On 30 April 2018, the Court of Appeal of NSW (Beazley P, Meagher and Gleeson JJA) delivered the decision in AD v Commissioner of the Australian Federal Police [2018] NSWCA 89.
The case highlights the importance of ensuring that any application for an exclusion order and any appeal against the refusal to make an exclusion order is heard and determined before automatic forfeiture takes place under the Proceeds of Crime Act 2002 (POCA).
Facts
After the appellant was charged, restraining orders were made under section 18 of the POCA in respect of various items of the appellant’s property.
On 20 March 2015, the appellant was convicted of two “serious offences” and sentenced to a term of imprisonment. Subsequently, the Crown appealed on sentence and, on 10 June 2016, the appellant was resentenced.
By reason of the appellant’s conviction of a “serious offence”, the restrained property was liable to automatic forfeiture at the end of either a six month period starting on the conviction day or an extended period fixed by the court, which must end no later than 15 months from the start of the conviction day (sections 92 and 93). The initial forfeiture date was extended by the Court to 19 May 2016.
On 1 December 2015, the appellant sought an exclusion order in respect of certain items of restrained property. The primary judge dismissed his application on 6 May 2016 (13 days before the date on which forfeiture occurred). On 4 August 2016, the property was declared to have forfeited to the Commonwealth at midnight on 19 May 2016.
The appellant filed a notice of appeal against the primary judge’s refusal to grant an exclusion order. The Commissioner of the Australian Federal Police sought summary dismissal of the appeal.
Principal issue:
The principal issue raised by the appeal was whether, after automatic forfeiture occurred, the Court of Appeal had the power to make an exclusion order if it considered that the trial judge had wrongly dismissed the exclusion application. If the Court of Appeal had no power, the appeal was futile.
Reasons:
The Court of Appeal determined that it had no power to grant an exclusion order after automatic forfeiture had occurred. Hence, the appeal was futile and bound to fail.
Beazley P stated (at [58]):
It follows therefore that, regardless of whether an application for an exclusion order was made within the six month period starting from the conviction day or any extension of that period, unless an exclusion order has been made before the expiry of either of those periods, as may be relevant, the property is forfeited.
Beazley P referred to the following observation of McClellan CJ at CL in Studman (at [63]):
The appropriate course for the appellant to have taken upon receiving the [primary judgment] was to appeal to this Court and seek an expedited hearing. If so persuaded, this Court could have made an extension order and provided for the appeal to be heard and determined within an appropriate period. However, as that course was not taken the situation is now irretrievable.
Further, Beazley P noted that the period after which automatic forfeiture occurs cannot be extended beyond 15 months (at [72]):
The court cannot, under ss 92-94, extend the period at the end of which property is forfeited beyond a period of 15 months from the start of the conviction day. Nor can an exclusion order be made at a time after the property has been forfeited. As neither an extension order could have been made in this matter, nor could an exclusion order have been made as the property had been forfeited, there was no basis for the Court to make an order under the Supreme Court Act, s 75(10). This is apparent from the terms of the sections themselves and is confirmed in the decisions of Studman and Halac.
The appellant also challenged the constitutional validity of aspects of the POCA on the basis that he alleged that it offended against the principle of separation of powers. In short, the appellant contended that the fact that the Court was compelled the make a restraining order abrogated the Court’s independent decision-making process. The contention was dismissed (at [83]-[106]).
Lessons for practitioners
First, practitioners must be aware that in the context of either a section 17 or 18 restraining order, property will automatically forfeit 6 months after the conviction date if, by that date, no exclusion is made. The filing of an application for exclusion does not stop time running (unlike, for example, under the Confiscation Act 1997 (Vic)).
Secondly, practitioners should seek a maximum extension period immediately after the conviction, so as to extend the automatic forfeiture date to the date which is 15 months after the conviction.
Thirdly, practitioners should seek timetabling orders for the trial that accommodate the time for the hearing and determination of an appeal within the 15 month period. If the appeal is not heard and determined in that 15 month period, it cannot succeed.
Fourthly, in order to be able to accommodate a trail and any appeal, practitioners must be in an advanced state of preparation (i.e. completed or near completed affidavits) at the time of any criminal trial or plea. If the work in connection with the exclusion application is delayed until after the conviction, then there is a real risk that any trial and possible appeal(s) cannot be conducted and determined in the 15 month period.
The 15 month time limit has the potential to work substantial prejudice to exclusion applicants. It may well render meritorious appeals against a refusal to grant an exclusion order nugatory. There is urgent need for legislative change, so that automatic forfeiture occurs only once an exclusion application is dismissed (or any appeal against a refusal to grant an exclusion application is dismissed), as is the case under the Victorian analogue, the Confiscation Act 1997.
About the author
Christian Juebner (LLB (Hons), BEc (Accounting), Grad. Dip. (Commercial Law)) was admitted to practice in 1996. He became partner with commercial law firm Deacons (now Norton Rose Fullbright) in 2002 and joined the Victorian Bar in 2004.
Through his commercial background, he is well placed to advise on property, contract, trust and corporations law issues, insofar as they impact on proceeds of crime litigation.
Christian can be contacted as follows:
- T (03) 9225 8203
- M 0410 657 177
- juebner@vicbar.com.au
- Room 1301, Castan Chambers, 460 Lonsdale Street, Melbourne VIC 3000
