Parker v R [1997] HCA 15; (1997) 186 CLR 494; (1997) 143 ALR 293; (1997) 71 ALJR 598 (11 April 1997)

HIGH COURT OF AUSTRALIA

BRENNAN CJ,

DAWSON, TOOHEY, McHUGH AND KIRBY JJ

DAVID CHARLES PARKER APPELLANT

AND

THE QUEEN RESPONDENT

ORDER

1. Appeal allowed.

2. Set aside the order of the Court of Criminal Appeal directing that there be a new trial.

3. Enter verdicts of acquittal on counts 1, 3, 4, 5, 6, 7 and 11.

11 April 1997

FC 97/013

On appeal from the Supreme Court of Western Australia (Court of Criminal Appeal)

Representation

G R James QC with M J Watson for the appellant (instructed by

Dwyer Durack)

J R McKechnie QC with A R Beech for the respondent (instructed by Director of Public Prosecutions, Western Australia)

Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

David Charles Parker v The Queen

Criminal law - Stealing - Receipt of funds some of which expressly intended for election campaign purposes - Mixing of funds in common bank account - Money withdrawn for personal purposes - Correctness of conclusion of Court of Criminal Appeal (WA) that moneys held on trust for each donor - Conviction for stealing quashed on basis of misdirection at trial - Whether new trial should have been ordered - Crown proposing significant amendments to indictment at new trial.

The Criminal Code (WA), ss 371, 373, 378, 584.

BRENNAN CJ. The facts giving rise to this appeal are stated by Dawson, Toohey and McHugh JJ. The question for determination is whether, having regard to the terms in which the indictment was framed, the evidence was sufficient to support the conviction of the appellant on those counts on which the jury found him guilty. The answer to that question depends on the sufficiency of the evidence to establish that money withdrawn by the appellant from the "ALP David Parker for Fremantle Campaign" bank account[1] ("the account") on the occasions specified in the respective counts was the property of the persons referred to in those counts. In each count, the property in the money withdrawn was laid in a named donor of money "and others".

By virtue of s 373 of The Criminal Code (WA) ("the Code"), money given to a recipient with a direction that it be applied for a given purpose is deemed to be the property of the person giving it ("the donor") until the direction has been complied with. It follows that each contribution that was received by or on behalf of the appellant accompanied by a direction to apply it for a purpose (such as defraying the election expenses of the appellant) is deemed to have been the property of the donor, at least until it was paid into the account. On payment into the account, the actual notes and coins and the proceeds of cheques contributed by donors were converted into credits in that account. When each contribution was paid into the account, it was mixed with other moneys, some of which had been contributed with a direction as to their application and some of which were free funds which the appellant was entitled to apply to his own private use. The credits arising from the several contributions were commingled with one another and with the free funds in the account.

Section 371(7) includes in the definition of "property" money, debts and bank credits and "any property in which or for which [property] has been converted or exchanged and anything acquired by the conversion or exchange, whether immediately or otherwise". The bank credits into which contributions were converted thus became property for the purposes of s 371(2) which reads:

" A person who takes anything capable of being stolen or converts any property is deemed to do so fraudulently if he does so with any of the following intents, that is to say:-

(a) An intent to permanently deprive the owner of the thing or property of it or any part of it;

(b) An intent to permanently deprive any person who has any special property in the thing or property of such special property;

...

(f) In the case of money, an intent to use it at the will of the person who takes or converts it although he may intend to afterwards repay the amount to the owner.

The term 'special property' includes any charge or lien upon the thing or property in question, and any right arising from or dependent upon holding possession of the thing or property in question, whether by the person entitled to such right or by some other person for his benefit."

Although specific notes, coins, or cheques contributed by a donor would be capable of being stolen or converted[2], a bank credit arising from the paying in of a contribution to an account would not be capable at common law of being stolen or of being converted[3]. But, as s 371(7) brings a bank credit within the definition of "property" for the purposes of s 371, a bank credit must be taken to be capable of fraudulent conversion as money in the form of particular coins, notes or bills of exchange. The drafting of the Code, which was the work of Sir Samuel Griffith, was explained by Wickham J in Orsi v Legal Contribution Trust[4]:

" Sir Samuel Griffith, however, in drafting the Code adopted a different approach and in doing so anticipated the ideas now revealed in the English Theft Act 1968. Instead of adapting the older devices ... which provided that dishonest dealing with funds held under direction or received by agents should be deemed to be theft, he preferred the course of declaring that property held under such circumstances should be deemed to be the property of the person beneficially entitled to it, and thus by statute creating a situation where an act of fraudulent conversion would fall within the general statutory definition of stealing: see xiii of Sir Samuel's explanatory letter to the Attorney-General of 29 October 1897. This was achieved by sections of which the equivalent in the Western Australian Code are ss 373, 374 and 375. In the equivalent of s 373 the Royal Commission slightly amended Sir Samuel's draft by inserting the words 'or any other money received in exchange for it or any part thereof'. That Sir Samuel's objective had been achieved received judicial recognition by the Full Court of Queensland in the case of Re a Solicitor[5]."

In Re a Solicitor, a solicitor to whom money had been given for a specific purpose failed either to apply it to that purpose or, on demand, to return it. The Full Court of the Supreme Court concluded that he had stolen the money. Without reference to the form in which the money had been given or into which it had been changed, Griffith CJ speaking for the Court in reference to the Code then lately enacted said[6]:

"Last year it was not technically stealing, though morally just as bad: now, under the Code it is stealing, and the man who does it, solicitor or not, is liable to be dealt with criminally."

Similarly, a bank credit (which is a chose in action) can be "converted" if it is dealt with inconsistently with the rights of the owner of the bank credit and, if it be converted with fraudulent intent, the conversion is stealing. The same result was achieved in England by the provisions of the Theft Act 1968 (UK)[7]. A reflection of some of the provisions of that Act can now be seen in s 408C of the Queensland Criminal Code and the concept of converting a bank credit has been judicially recognised[8].

Although a bank credit for which other property is exchanged is "property" for the purposes of s 371 and is deemed by s 373 to be owned by the owner of the original property, can ownership of a bank credit survive when it is commingled in an account containing other credits? If the bank credits of several donors are mixed with other credits in a bank account, do the donors' bank credits lose their separate identity in the mass of credits commingled in the account? It would subvert the obvious purpose of ss 371 and 373 and be inconsistent with Re a Solicitor[9] to hold that, by payment of money given subject to a direction into an account in which the recipient kept his own funds, the recipient could escape liability for stealing when he misappropriated the money subject to the direction. But it cannot be stealing for a recipient to withdraw money from his bank account for his own purposes when, although his account contains a bank credit deemed to be owned by another, it continues to contain enough free funds to cover the withdrawal. The "conversion" of which s 371 speaks is conversion of property owned by another or in which another has a "special property" - for example, a charge or lien over the property.

In such a situation, the determination of the ownership of the money in the account and the character of the money withdrawn raises a question of mixed fact and law, sometimes technical law. The practice under the Theft Act is for the trial judge to direct the jury as to the facts of which they must be satisfied in order to be satisfied as to the ownership of what has been appropriated in the light of the judge's own determination of the applicable law[10]. That is a practice which ought to be followed in this country. It is the applicable law that has to be determined on this appeal.

When a number of contributions by donors are banked to the credit of a bank account which also contains moneys which the holder of the account may use at will, is it possible to attribute a withdrawal effected with the intent to use the money withdrawn at will to any one or more of the donors' contributions? In principle, an affirmative answer must be given. If the bank credits representing the donors' contributions are to be treated as the property of the donors, a withdrawal that diminishes the sum of those bank credits is a conversion of the amount by which they are diminished[11]. The identification of the owner or owners of the amount converted must depend either on the rules of common law or the rules of equity.

The common law rule

If the bank credits which are commingled in the account with other bank credits are treated by the Code as property capable of conversion and are deemed to be the property of the donors, the donors' bank credits in the account become simply part of an undifferentiated mass. Then the basic rule is that stated by the Privy Council in The South Australian Insurance Co v Randell[12]:

"In the case of mixture by consent, the identity of the specific property of each who consents is no longer ascertainable, and the mixed property belongs to all in common."

In the present case, the donors must have been taken to consent to the banking of their contributions. A stricter rule is applied if the person having control of the mass of property wrongfully mixes his property with the property of another. Staughton J, after reviewing the authorities in Indian Oil Corp v Greenstone Shipping SA[13], stated the rule thus:

"where B wrongfully mixes the goods of A with goods of his own, which are substantially of the same nature and quality, and they cannot in practice be separated, the mixture is held in common and A is entitled to receive out of it a quantity equal to that of his goods which went into the mixture, any doubt as to that quantity being resolved in favour of A."

The same rule is applied if the person controlling the account pays money belonging to others into a bank account which contains free funds - albeit with their consent - and then withdraws money from that account to use at will. The rule was stated by Page Wood V-C in Frith v Cartland[14]:

"If a man has [sterling]1000 of his own in a box on one side, and [sterling]1000 of trust property in the same box on the other side, and then takes out [sterling]500 and applies it for his own purposes, the Court will not allow him to say that that money was taken from the trust fund. The trust must have its [sterling]1000 so long as a sufficient sum remains in the box."

This rule does not depend on the man in charge of the box being a trustee. It is a common law - and, one may add, a common sense - rule by which the law gives effect to the common morality of the community.

The equitable rule

The equitable rule is to the same effect but it allows the tracing of money into identifiable forms into which it is changed. In Brady v Stapleton[15] Dixon CJ and Fullagar J said that:

" Cases in which one who has in his hands the property of another converts that property into some other form or mixes property of another with his own have been familiar both to courts of law and to courts of equity. Courts of law were concerned with legal ownership, and courts of equity with equitable ownership, but, up to a point, as is well known, the doctrines of the two systems were identical."

The passage I have cited from Frith v Cartland was cited with approval by Jessel MR in In re Hallett's Estate; Knatchbull v Hallett[16]. In that case[17] Jessel MR, citing earlier authority[18], pointed out that the changing of property belonging to a person from one form into another makes no difference to the right of that person " 'as long as it can be ascertained to be [the product of that person's property], and the right only ceases when the means of ascertainment fail' ". In that event, he said, the rule of Equity "gave you a charge - that if you lent [sterling]1000 of your own and [sterling]1000 trust money on a bond for [sterling]2000, or on a mortgage for [sterling]2000, or on a promissory note for [sterling]2000, Equity could follow it, and create a charge". Dixon CJ and Fullagar J in Brady v Stapleton[19] said that:

"it would be a great mistake to suppose that the great case of Re Hallett's Estate lays down a doctrine peculiar to money. On the contrary, it extends to money paid into a bank account, and so losing its identity as money, a doctrine which equity would never have had the slightest hesitation in applying to money physically existing or to any other kind of personal property to which it could, as a matter of practical possibility, be applied. ... In Re Hallett's Estate[20], the Master of the Rolls says: 'Supposing the trust money was 1000 sovereigns, and the trustee put them into a bag, and by mistake, or accident, or otherwise, dropped a sovereign of his own into the bag. Could anybody suppose that a Judge in Equity would find any difficulty in saying that the cestui que trust has a right to take 1000 sovereigns out of that bag?' " (Emphasis added.)

It follows that when an account holder makes a withdrawal for his own private purposes from an account containing a mixed fund, the rules of equity and the common law run parallel in attributing the withdrawal to the moneys that can lawfully be so used so far as those moneys extend.

In the present case, if the common law rule is applied, the amounts which were credited to the account by the payment in of donors' contributions are untouched by withdrawals by the appellant for his own private purposes (or for any other purpose authorised by a donor) until the funds which the appellant was entitled to use for those purposes were exhausted. At that point, the money remaining to the credit of the account is the property in common of the donors. In terms of s 371 of the Code, the property in the balance of the account was vested in the donors once the appellant had exhausted by withdrawals the amounts which he was lawfully entitled to withdraw.

