Tuan Quoc Dong v Greg Ranse [1999] ACTSC 125 (18 November 1999)

Last Updated: 23 November 1999

Tuan Quoc Dong v Greg Ranse [1999] ACTSC 125 (18 November 1999)

CATCHWORDS

CRIMINAL LAW - appeal from conviction by Special Magistrate for offence against Proceeds of Crime Act 1991, s 75(1) - whether money in possession of appellant may reasonably be suspected of being proceeds of crime - whether ruling of law on "no case to answer" submission cast onus on appellant to prove statutory defence under s 75(2) - it did not - whether appellant deprived of opportunity to have Special Magistrate consider whether elements of offence under s 75(1) proved beyond reasonable doubt - he was not.

Proceeds of Crime Act 1991, s 75(1), s 75(2)

Crimes Act 1900 (NSW), s 527A

Police Offences Act 1901 (NSW), s 27

Magistrates Court Act 1930, s 207

R v Buckett (1995) 79 A Crim R 302

Anderson v Judges of the District Court of New South Wales (1992) 27 NSWLR 701

Morris v Russell [1990] ACTSC 11; (1990) 100 FLR 386

May v O'Sullivan [1955] HCA 38; (1995) 92 CLR 654 at 658

Myers v Claudianos [1990] ACTSC 12; (1990) 100 FLR 362

Waverley Municipal Council v Roberts (31 August 1987, NSWSC, unreported)

Driclad Pty Limited v Federal Commissioner of Taxation [1966] HCA 59; (1968) 121 CLR 45

ON APPEAL FROM THE MAGISTRATES COURT

No. SCA 13 of 1999

Judge: Miles CJ

Supreme Court of the ACT

Date: 18 November 1999

IN THE SUPREME COURT OF THE )

) No. SCA 13 of 1999

AUSTRALIAN CAPITAL TERRITORY )

ON APPEAL FROM THE MAGISTRATES COURT

BETWEEN: TUAN QUOC DONG

Appellant

AND: GREG RANSE

Respondent

ORDER

Judge: Miles CJ

Date: 18 November 1999

Place: Canberra

THE COURT ORDERS THAT:

1. The appeal be dismissed.

1. This is an appeal from a conviction by a Special Magistrate for an offence against s 75(1) of the Proceeds of Crime Act 1991, the relevant parts of which provide:

"1. A person who ... possesses ... any money ... that may reasonably be suspected of being proceeds of crime is guilty of an offence under this section ...

2. Where a person is charged with an offence against this section, it is a defence to the charge if the person satisfies the court that he or she had no reasonable grounds for suspecting that the property referred to in the charge was derived or realised, directly or indirectly, from some form of unlawful activity."

2. The only ground of appeal pursued is that "the learned Magistrate erred in law in declining to take into account any of the evidence presented by the defendant as to the question of whether or not the goods could be described as reasonably suspected of being the proceeds of crime". The ground of appeal reflects the imprecision of which the Special Magistrate is accused. No question arises of the description of goods. The question is whether money in the possession of the appellant may reasonably be suspected of being the proceeds of crime.

3. At the end of the evidence called on behalf of the prosecution, counsel for the appellant made a submission of "no case to answer". In rejecting the application, the Special Magistrate summarised the evidence to support the prosecution case as follows:

(a) On the day before Mr Dong was apprehended the vehicle he was driving had been observed at the BP station. Mr Yeats, the manager had observed people make phone calls. A short time after the calls were made that vehicle arrived and the people got into it. They were in the vehicle for a short time and were seen to exchange something. This happened on a couple of occasions.

(b) The BP station was a place where drug transactions took place, and people involved with drugs were known to be.

(c) On 27 May 1999 Mr Yeats, the manager of the BP station saw someone make a telephone call and then saw the car (in which the appellant was arrested) arrive a short time after the call. This was approximately 9.30 am. Once again the caller got into the car for a very short period of time.

(d) There was no evidence that Mr Dong was in the car prior to his arrest in it later on 27 May.

(e) When Mr Dong was arrested, a Star TAC mobile phone, which rang frequently, was found in the car. This phone was owned by Mr Quoc Kno who had lent it to Mr Dong.

4. The Special Magistrate concluded on the "no case to answer" submission:

"I am of the view that given the phone - that the Star TAC phone had been in his possession and being the one on which all the calls that one might reasonably suspect to people seeking to purchase drugs that it is reasonable to entertain a suspicion that the money that was in his wallet and in the pocket of the car were proceeds of the sale of illicit drugs and I find that he does have a case to answer, Mr Gill."

