Milne v The Queen [2014] HCATrans 9 (6 February 2014)

Last Updated: 6 February 2014

[2014] HCATrans 009

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S278 of 2013

No S279 of 2013

B e t w e e n -

MICHAEL JOHN MILNE

Appellant

and

THE QUEEN

Respondent

FRENCH CJ
HAYNE J
BELL J
GAGELER J
KEANE J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON THURSDAY, 6 FEBRUARY 2014, AT 10.15 AM

Copyright in the High Court of Australia

MR H.K. DHANJI, SC: May it please the Court, I appear for the appellant with my learned friend, MR T.F. EDWARDS. (instructed by Michael Bowe)

MR T.A. GAME, SC: If it please, I appear for the respondent with MR D. JORDAN, SC and MR A.P.C. McGRATH. (instructed by Commonwealth Director of Public Prosecutions)

FRENCH CJ: Yes, Mr Dhanji.

MR DHANJI: Thank you, your Honour. Your Honours have, I apprehend, our outline of oral argument. In our submission, the Court of Criminal Appeal, and in turn the trial judge, was in error in finding that in the circumstances of this case the appellant was guilty of the offence against section 400.3 of the Criminal Code. If I can begin with the terms of the provision - it is annexed to our written submissions - if I can take your Honours straight to section 400.3, which is at page 5 of the annexure. Your Honours will see quite readily, I submit, that section 400.3(1) creates offences which involve a temporal dichotomy, offences of dealing in “proceeds of crime” in (b)(i), and offences in relation to dealing with “money or other property”:–

the person intends that the money or property will become an instrument of crime –

That is the key provision, or the key part of the section in relation to this appeal. In relation to that part of the section there is no issue that what it is talking about is some future offence. But further, in our submission, what the section or the provision directs attention to is the use of property in the future either in the offence or to facilitate the offence, what might be called the primary offence or the predicate offence.

The Court of Criminal Appeal in fact accepted that the provision, read in the ordinary way, requires that there be some future use of the property and we say in that respect the Court of Criminal Appeal was correct. That is the Court of Criminal Appeal at 138, appeal book 901. I will not take your Honours to it just yet but I will come back to that. The section, we say, or the requirement of future use is supported, in our submission, when one goes on to look at subsection (2) because in subsection (2) there is the lesser offence of and in particular to paragraph (b)(ii):

there is a risk that the money or property will become an instrument of crime –

When one looks at that expression, clearly, in dealing with a situation where there is a risk that the property will become an instrument of crime and factoring in the definition of “instrument of crime” into that, the idea of risk necessarily takes with it the idea that there must be this future use. There could not be present use of property and a risk that it will become an instrument of crime. The risk picks up its risk element from that future use.

So when one looks at subsections (2) and (3) and, in a sense, looks at that whole provision in context, it is clear enough, in our submission, that the section is directed to dealing with property where there is to be some further use made of the property. What ultimately we submit is that the section is about criminalising the equipping of persons – oneself or someone else – with property. The section directs itself very much towards the notion of property being used and it is about the equipping of oneself for dealing with property such that either you or another person are equipped with that property such that that property might be used, or can be used – I withdraw that – is intended to be used in the commission of an offence or to facilitate the commission of an offence.

BELL J: Can I just stop you at that point and invite you to just consider the analysis of the offence created by 400.3(1) in terms of the physical and fault elements under Chapter 2. Is the first element one of conduct, that is dealing with money or other property?

MR DHANJI: Yes, your Honour.

BELL J: Is that accompanied by a default, fault element of intention?

MR DHANJI: Yes, it is, your Honour.

BELL J: That being the intention to deal with the money or the property?

MR DHANJI: That is so.

BELL J: Then is the - how would one describe the next element, relevantly the element in subparagraph (b)(ii)? It seems to be a fault element - - -

MR DHANJI: It is not without difficulty.

BELL J: Yes.

FRENCH CJ: This is described, I think, by some of the text as an ulterior intention, or ulterior fault element, is it not?

MR DHANJI: Yes, your Honour.

FRENCH CJ: That is not a statutory term. It is just a way of trying to sort it out from those which are attached to a particular physical element.

MR DHANJI: Your Honours, I would accept that in terms of fitting this provision into the structure set out in Chapter 3 of the Code and as explained by this Court in RK and LK and other cases, it is not without difficulty. Ultimately, in our submission, in this case it does not matter and your Honours do not need to grapple with it in order to resolve the differences as between the parties because ultimately it is common ground that there is, however one frames this particular provision, be it circumstance or result of conduct or some such formulation, however one tries to force it into the Code provisions, it is common ground that there is a need to prove what in effect becomes a type of fault provision, in that there is a need to prove that the person intends that the money will become an instrument of crime. I appreciate I have not been helpful but, in our submission, ultimately to try and deal with it in the context of what is joined in this appeal - - -

FRENCH CJ: Does it matter to your case whether the notion of intention in 400.3(1)(b)(ii) falls within the definition under the Code?

MR DHANJI: It does not. It does, we would say, but in that sense the level of variation that is available is such that it really does not matter to the case but we, for what it is worth, would say that one would not go extending the word “intends” beyond what is in 5.2.

BELL J: So that on your analysis the offence requires an intention to deal with the property and at that time an intention that the property will in the future become an instrument of crime?

MR DHANJI: That is so and in terms of the concurrence of those elements there cannot, in our submission, be any doubt about that. The act and the intention must co-exist at that point in time, albeit that the intention is with respect to a future use of the property. One can, I suppose, talk around this provision for some time but at the risk of being glib there is no avoiding the ordinary meaning of the word “will” in the context of this provision. “Will” necessarily directs attention to what will happen in the future.

FRENCH CJ: How was the case ultimately put to the jury because it seemed to me that the Crown case rather did not consistently adopt as a premise that there was a temporal separation.

MR DHANJI: That is so. There was, in a sense, a shifting between discussion of the structure directing attention towards the act itself, directing attention to aspects of the transaction, but I might perhaps most conveniently start in that, to answer your Honour the Chief Justice’s question, with the written directions to the jury, and they appear at appeal book page 827, and in particular at 827 there is the elements set out. The key part of this aspect is at 829 and following where there is the application of the elements to the first count, and your Honours will see at about line 35, paragraph 9.

Now, this is – I should just preface this – this is dealing with – the first element dealt with property, but in the definition of “dealing” there is also the requirement of establishing that the property could become an instrument of crime. Ultimately that issue and the issue in relation to paragraph (b), at least in this case, effectively merge. So beginning then at paragraph 9 on page 829 of the appeal book:

On or around 3 February 2005 the Accused . . . dealt with property –

So we have a clear identification of the dealing being the disposal on 3 February.

The Accused meant to engage in that conduct.

(iii) The 48 million Admerex shares could be used to facilitate the commission of a Commonwealth indictable offence - - -

HAYNE J: Is the use that is spoken of there identified elsewhere in the written directions?

MR DHANJI: Yes, your Honour. At 832 – this is dealing with the next element but in the context it would become an instrument of crime – there is at line 20:

Barat Advisory was the beneficial owner of the 48 million Admerex shares on or around 3 February 2005 –

that being a key factual issue.