If the equitable rule is applied, a similar result is achieved. The appellant did not receive the donors' contributions by way of gift, in discharge of an obligation or as an amount to be treated as an item in a debtor and creditor account. He banked the contributions as a fiduciary. Therefore the donors, whose money it was deemed to be, had a charge over the account. Once the appellant had withdrawn the amounts he was entitled to withdraw, any further unauthorised withdrawal depleted the donors' charge over - their "special property" in - the account. In accordance with the maxim that equity is equality, the donors would have been entitled to the benefit of the charge in proportion to the amounts of their contributions remaining in the account at the time of an unauthorised withdrawal.

Whether the common law or the equitable principle be applied in the present case, the issues of fact are the same. However, although the Code does not exclude the operation of equitable rules in determining whether a person has a special property in a thing or chose in action, it is the common law rule that should be applied in determining whether property in any of the forms mentioned in s 371(7) is the property of a particular person.

In the present case, the prosecution contended in the Court of Criminal Appeal that, at the time of the withdrawals specified in the counts on which the appellant was convicted, the donors were co-owners of the money withdrawn. In my opinion, that contention was correct. Their co-ownership was not a consequence of the intentions of the several co-owners that they should acquire property in common in the bank account. It is the legal consequence of the payment into the account of moneys which, by force of s 373, were deemed to be the moneys of the respective donors and which were mixed indistinguishably with other moneys in the account. This analysis was rejected by the Court of Criminal Appeal, apparently on the ground that co-ownership could arise only if each of the respective donors so intended. That was a proposition for which Bacon v Pianta[21] was cited as authority. Bacon v Pianta turned on the construction of a will containing a gift to "The Communist Party of Australia", a voluntary association. The Court held that, as there was no testamentary intention to benefit the members of the Communist Party, they did not take the gift beneficially and the gift failed. In my respectful opinion, that case is irrelevant to the present case.

Rejecting the prosecution's submission as to property in the moneys withdrawn without authority, the Court of Criminal Appeal sought to invoke equitable rules as to the tracing of property to identify the owners of the moneys withdrawn without authority. In my respectful opinion, that was an approach that could have identified the donors' special property in the moneys withdrawn, but the Court's conclusion seems to depend on the assumption that each donor's contribution "would be withdrawn rateably in proportion to the amount thereof" irrespective of the purpose for which the withdrawal was made. In my respectful opinion, a withdrawal for a purpose authorised by one donor but not authorised by another should be attributed to the money available for withdrawal for that purpose. A fortiori, a withdrawal for the appellant's private use should be attributed to whatever free funds were available. There was no evidence of the intention of the donors to the contrary. Their Honours were of the opinion that it was an error for the trial judge not to explain "the relevant principles". But, if the English practice be right, it is unnecessary for a trial judge to explain the principles so long as he identifies to the jury the relevant facts on which the issue of a person's property or special property depends.

In this case, it is common ground between the parties that, in the case of each of the counts on which the appellant was convicted, there were insufficient free funds available to cover the amount withdrawn by the appellant for his private use. Hence, on each occasion, the withdrawals converted the property of the donors. There was ample evidence on which the jury could find such a conversion with a fraudulent intent. The appellant's submission that the Crown could not prove the fraudulent conversion of funds belonging to any particular donor named in the several counts on which the appellant was convicted misconceives the nature of the property or special property of the donors[22]. There is no common law or equitable rule which would debit a withdrawal against the money contributed by a named donor only if it could not be debited against the moneys contributed by anybody else.

The next question is whether the appellant was liable to conviction on counts in the indictment in which property in the money withdrawn was laid in a named donor "and others". A withdrawal that depleted the account balance that was the property of the donors was a withdrawal of money that was the property of all of them. The respective amounts to which the respective donors were severally entitled out of the balance in the account at the time of the withdrawal were irrelevant. There was no occasion to consider questions of distribution, priority or tracing. A balance contributed by particular donors might have been exhausted by a withdrawal at some stage in the account's history so that a balance built up by later contributions was not the property of the earlier donors. However, that possibility can be discarded in relation to each of the counts on which the appellant was convicted. The money contributed by the named donor mentioned in each of those counts had then lately been deposited to the credit of the account and was part of the account balance of non-free funds which were depleted by the particular withdrawal.

The indictment was appropriately drawn to reflect that situation. Section 584(6) of the Code reads:

" In an indictment in which it is necessary to mention any co-owners of property it is sufficient to name one of such persons, adding the words 'and another' or 'and others', as the case may be, and to state that the property belonged to the person so named and another or others, as the case may be."

In each count, the money that was the property of "the person so named" was part of the non-free funds against which the impugned withdrawal was made.

At the trial, the issue of the persons whose property was converted did not loom large. Little attention was given to it by the parties. The trial judge gave the jury these directions:

" So the law is that if you take 'save the whales' collection money from the tin when obliged to take it to the 'save the whales' office, you steal it from the providers of the money. That's all those people who have made donations by putting their money in the tin. The first question you must decide is whether the amounts making up the donations total - that's the items 1 to 64, the $123,000, admittedly paid by donors - whether that money in each case was given with a direction."

Later, his Honour said:

" If the collector takes the money from the tin for himself or herself, there is a stealing, and that stealing is from you and all the others who gave. That is why the indictment is set out in the way that it is. It mentions one of the donors 'and others'."

As earlier noted, the Court of Criminal Appeal, believing it necessary that more detailed directions be given, found fault with this aspect of the summing up. For that and other reasons, the convictions were set aside and a new trial ordered. In my opinion, the summing up by the trial judge with reference to ownership of the money withdrawn was, in the circumstances of the case, sufficient to bring home to the jury that, if the donations which aggregated $123,000 were subject to directions, they would be the property of the persons referred to in the several counts in the indictment. It may have been desirable - much would depend on an analysis of the balances in the account - to add a direction as to ownership in the event that any of the donors were found not to have given a direction. However that may be, a retrial would not result in the prosecution of a case on retrial different from that which the appellant had to meet at his trial. I would therefore dismiss the appeal. Whether the appellant, who has already served the sentence imposed, should be retried is a question for consideration by the Director of Public Prosecutions.

DAWSON, TOOHEY AND McHUGH JJ. The appellant was indicted under The Criminal Code (WA) ("the Code") on 11 counts of stealing various sums of money. He was convicted on seven counts. His appeal against conviction was allowed by the Court of Criminal Appeal of Western Australia (Malcolm CJ, Ipp and Steytler JJ) which directed a new trial on the seven charges. This appeal is brought against the order for a new trial.

By his notice of appeal the appellant seeks to have the order for a new trial quashed and verdicts of acquittal entered. He had, at the time of the appeal to the Court of Criminal Appeal, served the custodial portion of the sentences of imprisonment imposed upon him. While the appellant does raise matters bearing upon the exercise of the discretion involved in determining whether or not to order a new trial, the principal aim of the appeal is to show that, on the evidence, it was not open to the jury or to the Court of Criminal Appeal to find that any offence had been committed in respect of any of the moneys concerned. It is principally on that basis that, it is urged, verdicts of acquittal should be entered.

The indictment

The indictment against the appellant was in the following terms:

"Code Sec 378(9)(b)	(1)	On or about 15 January 1986 at Perth, DAVID CHARLES PARKER stole $9,000 the property of AERODATA HOLDINGS PTY LTD AND OTHERS.
Code Sec 378(9)(b)	(2)	AND FURTHER that on or about 3 February 1986 at Perth, DAVID CHARLES PARKER stole $600 the property of SABEMO (WA) PTY LTD AND OTHERS.
Code Sec 378(9)(b)	(3)	AND FURTHER that on or about 7 February 1986 at Perth, DAVID CHARLES PARKER stole $3,941.21 the property of CARR BOYD MINERALS LTD AND OTHERS.
Code Sec 378(9)(b)	(4)	AND FURTHER that on or about 12 February 1986 at Perth, DAVID CHARLES PARKER stole $4,000 the property of INTERSTRUCT PTY LTD AND OTHERS.
Code Sec 378(9)(b)	(5)	AND FURTHER that on or about 19 February 1986 at Perth, DAVID CHARLES PARKER stole $13,539.46 the property of SIR LAWRENCE CHARLES BRODIE-HALL AND OTHERS.
Code Sec 378(9)(b)	(6)	AND FURTHER that on or about 12 May 1986 at Perth, DAVID CHARLES PARKER stole $1,040 the property of AUSEAN INTERNATIONAL PTY LTD AND OTHERS.
Code Sec 378(9)(b)	(7)	AND FURTHER that on or about 25 June 1986 at Perth, DAVID CHARLES PARKER stole $560 the property of DEREK WILLIAM BIBBY AND OTHERS.
Code Sec 378(9)(b)	(8)	AND FURTHER that on or about 4 March 1988 at Perth, DAVID CHARLES PARKER stole $8,509.42 the property of HANCOCK FAMILY MEMORIAL FOUNDATION LIMITED, AND OTHERS.
Code Sec 378(9)(b)	(9)	AND FURTHER that on or about 23 February 1989 at Perth, DAVID CHARLES PARKER stole $670 the property of BUNNINGS LTD AND OTHERS.
Code Sec 378(9)(b)	(10)	AND FURTHER that on or about 31 March 1989 at Perth, DAVID CHARLES PARKER stole $2,781.20 the property of PMR QUARRIES PTY LTD trading as WA LIMESTONE AND OTHERS.
Code Sec 378(9)(b)	(11)	AND FURTHER that on or about 14 April 1989 at Perth, DAVID CHARLES PARKER stole $13,337 the property of CLOUGH LTD AND OTHERS."

The counts on which the appellant was convicted were counts 1, 3, 4, 5, 6, 7 and 11. He was acquitted on counts 2, 8, 9 and 10.

The Code

To appreciate the appellant's case, some examination of the facts is unavoidable. But first it is, we think, helpful to identify the relevant provisions of the Code. The operation of those provisions is critical to the outcome of the appeal.

"Stealing" is defined in s 371 of the Code which reads:

"(1) A person who fraudulently takes anything capable of being stolen, or fraudulently converts to his own use or to the use of any other person any property, is said to steal that thing or that property.

(2) A person who takes anything capable of being stolen or converts any property is deemed to do so fraudulently if he does so with any of the following intents, that is to say:-

(a) An intent to permanently deprive the owner of the thing or property of it or any part of it;

...

(f) In the case of money, an intent to use it at the will of the person who takes or converts it although he may intend to afterwards repay the amount to the owner.

...

(7) In this section, "property" includes any description of real and personal property, money, debts, bank credits, and legacies and all deeds and instruments relating to or evidencing the title or right to any property or giving a right to recover or receive any money or goods and also includes not only such property as has been originally in the possession or in the control of any person but also any property in which or for which it has been converted or exchanged and anything acquired by the conversion or exchange, whether immediately or otherwise."

Because there was an issue as to the identity of the owner of the money said to have been stolen in each case, the Crown relied on s 373 which provides:

" When a person receives, either alone or jointly with another person, any money ... with a direction ... that such money or any part thereof, or any other money received in exchange for it, or any part thereof, ... shall be applied to any purpose or paid to any person specified in the direction, such money ... [is] deemed to be the property of the person from whom the money ... was received, until the direction has been complied with:

Provided that if the person receiving the money ... and the person from whom he receives it ordinarily deal with each other on such terms that in the absence of any special direction all money paid to the former on account of the latter would be properly treated as an item in a debtor and creditor account between them, the former cannot be charged with stealing the money ... unless the direction is in writing."

Section 378(9)(b), the provision identified against each charge in the indictment, specifies a liability to imprisonment for 10 years if the thing stolen is money received with a direction.

