Douglas Morris Willcoxson v Legal and General Insurance of Australia Limited [1990] ACTSC 14; (1990) 101 FLR 1 (10 April 1990)

SUPREME COURT OF THE ACT

DOUGLAS MORRIS WILLCOXSON v. LEGAL AND GENERAL INSURANCE OF AUSTRALIA LIMITED
S.C. No. 405 of 1989
Magistrate - Insurance - Evidence
[1990] ACTSC 14; (1990) 101 FLR 1

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Miles C.J.(1)

CATCHWORDS

Magistrate - dismissal of informations - successful appeal by way of order to review - discretion to remit to Magistrates Court - application of rule against double jeopardy.

Insurance - Authority to carry on insurance business - evidence of presumption of continuance.

Evidence - presumption of continuance.

Phipson on Evidence (13th ed.) p 122, paras. 9-16

Axon v. Axon [1937] HCA 80; (1938) 59 CLR 395 at 404

Sutton, Insurance Law in Australia and New Zealand 1980 ed., p 193

May v. O'Sullivan [1955] HCA 38; (1955) 92 CLR 654

HEARING

CANBERRA
10:4:1990

ORDER

The order nisi of 5 July 1989 be discharged.

The appellant pay the respondent's costs of and incidental to the appeal.

DECISION

This is the return of an order nisi for a review of an order made by a Magistrate in the Canberra Magistrates Court.

2. On 14 June 1989 the Magistrate dismissed two informations alleging that the respondent had committed offences against the Insurance Act 1973 (Cth) (the Act). The first information alleged a contravention of sub-s.44(4)(a) of the Act in the following terms:
".... that it being a body corporate authorised

under the said Insurance Act 1973 to carry on
insurance business in Australia on 30 November
1987 did not within the period of six weeks after
31 December 1987 lodge with the Insurance and
Superannuation Commissioner a statement of assets
in Australia and liabilities in Australia on 31
December 1987."

The other information alleged a contravention of sub-s.44(4)(b) of the Act in the following terms:

".... that it being a body corporate authorised
under the said Insurance Act 1973 to carry on
insurance business in Australia on 30 November
1987 did not within the period of six weeks after
31 December 1987 lodge with the Insurance and
Superannuation Commissioner a statement of
premiums and claims in respect of insurance
business carried on by it during the period of
three months ending on 31 December 1987."

3. The only evidence in the prosecution case was the following:
1. A certificate of incorporation under the seal of the

National Companies and Securities Commission issued
pursuant to the Companies (New South Wales) Code,
certifying that the respondent was incorporated on
14 June 1977.

2. A certificate under the hand of the Insurance and

Superannuation Commissioner appointed pursuant to s.4
of the Insurance and Superannuation Commission Act (the
Commissioner) certifying that the requirements of
paragraph 44(4)(a) of the Act had not been complied
with by the respondent in that the respondent did not
lodge with the Commissioner a statement of assets in
Australia and liabilities in Australia on 31 December
1987 within the period of six weeks after 31 December
1987.

3. A certificate under the hand of the Commissioner

certifying that the requirements of paragraph 44(4)(b)
of the said Act had not been complied with by the
respondent in that the respondent did not lodge with
the Commissioner a statement of premiums and claims in
respect of insurance business carried on by it during
the period of three months ending on 31 December 1987
within the period of six weeks after 31 December 1987.

4. A certificate under the hand of the Commissioner

dated 26 April 1988 certifying as follows:
"(1) Pursuant to sub-section 122(1) of the
Insurance Act I keep a register known as the
Register of Authorised Insurers.
(2) The said Register contains a record of each
and every authority to carry on insurance
business granted pursuant to the Insurance
Act.
(3) The said Register records that on 30
November 1978 an authority was granted to
Legal and General Insurance of Australia
Limited to carry on insurance business
pursuant to section 24 of the Insurance Act."

4. At the end of the prosecution case the Magistrate accepted a submission on behalf of the respondent that there was no evidence that at the date of the alleged offences, 11 February 1988, the respondent was authorised under the Act to carry on insurance business in Australia. The Magistrate took the view that the certificate of the Commissioner dated 26 April 1988 was evidence that on 30 November 1978 an authority was granted to the respondent to carry on insurance business pursuant to s.24 of the Act, but that it was not evidence that as at 11 February 1988 the respondent was still so authorised. The Magistrate expressed the view that further evidence was necessary to prove that the authority to carry on insurance business still existed at the date of the alleged offence. The Magistrate dismissed both informations and did not elaborate further on his reasons.

