion that this witness was anything but honest in his answers. He knew that the examination was special because of the request from Australia. He personally did the counting. He wrote the results of his examination in a contemporaneous report. His evidence on the results of his count was unchallenged in cross-examination and there was no application for him to be recalled for further cross-examination after Mr Limnanigau gave his evidence. Mr Limnanigau gave his evidence by video link and there were from time to time the difficulties caused by this method of examination. His grasp of English was inferior to that of Mr Waihere. The only reference to cigarettes in the entry for warehousing, which he had personally filled out, was to “Rothmans KSF”, the weight of which was stated to be 20.4 kg. That was what two or three shipping cases full of cigarettes would have weighed; 136 shipping cases would have weighed far more. Surely Mr Limnanigau would have been astonished to have seen so many when the 81 In his 23 years as the Customs Officer, Mr Waihere had not come across a broken or missing seal or one that had been tampered with. -- 71 of 79 -- 72 container was opened, yet he said nothing.82 On this point I do not accept his evidence. [234] On behalf of the defendants, Mr Hack submitted that I could not be confident that the container had not been interfered with prior to its inspection by Mr Waihere. (I take it that by “interfered with” the submission refers to the removal of about 133 shipping cartons of cigarettes.) He submitted that on the evidence of Mr Stonehouse, procedures on the wharf at Honiara were “fairly lax”. I take that to refer to evidence by Mr Stonehouse that he was able when in Honiara to accompany a QQQ vehicle onto the wharf when goods were unloaded from a container on to the vehicle. It was however an unsealed container with only one padlock, to which the QQQ employees had the key. It must therefore have already been cleared by Customs, so no impropriety is demonstrated. Mr Stonehouse said that the vehicle was not stopped on its departure, which does demonstrate some laxity. On another occasion, he said, he went for a stroll through the port facility and was not stopped, but he was vague about precisely where he went and did not suggest that he could have removed goods from a sealed container under Customs control. [235] In addition to evidence of the possibility that the cigarettes were removed from the container before its inspection, there was evidence relating directly to the packing of the container to support the contention that what was exported was indeed 136.5 shipping cartons of cigarettes. I turn to that evidence. The packing of the container [236] Both Mr Wright and Mr Bryce swore that the container was packed with the goods set out in the new-style invoice and packing list. The defendants sought to support their testimony by evidence from Mr Stonehouse who was alleged to have been present at the time of packing. They also gave evidence of the presence of Customs officers at Labrador's premises at the time of the packing. [237] During May 1996 two Customs officers, Mr Holiday and Mr King, were carrying out routine auditing activities at Labrador's premises. These activities had nothing to do with the events the subject of the prosecution and the officers were not initially opened as witnesses in the plaintiff's case. In the course of cross-examining another Customs officer, Mr Hack asked if he was in a position to comment on the proposition that the two auditors were present at Labrador's premises at the time when the Honiara shipment was being packed and the container sealed. He could not; but the plaintiff promptly made arrangements for the two officers to be called, in effect for cross-examination. In relation to an occasion at Labrador's premises on 7, 13 or 17 May 1996, the following propositions were, expressly or by implication, put to one or other, or both, of them: • the witness might have been in a position to have seen a number of cartons of Regency Scotch Whisky in a container • the witness might have been in a position to notice cigarette cartons on top of the whisky • Mr Bryce said he was packing a container to go to Honiara • Mr Bryce showed the witness a chalk mark on the floor of the container, marking where beer was to go 82 In saying this I do not overlook the fact that Mr Vosa seems to have made such an error in respect of the cigarettes in the seventh Fiji shipment. -- 72 of 79 -- 73 • there was some discussion about whether all of the goods would fit in the container • Mr Bryce came into the office while both witnesses were there “a bit cocky about having got a lot of goods into a container” • Mr Bryce asked Mr Holiday to go and have a look at the container • Mr Holiday said that he was doing an audit and he wasn't interested • Mr Bryce said to Mr King, “Why don't you come and look at it” • Mr Holiday said to Mr King words to the effect, “Go and have a look” • Mr King went and had a look at the stuffed container. Neither witness had any recollection of such of those events as were put to him. That is not surprising. Neither is presently employed by Customs and neither had any direct involvement in the case. However the solicitors for the defendants raised an allegation that one or other of them inspected the content of the container on either 7 or 13 May with the solicitor for the