The circumstances giving rise to the charges

With those provisions in mind we turn to the circumstances giving rise to the charges against the appellant. In what follows we have drawn heavily on the judgment of Malcolm CJ in an earlier appeal from committal proceedings against the appellant[23].

In 1985 the appellant was the sitting member of the Legislative Assembly for the seat of Fremantle. He was a successful candidate for that seat at the State elections in 1986 and 1989 and was also at all relevant times a Minister of the Crown. Some years earlier, he had opened an account with the Commonwealth Bank styled the "ALP David Parker for Fremantle Campaign" account. For the purposes of the two elections, donations were sought by him and on his behalf and donations were volunteered to him. These donations were paid into the campaign account and, at the outset, it was the Crown case that all of the moneys paid into the account were received by the appellant with a direction that they be applied for election campaign purposes. The 11 charges concerned payments out of the account which were alleged to have been stolen because they were not made in accordance with that direction.

Counts 1 to 7 related to the use of funds received in the period covered by the 1986 election. Counts 8 to 11 related to the period covered by the 1989 election. It was originally the Crown case that in respect of each charge the money was not given to the appellant for his own use but with a direction that the money be used for election campaign purposes. Hence the relevance of s 373. Each direction was said to have been given either in express terms or with a tacit direction to be inferred from all the circumstances. It is not in dispute that the appellant withdrew some money from the account for his own purposes but he challenged that any of that money was received with a relevant direction. It was also part of the defence case that the directions upon which the Crown relied extended to "general political purposes" and that, in any event, "election campaign purposes" had a wide meaning which embraced general political purposes, and further that it was difficult to draw the line between political and private purposes.

The Crown case as it reached the jury

When, at the end of the appellant's trial, the Crown addressed the jury, counsel used language which, in the words of Ipp J, "to a degree, represented an alteration of course". Counsel said:

"In this case, with over 60 donations, the evidence in respect of the direction in every case is not identical. We say that the proven direction in almost every single case would certainly not encompass the uses to which the accused put the money. In respect of most donations the direction on the evidence clearly was that the funds were to go to meet the campaign election costs for the coming election or re-election of David Parker and in some cases where the cheques were made out to the ALP, the direction may have encompassed campaign costs of the ALP in the coming election. They certainly didn't encompass him using the money to invest in options or anything like that."

Ipp J pointed out that counsel "was placing emphasis on the directions not encompassing 'the uses to which the [appellant] put the money' ". As his Honour observed, that was all very well so long as the jury understood that it was essential for the Crown to prove that the direction in question unambiguously identified the purpose to which the money was to be applied. In Ipp J's words: "The offence would not be proved if the accused put the money to uses not encompassed by an ambiguous or vague direction." Furthermore, the statement that the "proven direction in almost every single case would certainly not encompass the uses to which the accused put the money" carried a concession that the evidence did not support the Crown case on every direction. The concession was emphasised by the statement that in some cases the direction may have "encompassed" campaign costs of the ALP.

In the light of what Ipp J described as "the somewhat shifting and confusing position of the Crown", a clear instruction to the jury was needed as to what was required to establish a direction in terms of s 373. The Court of Criminal Appeal held that the trial judge had not adequately instructed the jury in this regard and, accordingly, the convictions must be quashed. However, for reasons which lie at the heart of this appeal, the Court held that on the evidence it was open for the appellant to have been convicted of the offences charged. In all the circumstances, a new trial was held to be appropriate.

To understand why the Court of Criminal Appeal took the view it did, it is necessary to look more closely at the facts. The campaign account was opened in November 1979 and was operated until 1990. As from 26 November 1985 the signatories to the account were the appellant, Lucinda Allen and John Row. The account was classified by the bank as a "society" account, that is, one which was operated for non-profit organisations.

In late 1985 the appellant enlisted the support of Mr Row, who was a superannuation fund manager, in raising funds for the forthcoming election. Mr Row agreed to write or sign what became known as "begging letters", that is, letters seeking donations. Effectively, Mr Row was the appellant's finance manager for the 1986 campaign. Ms Allen was a ministerial officer who worked in the appellant's Fremantle office. She prepared a list of potential donors which she thought the appellant added names to or deleted names from. The appellant was involved in drafting "begging letters". The text was sent to Mr Row, along with a list of addressees. Mr Row then produced letters, signed them and had them sent out. This procedure was followed twice in regard to the 1986 election and once after the election. Between 100 and 150 letters were sent in November 1985 and something less than that number in January 1986. The letters were on a letterhead styled "Campaign to Re-elect David Parker MLA" and were signed by Mr Row as Finance Committee Director. A post-box was rented for the purpose of each campaign. The same procedure was followed in regard to the 1989 election, though only one standard form of letter was sent out on that occasion.

The standard form of receipt used by the appellant for money received in response to the letters was endorsed "Campaign to Re-elect David Parker". Thank you letters or letters of acknowledgment were sent out, sometimes signed by the appellant personally. Records were kept of all letters sent out. Receipt books were kept and given to the appellant at the end of the campaign. From time to time Ms Allen gave the appellant a list of donors. There was evidence from the appellant's staff that no funds belonging to the appellant were credited to the account and that the account was only used to receive moneys raised as donations to campaign funds. There was evidence from Ms Allen that some cheques, which were made out to the Australian Labor Party and did not specifically refer to the campaign, were sent to the Party "unless there was a clear intent that they were meant for" the campaign account. All bank statements relating to the campaign account were posted to the appellant; the staff did not open them. The cheques drawn on the campaign account were signed either by the appellant or Ms Allen.

The case against the appellant was that the moneys he withdrew from the account for his own purposes were withdrawn with the intent to permanently deprive the donors of their property or part of it[24] or that the withdrawals constituted a taking or conversion of the money of the donors with the intent to use that money at his will[25].

The order for a new trial

As mentioned earlier, the Court of Criminal Appeal concluded that there had been a serious misdirection on the part of the trial judge. Nevertheless the Court ordered a new trial. Malcolm CJ did so on the footing that "the admissible evidence given at the original trial was sufficiently cogent to justify a conviction had the jury been adequately directed". The Chief Justice was in general agreement with Ipp J's assessment of the evidence. But it must also be noted, because this is the gravamen of the appeal, that in the Chief Justice's opinion:

"the principles applicable to the appropriation of deposits and withdrawals on trust moneys were applicable in the manner described by Ipp J in his reasons and, in particular, the principles stated in Re Hallett's Estate (1880) 13 Ch D 696 at 727 per Jessel MR and on a similar basis to that applied in Re British Red Cross Balkan Fund [1914] 2 Ch 419."

Steytler J agreed generally with the reasons of Malcolm CJ and Ipp J.

Ipp J examined in detail the 64 payments made into the account. Although the indictment alleged 11 counts of stealing, his Honour considered it necessary to analyse the 64 payments because the circumstances surrounding each payment threw light on the money in the campaign account. And the dates on which money was paid into the fund and the dates on which payments were made out of the fund were relevant to whether the Crown had made good its case with respect to each count.

It is unnecessary, for the purposes of determining this appeal, to follow his Honour's analysis of the various transactions involving the campaign account. The analysis reveals the difficulties confronting the jury and the need for a very clear direction from the trial judge as to how they were to approach their task.

In each count in the indictment the money was said to be the property of an identified donor "and others". As Ipp J rightly pointed out:

"Accordingly, for Parker to be found guilty of any particular count, the prosecution had to establish that at least part of the moneys, the subject of the count in question, was the property of the nominated donor. In other words, it was essential for the Crown to establish its case in accordance with the particulars contained within the indictment".

Section 584(15) of the Code permits an indictment to describe property as belonging to one or other of named persons, without specifying which, if it is uncertain to which of two or more persons the property belonged. But the Crown did not rely upon this provision at trial.

While the Crown contended that each cheque from a donor was paid subject to a direction within s 373, the circumstances under which the payments were made were not uniform. Some cheques were accompanied by letters showing clearly that they were for the appellant's re-election campaign. Some cheques were drawn in favour of the campaign. From the appellant's records it could be concluded that, in some cases, the person paying the cheque had received a "begging letter". In a few cases the payment was not clearly linked to such a letter. This had particular significance in the case of two donations of $20,000 and $30,000, made by Hancock Family Memorial Foundation Limited and Hancock Prospecting Pty Ltd respectively. It was therefore possible that the jury could find that some payments were made with the direction alleged but be not so satisfied in other cases. Ipp J described the evidence relating to the system employed by the appellant as "not given in coherent form and ... confusing". The appellant was acquitted on four of the counts and, in respect of counts 8, 9 and 10, the jury seem not to have been satisfied that the donation of $20,000, just mentioned, was made with the relevant direction.

The charges against the appellant were brought when it was discovered that he had drawn cheques against the campaign account for personal and family purposes, having nothing to do with his re-election campaign. It is unnecessary to detail those purposes; they are not in issue. But the matter is further complicated because it was common ground that some withdrawals were made from the campaign account in accordance with the directions under which they were paid. It followed that account had to be taken of the withdrawals accepted as legitimate in deciding whether, in regard to each count, the nominated donor was the owner of the money alleged to have been stolen, or at any rate the owner of part of the money.

Co-ownership

Before the Court of Criminal Appeal the Crown argued that the donors were joint owners of the funds in the campaign account. Reliance was placed on s 584(6) of the Code which reads:

"In an indictment in which it is necessary to mention any co-owners of property it is sufficient to name one of such persons, adding the words 'and another' or 'and others', as the case may be, and to state that the property belonged to the person so named and another or others, as the case may be."

The argument of the Crown was that the donors were co-owners of the pool constituted by the funds in the campaign account and that each donor had an interest in each sum of money withdrawn in accordance with his or her proportionate share. Proceeding along these lines, it was contended that each donor nominated in the 11 counts was a co-owner of the pool and that therefore each withdrawal was a withdrawal of some money that belonged to the nominated donor.

The Court of Criminal Appeal rejected this argument, and rightly so. It was not relied upon at the trial of the appellant. In any event co-ownership of the sort argued on appeal would require evidence of the intention of the donors to this effect and this was not forthcoming[26]. Nothing in s 373 or in any other section of the Code would advance the Crown's case in this regard.

Equitable principles

However, Ipp J did find in s 373 "the key to the ... ownership of the funds withdrawn from the campaign account." His Honour proceeded to elaborate the point, by reference to principles which had not been canvassed before the Court of Criminal Appeal and which, in our view, were inapplicable to the charges against the appellant. Because it is this approach which loomed large in the decision of the Court of Criminal Appeal not to direct an acquittal on the charges, it is as well to set out at some length this part of the judgment of Ipp J. Referring to s 373, his Honour said:

"If, by that section, moneys deposited in the campaign account are to be deemed the property of the donors thereof, the consequential effect, in my view, is that the moneys are to be regarded as trust moneys in the hands of the recipient. The section, by deeming the moneys to be the property of 'the person' who receives the moneys under the circumstances defined, in effect imposes a statutory trust on those moneys in the hands of the recipient, and those moneys remain impressed with the trust until the direction, subject to which they were received, has been complied with. In particular, the moneys remain trust moneys even though they have been deposited in a bank account: cf Black v S Freedman & Co [1910] HCA 58; (1910) 12 CLR 105 at 110.

In the premises, in my view, as moneys received by a person subject to a direction within the meaning of s 373 are, in effect, deemed to be trust moneys, the rules governing the appropriation of deposits and withdrawals of such moneys are to be ascertained by the general principles applicable according to the general law relating to trusts. Two main questions arise concerning appropriation of moneys in the campaign account. Firstly, how were moneys not subject to s 373 directions (ie moneys owned by Parker) to be treated when withdrawals from the campaign account were made? Secondly, how were moneys subject to s 373 directions, to be treated as between the donors themselves, when withdrawals were made?

As regards the first question, the rule is that wherever an act 'can be done rightfully, (a fiduciary) is not allowed to say, against the person entitled to the property or the right, that he has done it wrongfully': Re Hallett's Estate (1880) 13 Ch D 696 per Jessel MR (at 727). ...