5. The informant appeals by way of application for order to review under s.219C of the Magistrates Court Ordinance 1930.

6. It is important to bear in mind that the Magistrate's decision was that there was no prima facie case in relation to an essential element of each of the charges, namely that at the date of the offence the respondent was authorised to carry on insurance business under the Act. That decision is to be contrasted with the decision that might have been made by the Magistrate had the case proceeded otherwise that, although a prima facie case had been made out, he was not satisfied beyond reasonable doubt that the guilt of the respondent had been proved beyond reasonable doubt because the state of the evidence still left open the reasonable possibility that the authority to carry on insurance business no longer existed at the time of the alleged offences.

7. The Commissioner's certificate dated 26 April 1988 did not expressly state, as presumably it might have, that the respondent was authorised to carry on insurance business at the date of the certificate. The relevant part of the certificate stated only that the register recorded that on 30 November 1978 an authority was granted to the respondent to carry on insurance business. The prosecution case was that there was a presumption of continuance whereby in the absence of any evidence to the contrary, it was to be presumed that the authority granted on 30 November 1978 continued and was still in existence at the date of the certificate, namely 26 April 1988, and therefore at the date of the alleged offences, namely 11 February 1988. The defence case was simply that there was no presumption of continuance, and that from the fact that the authority was granted on 30 November 1978 there could not be inferred the further fact that the authority continued at 11 February 1988.

8. Over many years there has been a good deal of judicial discussion and academic writing about the nature of presumptions and their place in the law. It is said that there are presumptions of law which are either rebuttable or irrebuttable and that there are presumptions of fact, which are always rebuttable. The better view appears to be that presumptions of fact are not really presumptions at all, and there is a good deal of disagreement about the nature of rebuttable presumptions of law. Phipson on Evidence (13th ed.) sums up the position at p 122, paras.9-16 in the following terms:

"States of mind, persons, or things, at a given
time may in some cases be proved by showing their
previous or subsequent existence in the same
state, there being a probability that certain
conditions and relationships continue. This sort of
inference is sometimes called the presumption of
continuance. While it is preferable to characterise
this as a presumption of fact and not a
presumption of law (that is, a true presumption)
it is more sensible and more accurate to regard it
as a type of ordinary reasoning which applies in
circumstances of the utmost frequency and
diversity. The strength of the inference
naturally diminishes with the remoteness of time,
and is merely part of the totality of the evidence
in the case .....
The use of the expression 'presumption of
continuance' obfuscates the fact that whether or
not a state of affairs continues is a question of
fact and depends only on the totality of the
evidence and the natural probabilities."

9. Many of the cases regarding the presumption of continuance are concerned with the presumption of the continuance of human life. In this connection Dixon J., as he then was, said in Axon v. Axon [1937] HCA 80; (1938) 59 CLR 395 at 404:

"When it is proved that a human being exists at a
specified time the proof will support the inference
that he was alive at a later time to which,
having regard to the circumstances, it is
reasonably likely that in the ordinary course of
affairs he would survive. It is not a rigid
presumption of law. The greater the length of
time the weaker the support for the inference.
..... The presumption of life is but a deduction
from probabilities and must always depend on the
accompanying facts."

10. In the present case we are not concerned with the continuance of a human life, but with the continuance or otherwise of the status under the Act of a body corporate. (There was, incidentally, no argument that there was no evidence that the respondent continued to exist as a body corporate.) That is a question of fact to be determined in the probabilities from the evidence, meagre as the evidence might be.

11. The background against which the continued authority of the respondent to carry on insurance business falls to be ascertained is the scheme established by the Act itself. The Act is somewhat blandly entitled "An Act relating to Insurance", but it is really an act regulating the insurance industry: Sutton Insurance Law in Australia and New Zealand 1980 ed., p 193. A person not being a body corporate or a Lloyds underwriter may not carry on insurance business in Australia: s.21. A body corporate may not carry on insurance business without being authorised to do so: sub-s.21(2). A body corporate may make application to the Commissioner for authority to carry on insurance business: s.22. The Commissioner, on being satisfied of certain matters relating to the assets and financial viability of the body corporate, may grant to it an authority to carry on insurance business: s.23. The authority is subject to certain conditions, for instance the value of paid up share capital shall not be at any time less than $500,000: s.29. The consequence of a failure to comply with any of the conditions to which the authority is subject is not spelt out in s.29. However, in s.36 the Commissioner is given power to revoke an authority in certain circumstances. Under s.36(1) the authority may be revoked at the request of the body corporate but only when the Commissioner is satisfied that the body corporate has no liability in respect of insurance business carried on by it in Australia. Where the Commissioner is satisfied that the body corporate has not commenced to carry on insurance business or has ceased to carry on insurance business and has no liabilities in respect of insurance business carried on in Australia, the Treasurer may, after notice, revoke the authority. Investigations and enquiries into a body corporate authorised to carry on insurance business and into its dealings and transactions are authorised by Part V of the Act.