plaintiff by correspondence in September 1996.83 The latter spoke to the officers about the allegation. At that time the matter would have been reasonably fresh in their minds. The Australian Government Solicitor responded by letter dated 23 September 1996: “… neither officer was engaged in any inspection of a container being loaded for export. My instructions are that such an activity was not in their audit program for the days in question notwithstanding their presence at the warehouse.” [238] The three dates to which Mr Hack directed the witnesses’ attention were selected because they were the only dates on which Mr King and Mr Holiday were at Labrador's premises in mid-May 1996. However it is impossible for the packing to have taken place on 7 May because the order was not placed by QQQ until 8 May. I have already found that it did not take place on 17 May.84 If these things happened, they could only have happened on 13 May. If the parties’ agreement that the container was packed on or about 10 May is understood to refer that to that precise date, these events could not have happened. The documentary evidence supports the view that packing occurred on 10 May: that is the precise date specified as the date of packing in the Export Receival Advice. On the other hand, I have already found that the container was transported from Labrador's premises on 13 May and that the second seal was delivered to Labrador on that day. I have no reason to doubt the evidence of Mr Stonehouse. Consequently I think that despite the terms of the parties’ agreement it is possible that the events described by Mr Stonehouse occurred on 13 May. That is why I stated above that my findings regarding the date when Mr Wright gave instructions to EDI and the date of lodgement of the export clearance were made more readily because they favoured the defendants.85 [239] Mr Hack opened the defence case on these matters in much less detail, but with no apparent inconsistency: “At the time that the container was being packed for Honiara, Mr Holiday and Mr King were there present doing their regular tasks and I don't for a moment suggest that one of their tasks was to check this, but it was a very large shipment and it was a matter of some pride to Mr Bryce that he could actually get that into the container 83 Exhibit 9. 84 Paragraph [195]. 85 Paragraph [198]. -- 73 of 79 -- 74 and his evidence will be, as to that event, that during the course of packing he had conversations with Mr King and Mr Holiday about that he'd get it in and so on, and that when he finally got the last shipper of carton of cigarettes into the container he wanted to show them that he'd actually achieved what he had set out to do. Mr Stonehouse was - happened to be there that day and will give similar evidence to the effect that he saw, as it were, the last carton go in. Sorry. I'll just check that. I said the last carton to go in. Yes.” [240] Mr Wright gave a limited amount of evidence on the topic: “Do you recall the circumstances involving the packing of that container?-- I remember there was a lot of controversy as to whether all the goods would fit. I remember at the time we had a Customs audit. I think some teasing, joking, was going on, including even Mr King from Customs. Mr Stonehouse had a bet with Mr Bryce that he wouldn't get it all in, but he did. Yeah, I - that's what I remember about packing that - well, that container being packed.” [241] Mr Bryce's evidence was more important. He testified that at the time he was packing the Honiara shipment (it was the only one he had ever packed for Honiara), two Customs officers were carrying out an audit. He thought the date was 17 May 1996.86 He said that he had Mr Stonehouse “basically there helping me”. He said the container was packed all in the course of one day. He said that he put the Scotch at the back of the container, put some cigarettes (sleeves or gross cartons) on top of it, then packed shippers (shipping cartons) of cigarettes. He said that he had drawn a line on the floor of the container to mark where the beer had to start. He said that Mr Stonehouse had said that he wouldn't get it all in and they had a wager on it, “… and I recall the last box of beer went in the top right-hand corner of the container and it was just absolutely no room for a box of matches to go in there after it, and I recall going into Paul Holiday particularly, one of the Customs officers there, and saying, "Paul, do you want to come and have a look at this container now it's packed?", because I think he was a bit skeptical and I believe his comment was, "I'm here to do an audit. I'm not really interested, but my colleague might like to go and have a look", and he did. When you say he was a bit skeptical, had Mr Holiday been involved in this earlier?-- Oh, I don't remember. He saw the stock that was to go in the container. Why did you go in to see him?-- Oh, gloating, I guess. Right. What happened? Did the other Customs person come out?-- Yes. And what happened then?