Commonwealth Director of Public Prosecutions v Queensland Jewellery and Gift Company Pty Ltd & Ors [2005] QDC 299

[2005] QDC 299 DISTRICT COURT CIVIL JURISDICTION JUDGE ROBIN QC No 4090 of 2004 COMMONWEALTH DIRECTOR OF PUBLIC PROSECUTIONS Applicant and QUEENSLAND JEWELLERY AND GIFT COMPANY PTY LTD (ACN 070 716 175) trading as QUEENSLAND DUTY FREE and SEN-HUNG CHEN and CHIU-YUAN HSIAO and TAI XING INVESTMENT PTY LTD (ACN 096 384 191) First Respondent Second Respondent Third Respondent Fourth Respondent No 4091 of 2004 COMMONWEALTH DIRECTOR OF PUBLIC Applicant PROSECUTIONS and PEACE INTERNATIONAL INVESTMENTS First Respondent PTY LTD (ACN 103 055 125) trading as PEACE DUTY FREE and CHEN LI-LING (KAY) CHOU Second Respondent and CHI TSAN LIN Third Respondent -- 1 of 13 -- 11102005 T23/JIR32 M/T CMS113/2005 (Robin DCJ) 1 10 20 30 40 50 60 No 4092 of 2004 COMMONWEALTH DIRECTOR OF PUBLIC Applicant PROSECUTIONS and QUEEN STREET MALL CHANDLERS PTY LTD First Respondent (ACN 103 311 682) trading as QSM DUTY FREE and CHUNG-KUNG (CHRIS) LIN Second Respondent and CHUN-I (KEVIN) WU Third Respondent No 4993 of 2004 COMMONWEALTH DIRECTOR OF PUBLIC Applicant PROSECUTIONS and GARY JOHN SIMON EDWARDS Respondent No 4095 of 2004 COMMONWEALTH DIRECTOR OF PUBLIC Applicant PROSECUTIONS and HI NGO Respondent BRISBANE ..DATE 11/10/2005 ORDER -- 2 of 13 -- 11102005 T23/JIR32 M/T CMS113/2005 (Robin DCJ) 1 10 20 30 40 50 60 CATCHWORDS: (Cth) Proceeds of Crime Act 2002 s 180. Uniform Civil Procedure Rules, r 667, r 668 - application by examinee to set aside or stay "examination orders" made without notice to him - whether the orders could be made ex parte - effect of the sale charge against the examinee being dismissed at subsequent committal proceedings - whether officer's allegation he continued to suspect there was offending could be relied on. -- 3 of 13 -- 11102005 T23/JIR32 M/T CMS113/2005 (Robin DCJ) 4 ORDER 1 10 20 30 40 50 60 HIS HONOUR: Orders were made by me on the 14th of June 2005 pursuant to section 180 of the Commonwealth Proceeds of Crime Act 2002 calling for the examination of the present applicant, Mr Ngo in relation to his own affairs and in relation to the affairs of others. He is applying now, under rule 667(2)(b) and/or rule 668 of the Uniform Civil Procedure Rules, to have those orders set aside or stayed. The examinations are imminent, indeed, Mr Ngo's examination was scheduled to occur in August this year but the AAT member, Mr Muller, deferred proceedings to permit the present applications to be made to this Court and also I think in light of criminal proceedings which were by then pending against Mr Ngo under section 134.2(1) of the Criminal Code of the Commonwealth. The charge was that by deception, Mr Ngo obtained a financial advantage from the Commonwealth by assisting in the avoidance of customs duty payable on cigarettes and other tobacco. On the 4th day of this month, that matter came before a Magistrate in Brisbane for the committal hearing, when the charges were dismissed. Mr Smith, appearing for Mr Ngo today, has made available the outline of submissions which were successful before the Magistrate. Those contend that it was for the Prosecution to prove that Mr Ngo knew that the Duty Free Shop, in which he acquired tobacco products, had not entered them for home consumption and had not paid the relevant duty. It was successfully submitted to the Magistrate that it could not be proved that Mr Ngo knew, or -- 4 of 13 -- 11102005 T23/JIR32 M/T CMS113/2005 (Robin DCJ) 5 ORDER 1 10 20 30 40 50 60 believed there was a substantial risk of loss to the revenue occurring. Or, at the least, could not exclude a mistake of fact on Mr Ngo's part. The evidence showed that he had paid at least $55 per carton of cigarettes acquired by him, more than ample to cover any duty which the Duty Free Shop was required to collect and pass on to the Commonwealth. There was no evidence called to the effect that Mr Ngo knew they were not passing duty on. The evidence of his resales was apparently that they were at prices which were consistent with duty having been paid. The Magistrate, it appears, was impressed by submissions that there was nothing sinister about Mr Ngo's having loaded cigarettes into his vehicle or about his having removed stickers containing the words "Duty Free" from packets, which he would have been entitled and perhaps required to do if the goods were no longer duty free. Nor was there anything suspicious, it was contended, in the quantities of cigarettes that he had. The submissions of Mr Smith today fall into two parts. The first is to the effect that this Court lacked jurisdiction to make the orders of the 14th of June 2005, the foundation for which was a series of restraining orders which had previously been made by other Judges; they were also made ex parte. -- 5 of 13 -- 11102005 T24/LDV16 M/T CMS113/2005 (Robin DCJ) 6 ORDER 1 10 20 30 40 50 60 Proceeding in that way had concerned me. The short reasons which I gave, which can be found at [2005] QDC 173, include the following at page 4: "Another respect in which the Act might be thought less than clear concerns the notice that ought to be given to the respondent, Mr Edwards, or to the person proposed to be examined. Ms McCarthy has presented a capable written argument to the effect that there is no reason to think that notice to either of them is required. She submits that where notice of particular application is required, the Act is explicit about that, instancing sections 26, 39, 61 and 136. I