(iii) The 48 million shares in Admerex were disposed of by Barat –

That was a capital gains tax event and then –

(iv) At that time, on or around 3 February 2005, the Accused intended that the 48 million Admerex shares would facilitate the commission of an offence.

In relation to that, we would simply pause to note that the word “used” has dropped out of the formulation. Then at paragraph 22, the next paragraph - - -

HAYNE J: Again, is either the use or, here, the word used is “facilitation”, ever amplified or identified?

MR DHANJI: Well, going on, at paragraph 22:

The Crown alleges that the Accused intended that the 48 million shares would be used to facilitate the commission of an offence which involved the Accused, at some time in the future, dishonestly obtaining a financial gain by causing Barat Advisory to lodge an income tax return that contained false information –

In relation to that aspect, the - - -

HAYNE J: Again, Mr Dhanji, the point I am trying to grapple with may be so simple as to be irrelevant but, yes, I see the word “used” appearing - - -

MR DHANJI: Yes.

HAYNE J: - - - but we are not told how or what constitutes the use.

MR DHANJI: Yes, your Honour. Perhaps if I can go from there and move on – just before I leave that I would also just note in passing that at paragraph 22, while there is a reference to intention, there is a not a tying of the time of that intention to the time of the dealing. That is the necessary requirement that the elements all exist at the same time.

GAGELER J: Is there any particularisation of paragraph 23?

MR DHANJI: I am sorry, your Honour?

GAGELER J: Paragraph 23.

MR DHANJI: Yes, if I can just come to that. If I can take your Honours to appeal book 529? That is in the first volume and at about line 29 what his Honour directed the jury was:

The Crown submits that the evidence points to a dealing with the 48 million Admerex shares, intending that the property be used as an instrument of crime in order to gain a financial advantage . . .

The Crown submitted that the outcome of using the 48 million shares, in the way in which it is alleged that the Accused did, was to secure a position whereby he had the Stichtings and the Stichting companies, as a form of screen behind which he could dispose of the shares with limited risk of detection.

So there is there in that sense a focus on the outcome and the structure itself. It goes on –

It was submitted that the Accused transferred shares into small parcels.

I will not read all of that, because what is being spoken of there, the transfer into parcels in fact precedes the dealing and so could not be relied upon. But then, perhaps most directly answering your Honour’s questions, at line 19 on page 530:

The Crown says that it is clear that the actions on 3 February 2005 facilitated the commission of the offence of obtaining a financial advantage by not paying capital gains tax, because the combined effect of having the screen of the Stichtings and the conversion of the Admerex shares into Temenos shares, meant that there was an ongoing advantage or facilitation which allowed the proceeds of the Admerex shares to be repatriated back into the country, to be ultimately used for the Accused’s own benefit.

That is perhaps the clearest statement. In other words - - -

FRENCH CJ: That does not involve the appellant doing anything post-disposal with the Admerex shares because post-disposal they are in the hands of Mr Goodall.

MR DHANJI: Precisely.

HAYNE J: No doubt Mr Game will later tell us what that paragraph means.

MR DHANJI: Yes, but we would clearly enough submit that that does not amount to a use of the Admerex shares.

FRENCH CJ: But is the judge’s direction to the jury given on the premise that there is a temporal separation between those two elements, the dealing and the intention, or the intended use, I should say?

MR DHANJI: Yes. The difficulty in answering your Honour the Chief Justice’s question is that there is something of a shifting in - - -

FRENCH CJ: I am not talking about the Crown case. I am talking about the judge’s direction to the jury.

MR DHANJI: Yes. At times, the directions did refer to certainly some future facilitation, but in terms of directly focusing in precise terms that there had to be some use of the Admerex shares made in the future, our submission would be that that direction was not given. There was an absence of a focus on that, and that is what I was trying to get at, in a sense, when I was back at the written directions at page 832, paragraph 22.

HAYNE J: That has the element of futurity, has it not, at line 2 - “intended that the . . . shares would be used”, plainly an element of futurity.

MR DHANJI: It does, but the difficulty is that certainly to a criminal lawyer who appreciates that the elements must all co-exist at the same time, one can clearly enough see that there is the futurity from the point of dealing, but this does not identify for the jury that the futurity relates to the point of dealing. That is why I was careful to in my answer – that is to say that, in our submission, there was no precise identification of the need for the co-existence of the elements at the one time and that futurity in relation to the dealing.

If I can take your Honours to then what we submit is a key difficulty in the context of what has just been discussed. At appeal book 830 at line 50, it is paragraph 15 of the written directions:

The Crown case is that the 48 million Admerex shares were disposed of on 3 February 2005 because the Accused on behalf of Barat Advisory entered into a contract with Mr Goodall to transfer the shares to him on that day, so that there was a change of ownership of the Admerex shares on that day because the Temenos shares were accepted by Barat Advisory as consideration for Admerex shares on that day.

Now, insofar as in the passage of the summing-up I took your Honours to a short moment ago there is the reference of the shares being used to obtain the Temenos shares and then the Temenos shares being able to be sold discretely, it is clear enough that the obtaining of the Temenos shares was, in a sense, the end of any potential usefulness for the Admerex shares. I do not know if I have made that clear.

HAYNE J: No, you have not.

MR DHANJI: I have got one nod and one shake.

HAYNE J: Well, not for me.

MR DHANJI: The respondent, I apprehend, will put to your Honours that the Admerex shares were not finally disposed of. There were other steps that needed to be taken in relation to ultimately getting rid of them and that there was not this final washing or departure point on 3 February, despite the fact that the 3 February dealing is quite plainly the dealing relied upon. Now, the submission I am trying to make is that even if that is so, that is that there was some ongoing capacity to access or deal with the Admerex shares, it does not matter because the key from the Crown’s perspective is the obtaining of the Temenos shares.

At its best, the Crown case is that there was a use of the Admerex shares to obtain Temenos shares, that is the dealing and the use. Once the Temenos shares were obtained, because it is the obtaining - what is put is it is the obtaining of the Temenos shares with the ability to sell those shares discretely, that is, it meant that the appellant could realise the gain without drawing attention to himself. That is the respondent’s case.

BELL J: The intention being to obtain dishonestly the gain, namely the non-payment of capital gains tax.

MR DHANJI: Yes.

BELL J: The capital gains tax event being on 3 February when the Temenos shares were acquired.

MR DHANJI: That is right. But the key point - I am perhaps not making very well - is that insofar as the Crown speak of a use to facilitate it is the obtaining of the Temenos shares, that is the use to facilitate.

HAYNE J: To facilitate what?

MR DHANJI: Well, again, that is the question the appellant puts.

KEANE J: But if it is about having a blind, if it is about concealing the capital gain that is realisable on the Admerex shares it is really the Temenos shares that are used to create the blind.

MR DHANJI: That is right. That is why I have taken your Honours to that passage at the top of 831 because certainly once he has got the Temenos shares, and that is the dealing, there is no use for the Admerex shares. So whatever one might say about the complexities of the arrangement and the fact that there may have been events taking place after 3 February 2005 with respect to the Admerex shares, the subject of the count, well, they had absolutely no usefulness, could not facilitate.