Jessel MR [also] turned to the mingling of trust moneys with money of the trustee's own and said:

'Suppose he has a hundred sovereigns in a bag, and he adds to them another hundred sovereigns of his own, so that they are commingled in such a way that they cannot be distinguished, and the next day he draws out for his own purposes one hundred pounds, is it tolerable for anybody to allege that what he drew out was the first one hundred pounds, the trust money, and that he misappropriated it, and left his own one hundred pounds in the bag? It is obvious he must have taken away that which he had a right to take away, his own one hundred pounds.'

Accordingly, in my view, where a fund contains deposits of the recipient's own moneys, as well as the moneys of persons paying under a direction within the meaning of s 373, withdrawals are to be treated as representing, firstly, the moneys of the recipient and the moneys of the donors are to be treated as withdrawn only after the exhaustion of the recipient's own money.

I turn now to the question as to how moneys subject to s 373 directions were to be treated as between the donors themselves, when withdrawals were made.

Under the rule in Clayton's Case [1816] 1 Mer 572, as between beneficiaries whose money the fiduciary has paid into his own account at the bank, the first sum paid in will be held to have been first drawn out: Hodges v Kovacs Estate Agency Pty Ltd [1961] WAR 19 at 22; The Mecca [1897] AC 286 at 290. ... In the present case it was ... common cause that the rule in Clayton's Case had no application.

The donors to the campaign fund were intending to be contributors to a global mixed fund for political purposes. It was obvious that there would be a large number of contributors at varying times in varying amounts; it would not be unusual for different persons to receive donations on the basis that they would transmit the moneys to the persons administering the fund. In my view the only reasonably just and practicable way of treating directed donations is to regard each as being made on the basis that it would be withdrawn rateably in proportion to the amount thereof, and the balance of the directed funds retained in the campaign account would be held rateably in proportion to each donation made. In my view it was implicit in each such donation that it was made on such a basis. A similar conclusion was arrived at in Re British Red Cross Balkan Fund [[1914] 2 Ch 419] where it was held that donors to a special global fund for charitable purposes were, upon cessation of the purpose for which the fund was created, entitled to a rateable proportion of their subscriptions. See also Sinclair v Brougham [1914] AC 398."

It must be said immediately that the Court of Criminal Appeal erred in treating s 373 as deeming money to which it applies to be trust money. There is nothing in the section or elsewhere in the Code to support that conclusion. The deeming language of the section is at odds with the idea of a trust. This was not the Crown case at trial or on appeal to the Court of Criminal Appeal and the Director of Public Prosecutions did not seek to support the concept before this Court. It must also be said that the Court of Criminal Appeal erred in its consequent introduction of equitable principles to resolve questions which turned on the operation of the Code. That is not to say that guidance as to the meaning of particular words and phrases in the Code may not be gained by reference to the common law (which, in this context, would include equity) if the importation of those meanings is not excluded by the Code[27]. But that is done in order to throw light on the meaning of a particular word or phrase; it does not involve the introduction of some principle of the common law or equity in order to determine the operation of the Code.

In Stephens v The Queen[28] the applicant had been convicted under s 1(1)(a) of the Criminal Law Amendment Act 1902 (SA) which made it an offence for a person, entrusted with property, to fraudulently convert the property to his own use or that of any other person. Gibbs J, with whom Jacobs and Murphy JJ agreed, said that while there could only be an offence under the provision if there was a fiduciary element in the relationship of the accused to the property in question, "it does not seem to me necessary that either the jury or the Court of Criminal Appeal should inquire whether the accused received the property in circumstances giving rise to a trust."[29] Gibbs J added[30]:

"Such a construction would lead to undesirable complexity in the administration of the criminal law and is not made necessary by the words of the section."

Stephens was referred to by the Court of Appeal in England in R v Clowes (No 2)³¹. In delivering the judgment of the Court, Watkins LJ referred to a passage in the judgment of Jacobs J in Stephens in which he said that once it was established that the moneys the subject of the charge were paid pursuant to a written contract, the question of whether there was an "entrusting" was a question of law for the judge. Jacobs J added[32]:

"However, this does not mean that guilt or innocence turned substantially upon the construction of an obscurely worded instrument. The real question for the jury was whether the applicant had fraudulently converted the money."

Towards the end of his judgment[33], Watkins LJ referred to "an interesting argument based on the decision in Re Hallett's Estate" advanced on behalf of one of the appellants. His Lordship said that such cases "are concerned with tracing assets and the enforcement of beneficiaries and interests", adding that "[i]n the present case the court is concerned not with tracing assets and the enforcement of beneficial interests but with the meaning of s 5(1)" of the Theft Act 1968 (UK).

The Criminal Code Act 1913 (WA), which establishes the Code as a schedule thereto, provides in s 4:

"No person shall be liable to be tried or punished in Western Australia as for an indictable offence, except under the express provisions of the Code, or some other statute law of Western Australia".

It is thus to the Code we must look to determine whether, on the evidence adduced at trial, the appellant could have been convicted on counts 1, 3, 4, 5, 6, 7 or 11. This involves particular consideration of s 373 because of the change of character once a cheque was paid into the campaign account.

Section 373

To commit the offence of stealing, a person must fraudulently take something or fraudulently convert it to his or her own use. There was no asportation in the present case; it was a charge of fraudulent conversion that the appellant had to meet. And on each count he was charged with stealing a specific sum, being a sum withdrawn by cheque on the campaign account.

Applying s 373 to the present case, the section provides that if the appellant received "money", with a direction that the money be applied to a particular purpose, the money is "deemed" to be the property of the person from whom it was received until the direction has been complied with[34]. In the course of argument a question arose as to whether the words "such money" towards the end of the first paragraph of s 373 extend not only to the cheque received with a direction, but also to the credit in the account consequent upon deposit of the cheque. It is true that, once deposited, the "money" represented by the cheque becomes a chose in action against the bank in which it is deposited. But Ch XXXVI - Stealing, in which these sections lie, is not confined to situations of asportation; it is very much concerned with fraudulent conversion. The observations of Wickham J in Orsi v Legal Contribution Trust[35] are particularly apposite at this point. Contrasting the position at common law, his Honour said:

" Sir Samuel Griffith, however, in drafting the Code adopted a different approach and in doing so anticipated the ideas now revealed in the English Theft Act 1968. Instead of adapting the older devices or following the English Draft Code of 1879 (which never became law), and which provided that dishonest dealing with funds held under direction or received by agents should be deemed to be theft, he preferred the course of declaring that property held under such circumstances should be deemed to be the property of the person beneficially entitled to it, and thus by statute creating a situation where an act of fraudulent conversion would fall within the general statutory definition of stealing: see xiii of Sir Samuel's explanatory letter to the Attorney-General of 29 October 1897. This was achieved by sections of which the equivalent in the Western Australian Code are ss 373, 374 and 375. In the equivalent of s 373 the Royal Commission slightly amended Sir Samuel's draft by inserting the words 'or any other money received in exchange for it or any part thereof'."

The deeming aspect of s 373 is clearly intended to ensure that, for the offence of stealing, where a person receives money in the circumstances to which the section refers, the money notionally remains the property of the person from whom it was received until the direction has been complied with. The result is that a person who fraudulently converts the money to his own use commits the offence of stealing[36]. In that regard the definition of money in s 1 is inclusive and extends to the form the money received takes when deposited in an account. The money received does not cease to be "such money" in the terms of s 373 simply because it has undergone a conversion. The adjective "such" identifies the money to which the opening words of the section refer but it is not confined to the money in the form in which it is received. To give the word or the provision in general such a restricted meaning would have odd results. It would mean that if a person received only one cheque, though subject to a direction, and paid that cheque into an account, the withdrawal of the money which the cheque represented and its misappropriation would not constitute the offence of stealing. That is a conclusion which, in the language of the Code, is unacceptable.

To say that, however, is to say no more than that each donation, subject to a direction, remained the property of the donor until the direction was complied with. The problem for the Crown remains, that is, of showing that each withdrawal the subject of a charge was a withdrawal of money deposited with a direction. This cannot be done by the application of equitable doctrines for which no basis can be found in the Code. The Court of Criminal Appeal erred in its conclusion that principles of tracing were available to determine whether money paid out of the account was the money of a particular donor.

Nevertheless, if it appeared that, on the application of the relevant provisions of the Code, in each case the withdrawal was of money that belonged to the nominated donor, or the nominated donor and others, and was received with a direction that it be used for campaign purposes and that the withdrawal was not in accordance with the direction, there would be no justification for directing an acquittal except by reference to discretionary considerations. Unless those considerations were compelling, the order for a new trial would not be inappropriate.

Counsel for the appellant prepared a schedule with a view to showing that, in respect of each count on which the appellant was convicted, it was not possible to show that the money paid out belonged to a particular donor or donors. In that event, it was said, there was no evidence on which the appellant could be convicted. The schedule also aimed to show that at the time of each withdrawal there was money in the account from sources additional to the particular donor so that it was not possible to say of any withdrawal that it was the money or even part of the money of the named donor "and others". The Crown did not accept the schedule but did not take its stand on that aspect. Rather, the Crown's position was that, while accepting that the Court of Criminal Appeal erred in treating s 373 as creating a trust, the application of equitable principles "is not necessarily wrong and has much to commend it". On a retrial, the Crown would contend that the campaign account represented a common fund but that donors were owners of different parts of the fund according to the directions that were given. Against that background the Crown would rely upon principles of tracing so as to identify a relationship between money paid into the account and money paid out.

The reasons why we find it unnecessary to go to the particular examples in the schedule prepared on behalf of the appellant are twofold. The first is that it is apparent that on a retrial the appellant would be called upon to meet a quite different case to that presented against him at trial. That would be unfair, particularly having regard to the sentence already served. In our view these circumstances justify this Court entering verdicts of acquittal, not by reference to what might be called discretionary considerations but by reason of the unfairness of the criminal process that would otherwise follow. An attempt might be made to strengthen the Crown's position by relying upon s 584(15) of the Code which reads:

"In an indictment for an offence respecting any property, if it is uncertain to which of 2 or more persons the property belonged at the time when the offence was committed, the property may be described as being the property of one or other of such persons, naming each of them, but without specifying which of them; and the indictment will be sustained, so far as regards the allegation of ownership, upon proof that at the time when the offence was committed the property belonged to one or other of such persons without ascertaining which of them."

But that would require a substantial amendment to the indictment. In all the circumstances, particularly since the term of the sentence has now expired, the Crown accepted that an order for a new trial could not be justified for that purpose. The second reason is that the application of tracing principles in this context finds no support in the Code so that the proposed exercise is unjustified in any event.

There are other considerations that militate against a new trial[37]. They were considered by the Court of Criminal Appeal though not thought sufficient to preclude a new trial. In light of the reasons in this judgment, we need place no reliance on those considerations, though the length of time that has elapsed since the events giving rise to the charges and the fact that the appellant has served the custodial part of his sentence tell against a new trial.

The appellant could have been charged with stealing the property of one or other of named persons, without specifying which[38]. That was not done. He could perhaps (though not realistically) have been charged with stealing the property of persons unknown[39]. However, that was not the Crown case. The Crown should not be permitted to present a quite different case through a new trial. We should make it clear that, in allowing the appeal, we are not to be taken as saying that the Crown could not, on any view of the matter, make out a case of stealing in respect of any of the seven counts. Whether that could be done by carrying out the sort of exercise represented by the appellant's schedule or by some other analysis of the account is something which it is unnecessary to consider. The trial miscarried, the Court of Criminal Appeal erred in its use of equitable principles and it would be unfair to the appellant to order a new trial in which he would have to meet a significantly different case to that the jury were asked to consider.