5. The appellant then gave evidence on his own behalf. The Special Magistrate rejected the evidence of the appellant that the money came from winnings on poker machines at the City Club, part being his own winnings and part being the winnings of friends which he was holding on their behalf.

6. The Special Magistrate found the offence proved. His reasons for decision commence with the following:

"At the end of the prosecution's case I was of the view that the prosecution had established that the money may reasonably be suspected of being the proceeds of crime, namely, trafficking in drugs.

The defendant went into the witness box and sought to establish a defence. The way Mr Gill approached it seemed to me to be twofold. Firstly, given Mr Dong's evidence that it is no longer appropriate to reasonably suspect the money being in [sic] the proceeds of crime and secondly take advantage of the provision that permits a person to raise the defence of attempting to satisfy the Court that he had no reasonable grounds for suspecting that the property referred to in the charge was derived, realised directly or indirectly from some sort of unlawful activity.

It seems to me that the structure of the section does not really permit the defence to go back to the beginning, as it were, of attempting to deal with the issue that led to the defendant being called on to give evidence. It seems to me that once the Court makes the original finding then the defendant has the onus of satisfying the Court that in this case he had no reasonable grounds for suspecting the property referred to in the charge was derived, realised directly or indirectly from some form of unlawful activity."

7. Mr. Sharman, who appeared for the appellant in the appeal, submitted that these introductory paragraphs of the reasons for decision of the Special Magistrate indicate that his Worship fell into error by not taking into account the evidence of the appellant for the purpose of determining whether or not the prosecution had proved beyond reasonable doubt that the money in the possession of the appellant may reasonably be suspected of being the proceeds of crime.

8. Ms Cronan, for the respondent Director of Public Prosecutions, submitted that reading the reasons as a whole, the Special Magistrate must be taken to have been aware of the need for the prosecution to prove the ingredients of the offence under s 75(1) beyond reasonable doubt, and at the end of all the evidence, the Special Magistrate should be taken to have found the facts supported by the evidence in the prosecution case so clearly established that it must follow that he found them proved to the requisite standard, that is, beyond reasonable doubt.

9. The initial difficulty with the submission on behalf of the respondent is that parts of the Special Magistrate's reasons suggest that he treated his rejection of the application of the "no case to answer" submission as casting an onus on the appellant, pursuant to s 75(2), to satisfy the Court that he had no reasonable grounds for suspecting that the money was the proceeds of unlawful activity. It is necessary to examine this aspect.

10. It has been said that the origin of s 75 (or its equivalent in New South Wales) is in the old offence of "goods in custody" (as enacted for instance in the Crimes Act 1900 (NSW), s 527A, and in the Police Offences Act 1901 (NSW), s 27) and should be interpreted in accordance with decisions relating to that offence: see the judgment of Hunt CJ at CL in R v Buckett (1995) 79 A Crim R 302 at 307, where his Honour went on to say at 307-308:

"The effect of this statutory framework is thus that the state of knowledge of the person charged as to the provenance of the things in his custody is irrelevant to the prosecution case; but if the court is satisfied beyond reasonable doubt upon the state of the evidence before it that those things may reasonably be suspected of being stolen or otherwise unlawfully obtained, the person charged must, in order to escape conviction, discharge the lesser civil onus upon him of satisfying the court that he had no reasonable grounds for suspecting that they were stolen or unlawfully obtained: Ex parte Patmoy; Re Jack (1944) 44 SR NSW 351 (at 356); Tegge v Caldwell (1988) 15 NSWLR 226 at 227-228; 36 Crim R 8 at 9-10; Anderson v Judges of District Court (1992) 27 NSWLR 701 (at 291-292, 716-717)."

11. The legislation had been the subject of earlier examination in Anderson, where Kirby P, with whom Meagher and Sheller JJA agreed, said at 715:

"As was observed during argument, there is an ambivalence in the section. The pre-conditions must, as in any other criminal offence, be established beyond reasonable doubt. How a level of thought which is qualified by what `may' be (and does not need to reach beyond what is `suspected') can be established beyond reasonable doubt is not entirely clear. But the section exists and has survived for more than a century in substantially the same form. It can apply to banknotes. It must therefore be given meaning. Presumably the criminal onus and the words of the section must be reconciled by saying that the court before which the person is charged must be satisfied beyond reasonable doubt that the circumstances are such that the thing in question may reasonably be suspected of being stolen or otherwise unlawfully obtained."