FRENCH CJ: Now, the level at which we are dealing with this of course is that on essentially undisputed facts, which are reflected in the Crown case, there is no way you could fit them into the elements of the offence and, in particular, (b)(ii) in relation to intention to use, et cetera.

MR DHANJI: That is right.

FRENCH CJ: In a sense, I mean, the direction and the way the Crown puts its case in terms of characterisation are of some significance, but in the end it is a question of whether, on the facts, you can bring it within the section.

MR DHANJI: Yes. We do not have a new trial ground. It was not argued on that basis is in the Court of Appeal and obviously we do not have leave in this Court in that regard, but those directions, in our submission, elucidate the problem because ultimately when one goes to the directions and in turn the reasoning of the Court of Criminal Appeal in the passages that I have taken your Honours to they are, in effect, question begging, in our submission. They certainly do not answer the problem that is thrown up.

HAYNE J: But reduced to its essentials, the facts with which the charge laid must engage are, one, the accused made a share transaction which was a CGT event; two, the accused then intended, and if it matters in fact later did not, not to disclose the CGT event in the tax return.

MR DHANJI: Yes.

HAYNE J: Then, somehow, in a way which Mr Game will eloquently explain to us later, we get some unspecified use of shares which have been disposed of to facilitate what otherwise has been already described.

MR DHANJI: That is so.

BELL J: One small matter, Mr Dhanji, you refer in your submissions to the intended offence and the one with which he was charged in count 2 as an offence under 134.2. The indictment charged as an offence under 135.1 - was there an amendment?

MR DHANJI: I am sorry, that is an error in my submissions.

BELL J: So, to be clear, we are looking at an offence under 135.1 in count 2?

MR DHANJI: No. I am sorry, in count 2 it is an offence under 135.1.

BELL J: Yes.

FRENCH CJ: What is the offence by Barat Advisory?

MR DHANJI: The offence that was particularised as the offence which it was intended would be facilitated - - -

BELL J: Was the 134?

FRENCH CJ: Was the 134, yes.

MR DHANJI: Yes, 134.2. I am sorry.

GAGELER J: Was the acquisition of the Temenos shares, as distinct from the disposal of Admerex shares itself a dealing with property within the meaning of section 400.3?

MR DHANJI: Well, if it was it was not the dealing relied upon. I am sorry, that is not a direct answer to your Honour’s question. They are, in a sense, one and the same event. In terms of how the Crown put its case conceivably there may have been other potential – dealings that one could point to and then would need to prove the requisite intention. So, whilst it is the one event, one could particularise the dealing as a disposal of one property or particularise it as the receipt of different property but one would then have a different need to prove the subsequent fault element with respect to the particular property.

Your Honours, the Court of Criminal Appeal focused on the notion that the construction or the argument of the appellant would rob the section of its utility. Now, at the outset, it is our submission that whatever construction one puts on this provision, it is of wide operation. The point is, it does not operate here but it is certainly not a situation where, on the appellant’s construction, this section does not remain a section of wide operation.

FRENCH CJ: To the extent that it implemented the recommendations of the Australian Law Reform Commission report, it was intended to broaden the offences created by the old Proceeds of Crime Act of 1987, I think, but that is a different question perhaps from how you construe the section.

MR DHANJI: Yes. So, just to go back where I was in the outline of oral argument, in our submission, it is very much about equipping the person, and it might be the person doing the dealing or some other person with property, where there is an intended future use to be made of that property.

What is significant, in our submission, when one starts looking at whether there is any robbing of utility or any difficulty in terms of leading to a construction that does not further the purposes of the provision, where a person does in fact use property with a particular intention, that person is in some circumstances going to be guilty of the primary offence itself, if they, as a result of that use, go on and commit primary offence. They may be guilty of the offence of attempt.

Now in that circumstance, the person will only be guilty of the offence of attempt if there is the requisite proximity as required in section 11.1. Now there is good reason why one would limit the operation of the provision in those circumstances and maintain the idea of the need for proximity and that is, it gives the person the opportunity to withdraw from the commission of the offence.

If the primary offence is to be committed by another person, or with another person in circumstances where there is in fact a use of the property with the specified intention, then there is available ordinary principles of complicity - aid, abet, counsel and procure, incitement and conspiracy and the use of the property with the particular intention is inevitably or necessarily an act that would be available as an overt act with respect to conspiracy.

FRENCH CJ: You do not have to exclude those possibilities for your case.

MR DHANJI: No.

FRENCH CJ: I mean, the notion of “use” could encompass using the property as a step in connection with a step in the conduct of an offence or in some accessorial conduct or in the concealment of the offence.

MR DHANJI: Yes.

FRENCH CJ: But your case really must turn on whether the text allows an application to this class of case where the Court of Criminal Appeal, I think, talks about the continuing existence of the shares.

MR DHANJI: That is right.

FRENCH CJ: That can be brought within the notion of “use”.

MR DHANJI: That is right. But all I am seeking to do – and I will move on reasonably quickly – is to note that when one looks at the provisions with respect to complicity and, in particular, provisions that allow - or the availability, for example, the offence of attempt to incite. So, if you use property with the requisite intention that some other person commit an offence, that is very likely going to be an incitement to that person and, in fact, if that person does not – if the communication does not reach that person it is likely to be an attempt to incite that person. So, there is a broad range of liability available.

FRENCH CJ: I do not understand what this has to do with your case.

MR DHANJI: Well, I will move on - - -

FRENCH CJ: The exclusion of those aspects.

MR DHANJI: All I am getting at, your Honour, I apologise, is the notion that the Court of Criminal Appeal in starting from the basis that the appellant’s construction would rob the section of its utility is simply not the case. There is no robbing of utility. Where people use property with an intention to commit an offence, or to facilitate an offence, there are provisions available which will deal with that.

FRENCH CJ: But they cover all of those things. But, on your case, it still does not cover your case.

MR DHANJI: But it does not cover our case. That is my point. They are available. They cover those cases. They do not cover this case. Your Honours, if I could go then to the decision of the Court of Criminal Appeal and, in particular, at appeal book 891, the Court of Criminal Appeal deals with the appeal against conviction. I will not trouble your Honours with the earlier part of the reasoning but I will just take your Honours, perhaps, directly to what we submit is the key reasoning beginning at page 901. At paragraph 135, there is a reference to the need to give “a broad and purposive interpretation”. That is the aspect I was endeavouring to deal with earlier.

HAYNE J: The principle of construction of a criminal statute invites adoption of a broad construction.

MR DHANJI: As we say in our written submissions, we certainly do not accept that one starts from that standpoint - - -

HAYNE J: Now “purposive”, I can well understand, but “broad”.

MR DHANJI: Yes, that is so. There are two aspects to what his Honour there refers to, broad and purposive. I accept what your Honour Justice Hayne says, “purposive” is straightforward, but “broad” is contrary to the various decisions that we have referred to in our written submissions in that regard. Towards the bottom of the page at 138, their Honours accept the requirement of future use, and then over the page at 139, their Honours say:

We are unable to accept, however, the first principal contention that the shares, once disposed of, cannot be used in any way at all.