For that reason, we would allow the appeal, set aside the order of the Court of Criminal Appeal directing a new trial and enter verdicts of acquittal on counts 1, 3, 4, 5, 6, 7 and 11.

KIRBY J. This appeal from the Court of Criminal Appeal of Western Australia concerns the meaning of provisions of The Criminal Code (WA) ("the Code") relating to the theft of property received under a direction. It also concerns the approach taken by that Court, having found serious errors in the trial of the appellant, in withholding the entry of a verdict of acquittal and ordering, instead, that a new trial be held.

Alleged conversion of moneys paid for re-election campaigns

Mr David Parker ("the appellant") was, at the time of the offences alleged against him, a member of the Parliament of Western Australia and a Minister of the Crown. His electorate comprised the seat of Fremantle. He stood for election, and was re-elected, in each of the 1986 and 1989 State elections. For the purpose of funding his campaign for re-election, in the periods immediately before each campaign, he arranged for letters to be distributed on his behalf. The letters were addressed to named persons and requested a donation of funds. The letters implied that donations would be used for the re-election campaign.

In 1979, long before the first of the elections in question, the appellant had opened an account at a bank in Fremantle specifically designated to be his campaign account. This account was distinct from his personal account at the same bank. It was a "society account" of the type made available by the bank to non-profit organisations, clubs and societies. At the relevant times, the signatories were the appellant, his campaign finance manager and a staff member. Following the "begging letters", in the period prior to each of the elections and between the elections, numerous cheques were received by the appellant.

Some of the cheques sent to the appellant's office were accompanied by letters which clearly indicated that they were being paid by the donors specifically for the re-election campaign mentioned in the letters. Indeed, some of the cheques were drawn in favour of the "ALP David Parker for Fremantle Campaign" or like words. Such cheques were deposited in the campaign account, from which sums were paid for what were accepted as electoral and campaign purposes, entirely within the description of the purpose specified in the letters. Other cheques, however, were drawn in favour of the Australian Labor Party ("ALP"), in whose interest the appellant was seeking re-election. A small number were simply made payable to the appellant. Evidence at the trial, given by staff employed in the appellant's office at the relevant times, established that in some, but not all, cases the person paying the cheque had received one of the "begging letters". In other cases, and in particular in the case of two large donations respectively of $20,000 paid by Hancock Family Memorial Foundation Limited, and $30,000 paid by Hancock Prospecting Pty Ltd, the sums were paid without clear evidence of receipt of a letter of request. However, those cheques too were paid into the campaign account.

The criminal charges against the appellant arose following the discovery that he had drawn cheques against the campaign account for purposes apparently having nothing to do with his re-election campaign in either election but rather for personal and family purposes. The first payment, the subject of the first count in the indictment, related to a transfer on 15 January 1986, of $9,000 from the campaign account deposited into the "David Parker MLA" account operated by the appellant personally. The second payment, giving rise to the second count, was of $600 withdrawn on 3 February 1986 paid to a company for the rent of a unit in Fremantle at which the appellant was living. The third count related to a withdrawal on 7 February 1986 of $3,941.21 used to repay a personal loan to the National Australia Bank. The fourth count concerned a withdrawal of $4,000 on 12 February 1986 used to purchase share options in a named company. The fifth count concerned a withdrawal on 19 February 1986 of $13,539.46 which was paid to a credit union to pay out an existing loan to the appellant. The sixth and seventh counts concerned further withdrawals of $1,040 and $560 made, respectively, on 12 May 1986 and 25 June 1986. These sums were paid for rent on the unit in Fremantle in which the appellant was living. The eighth count concerned a withdrawal on 4 March 1988 of $8,509.42 paid to the Deputy Commissioner of Taxation on behalf of one K M Rooney. The ninth count related to a withdrawal on 23 February 1989 of the sum of $670 paid to Rentokil, allegedly for pest extermination services at the appellant's house. The tenth count concerned a withdrawal of $2,781.20 on 31 March 1989 to purchase a bank cheque to pay a security company, allegedly for enhanced personal security for the appellant. The eleventh and final count concerned a withdrawal of $13,337 on 14 April 1989 used in part to pay a deposit for renovations of the kitchen in the appellant's house ($2,124); to purchase travel tickets for the appellant and his family to visit Hong Kong ($8,213); to purchase traveller's cheques ($2,000); and to obtain cash ($1,000) for the journey to Hong Kong.

The total amount involved in the transactions nominated in the several counts was $57,978.29. Without descending to particularities, the essential complaint in the Crown's case was that the appellant had misused funds, for the most part solicited and expressly paid to him for electoral campaign purposes. He had spent them for purposes which were entirely personal or, if related to his political office (as arguably in the case of the payment for enhanced security), unconnected with the re-election campaign for which the moneys were paid. Such conduct on the part of the appellant, if made good in the facts, might be reprehensible. But once he was charged, the Crown was obliged to bring its complaint within an offence provided by the Code and to prove that offence within the terms of the counts of the indictment by which the charges were expressed.

Earlier proceedings in the Western Australian courts

The re-election of the appellant at each of the State elections in question was declared, respectively, on 28 February 1986 and 15 February 1989. The 11 charges of stealing were laid against the appellant in 1992. On 18 January 1993 a magistrate determined that the appellant should be committed for trial on each of the charges. By leave granted by White J in the Supreme Court of Western Australia on 8 February 1993 an appeal was taken from that determination. That appeal was heard by a Full Court of the Supreme Court of Western Australia (Malcolm CJ, Franklyn and Murray JJ) on 21-22 June 1993.

On 29 October 1993 the appeal against the order of committal was dismissed. Franklyn J agreed in the decision of Malcolm CJ that the appeal should be dismissed generally. Their Honours found no merit in the legal arguments raised for the appellant. Those arguments concerned the suggestion that within the Crown case as presented, there was no prima facie evidence that the moneys said to have been stolen by the appellant (a) had been paid to the appellant with a "direction" by the payer that they be applied for a purpose specified in that direction; and (b) had been used by the appellant for a purpose other than that so specified in the payer's "direction". The Court proceeded on the footing that where there was a mix of the funds received, so long as the amount withdrawn or paid for private purposes did not exceed any "undirected funds" in the mix, there could be no stealing. The Court rejected the submission that a "direction" under the Code, ss 373 and 378(9)(b), could not be constituted by a "tacit" direction but only by an express one. It concluded that directions could be "tacit" and that having regard to all of the facts (including the terms of the letters written, the cheques received and the bank account used) it should be left to the jury to determine whether the several charges had been proved.

Murray J agreed in the legal propositions of the majority. However, his Honour differed on the facts concerning one of the two payments made by Hancock Family Memorial Foundation Limited and Hancock Prospecting Pty Ltd. He found it impossible to conclude that there was any evidence capable of establishing that the cheque for $20,000 was other than a personal gift by Hancock Family Memorial Foundation Limited to the appellant. Murray J was prepared to infer a direction in the case of the $30,000 payment, made by Hancock Prospecting Pty Ltd shortly before the 1989 campaign. But having regard to the large "undirected" fund provided by the $20,000 deposit, he could not conclude that the Crown could establish, in the then state of the re-election account, that the withdrawals alleged in the eighth, ninth and tenth counts were from "directed", as distinct from "undirected", funds available to cover each of those payments.

An application was made to this Court for special leave to appeal from the orders of the Full Court of the Supreme Court. Special leave was refused. Both in the differentiation between the opinions of the majority and minority judges in that Court, in the close attention paid by Malcolm CJ and Murray J to the payments in, payments out and "direction" in each case, as well as in the observations of Malcolm CJ as to the way the trial should be conducted, there can be no doubt that the Crown and the accused were alerted to the importance of most of the controversies which have now found their way to this Court.

The decision of the Full Court laid emphasis upon the meaning of a "direction" within the applicable provisions of the Code; the need to identify, in the case of each cheque drawn by a donor, the "direction" relied upon; and the need to do this with some particularity. Thus Malcolm CJ made it clear that the mere fact that money was deposited in the dedicated account would not prove that there "must have been a direction"[40]. A mis-deposit by a staff member could not fix the appellant with a "direction", if it were not attached by the donor. Much attention was given by Malcolm CJ in the earlier proceedings to the need to prove, in each case, that a payment had been made contrary to the donor's direction. Therefore, in the way in which the proceedings developed, both the judge of trial and the Crown Prosecutor had the advantage of the opinions in the Full Court. These should have made it clear to the Prosecutor that a "broad-brush" approach to the proof of the facts necessary to establish the Crown's case would potentially present serious difficulties.

Trial, conviction and appeal

Following the above proceedings, the appellant stood his trial in the District Court of Western Australia on the eleven counts of stealing charged in the indictment. The trial lasted nine days. It began with the Crown asserting that the appellant had received funds from donors with a direction that they were to be used for his election campaign purposes. Accordingly, the Crown asserted that, under the Code[41], the funds so received were deemed to be the property of the donors until the direction had been complied with. When he withdrew moneys from the account for his own private purposes, the appellant had converted the property of the donors to his own use because their directions had not been complied with. This rendered the taking of the moneys fraudulent, in that there was intent permanently to deprive the owners of the moneys or an intent to use them at will[42]. The defence case at the trial was essentially that the purposes of the "directions" were not clearly defined; that they extended to "general political purposes"; and that, if the purposes specified were for "election campaign purposes", that expression had a broad meaning which embraced general political purposes.

Towards the end of the trial the case for the Crown was changed. No longer was the Crown asserting that all donations were given with a direction that they were to be used solely for the applicant's election campaign. Instead, the Crown argued, in effect, that the direction "certainly didn't encompass him using the money" in the way he did[43]. Further, the Crown conceded that in "some cases where the cheques were made out to the ALP", the direction "may have encompassed campaign costs of the ALP in the coming election"[44]. It also stated that "the proven direction in almost every single case would certainly not encompass the uses to which the accused put the money"[45]. The Crown did not formulate any alternative direction with precision[46].

It was accepted during the trial that some payments, not the subject of charges, were made out of the bank account for purposes which were properly connected with the appellant's re-election campaign. In addition, it was open to the jury, in the facts proved, to find (and by their verdict shortly to be referred to they appear to have concluded) that some of the moneys deposited in the bank account were "undirected" or at least not proved to be unavailable for use by the appellant for his own non-election purposes.

The task of the trial judge in giving directions to the jury was not made easier by the late change in the conduct of the Crown's case and by the want of attention in the closing address of the Prosecutor to about half of the payments made into the account[47]. The jury returned their verdicts. They acquitted the appellant of the charges contained in counts 2, 8, 9 and 10. But they convicted him on the remaining counts.

There was some debate before the Court of Criminal Appeal, and before this Court, concerning the interpretation of the verdicts of acquittal. The Crown suggested that the acquittal on the second count was consistent with a view that the deposits in 1985 and 1986, there referred to, were of moneys paid with a relevant direction but that the jury had found that the withdrawal was within the election campaign purposes. The acquittals on counts 8, 9 and 10 were somewhat easier to explain. They were consonant with the approach earlier taken in the Full Court by Murray J. They suggested that the jury were not satisfied that the donation of $20,000 received from the Hancock interests was made with a relevant direction. If that was so, in withdrawing the sums alleged in those counts, the appellant had not been shown to have acted outside a relevant direction.

The trial judge convicted the appellant in accordance with the jury's verdicts. He sentenced him to a term of imprisonment of 12 months in respect of each of the counts of the indictment upon which he was convicted. He directed that each of the sentences be served concurrently. The appellant duly completed the custodial part of his sentence. He was on parole when the appeals came before the Court of Criminal Appeal.

Dismissal of the appeals

Two appeals were taken to the Court of Criminal Appeal. The first was by the appellant. The second was by the Crown.