-- I think he either put the seal on it himself or watched me put the seal on it and that was the end of that container.” I do not believe the last answer. Mr Bryce did not identify which seal he was referring to. Indeed he made no mention of the fact that two seals were used. There was no suggestion in cross-examination that Mr Holiday had applied a seal himself 86 Paragraph [195]. -- 74 of 79 -- 75 or had seen a seal applied. Moreover Mr Bryce's evidence “I recall going into Paul Holiday particularly, one of the Customs officers there, and saying, ‘Paul, do you want to come and have a look at this container now it's packed?’” is inconsistent with the cross examination of Mr King and Mr Holiday, where it was suggested that the invitation was directed to Mr King who in turn spoke to Mr Holiday. I am not prepared to accept Mr Bryce's evidence in relation to this incident except where it was corroborated by Mr Stonehouse. [242] To some extent, Mr Bryce's evidence was corroborated by Mr Stonehouse. The latter testified that at an unspecified time on an unspecified date in May 1996 he went to Labrador's premises to see Mr Wright. He found Mr Wright engaged in an audit with two Customs officers. Mr Wright said that he was busy and suggested that Mr Stonehouse talk to Mr Bryce “and he would see me not long after”. He went through to the warehouse and found Mr Bryce engaged in packing a container. Mr Bryce told him the container was going to Honiara and that he was only halfway through loading it. He said the truck was due to arrive at any moment. At that stage the third of the container furthest from the doors87 contained “quite a few” cases of cigarettes and appeared to contain spirits behind them (although it was difficult to see beyond the first row). Mr Bryce was packing cigarettes by taking sleeves out of the cases and packing them on top of the spirits. There were a few cases on a pallet inside the container and another 32 awaiting packing on a pallet outside. After the former pallet had been emptied and removed, Mr Stonehouse threw the remaining 32 into the container for Mr Bryce to pack. This Mr Bryce did, packing them along one side of the container, not in full rows. They did not reach the doors of the container. There was some discussion as to whether the “balance of the beer” would fit in the remaining space. Mr Stonehouse did not think it would, and had a bet with Mr Bryce to support his opinion. In the event it fitted in, very neatly filling the last hole. Mr Bryce showed Mr Stonehouse a seal when he was about to close the container. They then walked into the office, Mr Bryce saying that he was going to get one of the Customs officers to seal the container with him. He spoke to the Customs officers and one of them went with him out to the warehouse. Mr Stonehouse continued to the inner office to speak to Mr Wright. [243] The evidence of both Mr Bryce and Mr Stonehouse differed from what was put in cross-examination and opened in two significant respects. First, Mr Bryce did not suggest in his evidence that either officer was involved during the packing of the container or even saw it before packing was complete, although he did claim that Mr Holiday had seen the stock that was to go into the container. In particular he did not allege that he showed either officer a chalk mark on the floor of the container, nor did he allege that either was involved in a conversation about whether all of the goods would fit in the container. Second, the goods packed closest to the entrance of the container were, on his evidence and that of Mr Stonehouse, cartons of beer, not cartons of cigarettes as was opened. Given the tightness of the alleged pack, no cigarettes could have been visible to Mr King, even if he went with Mr Bryce as alleged. [244] The defendants submitted that it would suggest a particular bravado for Labrador to be attempting to evade duty on $92,820.00 worth of cigarettes in the presence of Customs officers undertaking an audit; particularly to have involved Mr King and 87 In Mr Stonehouse's terminology, the front of the container referred to the end furthest from the doors and the back to the end near the doors. -- 75 of 79 -- 76 Mr Holiday in some banter with Mr Bryce about fitting the goods into the container. The difficulty with that submission is that it is impossible to determine with any precision what happened at Labrador's premises on 13 May (assuming that was the day the container was packed) and the sequence in which it happened. Why a second seal was needed was not explained. The time of Mr Stonehouse’s visit is unknown. Important elements of Mr Bryce's evidence are uncorroborated and that evidence itself is unreliable. [245] Whatever the level of bravado displayed by Mr Bryce, the more important question is whether the evidence just discussed, considered with all of the other evidence relevant to the point, opens up a reasonable hypothesis consistent with innocence. When I consider that evidence and the evidence relating to the opportunity for the container to be tampered with, and balance it against the evidence of Mr Waihere relating to the seal, the documentary evidence of the contents of the container, the evidence regarding the nature of QQQ's business and the evidence regarding payments to Labrador, I have no doubt that when the container left Labrador's premises its contents were as set out in the Honiara version of the Combined Certificate of Value and Origin. Those were the goods which Labrador exported. Conclusions regarding Honiara shipment [246] My conclusions regarding this shipment are similar to those reached in respect of the Fiji shipments. The Honiara version of the Invoice and Combined Certificate of Value and Origin sets out the contents of the container TPHU 824197-2 sent by Labrador from