think her submission that in the absence of specific notice requirements, there is no basis for implying a requirement for notice is correct. As she observes, the application is not one for final relief nor will the order affect any person's interests in any property. She has acknowledged what might be called "draconian features" of the examination process enacted in support of the pursuit of what is seen as pursuing the public interest to which the Act is directed. Given that these proceedings have been ex parte, I would think that if there is scope for the examinee and indeed Mr Edwards to raise objections to the procedure, that might be done at the examination or in other proceedings. The practicalities of the notice issue are obvious. There is clearly room for concern that if applications such as the present are on notice, the examination procedure may, one way or another, be deliberately or incidentally subverted." The sections mentioned are instances where notice is expressly required; section 61 deals with applications for forfeiture orders. Section 136 embodies a good deal of refinement indicating to my mind the care which was taken by the drafters in relation to notice. It provides: "1. The DPP must give written notice of the application to a person who would be subject to the pecuniary order if it were made. -- 6 of 13 -- 11102005 T24/LDV16 M/T CMS113/2005 (Robin DCJ) 7 ORDER 1 10 20 30 40 50 60 2. The DPP must include a copy of the application and any affidavit supporting the application with the notice. 3. However, the DPP may delay giving a copy of an affidavit to the person if the Court to which the application was made so orders. 4. The Court must not make such an order unless it is satisfied that: (a) including a copy of the affidavit with the notice would prejudice the investigation of or the prosecution of a person for an offence; or (b) it is for any other reason appropriate to make the order." Mr Smith's argument began with reference to the New South Wales Court of Appeal's decision regarding predecessor legislation, the Proceeds of Crime Act 1987, in DPP v. Logan Park Investments Pty Ltd (1995) 37 NSWLR 118, in particular at page 125 where the appropriateness of construing such legislation "strictly" was confirmed. I understood Mr Smith to be asserting that, perhaps unlike myself, other Judges had not been prepared to make examination orders ex parte. No instance of such reluctance was referred to me. I think it also should be said that no particular comfort has been provided by Mr Freer (for the DPP) today in the form of demonstration that other Judges have proceeded ex parte under section 180. Reference was made in support of today's application to Commonwealth DPP v. Garcia [2004] QDC 523 in which Judge Forde set aside, at least in part, restraining orders that had been made ex parte by another Judge. Commonwealth DPP v. Xu [2005] -- 7 of 13 -- 11102005 T25/TMP35 M/T CMS113/2005 (Robin DCJ) 8 ORDER 1 10 20 30 40 50 60 NSW SC 191 was about ancillary orders under Section 39 of the Act, subsection (3) of which provides: "A person who applies for an ancillary order must give written notice of the application to all other persons entitled to make such an application." Reference to subsection (2) shows that the full list of those entitled to apply for an ancillary order is the DPP, the owner of the property covered by the order, the official Trustee on the basis of an order having been made to take custody and control of the property and "any other person who has the leave of the Court." Unsurprisingly the Judge in Xu said at paragraph 15: "Taking account of the language of Section 39 particularly the use of the word 'must' I am of the opinion that failure to provide written notice is not to be regarded as an irregularity. Failure to give such written notice rendered the ancillary order a nullity. Section 39(4)(a) does not assist, it does no more than authorise an ancillary order being made at the same time as a restraining order." The Judge applied Project Blue Sky Inc v. Australian Broadcasting Authority (1998) 194 CLR 355 in taking that approach. Xu won the battle but lost the war, as Hobein J said in the next paragraph: "The only practical benefit for the defendant in succeeding on the preliminary point is that no action can be taken against her for being in breach of the ancillary order to date. The substantive question still needs to be decided." -- 8 of 13 -- 11102005 T25/TMP35 M/T CMS113/2005 (Robin DCJ) 9 ORDER 1 10 20 30 40 50 60 The Judge proceeded to treat the matter as an application instanter for a new ancillary order which was made, requiring the defendant to give the plaintiff within 21 days a statement sworn on oath setting out the particulars of, and her dealings with, the property of the defendant as specified in a schedule. The other authority relied on is re: Criminal Proceeds Confiscation Act [2004] 1 Queensland Reports 40. It dealt with State legislation which by Section 30 subsection (3) provided that: "The Court must hear the application: (a) In the absence of a person whose property is the subject of the application; and (b) Without the relevant person having been informed of the application." As the headnote summarises, the direction to hear an application in the absence of any party affected by the order to be made was such an interference with the exercise of the judicial process as to be repugnant to or incompatible with the exercise by the Court of the judicial power of the Commonwealth. Accordingly Section 