The appellant's appeal was unanimously upheld by the Court constituted by Malcolm CJ, Ipp and Steytler JJ. Their Honours found that fundamental errors in the course of the trial, inadequate directions and misdirections to the jury had caused the trial to miscarry. They concluded that the trial process was "fundamentally flawed" and that there had been a miscarriage of justice such that, in the light of the totality of errors found, the trial had "gone seriously wrong"[48].

The errors which were found included:

(a) A misdirection involving a reversal of the onus of proof of the existence and content of a "direction" in respect of the donations specified in the several counts[49].

(b) An omission on the part of the trial judge to identify the evidence relevant to each "direction" and to differentiate that evidence from evidence offered in respect of other charges. Some attempt was made to summarise the particular cases of alleged "directions" in donations by the Holmes a Court and Hancock interests. However, it was found that there had been no real attempt to summarise the evidence in respect of the other donations with appropriate guidance, without which the jury would not be able to marshal the facts particular to each donation, especially in the context of such a long and complex trial. Malcolm CJ, in particular, was critical of the contribution which the Crown's conduct of the trial had made to this failure on the part of the trial judge.

(c) Contrary to established authority, to which he even referred, the trial judge also made the mistake of attempting to define, or at least to elaborate, the meaning of the standard jury direction requiring satisfaction "beyond reasonable doubt" of the matters which the Crown was required to prove[50]. It was decided that the elaboration, with its references to "reasonable possibility", could have confused the jury and caused them to water down the applicable standard of proof.

(d) The decision of the trial judge to allow cross-examination of the appellant as to conversations which he had had with the late Mr L Hancock concerning the latter's appearance before a Royal Commission which had taken place in Western Australia was found to be unfair and such as could give rise to a miscarriage of justice. By then reading the relevant evidence to the jury, the judge was found to have compounded the prejudice contained in the questions of counsel. That prejudice was not satisfactorily eradicated and harmed the appellant's credit[51].

These conclusions were sufficient to require the setting aside of the guilty verdicts. That order was clearly correct. But both to decide whether there had been a substantial miscarriage of justice according to "the ordinary test" and to decide on the disposition of the appeal[52], the Court of Criminal Appeal went on to examine whether the mistakes identified had deprived the appellant of the "chance which was fairly open to him of being acquitted"[53].

In determining whether a substantial miscarriage of justice had occurred, Ipp J, writing the principal judgment of the Court of Criminal Appeal, introduced a thesis which was embraced expressly by Malcolm CJ[54] and, by implication, by Steytler J. The thesis addressed the problem, to which it will be necessary to return, concerning the operation of the Code in a case where moneys received subject to a "direction" are placed in a fund together with other moneys received subject to the same or other directions, moneys received subject to no, or no proved, direction, and private moneys available for unrestricted use by the controller of the fund. In the way the trial was conducted and, as inferred from the verdicts of acquittal by the jury, it must be accepted that, at least in respect of some of the moneys deposited in the relevant bank account, the jury concluded that the Crown had failed to prove a "direction" or had failed to establish that the moneys had been used by the appellant contrary to such direction. The problem is then squarely presented, of deciding whether the Code is to operate where the fund is mixed and the moneys deposited subject to various directions are undifferentiated from other moneys. This problem, it soon became apparent, was central to any prospect that the Crown could have established its case against the appellant in the first trial or could establish such a case if a second trial were ordered.

The solution which Ipp J offered involved an ingenious attempt to draw upon principles which have been fashioned by courts of equity to determine whether a fiduciary, with control of a fund, containing both trust and non-trust moneys, is to be taken to have expended the fund in breach of trust.

Those principles have been developed over two centuries, usually in the context of a mingling of trust moneys with the personal moneys of the trustee[55]. The solution which Ipp J offered is stated in the following passages in his Honour's reasons[56]:

"[Section] 373 remains the key to the question as to the ownership of the funds withdrawn from the campaign account. If, by that section, moneys deposited in the campaign account are to be deemed the property of the donors thereof, the consequential effect, in my view, is that the moneys are to be regarded as trust moneys in the hands of the recipient. The section, by deeming the moneys to be the property of 'the person' who receives the moneys under the circumstances defined, in effect imposes a statutory trust on those moneys in the hands of the recipient, and those moneys remain impressed with the trust until the direction, subject to which they were received, has been complied with. In particular, the moneys remain trust moneys even though they have been deposited in a bank account ... .

In the premises, in my view, as moneys received by a person subject to a direction within the meaning of s 373 are, in effect, deemed to be trust moneys, the rules governing the appropriation of deposits and withdrawals of such moneys are to be ascertained by the general principles applicable according to the general law relating to trusts. Two main questions arise concerning appropriation of moneys in the campaign account. Firstly, how were moneys not subject to s 373 directions (ie moneys owned by Parker) to be treated when withdrawals from the campaign account were made. Secondly, how were moneys subject to s 373 directions, to be treated as between the donors themselves, when withdrawals were made."

Ipp J proceeded to answer the stated questions by reference to the principles developed by the law of equity. Applying to s 373 of the Code the law as stated in Re Hallett's Estate[57], where a fund contains a mixture of personal moneys and moneys of persons paying under a direction, withdrawals were to be treated as representing first, the moneys of the recipient, and the moneys of the donors were to be treated as withdrawn from the mixed fund only after exhaustion of the recipient's own moneys[58]. As between the donors "the only reasonably just and practicable way of treating directed donations is to regard each as being made on the basis that it would be withdrawn rateably in proportion to the amount thereof, and the balance of the directed funds retained in the campaign account would be held rateably in proportion to each donation made"[59].

Malcolm CJ embraced this solution. Specifically, he referred to Re Hallet's Estate in determining how the appropriation of deposits and withdrawal of trust moneys were to be treated for the purposes of the Code. This was therefore an important step in the reasoning of the Judges towards their conclusion that there was point in sending the appellant for retrial. On this, Ipp J said[60]:

"The second issue is whether there was a fair chance of a properly instructed jury (after examining each and every donation and withdrawal) finding that, after applying the principles governing the appropriation of moneys, the person specifically identified in each particular count (although having made a donation subject to s 373 directions) was not the owner of the moneys alleged to have been stolen (by reason of the status of the balance of funds standing to the credit of the campaign account on each relevant date)."

The "principles governing the appropriation of moneys" clearly refers to the principles of the law of equity which Ipp J was prepared to introduce into the operation of the Code and the "statutory trust" which his Honour felt should be imposed upon the moneys subject to a "direction" as provided by s 373 of the Code.

There are many difficulties with this reasoning. For the moment, it is enough to note that it was critical to the conclusion that, upon a retrial, a second jury, instructed as their Honours proposed, could properly return a verdict of guilty against the appellant on the counts not already disposed of by the jury's not guilty verdicts.

Disposition: the appellant's and the Crown's appeals

Most of the time in the Court of Criminal Appeal was taken up with the appellant's appeal by which he asserted that he was entitled to an acquittal on the remaining counts both by reason of the erroneous conduct of the first trial and because the evidence at that trial had failed to establish the charges mentioned in the remaining counts of the indictment. The appellant also urged that the proper exercise of discretion required that a verdict of not guilty should be entered so that he would not be submitted to a new trial. Discretionary considerations which the appellant relied upon in this regard included (i) the fact that, by the time of the appeal, he had fully served his custodial sentence; (ii) he was living in Hong Kong with his family; (iii) the first trial had been long and arduous and serious errors had occurred, in part by reason of the way the Crown had presented its case, despite the earlier guidance given by the Full Court; and (iv) the Crown should not be given a second chance to prove its case in another, different and more thorough way for that course would expose the appellant unfairly to double jeopardy. In addition to these arguments of a discretionary character, the appellant pressed his legal arguments, challenging the sustainability of his conviction on the case presented by the Crown.

One might have thought that these extremely powerful discretionary arguments (particularly that the appellant had served the custodial part of his sentence) and the extended lapse of time from the critical events might have led the Court of Criminal Appeal to conclude that a new trial was unnecessary. However, by reference to the relevant authority[61], their Honours determined otherwise. A powerful factor affecting their conclusion was that the offences charged involved the misuse of funds raised from citizens by an elected official and a Minister which therefore amounted to a "serious breach of public trust" and a "significant departure from the standards expected of political candidates and, in particular, of those who hold high public office"[62]. The Court therefore withheld entry of a verdict of acquittal and directed a retrial[63].

Such an exercise of discretion, although not one immediately appealing to me, is impregnable from interference in this Court provided it is not itself affected by error. Special leave to appeal would not have been granted simply to reconsider the exercise by the Court of Criminal Appeal of Western Australia of the discretion disposing of the appeal to it. All of the relevant authorities had been referred to. Unless it were shown that an error affected the conclusion, the order for retrial would stand.

The Crown also appealed to the Court of Criminal Appeal, somewhat belatedly, against what it contended was the inadequacy of the aggregate period of one year's imprisonment imposed upon the appellant. Upon the assumption that the convictions were well founded, the Crown submitted that the custodial sentence was inadequate. The Court of Criminal Appeal dismissed the Crown's appeal. This decision is not challenged. Accordingly, any retrial of the appellant would have to take place on the footing that, were he properly convicted at a second trial, his new sentence almost certainly would not expose him to a return to prison[64]. Although, strictly, it would be for the judge at the second trial, in the light of the evidence, to determine the sentence proper to a conviction at that trial, the fact of the previous custodial sentence, its completion, the dismissal of the Crown appeal against that sentence and the principles controlling double jeopardy would render it unlikely in the extreme that the appellant would be returned to prison. A retrial, potentially repeating the nine day hearing of the first trial, would therefore seem to have had relatively little practical point for the vindication of the criminal law. This consideration is not mentioned by the Judges of the Court of Criminal Appeal in their reasons. However, I assume that it was taken into account. The very large public and private funds which would have to be expended in mounting a second trial, the only merit of which would be to avoid the entry of verdicts of acquittal on technical grounds, add to my sense of disquiet concerning the disposition order in the Court of Criminal Appeal.

Nevertheless, the question remains, whether this Court, conforming to the ordinary principles of restraint in such matters, is warranted to substitute a different order. That different order which the appellant sought was that the order for a new trial be set aside and verdicts of acquittal entered. The appellant submitted that this was the proper course by the application of a correct understanding of the application of the Code to the evidence called at the first trial; by the application of the principles which deprived the Crown of a chance to have a second trial in order to repair the inadequacies of its presentation of the first; and on general discretionary grounds, once a lawful foothold was established for the re-exercise of the discretion by this Court.

Relevant provisions of the Code

It is now necessary to set out the relevant provisions of the Code. They derive from Griffith's Queensland Code. They were intended to solve the problem, which had been noted in the common law of larceny, that there could be no larceny if the circumstances would not sustain an action for trespass[65]. In Ilich v The Queen[66] Gibbs CJ remarked, when writing of the definition of stealing in s 371 of the Code[67]:

" The law as enacted by this section is free from some of the complexities of the common law. Stealing, as defined, includes both fraudulent taking and fraudulent conversion. A taking or conversion is deemed to be fraudulent when done with one of the intentions described in pars (a)-(f) of s 371(2). No further state of mind is necessary ... It is necessary to prove that the thing stolen is the property of someone".

In the same case Wilson and Dawson JJ said[68]:

"[At common law] it is said that there is no larceny if the circumstances would not sustain an action for trespass. Under the Code, on the other hand, a person who fraudulently takes anything capable of being stolen is said to steal that thing. Absence of consent on the part of the owner is not required and there is, for that reason, no necessary element of trespass. Of course, if the taking is to be fraudulent, there must be the requisite intent but, given that intent, there may be a fraudulent taking of something under the Code even if the owner intentionally delivers the thing to the person said to take it."

Brennan J added[69]:

"For the purposes of the crime of stealing by conversion under the Code, the inquiry into the intention of the person who is said to be the owner of the property is undertaken in order to determine whether ownership of the property has passed to the person charged, not to determine whether the property was taken invito domino."