12. Under s.122 the Commissioner is obliged to keep a register of authorised insurers. Section 124 is in the following terms:

"Evidence and Judicial Notice
124.(1) A certificate under the hand of the
Commissioner certifying as to any matter relating
to the contents of the Register of Authorized
Insurers shall be received in all courts as
evidence of the matter certified.
(1A) In proceedings in any court, a certificate
under the hand of the Commissioner that a requirement
of this Act specified in the certificate -
(a) had or had not been complied with at a date
or within a period specified in the
certificate; or
(b) has been complied with upon a date specified
in the certificate, but not before that
date,
is prima facie evidence of the matters specified
in the certificate.
(2) All courts shall take judicial notice of
the official signature of any person who is or has
been the Commissioner and of the fact that that
person is or was the Commissioner.
(3) In this section, "court" includes a
Federal court and a court of a State or Territory
and all persons authorized by a law of the
Commonwealth, of a State or of a Territory or by
consent of parties to receive evidence."

13. The Act sets up a scheme for the regulation of insurance business in Australia carried on by bodies corporate. The scheme envisages that such insurance business is not to be carried on unless the subject of an authority granted by the Commissioner. The granting of the authority to the body corporate confers a privilege which brings with it a correlative burden of responsibility, particularly in relation to the disclosure and management of its financial affairs. The scheme is no doubt aimed at protecting the interests of policy holders and investors and other persons directly concerned with the insurance industry. The involvement of the Treasurer in the scheme established by the Act reflects the wide economic and financial ramifications of the scheme. A body corporate which is granted an authority to carry on insurance business in Australia cannot rid itself unilaterally of its obligations. Nor may the Commissioner revoke the authority to carry on insurance business unless satisfied that the body corporate has no liabilities in respect of that insurance business in Australia. There is no provision in the Act for the annual or other periodic renewal of an authority to carry on insurance business. The scheme established by the Act is intended to keep the affairs of an authorised body corporate under scrutiny so long as the authority of the body corporate continues to exist. Whether or not this creates what is sometimes called a presumption of continuance, it means, in my view, that the bare fact of the granting of an authority to carry on insurance business on 30 November 1978 is capable of giving rise to an inference that on 11 February 1988 the authority was still in existence and that the respondent was on the latter date authorised to carry on insurance business.

14. It may well be, as was submitted on behalf of the respondent, that it was well within the capacity and province of the Commissioner under sub-s.124(1) to issue a certificate which put beyond doubt what was in issue, namely whether on 11 February 1988 the respondent was authorised to carry on insurance business. The point is, however, that in dealing with the question whether a prima facie case has been made out it is not relevant to consider whether any doubt has or has not been removed. The question is simply whether the evidence is capable of proving the essential elements of the charges to the required standard of proof beyond reasonable doubt.

15. I therefore rule that the Magistrate fell into error in holding that there was no evidence that at the date of the alleged offences the respondent was authorised to carry on insurance business in Australia. There remains the question whether in the exercise of discretion the matter should be remitted to the Magistrate or to the Magistrates Court for rehearing or for further hearing. That course is plainly open according to the terms of s.219F of the Magistrates Court Ordinance 1930. However, to make an order remitting the case to the Magistrates Court involves an invasion of the rule against double jeopardy and is not to be lightly taken. If the matter is remitted to the Magistrates Court, but not to the same Magistrate, the prosecution will have the opportunity to present its case again and to supplement the evidence, a course which is clearly against the normal principles of criminal justice. If the case goes back to the same Magistrate, the Magistrate may be asked by the prosecution to exercise his discretion to allow the prosecution to reopen its case. The exercise of that discretion lies with the Magistrate and not with this Court and it is not appropriate to direct the Magistrate how to exercise it, although I would think that in the interest of fairness the discretion should be exercised against allowing the prosecution to reopen and add to its case. If the case goes back to the same Magistrate and no further evidence is presented on behalf of the prosecution or the defence, the Magistrate will proceed to decide the facts on the evidence as it now stands. Whilst it may be within his legal power to decide, after hearing submissions from both sides, that he is in a position of doubt and to dismiss the informations on that ground (see May v. O'Sullivan [1955] HCA 38; (1955) 92 CLR 654) that would appear to be a perverse finding of fact. It is of course impossible to predict what might happen if the defence calls evidence.

16. This unsatisfactory state of affairs might have been avoided easily if the prosecution had tendered a certificate under the hand of the Commissioner pursuant to s.124(1) of the Act which simply stated that on 11 February 1988 the respondent was a body corporate authorised to carry on insurance business pursuant to s.24 of the Act. Because the prosecution might have sought to prove its case in so easy a fashion but declined for some reason to do so, I think it entirely inappropriate that the case should go back to the Magistrates Court so that the prosecution might continue its attempts to secure a conviction of the respondent. In these circumstances, I exercise my discretion not to set aside the dismissals of the informations. The order nisi is discharged. In accordance with s.219F(5) of the Magistrates Court Ordinance 1930 I order that the costs of and incidental to the appeal be paid by the appellant.