The difficulty, in our submission, is that this was a case where the use was by the appellant himself, that is the alleged use. Certainly, one can dispose of property to another person and that person might be able to use that property in the commission of, or to facilitate the commission of an offence, but in circumstances where it is the person themselves committing the offence, we simply say it cannot be the case that the person could use the property and certainly, on the facts of this case, the appellant, having disposed of the Admerex shares, simply could not use them. Their Honours go on –

Such a construction of s 400.3(1) would significantly erode the section of its utility.

As I said a moment ago, that is not accepted. Their Honours in that paragraph go on to deal with the example of the house, and their Honours say –

If a person sold his home, intending that the proceeds of sale would be used to fund the making of explosives to be used in a terrorist attack, the home itself, although disposed of, plainly could be said to have the capacity to facilitate the commission of the terrorism offence.

Again, the word “used” has dropped out of that sentence. The only way one could potentially look at the house being used to facilitate the terrorism offence is to go to a point anterior, and once one goes to a point anterior - - -

KEANE J: To the dealing.

MR DHANJI: To the dealing, then one has future use of the house, but we say that that example in fact is apposite and their Honours were wrong in the manner in which they have dealt with it.

HAYNE J: Does the manner of expression of the Court of Criminal Appeal’s reasons by reference to capacity for use reflect arguments that were advanced? It reads as though they are responding to arguments from the appellant couched in terms of capacity for use rather than couched, I would have thought, relevantly in terms of whether it was intended to be used.

MR DHANJI: Yes. I apprehend the reason for that is the argument started with respect to the definition of “dealing”.

FRENCH CJ: Could be.

MR DHANJI: Which requires “could be used”. Ultimately in the context of this case it, in our submission, does not matter particularly.

FRENCH CJ: They collapse into the same argument.

MR DHANJI: That is so.

FRENCH CJ: Because of the word “used”.

MR DHANJI: That is right. Their Honours go on:

More significantly, in the present matter, the Admerex shares did not cease to exist upon their disposal. They remained wholly in existence but were now hidden behind the additional curtain of the Temenos shares.

We are, in a sense, back to where we were some little while ago, that is, in our submission, impossible to comprehend as a use of the Admerex shares. Just going on, at 140, really at 139, 140, that is the entirety of the reasoning with respect to the future use argument, and, in our submission, it cannot be accepted. Their Honours then, at 141 and following, go on and deal with the argument in relation to the nature of the property and at 141 there is reference to various preconditions for the commission of the offence.

But, as we have said in our written submissions, the simple precondition, or, indeed motive, to commit the offence do not amount to a use of property to facilitate the commission of the offence and in the outline of oral argument I have referred to an example for an assault offence where it could hardly be said that the existence of a complainant in an assault means that the complainant has been used to facilitate the commission of the assault offence. The sale of the shares was what generated the capital gain. Putting to one side the future use argument, that was not a use of the shares to facilitate the commission of the offence. The reasons of the Court of Criminal Appeal at 145 - - -

HAYNE J: Just before you come to 145, what do you say, if anything, about the reasoning that appears at paragraphs 142 to 143?

MR DHANJI: In our submission, the argument, or reasoning, I should say, put forward there, in essence, at the last sentence of 142:

In other words, the offence could not have been committed without the shares -

is simply referring to the existence of a necessary precondition. The fact that there is a necessary precondition, that is, the existence of the shares was a necessary precondition to the commission of the offence does not amount to a use of the property to facilitate the offence, and it is in that context that I refer to the example of the existence of a complainant in an assault offence. One could not readily say that the complainant, by his or her existence, was used to facilitate the commission of the offence.

So that there were these steps that ultimately created the capital gain, and in a sense created the motive for the subsequent commission of the offence, did not mean that there was a use of the property to facilitate the commission of the offence. I should just be clear. This argument obviously is separate to the future use argument.

Their Honours at 145 go on and consider the word “facilitate”. What, in our submission, is conspicuously absent, however, is consideration in that same context of the need for there to be a use, or at least that the shares be used to facilitate. At 146 their Honours go on to say:

There is no warrant to give . . . a narrow meaning.

Their Honours at about line 38 say:

The shares were plainly capable of being used, and, on the Crown case, were intended to be used after their “disposal” to facilitate the commission of a s 134.2 offence.

I have dealt with that. At 147 there is a further reference and acceptance of the fact that the shares had to be used after they had been disposed of, and I apologise. There is something of a mingling of arguments through here but I will just take it in turn. What their Honours ultimately say in this respect appears at 149:

The submissions of the Crown at trial correctly recognised that the circumstances and nature of the dealing with the shares in the present matter – the disposal by way of an off market swap – had the capacity to demonstrate the existence of the relevant criminal intention.

That is, with respect to their Honours, an evidentiary consideration. That is, you could look at the various circumstances and use those matters to draw inferences as to intention.

BELL J: Relevant to proof of the 135.1 offence charged in count 2.

MR DHANJI: I am sorry, your Honour?

BELL J: It was relevant, by way of circumstantial evidence, to proof of the offence charged under 135.1 in count 2.

MR DHANJI: Quite so, quite so, and indeed, might be argued to be more broadly relevant except that there is the fundamental problem that there is no use to facilitate. Similarly, at 150:

The disposal of the Admerex shares in the present matter had two features that were relevant to proof of the appellant’s intention –

Again, there is confluence of proof of intention with the requisite elements of the section 400.3 offence. Insofar as their Honours then go on to say:

First, the share swap created the CGT event –

Clearly that is not a future use and indeed, in our submission, not a use to facilitate at all –

Secondly, it provided a facilitating mechanism for the commission of the offence in that it provided a further cloak or curtain behind which the act of ultimate deception (the lodgement of a return) would be more likely to succeed.

But again, certainly not a future use and, secondly, that is about the transaction that the shares themselves did not cloak the sale. The Admerex shares did not cloak the ultimate realisation of the Temenos shares for money that was subsequently returned – on the Crown case – to the appellant. Your Honours, that is all I would say in relation to the Court of Criminal Appeal’s decision.

HAYNE J: Just before you part from it, I wonder whether your criticism of what their Honours have said might be captured as being that particularly at 142 through to 145 their Honours treat the phrase “used to facilitate” as having been satisfied in the circumstances of this case by the observation that there could be no principal offence under 135, et cetera, without there having been a subject matter of the transaction that yielded a CGT event.

MR DHANJI: Yes.

HAYNE J: The reference to, or the use of words like “instrumental”, see page 904, paragraph 145, last line or the word “means”, paragraph 145, line 24, may perhaps yield that understanding of their Honour’s reasons, but, again, we will hear what Mr Game has to say about that.

MR DHANJI: Yes.

FRENCH CJ: You are saying that, as I understand it, that language is really referring to, on a proper analysis, the status of the shares as a necessary condition for what happened later?

MR DHANJI: That is right. It all comes back to their existence as a necessary precondition. It is no different, in our submission, to the complainant in the assault.

HAYNE J: It cannot be a CGT event without a subject matter of the transaction.