Brisbane to Honiara. The container was packed by Mr Bryce at Labrador's premises before it was exported. The cigarettes listed in the new-style invoice were not exported. For that reason the entry for export submitted by Labrador to Customs in accordance with a handwritten facsimile document sent by Mr Wright to EDI (which set out the same goods as were in that invoice) was false and misleading. In Labrador's records the missing cigarettes were taken out of stock held under bond and the only available inference is that they were delivered for home consumption. That inference accords with the plaintiff's averment to that effect. That process must have involved moving them while they were subject to Customs control. I am satisfied of those conclusions beyond reasonable doubt and on the evidence can find no rational hypothesis consistent with innocence. The circumstances in favour of this conclusion overwhelm all others. The plaintiff has proved the three charges which he alleges in respect of the Honiara shipment. Accessories [247] Liability as an accessory may arise pursuant to s 236 of the Customs Act 1901 in respect of an offence under that Act and pursuant to s 5 of the Crimes Act 1914 in respect of an offence under the Excise Act 1901.88 Although the word “knowingly” did not appear in the former provision, it is common ground that this difference between the sections is of little or no consequence. The plaintiff alleged that Mr Wright and Mr Bryce were liable under these provisions but did not particularise under which part of the provisions they were liable. 88 See note 2 above. -- 76 of 79 -- 77 Mr Wright [248] The defence accepted that if I found the case against Labrador proved to the necessary standard, it followed “as night follows day” that a similar finding must be made against Mr Wright. I have made such findings against Labrador on every charge and I have no hesitation in finding that on each charge Mr Wright is guilty as an accessory. Mr Bryce [249] On behalf of Mr Bryce, Mr Hack submitted: “There is simply no evidence that Mr. Bryce was in any way concerned in the matters alleged by the Plaintiff; being a director and having operational control with another does not satisfy that requirement, a fortiori beyond reasonable doubt. It does not amount to evidence for the Plaintiff to assert that Mr. Bryce “must have known”. If there is no evidence, assertion of what “must” have been known cannot overcome that void.” That rather overstates the position in several respects. [250] First, Mr Bryce packed all of the containers used for the disputed transactions. As Mr Bryce's evidence regarding the Honiara shipment showed, the process of packing culminated with the application of a seal to the container. Second, in each case he knew that details were provided to Customs for export clearance for the goods listed in the relevant export entry.89 Third, Mr Bryce swore that the container for the Honiara shipment would definitely have contained more than one row of shipping cartons of cigarettes. Whatever went on at Labrador's premises in relation to the shipment, that was not the position at the time the container left Labrador's premises. I reject that evidence. I can think of no reasonable hypothesis by which the container could have left Labrador's premises loaded as it was without Mr Bryce's knowledge. Fourth, there was evidence from Mr Bryce about the packing and contents of the Fiji shipments, not in his evidence in chief but in cross- examination: Mr Bryce insisted that the Fiji containers held “international brand spirits” and denied that he packed any of them with the goods listed in the relevant old-style commercial invoice. I reject those denials. I have already found that when those containers left Labrador's premises they held such goods. I can conceive of no rational means by which that state of affairs could have come about without the involvement of Mr Bryce. He must have known the true contents of the containers. Fifth, given that knowledge, his persistent denials that the containers held the goods listed in the old-style commercial invoices could not have arisen from forgetfulness, confusion or inadvertence. If he could not remember what was in the containers, Mr Bryce could have said so. Sometimes he almost seemed to say this, but invariably he returned to his theme that the containers did not hold those goods. I can see no rational explanation for these denials; I think they demonstrate a consciousness of his own and Labrador's guilt.90 Finally there is Mr Bryce's evidence that Labrador never purchased spring water, nor had it at its premises. I have already rejected that evidence.91 Mr Bryce must have known about the water and must have packed it into the container for the first Fiji shipment. In short, there 89 Admitted on the pleadings. 90 R v Edwards (1993) 178 CLR 193. 