30 was invalid as being beyond the power of the Queensland Parliament. The principal authority relied on was Kable (1996) 189 CLR 51, in which a New South Wales provision encountered the same fate of being held unconstitutional by reference to Chapter III of the Constitution of the Commonwealth. The Court's being invested with responsibility to exercise the judicial power of the Commonwealth rendered it unconstitutional for there to be any -- 9 of 13 -- 11102005 T25/TMP35 M/T CMS113/2005 (Robin DCJ) 10 ORDER 1 10 20 30 40 50 60 element of pollution by the exercise of powers which were seen as non-judicial. In this instance, the command not to hear a party affected was regarded as having the impermissible effect, the Court of Appeal, at page 49, relying on a statement of Lord Fraser in Hamilton [1981] AC 1038 at 1045: "One of the principles of natural justice is that a person is entitled to adequate notice and opportunity to be heard before any judicial order is pronounced against him so that he or someone active on his behalf may make such representations, if any, as he sees fit. That is the rule of audi alteram partem which applies to all judicial proceedings unless its application to a particular class of proceedings has been excluded by Parliament expressly or by necessary implication." Of course, the Court of Appeal had acknowledged the frequency of "special" cases such as Anton Pillar orders and Mareva injunctions. I have noticed provisions in the Proceeds of Crime Act 2002 which require notice to be given. Section 26(4) may be thought to raise questions of the kind our Court of Appeal considered. It provides, "The Court must consider the application without notice having been given if the DPP requests the Court to do so." That of course is not quite in the class of section 30 subsection (3) of the Queensland legislation. Section 26(4) is part of a much more complex section which in other parts envisages certain persons affected having notice. While I understand and respect Mr Smith's able argument on this point, I am unable to accede to -- 10 of 13 -- 11102005 T26/JLP15 M/T CMS113/2005 (Robin DCJ) 11 ORDER 1 10 20 30 40 50 60 it and without regarding myself as bound by the view I took on the 14th of June in any way, I adhere to it. That conclusion leaves it open to Mr Ngo to pursue his applications under rule 667 or under rule 668. Nothing has been shown to suggest that things went awry on that date because of anything that was placed before the Court. Turning to rule 668, reliance is placed on the Magistrate's dismissal of the charge which Mr Ngo subsequently faced. Mr Freer for the DPP has sought to use a further affidavit by Mr Potts who has been the main deponent in this regard all along, to the effect that he adheres to his original suspicion that Mr Ngo is an offender, notwithstanding the Magistrate's views. I would be reluctant without more to set any great store by what Mr Potts now says in the absence of reference by him to circumstances justifying it. The outcome of the committal does not disable the DPP from determining to indict, nonetheless, but I think it is entitled to respect from this Court and that was incumbent on Mr Potts to explain why he differed. Reference has been made to some theoretical possibilities, such as the existence of evidence which the Magistrate did not hear or the evidence that has been elicited in examinations of others relative to the greater inquiry being pursued on their examinations. -- 11 of 13 -- 11102005 T27/LDV16 M/T CMS113/2005 (Robin DCJ) 12 ORDER 1 10 20 30 40 50 60 There have been facts arising after the orders of 14 June last year which the Court ought to examine from the point of view of determining whether a stay under rule 668 is appropriate. It would be also open to the Court to set aside the order under subrule (3)(b). The new facts are the dismissal of the charge. On anxious reflection, I am not persuaded that those facts could be regarded as "entitling the person against whom the order is made to be relieved from it". Reasoning by analogy is always risky, but one might note the effect of quashing of convictions which can be gleaned from section 181 and the various sections referred to in it. By section 84, a forfeiture order made under section 48 is not discharged if within 14 days after the conviction is quashed the DPP applies to the Court for an order of confirmation. Section 107 deals in a similar way with the effect or lack of effect of the quashing of the conviction where there has been a forfeiture of property to the Commonwealth under section 92. Sections 146 and 173 respectively make similar provision in respect of pecuniary penalty orders and literary proceeds orders. As the reasons I gave on the last occasion indicate, it is not only persons who come within the descriptions in paragraphs (a), (b) and (c) in section 180 who may be ordered to be -- 12 of 13 -- 11102005 T28/PJH39 M/T CMS113/2005 (Robin DCJ) 13 ORDER 1 10 20 30 40 50 60 examined, but "any person" who it appears may be able to provide information about the affairs of those described in (a), (b) and (c). The fortunate outcome from Mr Ngo's point of view of the committal does not, it seems to me, mean that he is not "any person". (From the point of view of examination about his own affairs, as opposed to others' affairs, Mr Ngo comes within (a), even if he cannot be brought within (b). It is not necessary to have regard to Mr Potts' latest thoughts to reach this conclusion. The applications fail. ----- -- 13 of 13 --