MR DHANJI: That is right. Your Honours, the submissions deal with various authorities that have discussed the term “use”. Subject to anything your Honours might say, I did not propose - - -

FRENCH CJ: They all appear in particular statutory contexts, I think, and not least White.

MR DHANJI: White, particularly, is distinguishable for the reasons that I think we have referred to in our reply and in our outline of oral argument. It is perhaps best put in the Western Australian Court of Appeal where her Honour the President noted:

The use must, at its widest, be indirectly in connection with the facilitation of a confiscation offence -

and then, of course, understanding that in relation to what was said in this Court about it being a particular relationship between sections 146 and 147 of that Act and the complementary nature of those provisions. So, White is a different case. In our submission, “used” in this context is relevantly similar to the context in which it is used in relation to the using of false instrument - discussed in Sultan v The Queen - but to an extent ultimately it does not matter a great deal, in our submission, because whilst there has been a lot of consideration of “use” and “use in connection with” which is a common phrase, not used here but used in confiscation proceedings, across the various cases what is common is that there needs to be a use in some relevant sense and none of the cases would go so far as to say that someone could dispose of something and then subsequently use it.

KEANE J: Is not the real problem, Mr Dhanji, that however widely one might want to read the word “use”, in this provision it is tolerably clear that the use to facilitate has to be some different activity - - -

MR DHANJI: Yes.

KEANE J: - - - from the dealing that the section is talking about.

MR DHANJI: Yes, your Honour.

KEANE J: So, however widely one reads “use”, you have to be able to say it is distinct from the dealing.

MR DHANJI: Perhaps I should just clarify it in this way. That is our, perhaps, what might be described as our first or principal submission and, in our submission, quite plainly the simplest resolution of the argument. We do also submit, however, that even if one could merge the two, and the respondent submits one can, there is still not, in this case, a use to facilitate. But, your Honour, with respect, we would accept your Honour’s statement of really the simplest way to encapsulate the problem. But, we simply say that it is not the only problem.

Your Honours perhaps before I conclude just indicate that for reasons which I can go into if necessary, ultimately, in terms of if the appellant should be successful, orders 5ii and 5iii are not sought. There is a difficulty in relation to those. I do have a document - - -

BELL J: I am sorry, what page of the - - -

FRENCH CJ: Is it the sentencing disposition?

MR DHANJI: Yes. So, in our notice of appeal - - -

HAYNE J: What page?

MR DHANJI: I am sorry, it is - - -

BELL J: Page 972, 973?

MR DHANJI: Yes. There are two notices of appeal – 972 and also 975. For some reason we have two numbers. But, I will deal with the 973 - - -

FRENCH CJ: That was an artefact of the numbering below, was it not?

MR DHANJI: I could not begin to attempt to explain. Your Honours will see that there is, of course, the conviction in relation to the primary offence – the 135 offence. That was ordered to be served partially cumulative to the sentence imposed with respect to the section 400.3 offence. The only order we seek is that if this Court quashes the conviction and sentence in relation to the money-laundering offence, that the commencement date for the other sentence is adjusted.

HAYNE J: Do you not have to go back for resentence?

MR DHANJI: No.

HAYNE J: Why not?

MR DHANJI: Because what has happened subsequently – and it might assist if I provide your Honours with a document that sets all this out – subsequent to the proceedings before his Honour Justice Johnson and the Court of Criminal Appeal, the appellant was dealt with with respect to another matter and received a sentence in relation to that that was made partially concurrent, partially cumulative, on the entirety of the earlier sentence.

A new non-parole period was set by her Honour Justice Fullerton. Under the Commonwealth legislation, the new non-parole period, in fact, is a rescission of the earlier non-parole period and an entirely new non-parole period for the aggregate sentence. The result of all of that is that the non-parole period currently ordered is that ordered by Justice Fullerton, which is not the subject of the proceedings in the Court of Criminal Appeal in the matter before this Court.

The net result of all of that is that, despite the existence of various powers of a court on appeal, there is in fact no power for the Court of Criminal Appeal and hence no power for this Court to deal with the non-parole period set by her Honour Justice Fullerton. What that means is that all this Court should do, in our submission, and I do not know that there is any argument about this aspect of the matter, is simply do what the Court of Criminal Appeal, we submit, ought to have done at the time, and that is quash the sentence and adjust the sentence starting date for the section - - -

HAYNE J: That is the point at which I need help.

MR DHANJI: Yes.

HAYNE J: You have a two count indictment.

MR DHANJI: Yes.

HAYNE J: Your contention is “should be verdict of acquittal entered in respect of one count”.

MR DHANJI: Yes.

HAYNE J: The sentence imposed was partly cumulative?

MR DHANJI: The sentence imposed on count 2, yes.

HAYNE J: Is there not, therefore, a tailoring of the sentence to take account of two counts, and if there is a tailoring of the sentence, does that - I am not saying it does, I just need help - does that not suggest, go back to the CCA for resentence of an offender standing for sentence on only one count?

MR DHANJI: No, with respect, because there was, in our submission - there is no suggestion of any tailoring of the sentence in this case. What was done was sentences in relation to each offence were imposed in accordance with what is at least the desired approach suggested in Pearce v The Queen and that is appropriate sentences for each offence and the overlap dealt with - - -

FRENCH CJ: There was a recognition of overlapping criminality, was there not?

MR DHANJI: That is right, and that is why there is - - -

FRENCH CJ: Well, that is a judgment really the Court of Criminal Appeal made at the time.

MR DHANJI: Well, in terms of the overlapping criminality, it is dealt with - - -

FRENCH CJ: The sentencing judge, I mean.

MR DHANJI: Yes, that is right, and allowed for in terms of the degree of concurrence.

HAYNE J: Do you not beat all that out in the Court of Criminal Appeal on remitter?

MR DHANJI: Well, with respect, no, it is not necessary to do that. Where it might have been necessary would be if there was a setting of the non-parole period. Can I provide the document that I refer to? There is an original and copies. The net result of what we put is that where there is a need for something to be done – I have nine copies, if I can provide those,

your Honour, at least an original and nine copies. My friends have this document and I will provide additional copies.

FRENCH CJ: All right, we see that document. You have made your submission on it.

MR DHANJI: Yes, your Honour. In essence, the three and a half year sentence is – let me put it this way; his Honour was sentencing against a maximum of five years in relation to the section 135.1 offence. When one looks to that fact alone it is, in our submission, patently clear that his Honour was not ameliorating that sentence as a result of the fact that there was some other sentence imposed, but rather, his Honour was imposing what his Honour regarded as the appropriate sentence for that offence that dealt with the fact that there were two offences by selection of the starting date, and there would be no warrant for the Court of Criminal Appeal to interfere with the three and a half year sentence.

What would need to be done would be an application to her Honour Justice Fullerton to correct what would then become a sentence that is contrary to law because her Honour Justice Fullerton set the non-parole period and indeed set a term of sentence that would involve a hiatus between the first sentence and the second sentence.

BELL J: The cumulation that was imposed in relation to the offence charged in count 2 was five years, was it?