Section 373 of the Code provides, relevantly:

"When a person receives, either alone or jointly with another person, any money ... with a direction in either case that such money or any part thereof ... shall be applied to any purpose ... specified in the direction, such money ... [is] deemed to be the property of the person from whom the money ... was received, until the direction has been complied with".

There follows a proviso which has no application to the present case. The term "money", referred to in s 373, is defined in s 1 of the Code as including:

"bank notes, bank drafts, cheques, and any other orders, warrants, authorities or requests for the payment of money".

Stealing, under the Code, is defined by s 371(1) as follows:

" A person who fraudulently takes anything capable of being stolen, or fraudulently converts to his own use or to the use of any other person any property, is said to steal that thing or that property."

The penalty, upon conviction in the instant case, is provided by s 378(9)(b):

" If the thing stolen is any of the things following, that is to say:-

...

(b) Money received by the offender with a direction that the same should be applied to any purpose or paid to any person specified in the direction;

...

the offender is liable to imprisonment for ten years."

The question which is thus presented is whether the Court of Criminal Appeal was correct to conclude that, in respect of the remaining counts, it would be open to a second jury, upon evidence similar to that called at the first trial, to find the appellant guilty under s 371(1) of the Code, ie in fraudulently converting to his own use property which, by s 373 of the Code, was deemed to be the property of the various nominated donors until their "direction" has been complied with.

I shall assume (as I am inclined to think is correct) that the Western Australian courts were right in holding that such a "direction" might be tacit as well as express and that there was evidence, in each case of the nominated donations, from which it would be open to a jury to conclude that a "direction" had been given that the money forwarded to the appellant's office should be applied for a purpose, specified in the direction (viz that it should be used, and used only, for re-election campaign purposes). The appellant maintained his objections, both of law and of fact, to the finding about the "directions". However, I am prepared to assume that the decisions below were correct on this point.

But how do the words of the Code apply to a case where the "money" in question, being the several cheques received by the appellant, were paid into the mixed fund in the bank account? Did it there lose the quality of being notionally the "property of the person from whom the money ... was received"? In particular, did the money lose that notional quality if it was placed in an account and there mixed with other moneys provided by other persons giving the same directions; with money subject to slightly different directions; with money subject to no directions at all; or with money belonging to the appellant absolutely?

This is not a theoretical problem in this case. As the facts disclosed show, some moneys before deposit in the bank account were undoubtedly earmarked for the re-election campaign (and cheques made out accordingly). Some had different but related directions, eg for the purposes of the appellant's political party (ALP). Some had no, or no proved, direction (eg at least the $20,000 deposited by the Hancock interests). It was open to the jury to find (and the jury by inference found) that the $20,000 deposit was in the nature of a gift to the appellant and thus his to expend as he wished. Once all of these funds were mingled together in the one account, how is the Code to be interpreted in its provision that, "such money ... [is] deemed to be the property of the person from whom the money ... was received"?

One solution (embraced by the appellant) is to say that the "money" when mingled in this way loses its identity as "money ... with a direction". In law, it becomes the property of the bank in which it is deposited. The appellant, as account owner, has no further property in the money as such. He has a claim against the bank, in the nature of a chose in action. This conversion from the property of the appellant to a chose in action against the bank could sever the "money" from the "direction", at least in the case (such as the present) where there was not a separate bank account containing only the property subject to direction and nothing else.

Such a construction of the Code would result in its having no application to a case such as the present. It would not be an immediately attractive construction. The Code from which the applicable provisions were derived was the Queensland Code drafted by Sir Samuel Griffith at a time when banking, although not developed to its present electronic and trans-national character, was well-established in Australia. The Code was clearly intended to operate in the real world where money and cheques are deposited in banks and in accounts which mingle the funds of many, converting them into depositors' choses in action against the bank, identified by electronic signals occasionally converted to hard copy statements. The intention of the Code to operate in a context of banking is shown, clearly enough, by the definition which the Code adopts of "money". Once it is accepted that "money" includes "cheques" it is rather unpersuasive to suggest that the "direction" provided in s 373 of the Code is attached to the "money" so long as it remains in the form of a "cheque" but not once the "cheque" follows the usual course which cheques habitually take and is deposited to the credit of the payee in a bank account.

Construction of the Code

Codes, of their nature, tend to be strictly construed. The Code in question in this case is no exception. The Criminal Code Act 1913 (WA) includes a provision which lays emphasis upon the intended completeness of the Code[70]:

"No person shall be liable to be tried or punished in Western Australia as for an indictable offence, except under the express provisions of the Code, or some other statute law of Western Australia, or under the express provisions of some statute of the Commonwealth of Australia, or of the United Kingdom which is expressly applied to Western Australia."

This is a standard code provision designed to expel other sources of law, notably, in this Code, the crimes provided by the common law.

The principles governing the construction of a provision of the Code have been considered many times in this Court. They are usefully collected by Brennan J in Boughey v The Queen[71]. Although in that case his Honour was dissenting in the result, this does not affect the accuracy of the statement of the approach which is to be taken[72]:

"The paramount rule in construing a Criminal Code is that its meaning is to be ascertained by interpreting its language without reference to the pre-existing law, although reference may be made to that law where the Code contains provisions of doubtful import or uses language which has acquired a technical meaning: Robinson v Canadian Pacific Railway Co[73]. It is erroneous to approach the Code with the presumption that it was intended to do no more than restate the existing law (Brennan v The King)[74] but when the Code employs words and phrases that are conventionally used to express a general common law principle, it is permissible to interpret the statutory language in the light of decisions expounding the common law (Mamote-Kulang v The Queen)[75] including decisions subsequent to the Code's enactment: Murray v The Queen[76]; Reg v Rau[77]. The meaning of the words and phrases to be found in a Code is controlled by the context in which they are found but when the context does not exclude the common law principles which particular words and phrases impliedly import, reference to those common law principles is both permissible and required."

Returning to the provisions of s 371 of the Code, as elaborated by the deeming provision in s 373, can the words "such money" be extended to include not only the "money" received with a direction, comprising bank notes, bank drafts, cheques etc but also "such money" when converted into a bank deposit"?

There is no express provision in the Code to effect the conversion. The most that exists is the presumption that, normally "bank notes, bank drafts, cheques" are deposited in bank accounts. However, the difficulty is that the section of the Code is not dealing with reality but creating a fiction. The fiction is that "such money" is deemed to be the property of the person from whom it was received until the direction is complied with. The expression "such money" refers back to what the person receives as "money". This is not a credit in a bank account. It is the "bank notes, bank draft [or] cheques" which the extended definition of "money" is taken to include. Parliament, in the Code and elsewhere, may create such statutory fictions. They are by no means uncommon in our law. However, in a Code which is designed to be generally self-contained and to introduce novel concepts which extend criminal liability at common law, this must be done clearly. It cannot be left to the courts to repair significant omissions or deficiencies in the Code. Relevantly, the omissions and deficiencies here are:

1. The failure to include a provision to make it completely clear that the "money" remains "such money" after it is converted from a donor's cheque to a depositor's chose in action against a bank; and

2. The failure to enact a provision covering the mingling of directed money with money which is subject to different directions, to no direction or which belongs to other persons or to the bank account owner. Upon one view, s 373, in its terms, was not intended to cover such a case of pooling, in which it is impossible to identify separately the "property of the person from whom the money ... was received". It is possible that pooling is covered by s 373 but only so long as the money is clearly identifiable, held in joint ownership and all subject to the same direction(s). But this possibility is inapplicable to the present facts. Plainly, the ambiguity and uncertainty inherent in the Code's provisions should be removed.

An allegation of co-ownership might have been the simple and sensible way to approach this matter. But in this case, it runs into two difficulties. The first is that it was not the way the Crown's case was presented at trial. It is not competent, retrospectively, to endeavour to impose such a re-interpretation upon the facts. Proof of co-ownership, if disputed, would have required proof of the intention of the alleged co-owners[78]. This was not alleged, still less proved, in the trial. Secondly, and in any case, such evidence as was proved suggested that there might have been difficulties in the way of establishing co-ownership in the facts of this case. Such difficulties would have arisen from the different "directions" that existed with some payments and the lack of "directions" with others.

These basis problems eventually led the Crown in this Court, while rejecting the trust which Ipp J had postulated in the Court of Criminal Appeal, to attempt to support the invocation of the equitable doctrines which his Honour applied, by analogy, to the moneys when deposited and mingled in the bank account. With all respect, that solution must also be rejected:

1. It was never advanced by the Crown at the trial or in the Court of Criminal Appeal. The most that the Crown had argued, to resolve the way in which the sections of the Code should be interpreted to accommodate expenditure from a mixed fund which included both directed and undirected moneys, was that the general presumption of innocence would support the inference that a person, accused of expending moneys contrary to a direction, would be taken, to the full extent available, to be expending undirected moneys out of the mixed fund before expending the moneys subject to direction. This Court was informed that no argument was advanced before the Court of Criminal Appeal that the equitable doctrine developed in civil litigation by such decisions as Re Hallett's Estate[79] applied, by analogy, to the Code. To introduce such notions for the first time in the opinions of that Court, without affording an opportunity to the parties, including the accused, to explore them at trial and in appellate argument constituted, arguably, a procedural unfairness to the appellant which this Court could not condone.

2. In any case, the duty of the Court of Criminal Appeal was to construe the Code. The Code makes no mention, directly or indirectly, of the incorporation of the equitable doctrine relied upon. The notion could not therefore be introduced to give meaning to the language of the Code. On the contrary, the principles governing the construction of the Code, by reference to its own terms and to the exclusion of other and earlier legal rules, would prima facie require that such analogies from equitable principle should have no operation without express foundation in the language of the Code. The reconciliation of principles of statute law and general law is a large topic[80]. But it is, on the face of things, unpersuasive to suggest that a Code, which makes no mention of the equitable principles invoked, should be read as subject to equitable doctrines developed for quite different, non-criminal, purposes.

3. The introduction of those doctrines to this case rested upon the further hypothesis, expressed by Ipp J, that the Code postulated the creation of a statutory trust for the moneys received. There is no mention in the Code of such a trust. Indeed, the provisions of the Code are quite inconsistent with such a trust[81]. The foundation for the application of the equitable presumption to the operation of s 373 of the Code is therefore knocked away.

Because this was no minor matter for the decision of the Court of Criminal Appeal, a question is thus presented as to whether its rejection (as I would favour) destroys the basis upon which that Court ultimately concluded that the remaining counts of the indictment could be made good at a second trial because of an implied statutory trust over the entirety of the moneys deposited in the special bank account and the presumption that such moneys would be received and then expended in accordance with the rules developed by equity. Once this foundation for the suggested viability of the counts of the indictment is rejected, and the alternative possibility of co-ownership at common law is abandoned because of the way the Crown presented its case at the first trial, the conclusion of the Court of Criminal Appeal that the Crown could make out the remaining counts at a second trial becomes unsustainable. The exercise of discretion in ordering a second trial is undermined, at least upon the grounds which the Court of Criminal Appeal adopted.

Conclusion: enter verdicts of acquittal

The foregoing flaws in the principles which affected the exercise by the Court of Criminal Appeal of its discretion to order a retrial require that that Court's orders be set aside. This Court must then either return the matter to the Court of Criminal Appeal for it to exercise the discretion anew, freed from the erroneous consideration that a statutory trust was created and that equitable principles were incorporated into the Code. Alternatively, this Court must proceed to exercise its own discretion, excising these incorrect and irrelevant considerations.

Having regard to the lengthy saga of these proceedings; the significant lapse of time since the events, the subject of the remaining charges, occurred; the completion by the appellant of the custodial part of his sentence; and the unchallenged rejection of the Crown's appeal against sentence, I have no doubt that the proper course is for this Court to exercise the discretion which miscarried in the Court of Criminal Appeal[82].