12. Kirby P went on to consider the statutory defence provided for in the second sub-section, and said at 716:

"... the [sub] section is concerned with whether the person, having the thing in his or her custody, had reasonable grounds for suspicion that it was stolen or otherwise unlawfully obtained. It is concerned with what the accused's belief was, not with what was the suspicion of the arresting police, the prosecutor or the court concerning the thing suspected of having been unlawfully obtained."

13. Where the District Court Judge in Anderson had decided that there was a "prima facie case" established on the prosecution evidence and the unrepresented defendant had declined to give evidence, Kirby P at 717 stressed that it was important:

"... that his Honour should nonetheless have considered whether the prosecution had proved its case against him according to the criminal onus. That issue remained. It was not determined by the finding that a prima facie case had been established."

14. The Special Magistrate in the present case was aware of the pitfalls. When the "no case to answer" application was made, the Special Magistrate drew counsel's attention to the decision of Kelly J in Morris v Russell [1990] ACTSC 11; (1990) 100 FLR 386 where his Honour said at 391-392:

"When all these matters were taken into account, taking the prosecution evidence at its highest, it seems to me that there was a prima facie case which would have enabled the learned magistrate to conclude, as a matter of law, that the money could reasonably be suspected of having been unlawfully obtained. He agreed that the evidence would permit one to suspect, as a matter of possibility, that the money was the proceeds of illegal drug sales and this without having taken into account matters which he should have in considering whether there was a case to answer. The question he would then have been required to ask himself would have been whether, having regard to all the evidence pointing to the moneys having been unlawfully obtained, he was satisfied beyond reasonable doubt that it was then proper for him to entertain a reasonable suspicion that the money was unlawfully obtained, bearing in mind that suspicion is less than prima facie proof and certainly less than proof beyond reasonable doubt."

15. Although the reported decision does not make it clear, it appears that in Morris v Russell, as in Anderson, the defendant had declined to give evidence on his own behalf. That was why, in Morris v Russell, the magistrate, having ruled as a matter of law that there was a "prima facie case" (or "case to answer"), would then have been required to consider whether, on all the evidence, he was satisfied beyond reasonable doubt that it was proper to entertain a reasonable suspicion that the money was unlawfully obtained. The principles as stated in Morris v Russell were a reformulation, in the circumstances of that case, of the basic principles laid down by the High Court in May v O'Sullivan [1955] HCA 38; (1995) 92 CLR 654 at 658:

"When, at the close of the case for the prosecution, a submission is made that there is `no case to answer', the question to be decided is not whether on the evidence as it stands the defendant ought to be convicted, but whether on the evidence as it stands he could lawfully be convicted. This is really a question of law. Unless there is some special statutory provision on the subject, a ruling that there is a `case to answer' has no effect whatever on the onus of proof, which rests on the prosecution from beginning to end. After the prosecution has adduced evidence sufficient to support proof of the issue, the defendant may or may not call evidence. Whether he does or not, the question to be decided in the end by the tribunal is whether, on the whole of the evidence before it, it is satisfied beyond reasonable doubt that the defendant is guilty. This is a question of fact. In deciding this question it may in some cases be legitimate, as is pointed out in Wilson v Buttery [1926] SASR 150 for it to take into account the fact that the defendant has not given evidence as a consideration making the inference of guilt from the evidence for the prosecution less unsafe than it might otherwise possibly appear: cf. Morgan v Babcock & Wilcox, per Isaacs J [1929] HCA 25; (1929) 43 CLR 163 at 178. But to say this is a very different thing from saying that the onus of proof shifts. A magistrate who has decided that there is a "case to answer" may quite consistently, if no evidence is called for the defendant, refuse to convict on the evidence for the prosecution. The prosecution may have made `a prima facie case', but it does not follow that in the absence of a `satisfactory answer' the defendant should be convicted."