MR DHANJI: Yes. So the total effective sentence was then eight and a half years.

BELL J: Yes, I understand.

MR DHANJI: Your Honours, those are the submissions for the appellant.

FRENCH CJ: Yes, thank you, Mr Dhanji. Yes, Mr Game.

MR GAME: Can I say straight away that I do not think that paragraphs 142 to 145 can be defended, but I do say that if the question posed is whether or not there was material upon which the element in section 400.3(1)(b)(ii) could be satisfied, nevertheless I do argue that there was such evidence and I intend to seek to demonstrate how that is so.

Now, if I could take your Honours to the statute first - and I want to say a couple of things about it - if your Honours take our outline, the point to which I want to come is that which appears in paragraphs 6 and 8 of our outline. If I take you to the statute – I will only do this briefly – section 400.3 deals with “money or other property” and one brings in the definition of “deal” in 400.2, and here it is dispose, and the dispose is in effect the contract for sale of the Admerex shares.

Now, it could be possess, conceal or something else, so it could be, just as a matter of construction - the dealing could be a concealing, and then one comes to (1)(b)(ii), that is the one engaged in this case, and “will become an instrument of crime” then engages definition 400.1. The Crown did not rely on “is used in the commission of” but “used to facilitate the commission”. So coming back to 400.3, “intends that the . . . property will become an instrument of crime” - “intends” would pick up the definition in section 5.2 and it is probably a circumstance or result - but it does not matter for present purposes. To say the least, one would have to have an expectation, shall I say.

BELL J: I am sorry?

MR GAME: Result or circumstance is - - -

BELL J: Result or circumstance, you say, is the physical element.

MR GAME: Yes. So it would be either belief or - for circumstance or expectation, your Honour. That is my paraphrase, but means it to happen or expects it will happen is “result”, but that is a state of mind and we accept that it is contemporaneous with the dealing, so there cannot be any doubt about - - -

HAYNE J: A state of mind contemporaneous with the dealing about a future use?

MR GAME: Yes, your Honour. This is where I am seeking to, shall I say, finesse to a little degree, and the finesse is this – I do not know whether there is going to be death by 1,000 cuts but I am going to - - -

FRENCH CJ: Just one big slash.

MR GAME: The finesse is this, and we submit it is defensible. The finesse is that one can intend that it will become an instrument as a result of the transaction itself. The expectation is an expectation – I am not trying to take out the temporality, but I am saying that you can take it right back to the transaction so that you can have an expectation that as a result of the transaction the thing will be transformed, come to be something else, that is, have the character of being an instrument of crime.

BELL J: How do you succeed even on that analysis?

MR GAME: I will explain that in a moment. But that takes us up to paragraphs 6 and 8 in our submissions. So can I say, just to give your Honours an example of what I am talking about, if you dealt with the shares on CHESS, the ASX, then clearly enough they could not be an instrument of crime, but if the dealing is a dealing that brings about a concealment, or the dealing is a – then the dealing itself may be the thing that causes the thing to become an instrument.

HAYNE J: What does concealment matter a jot?

MR GAME: Well, your Honour, the argument is this, that later in the piece - what happens is the Temenos shares are gradually sold off and Mr Milne tells lies to his accountants about that and then he signs a tax return in which he does not disclose the capital gains event.

HAYNE J: Whether he has covered his tracks about that to any extent at all is irrelevant, is it not?

MR GAME: Well, no, your Honour, because if the argument is accepted the facilitate is making easier the commission of the offence, namely, making easier to, shall I say, get away - - -

HAYNE J: To tell an undetected lie. You want to inject, not just tell an untruth and you tell an undetected - - -

MR GAME: That is right.

HAYNE J: Where do you get that from?

MR GAME: Well, where I get that from is that again we are talking about a different timeframe so – actually the timeframes meet up because later in 2005 – September he is being asked questions by his accountants and he tells a series of lies to them about Challinor and what Challinor was. He said it was a Swiss bank. So the facilitation of the offence is the, shall I say, fooling his accountants into believing what he puts to them, that is to say, so that he can bring about a situation in which he signs the tax return with no disclosure of that fact. So it is facilitation of – when one says facilitation of commission of the offence, facilitation of him being in a position to sign the tax return without disclosing that fact. Now, I appreciate that may have some difficulties but that is the way in which it was put in this case, and if you do not accept that argument then we lose.

FRENCH CJ: He told his accountants, did he not, that the money coming back into Barat was repayment of loans from Clairmont, did he not?

MR GAME: Yes. What his accountants were told – they were told various things, but that Challinor was a Swiss investment bank and that they were loans coming in, whereas in fact they were the proceeds of the sale of the Admerex shares.

FRENCH CJ: Of the Temenos shares.

MR GAME: Yes, sorry, they were the ultimate proceeds of the sale of the Admerex shares and what he had done is he put the - in effect, parked after 3 February, parked until 14 or 15 September all of the Admerex shares in four of the Stichting companies that were not Challinor. So he parked them there and then on 14 or 15 September they were transferred to Mr Goodall. Mr Meisterhans, in effect, managed all of those events.

BELL J: Stripping it of all of these extra details, the capital gains tax event was the disposal of the shares on 3 February, was it not?

MR GAME: Yes, your Honour. Sorry, the capital gains event was the contract.

BELL J: Yes.

MR GAME: There was an alternative – you actually saw it before, the word “or” was crossed out and that was an alternative that was abandoned in that passage that Mr Dhanji took you to right at the - - -

BELL J: What passage?

MR GAME: Sorry, I say passage, page 831. You see in the second line on the top of 831 the word “or” is crossed out. It was crossed out for a reason because they were alternative ways of there being a capital gains event and the second was abandoned so that it just became the making of the contract.

If you just go back, briefly, you will see the directions on this at 823 that pick it up, but the directions at 823, paragraphs 16 and 17 are the critical ones and the second line in 17 – that was abandoned as being as a way of proving it, so the conversation with Mr Goodall which was actually, probably, before 3 February – maybe the day before. I will just take your Honours to one more passage in developing this part of the argument. If you go to page 612 to 613, one sees directions are given about the making of a contract and those directions start at line 35 on 612 and go to line 30 on 613.

I cannot make an excessive amount of this because people were not focusing on whether or not the contract was completed by the receipt of the Temenos shares or whether it was just made out by the oral contract. People were not focusing on that particular problem. But if you have the oral contract, you do see that the things that happen afterwards are, in effect, a performance of it – not limited to simply, we say, the receipt of the Temenos shares but things that happen in respect of them later and in respect of the Admerex shares up to 15 September.

BELL J: The relevant use of the Admerex shares in the context of the CGT event being the contract.

MR GAME: Yes, your Honour. Can I say this? The way in which it was put focused very heavily, and repeatedly, on getting the Temenos shares. I mean, we are talking about things happened – one happened immediately after the other. Again, whether or not one accepts the distinction may be a contentious point, but the dealing is the disposing of the Admerex shares, not the receipt of the Temenos shares, although it could have been framed in those terms.

FRENCH CJ: Are you saying the dealing collapses into the use, intended use?

