In a Project Wickenby case, the NSW Supreme Court has ordered a permanent stay of any proceedings on indictments against 2 men concerning alleged false tax deductions claimed regarding whisky distillation schemes.
On 14 March 2012, the Commonwealth Director of Public Prosecutions (“CDPP”) presented an indictment to the Supreme Court, which charged that the 2 men conspired with each other and others “with the intention of dishonestly influencing a Commonwealth public official, namely the Commissioner of Taxation, in the exercise of his duties as a public official”. The Crown alleged that each of the men, together with a Mr Phillip Egglishaw and a Mr Philip de Figueiredo, entered into an agreement to make false representations to ATO officers with the intention of dishonestly influencing them to accept deductions claimed in the 1999, 2000 and 2001 income tax returns of taxpayers who had participated in particular schemes involving the distillation of whisky in those years. The Crown alleged that the representations which were made by the 2 men were to convey false and misleading information.
In 2005, the Australian Crime Commission (ACC) commenced an investigation into the activities of the 2 men, which lasted for some years. During the course of this investigation, the ACC issued summonses for the compulsory examination of the 2 men, in the express contemplation of specific charges. Both men gave evidence under oath in response to the summonses. The ACC issued directions authorising distribution of the transcripts of the examinations by the ACC examiner and other material to the prosecution authorities (including the CDPP), and the ATO. On 25 November 2010, the 2 men were committed to stand trial on allegations of conspiracy to defraud the Commonwealth contrary to s 29D and s 86 of the Crimes Act 1914, and a further charge to similar effect contrary to s 135.4(7) of the Criminal Code Act 1995.
After being arraigned in the NSW Supreme Court, each of the 2 men filed motions in the Court seeking orders that the trial of the indictment against each of them be permanently stayed.
The Court said the Crime Commission accepted that dissemination of material had occurred contrary to some of the directions of the ACC examiner pursuant to s 25A(9) of the ACC Act. However, it submitted that this was, on the probabilities, due to an administrative oversight.
The Court however said it was “not prepared to make such a finding”. The Supreme Court was of the view that the only basis for the transmission of the transcripts and other material was to enable their derivative or indirect usage against the 2 men. Any such indirect usage must have been likely to have prejudiced a fair trial, the Court said, and was not authorised by the ACC Act.
The Court said the men were entitled to have the contents of their examination, in which they were obliged to forego their privilege against self-incrimination, and which contained evidence relevant to their defence, kept confidential from the prosecution so that their right at a fair trial was ensured.
The Court said the conduct of the Crime Commission, in conjunction with the CDPP, had deprived the men of the protection, which the law ensured. According to the Court, any trial would not be fair or in accordance with the adversarial process, and it therefore ordered that any proceedings on the indictments presented on 14 March 2012 against the 2 men, “be, and hereby are, stayed”.
(R v Seller; R v McCarthy [2012] NSWSC 934, NSW Supreme Court, Garling J, 17 August 2012.)
[LTN 160, 20/8]