16. It is essential that the distinction between a ruling of law on a "no case to answer" submission and a finding of fact on a submission that the prosecution has not proved the case beyond reasonable doubt be kept clearly in mind: Myers v Claudianos [1990] ACTSC 12; (1990) 100 FLR 362. A submission or ruling that the prosecution has failed to call evidence sufficient to establish a "prima facie case", or as it is sometimes called a "case to answer", tends to be confusing where there is statutory provision for a defence which may be established by the defendant. The terms "prima facie case" and "case to answer" can and should be avoided in making submissions and ruling on the question whether, at the end of the prosecution case, on the evidence as it stands the defendant could lawfully be convicted. Rejection of the submission that the defendant could not be lawfully convicted on the prosecution evidence does not cast any onus on a defendant. In the present case the Special Magistrate appears to have considered that the ruling of law on the submission that the appellant could not lawfully be convicted on the prosecution evidence amounted to establishing a "prima facie case" under s 75(1) which then cast an onus on the appellant to make out a defence on the balance of probabilities under s 75(2). Such an approach involved an error of law. A defence under s 75(2) could not have arisen and the appellant could not have been "called upon" to establish the defence under the sub-section unless and until, after hearing all the evidence, including that of the appellant himself (if he chose to give it), the Special Magistrate was satisfied as a matter of fact that the elements of the offence under s 75(1) were proved beyond reasonable doubt. Until he had made such a finding, the Special Magistrate could not lawfully have proceeded to determine whether he was satisfied on the balance of probabilities of the quite different factual elements of the defence available under s 75(2).

17. The Special Magistrate appears to have approached the question of the evidence of the appellant on the basis that, because the ruling had been given that there was a "case to answer" under s 75(1), the evidence was relevant only to the defence under s 75(2). The appellant was thus deprived of the opportunity of having the Special Magistrate consider the precise question whether the whole of the evidence, including that given by the appellant, was not sufficient to prove beyond reasonable doubt the ingredients of the offence with which he was charged, before considering the statutory defence.

18. However, I accept the submission on behalf of the respondent that it would be quite unrealistic to contemplate that, having rejected the appellant's explanation of the money in his possession being the proceeds of winnings of himself and friends on poker machines, the Special Magistrate would have entertained some doubt about whether the prosecution had made out its case that the money in the appellant's possession may reasonably be suspected of being proceeds of crime. In his reasons at the conclusion of the case, after all the evidence had been given and after counsel had made their final addresses, the Special Magistrate again referred briefly to the evidence in the prosecution case which he had summarised earlier for the purposes of the "no case to answer" submission. On that evidence, the remarks of the Special Magistrate that "it is reasonable to entertain the suspicion that the money that was in his wallet and in the pocket of the car were proceeds of the sale of illicit drugs" would have been entirely justified if he had made them at the end of all the evidence and not at the end of the prosecution case. Nevertheless, in my view, it is inconceivable that, having considered the appellant's explanation in evidence, and having rejected it, the Special Magistrate would have entertained some doubt about whether the money in the appellant's possession may be suspected of being the proceeds of crime, namely, the sale of illicit drugs.

19. In Tegge v Caldwell, another case of "goods in custody", a magistrate had rejected the evidence of a defendant but applied the wrong standard of proof as to the statutory defence. Yeldham J, on an application for statutory prohibition, cited approvingly at 228, the remarks of Hunt J in Waverley Municipal Council v Roberts (31 August 1987, NSWSC, unreported) that:

"To quash a conviction simply because a magistrate has misdirected himself upon some issue when there was ample material before him to have supported the conviction upon some other basis would be wholly inappropriate."

20. In an appeal from the decision of the Magistrates Court to this Court under s 207 of the Magistrates Court Act 1930, the appeal is against the judgment of the court below. It is not an appeal against the reasons: Driclad Pty Limited v Federal Commissioner of Taxation [1966] HCA 59; (1968) 121 CLR 45 per Barwick CJ and Kitto J at 64. Detection of error in the reasons is not sufficient to allow the appeal unless that error is shown to have affected the outcome. It is quite clear that had the Special Magistrate applied the correct process of reasoning, the outcome would have been the same. The conviction should not be set aside in order, as Yeldham J put it, "to allow the matter there to rest". The alternative, namely to quash the conviction and remit the matter to the Special Magistrate in order to enable counsel for the appellant to repeat the submissions previously made that the prosecution had not established beyond reasonable doubt that the money of which the appellant was in possession may reasonably be suspected of being the proceeds of crime, would be a completely pointless exercise. Far from upholding the rule of law, as was submitted, it would tend to bring the law into disrepute.

21. In my view, the appeal should be dismissed. I will hear the parties on costs.

I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, the Chief Justice.

Associate:

Date: 18 November 1999

Counsel for the appellant: Mr T C Sharman

Solicitor for the appellant: Saunders and Company

Counsel for the respondent: Ms S Cronan

Solicitor for the respondent: ACT Director of Public Prosecutions

Date of hearing: 11 November 1999

Date of judgment: 18 November 1999