MR GAME: No, I am saying that the dealing – the result of the dealing is the use, that the outcome of the dealing is the use. That use is a use for the purpose of concealment. Can I put it - - -

FRENCH CJ: You mean the circumstance, or the set of circumstances, created by the dealing is the use.

MR GAME: Yes, that is right. Can I just put it this way? If one goes back to the definition – say the deal was a concealment, you would not need another concealment – the continuation of the concealment might be the use, the future use.

HAYNE J: Well, can I just understand that? You say the shares were used - the Admerex shares were used to facilitate commission of the relevant offence. It seems to me you go on to say those shares were used in circumstances that might be described as covertly, secretly or some other pejorative term of equivalent content, to prevent detection, perhaps to prevent ready detection of the offence later committed. Is that right?

MR GAME: With one qualification, to prevent detection, but to deceive one’s own advisers to enable one to do it.

HAYNE J: He might have wished to deceive his own domestic partner but so what?

MR GAME: No, your Honour, I agree. But what I am saying is a slight variation of the set of propositions and that is all I was trying to clarify. It might be best if I simply go from here as to the way in which it was put and seek to demonstrate that that is capable of making out the offence. So the steps we take are the steps through paragraphs 9 and 10 of our submissions, but the best way for me to demonstrate those steps is by picking up what occurred in the submissions, both to the judge and then to the jury, about the subject, and so what I want to do is to pick up some of the references that appear in paragraph 12 of our submissions.

So if your Honours go to volume 1 of the appeal book, page 87. Now, this is in the course of what was, in effect, the no case submission, and there is – 85 to 87 is all of how the case was put, but the passage I want to draw your Honours’ attention to is at 87, lines 24 through to 38. So particularly the last line of that paragraph:

So, it was a use and an ongoing use in our submission as a result of the transaction leading up to the end of that financial year -

Then again, line 32 -

it was not until the swap on the 3rd of February that that conduct became an offence against section 400.3 for the reasons I have already expressed resulting in the Temenos shares . . . the advantage that they could be disposed of more readily and more discreetly, and in that way, facilitate or enhance –

Broadly speaking, that is the way in which the case was put, if that is not capable of sustaining the case we lose, but that is how it was put.

BELL J: There one sees that the advantage, which is the ingredient of the 134.2 offence, is being described as the discrete disposal, but the advantage for the purpose of the offence is the non-disclosure of the CGT event and the avoidance of the payment of the tax that is due, and it is in that connection that there may be thought to be a difficulty with the use of the shares, they provided the occasion for the event.

MR GAME: Yes, I accept, and I accept straight away that the fact they are the subject matter of the offence is not good enough to make out the offence, but if you are committing a tax fraud then the commission of the offence does involve, when you sign the form, shall I say, the concealment of the true situation, so that if you have concealed the true situation we would say – I accept, there has to be a use, an implementation, but the concealment of the true situation is, if that is what you do, that is a facilitation of the commission of an offence of dishonesty.

HAYNE J: Why? Because you are merging, concealing from whom? Concealing from the world, concealing from the Commissioner, concealing from your partner, domestic or commercial?

MR GAME: The way it was put in this case was it was concealing from the people who were interrogating you about it which were your accountants which is different because it comes before the signing of the form. In a way it is necessary that you get away with it because otherwise your accountants – well, shall I say by their own inquiries have revealed the true situation. Now, the accountants knew that in Barat there were 55 million Admerex shares and they asked questions of Mr Milne about that and they did not get, so to speak, the answers to that.

BELL J: Well, some of that went to proof of the dishonesty for the purpose of the offence.

MR GAME: True enough.

BELL J: But it still does not take us back to the mere fact that the subject matter of the dishonesty involves the CGT event created by the disposal of the Admerex shares. You are still light on establishing the use.

MR GAME: I could say that is not the only difficulty but the - - -

BELL J: For the present it seems - - -

MR GAME: Well, your Honour, what I would say is this, that one accepts for the moment, shall I say, that the shares are – accepts for the moment that the shares are utilised to conceal from the accountants in the sense that they are used to assist in creating a cloak as to what actually happened. I will just say accepting for one moment then, the question your Honour has asked me is directed to whether or not that hiding process for whoever might ask about it - be it the accountants or – is capable of facilitating an offence and we say - - -

BELL J: But you refer to the transaction in that answer, not to the shares that provide the occasion for the event that is the subject matter of the suggested offence.

MR GAME: Yes, but we would say it is excessively narrow to say that the commission of the offence is just the act of signing the – making it easier to commit the offence. It is not like making it easier to murder someone. It is like making it easier to bring about all of the circumstances in which that act can be done.

FRENCH CJ: Is it correctly stating your position to say that you equate the intended use with the intended taking advantage of circumstances created by the disposal, namely the substitution of the Temenos for the Admerex shares as a means of realising the capital gain derived from the Admerex shares in a way that would facilitate concealment of the capital gain from whoever?

MR GAME: Yes. It is not just that at the moment he makes the transfer his intention is “I am not going to pay capital gains”. It is not only am I not going to pay capital gains on this but I am also going to do this in a way that means that nobody will find out that this is what I have done.

FRENCH CJ: But the intent - coming back to the text, the use, on your argument is the intended taking advantage subsequently of a circumstance.

MR GAME: That is right, which he had created. That is the argument that - - -

HAYNE J: So he uses the shares to facilitate the commission of the offence by making the particular form of transaction which is the CGT event?

MR GAME: By making the particular form of the transaction, yes, the form of it.

HAYNE J: Namely, making a swap.

MR GAME: No, not just a swap, a swap in the circumstances in which the shares do the things that – the shares then sit in the company for some time, the Temenos shares come in, the shares that create that series of events that enable concealment. That is the argument that was advanced on that we put. I just have a couple more of - - -

GAGELER J: Mr Game, the concealment is concealment from the accountants, is it?

MR GAME: That is right.

GAGELER J: Is that what it comes down to? The facilitation is concealment from the accountants?

MR GAME: Yes.

GAGELER J: Where do we find that? I do not - - -

MR GAME: I am about to come to it.

GAGELER J: Thank you.

MR GAME: It is in our document. Paragraph 9)ii(c) is the relevant reference.

GAGELER J: And those page references?

MR GAME: Those page references, yes. In the address to the jury, and I will try and just pick up a few passages, but at the bottom of 109, we see the Crown says – this is about line 45:

the contract between Barat and Mr Goodall was made on 3 February 2005 although it took some time to be completed because it was not until later in 2005 that Mr Goodall accepted delivery of the 48 million shares that he was to receive pursuant to the contract.

BELL J: This is the Crown’s opening, is it?

MR GAME: Closing. This is the closing address.

BELL J: Appeal book 109 is the closing address there?

MR GAME: Yes, it is the closing address.

BELL J: I see.

MR GAME: One can ignore what appears at line 50 because that way of putting the case was abandoned later on, and then – I am just picking some passages that demonstrate the way it was put, 114, about lines 15 to the bottom. What counsel was doing there was he was going through his chart which appears at – that is this thing which is here, and it is very hard to read and we did send up a clean copy, but if I could just take you to that chart.