When I turn to reconsider the discretionary matters by reference to the applicable principles, the proper order for this Court to make is that verdicts of acquittal be entered.

The first trial went seriously wrong in the several respects correctly identified by the Court of Criminal Appeal. It could not be expected that a second trial would take place, probably until 1998, a decade after most of the offences charged were alleged to have occurred. I take into account the considerations which weighed with the Judges of the Court of Criminal Appeal. Dishonesty on the part of holders of public office has a tendency to corrode the community's confidence in its institutions. Furthermore, the funds diverted to private use are expressed in 1986 and 1989 money terms and would be greater if stated in today's terms. But there is little point in requiring a retrial where there is virtually no possibility of returning the appellant to prison. Such a trial would be had simply to vindicate the Crown's charges. This would not be the correct course where, if the Crown were to succeed, it would, on its own case, need significantly to change the way in which it presented the matter at the first trial. It is an established appellate principle that a second trial should be refused where the first trial miscarried by reason of the conduct of the Crown or where a second trial is needed to allow the Crown a further chance to present a different case[83].

Given the general objectives of ss 373 and 378 of the Code, it is clear enough that conduct such as was alleged against the appellant should fall within the Code. Defences relying on the identification of particular money and the framing of the indictment do not affect the merits of the defences upon which the appellant relied at his trial. These were that he had not received the funds with any relevant directions or that the directions were vague and had given him discretion or that the payments of an apparently private character were made within that discretion. By inference, these defences were rejected by the jury in relation to most of the charges of the indictment. Section 373 of the Code is silent as to how directed funds from several sources (subject possibly to differing and even inconsistent directions) are to be treated once mixed by the recipient with funds from other sources, directed, undirected and private. It would, in my view, be desirable that the Code be amended to cover, in clear terms, the problem now drawn to notice. If commercial crime is increasing, it is undesirable that the Code should be unclear in this matter for it is inevitable that cases presenting the same problems will recur. It is also undesirable that technical legal issues (particularly outside the Code) should predominate: effectively shifting the determination of the accused's guilt from a jury to the judge[84].

A criminal trial is not a contest between the Crown's assertions and the accused's defences. From first to last, it is a proceeding whereby the Crown, on behalf of the community, assumes the obligation of establishing the charges laid. This obliges it, relevantly, to prove beyond reasonable doubt facts which constitute a precise offence known to law, being the exact offence alleged in the indictment. In my opinion, the Crown failed to do this at the first trial of the appellant. It should not have a second chance.

Orders

I agree in the orders proposed by Dawson, Toohey and McHugh JJ.

[1] An account kept by the appellant at the Fremantle branch of the Commonwealth Bank.

[2] Orton v Butler (1822) 5 B & Ald 652 [106 ER 1329].

[3] Palmer v Jarmain [1837] EngR 148; (1837) 2 M & W 282 [150 ER 762].

[4] [1976] WAR 74 at 78-79.

[5] [1902] St R Qd 9.

[6] [1902] St R Qd 9 at 10.

[7] Kohn (1979) 69 Cr App R 395 at 407; R v Doole [1985] Crim LR 450; Attorney-General's Reference (No 1 of 1983) [1985] QB 182 at 187, 188; R v Dubar [1995] 1 All ER 781.

[8] R v Capewell [1995] 2 Qd R 64 at 67-68, 70-71, 75.

[9] [1902] St R Qd 9; and see R v Hallam and Blackburn [1995] Crim LR 323.

[10] Mainwaring (1981) 74 Cr App R 99 at 107; note to R v Hallam and Blackburn [1995] Crim LR 323 at 325.

[11] Orsi v Legal Contribution Trust [1976] WAR 74; Kohn (1979) 69 Cr App R 395; R v Doole [1985] Crim LR 450; Attorney-General's Reference (No 1 of 1983) [1985] QB 182; R v Dubar [1995] 1 All ER 781.

[12] [1869] EngR 60; (1869) LR 3 PC 101 at 113. See also Spence v Union Marine Insurance Co (1868) LR 3 CP 427 at 438.

[13] [1987] 3 All ER 893 at 907-908.

[14] (1865) 2 H & M 417 at 421 [71 ER 525 at 527].

[15] [1952] HCA 62; (1952) 88 CLR 322 at 336-337.

[16] (1880) 13 Ch D 696 at 719-720. See also Dixon CJ and Fullagar J in Brady v Stapleton [1952] HCA 62; (1952) 88 CLR 322 at 337.

[17] (1880) 13 Ch D 696 at 717.

[18] Taylor v Plumer [1815] EngR 551; (1815) 3 M & S 562 at 575 [105 ER 721 at 726].

[19] [1952] HCA 62; (1952) 88 CLR 322 at 337-338.

[20] (1880) 13 Ch D 696 at 711.

[21] [1966] HCA 44; (1966) 114 CLR 634.

[22] It was immaterial that there may have been some, but not sufficient, free funds available to cover a particular withdrawal: see s 376.

[23] Parker v Taylor unreported, Supreme Court of Western Australia, 29 October 1993.

[24] s 371(2)(a).

[25] s 371(2)(f).

[26] See Bacon v Pianta [1966] HCA 44; (1966) 114 CLR 634.

[27] Boughey v The Queen [1986] HCA 29; (1986) 161 CLR 10 at 30-31 per Brennan J.

[28] [1978] HCA 35; (1978) 139 CLR 315.

[29] [1978] HCA 35; (1978) 139 CLR 315 at 333.

[30] [1978] HCA 35; (1978) 139 CLR 315 at 333.

31 [1994] 2 All ER 316 at 331.

[32] [1978] HCA 35; (1978) 139 CLR 315 at 336-337.

[33] [1994] 2 All ER 316 at 336.

[34] "Money" is defined by s 1 to include "bank notes, bank drafts, cheques, and any other orders, warrants, authorities, or requests for the payment of money".

[35] [1976] WAR 74 at 78-79.

[36] As to the relationship between stealing at common law and under the Code, see Ilich v The Queen [1987] HCA 1; (1987) 162 CLR 110.

[37] The relevant authorities are noted by Dawson J in King v The Queen [1986] HCA 59; (1986) 60 ALJR 685 at 689.

[38] s 584(15).

[39] See Trainer v The King [1906] HCA 50; (1906) 4 CLR 126 at 135.

[40] Parker v Taylor unreported, Supreme Court of Western Australia, 29 October 1993 at 46 per Malcolm CJ.

[41] s 373.

[42] The Code, s 371(2)(a) and (f).

[43] Parker v The Queen unreported, Court of Criminal Appeal of Western Australia, 26 May 1995 at 15 per Ipp J.

[44] Parker v The Queen unreported at 23 per Ipp J.

[45] Parker v The Queen unreported at 15 per Ipp J.

[46] Parker v The Queen unreported at 27 per Malcolm CJ.

[47] See Parker v The Queen unreported at 28 per Malcolm CJ.

[48] Parker v The Queen unreported at 84 per Ipp J.

[49] Parker v The Queen unreported at 32 per Malcolm CJ, 75 per Ipp J.

[50] Thomas v The Queen [1960] HCA 2; (1960) 102 CLR 584 at 595, 604-605; Green v The Queen [1971] HCA 55; (1971) 126 CLR 28 at 31-32.

[51] Parker v The Queen unreported at 78-82 per Ipp J.

[52] Parker v The Queen unreported at 35-42 per Malcolm CJ, 82-89 per Ipp J.

[53] Wilde v The Queen [1988] HCA 6; (1988) 164 CLR 365 at 371-372, citing Fullagar J in Mraz v The Queen [1955] HCA 59; (1955) 93 CLR 493 at 514.

[54] Parker v The Queen unreported at 31 per Malcolm CJ.

[55] See for example Clayton's Case (1816) 1 Mer 572 [35 ER 781]; Re Hallet's Estate (1880) 13 Ch D 696 at 727.

[56] Parker v The Queen unreported at 68-69 per Ipp J.

[57] (1880) 13 Ch D 696.

[58] (1880) 13 Ch D 696 at 727.

[59] Parker v The Queen unreported at 70-71 per Ipp J, citing Re British Red Cross Balkan Fund [1914] 2 Ch 419 at 421; Sinclair v Brougham [1914] AC 398; Hodges v Kovacs Estate Agency Pty Ltd etc [1961] WAR 19 at 22.

[60] Parker v The Queen unreported at 85-86 per Ipp J.

[61] Peacock v The King [1911] HCA 66; (1911) 13 CLR 619; Andrews v The Queen [1968] HCA 84; (1968) 126 CLR 198 at 211; Gerakiteys v The Queen [1984] HCA 8; (1984) 153 CLR 317 at 321; Director of Public Prosecutions (Nauru) v Fowler [1984] HCA 48; (1984) 154 CLR 627 at 630-631; King v The Queen [1986] HCA 59; (1986) 161 CLR 423 at 433; Reid v The Queen [1980] AC 343 at 348; R v Wilson and Grimwade [1995] 1 VR 163 at 181-184.

[62] Parker v The Queen unreported at 41 per Malcolm CJ.

[63] The Code, s 689(2).

[64] Cf Gilmore (1979) 1 A Crim R 416 at 420-421.

[65] Parker v The Queen unreported at 7-8 per Ipp J.

[66] [1987] HCA 1; (1987) 162 CLR 110.

[67] [1987] HCA 1; (1987) 162 CLR 110 at 115.

[68] [1987] HCA 1; (1987) 162 CLR 110 at 123.

[69] [1987] HCA 1; (1987) 162 CLR 110 at 137-138.

[70] s 4.

[71] [1986] HCA 29; (1986) 161 CLR 10.

[72] [1986] HCA 29; (1986) 161 CLR 10 at 30-31. See also Stuart v The Queen [1974] HCA 54; (1974) 134 CLR 426 at 437.

[73] [1892] AC 481 at 487.

[74] [1936] HCA 24; (1936) 55 CLR 253 at 263.

[75] [1964] HCA 21; (1964) 111 CLR 62 at 76.

[76] [1962] Tas SR 170 at 172-173, 192.

[77] [1972] Tas SR 59 at 71-72.

[78] Bacon v Pianta [1966] HCA 44; (1966) 114 CLR 634.

[79] (1880) 13 Ch D 696.

[80] Cf Lamb v Cotogno [1987] HCA 47; (1987) 164 CLR 1 at 11 citing Pound, "Common Law and Legislation" (1908) 21 Harvard Law Review 383; Warnink v Townend and Sons (Hull) [1979] AC 731 at 743. See also Kelly, "The Osmond Case: Common Law and Statute Law" (1986) 60 Australian Law Journal 513; Cotogno v Lamb (No 3) (1986) 5 NSWLR 559 at 570-572 citing Traynor, "Statutes Revolving in Common Law Orbits" (1968) 17 Catholic University of America Law Review 401; Burrows, "The Interrelation Between Common Law and Statute" (1976) 3 Otago Law Review 583 at 599; Atiyah, "Common Law and Statute Law" (1985) 48 Modern Law Review 1.

[81] See Stephens v The Queen [1978] HCA 35; (1978) 139 CLR 315 at 336-337; R v Clowes (No 2) [1994] 2 All ER 316 at 336.

[82] House v The King [1936] HCA 40; (1936) 55 CLR 499 at 505; Lovell v Lovell [1950] HCA 52; (1950) 81 CLR 513 at 519-520; Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513 at 535; Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 at 47-48.

[83] R v Wilkes [1948] HCA 22; (1948) 77 CLR 511 at 518. See generally King v The Queen [1986] HCA 59; (1986) 161 CLR 423 at 426-427, 429, 433; Tsang Ping-nam v The Queen [1981] 1 WLR 1462 at 1467.

[84] Cf Davies, "After R v Clowes (No 2): An Act of Theft Empowered - A Jury Impoverished?" (1997) 61 Journal of Criminal Law 99 at 101.