91 Paragraph [53]. -- 77 of 79 -- 78 is some evidence that Mr Bryce was concerned in the matters alleged by the plaintiff against Labrador. [251] On the other hand, accepting that the charges against Labrador are proved, there is no evidence tending to exclude Mr Bryce's involvement. Although it was pleaded on his behalf that, if each container held the goods set out in the old-style commercial invoice, that occurred without his knowledge or consent, Mr Bryce did not suggest any hypothesis upon which he might not have been knowingly concerned in Labrador's conduct. That poses a difficulty for his case. The plaintiff pleaded in relation to each shipment that Mr Bryce knew at all material times that the container in question held only the goods listed in the relevant old-style commercial invoice. He also pleaded in relation to each shipment that Mr Bryce aided and abetted, counselled or procured or by way of act or omission was directly or indirectly concerned in moving altering or interfering with the relevant goods otherwise than in accordance with an appropriate authority and the making of the relevant false statements to Customs. The plaintiff submitted that these allegations constituted averments for the purposes of s 255 of the Customs Act 1901 and s 144 of the Excise Act 1901. If that is correct they provide prima facie evidence of the matters averred. [252] I see no difficulty in characterising the plaintiff's allegations in the statement of claim as averments.92 Indeed, the opening words of the statement of claim were, “Pursuant to the provisions of section 255 of the Customs Act 1901 and section 144 of the Excise Act 1901, the plaintiff says and avers …”.93 It is true that to some extent they may be regarded as averring a mixed question of law and fact; but the only consequence of that is that they are to be regarded as prima facie evidence of the fact only.94 It is probably also true that as against Mr Bryce, some of them are averments of the ultimate issue; but that is of no consequence.95 The only unresolved question is whether they are averments for the purposes of the averment provisions. To be so they must under the sections have been contained in the information, complaint, declaration or claim. In the present case they were contained in the statement of claim. Under the Uniform Civil Procedure Rules, that is a different document from the claim.96 Although Mr Hack made no submissions on this point, he expressly did not concede it. [253] The phrase “information, complaint, declaration or claim” embodies a mixed list of court forms. It reflects the variety of courts, superior and inferior and including courts of summary jurisdiction, in which customs prosecutions may be instituted.97 When originally enacted98 the phrase did not include “complaint”; that word was added in 1923.99 Informations and complaints were (and are) initiating processes in 92 An averment is an allegation: Brady v Thornton (1947) 75 CLR 140. 93 It was not suggested that this form of pleading caused any embarrassment to the defendants or that it was not open to the plaintiff to rely on the averment provisions in this way: compare R v Hush; ex parte Devanny (1932) 48 CLR 487 at pp 500-501 (per Gavan Duffy CJ and Starke J), 513-515 (per Evatt J). 94 Customs Act 1901, s 255(2)(b); Excise Act 1901, s 144(2)(b). 95 Chief Executive Officer of Customs v El Hajje [2005] HCA 35. 96 Rule 22. 97 Customs Act 1901, s 245; Excise Act 1901, s 134. 98 Act No 6 of 1901. 99 Act No 12 of 1923, s 35. -- 78 of 79 -- 79 courts of summary jurisdiction.100 A declaration was not an initiating process, but was the first pleading in a pre-judicature common law action in a superior court. “Claim”, on my limited research, does not seem to have had any particular technical meaning. I see no reason why it should be construed in the narrow sense in which it is used in the Uniform Civil Procedure Rules; and I note that this case was commenced by writ before those rules came into operation. The averment provisions were drafted long before those rules and have application throughout Australia. They display an intention to include a pleading (or at least the first pleading) among the documents which may contain an averment. When the High Court decided the separate questions earlier determined in this case, the applicability of the provisions to the statement of claim was assumed. 101 The same assumption was made in Chief Executive Officer of Customs v El Hajje.102 In my judgment averments in the statement of claim are averments for the purposes of the averment provisions. [254] It remains to determine Mr Bryce's guilt or innocence. That must be decided on the basis of all of the evidence,103 taking the averment provisions into account.104 On that basis I am satisfied of his guilt on all charges beyond reasonable doubt. Conclusion [255] Each of the defendants is convicted on all 45 charges. I shall hear the parties on the question of penalties and other consequential orders. 100 As to informations see Fraser v The Queen (No 2) (1985) 1 NSWLR 680 at pp 689-690; as to complaints see Justices Act 1886, s 42. In England an information was also the initiating process for proceedings commenced in the Court of Exchequer for recovery of amounts owed to the Crown for customs duty or as a penalty for not paying customs duty when due: Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161 per Hayne JA at p 193. No such jurisdiction ever existed in Australia. 101 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR at p 207. 102 [2005] HCA 35 at paras 29 and 34. 103 The existence of evidence tending toward the guilt relieves me of the “difficult and perhaps .. baffling task to discover appropriate criteria by which to judge whether [a] prima facie case has been converted into satisfaction beyond reasonable doubt”: Simmons v Venning (1969) 1 SASR 403 at p 406. 104 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR at p 208. -- 79 of 79 --