What it shows is this - at page 789 - so on 11 June - on the first page in a box - that the 55 million Admerex shares, in effect, go into the five companies owned by the Stichtings but ultimately controlled by Mr Milne with Mr Meisterhans as his person on the ground, as it were. There was some question about whether that was itself a capital gains event. So then, one sees in that box at 789, five Stichting companies. Eventually the shares all end up in the four top Stichting companies and Challinor Equities just has the Temenos shares.

But one sees in that box at the bottom of page 789 that in order to make up the 48 million shares on 7 February, that is to say after 3 February, Mr Milne puts 4.08 million shares into Metevier. So that what actually happens is when one comes to the capital gains event on page 790 which is the events on 3 February, the Temenos shares come into Challinor – the 1 million Temenos shares come into Challinor, again all on the direction of Mr Meisterhans because he is a signatory of the Swiss bank. Then what happens is that Mr Milne moves out any remaining Admerex shares in Challinor in July, that was in that box, so that by September 14 or 15, all the shares which have been sitting in those four Stichting companies are moved out to Mr Goodall.

BELL J: For the purpose of the advantage - - -

MR GAME: So that is what is being explained – yes.

BELL J: Yes. Without dazzling us with all that detail, if we can go back to the advantage for the purpose of the 134.2 offence, the advantage was the non-payment of capital gains tax due on the disposal of the Admerex shares to Temenos.

MR GAME: That is right.

BELL J: Given that, what is the significance that you are seeking to draw by reference to the detail in the diagram?

MR GAME: What we are saying is that counsel was putting in that passage at 114 that there was – sorry, there was also a box that showed the money going out, but what we say is that what counsel was doing at 114 was showing that there was a continuing use of the Admerex shares - - -

BELL J: After their disposal.

MR GAME: Yes, by Mr Meisterhans at the direction of Mr Milne to top them up to get – so to do things to, as it were, finalise the arrangements in relation to the swap with the Temenos shares. So that is what counsel is putting at page 114, that he is continuing to do things after 3 February in respect of the Admerex shares, but all, I accept all for the purpose of securing the proceeds of the Temenos sale.

BELL J: So the use in that respect is in the circumstances of the transaction with a view to concealing from the accountant when an inquiry is made.

MR GAME: Yes, that is correct. Then the material relating to the accountants comes up at 185 to 187.

BELL J: How one goes about dishonestly obtaining an advantage by deception is relevant to proof but one comes back to the advantage for the purpose of the offence.

MR GAME: Yes, I accept that, your Honour. I also accept that there is only so much you can do with the deception of the accountants because the deception of the accounts is after 3 February. So it is - - -

GAGELER J: What are the accountants being deceived about – the existence of the swap?

MR GAME: The source of the funds. So what the accountants were saying is there is an awful lot of money coming into Barat. Where is this money coming from? You will receive a betterment assessment by the Taxation Commissioner. Where is all this money coming from? Mr Milne says it is loans from Challinor which is a Swiss investment bank, and things like that.

So what he has done is, one has seen, he has moved all the Admerex shares out of Challinor. He has made up for the 48 million to Mr Goodall. He has got Challinor just with Admerex shares in it and then he creates a line of deception about what Challinor actually is. That is how he deceives his accountants. He is also asked by his accountants, what is this ASX document that he is asked about which records Barat having 55 million Admerex shares and they do not get a straight answer to that question.

BELL J: Again, concealment of the accountants – all of this is evidentiary with a view to establishing the dishonest obtaining of the financial advantage from the Commonwealth.

MR GAME: No. Quite, your Honour. What we are saying is that there is an extra character to it because not only does he intend the offence at the time of the transaction, he does things to make good its commission. If that cannot make out the offence, then we lose, but that is how the case was put. Now, the final passage is the closing observations made by the prosecutor at 203 to 205 but particularly 204, line 33 and to the end of the address:

but the one dealing which we suggest facilitated the deception later on was the conversion of the shares into the Temenos shares and that was where, whatever the inquiries embarked upon by –

that is the name of the accountants -

run into that dead end - - -

KEANE J: Mr Game, it may be irrelevant, but would not the case have been better put by identifying the relevant dealing as the acquisition of the Temenos shares with a view to using them as the blind?

MR GAME: Yes.

KEANE J: All this straining that we are going through is because the case was framed in relation to the Admerex shares.

MR GAME: That is a fair observation, your Honour, but I am putting the case that, yes, what is done was defendable and this is really the - this is it, this is how it was put. Then the same at the top of page 205. Your Honours may have missed this, but at paragraphs 11)i and ii of our submissions, what we saw was that after - again whether or not it persists is another matter - but it is after 2 February, on 7 February, he had to top up with four more million Admerex shares to make good the transaction with Mr Goodall and then the shares stayed in those four Stitchtings until - the other four Stitchting companies until 14 September.

So our case comes back to the propositions that I put in paragraphs 6 and 8 as to the legal position, that the outcome the transaction enabled a concealment of the events and that that was deliberate and that that amounts to an intention at the time of the dealing that the property will be transformed into something else which is something that enables Temenos shares to be taken - - -

GAGELER J: Transformed by the dealing.

MR GAME: By the dealing, yes.

GAGELER J: - - - into Temenos shares?

MR GAME: Yes, your Honour. Yes, that is how we put it.

GAGELER J: That is really what you are saying in paragraph 9.

MR GAME: Yes, that is correct. That is really what we say in 9, 10, and 11. That is our case.

FRENCH CJ: Now, is there any difference in the way that you have put the application of the statute to the facts from the way in which the judge put it to the jury in terms of what they had to find?

MR GAME: Mr Dhanji took you to a passage - there are other passages that say similar things. Whether or not it is – the answer to that question, there is no - I am not being sort of opportunistic here, but the complaint is not about the directions but the directions are light - no, the answer is the directions are light on in dealing with - the high point is what I just took you to in the Crown’s submissions. But we saw that passage at 529 and 530. There are a couple of other passages. There is one at 511, from the top of the page down to about line 40. There is a passage at 529 to 530 which Mr Dhanji has already taken you to and pages 532 to 533 deal with the accountants and again at 536. But that is it. It is not - - -

FRENCH CJ: It would be a curious situation - if we decide that on the facts, on any view of the facts, they could not constitute the offence, then cadit quaestio. If on a particular way of applying the statute to the facts they could constitute the offence, but that was never put to the jury, it is an odd situation.

MR GAME: No, your Honour, I understand that, but I am trying to put the case to you - to articulate the case consistently with the way in which the prosecutor finally put it in his address.

FRENCH CJ: But what matters is how the judge put it to the jury, is it not?

MR GAME: Yes, I accept that but he has paraphrased in a very, very perfunctory way what was put by counsel in those submissions that I have just taken you to.

GAGELER J: Mr Game, this is probably a very basic question, but what part of a criminal appeal statute are we dealing with? Your submissions seem very much to be about whether the verdict was open. Is that the question, was there an error of law, and if so, what is the error?

MR GAME: Well, I think that probably the correct articulation is it would be a wrong decision of law of the trial judge to allow the case to go to the jury on the facts in the case that was put to him, so it would be within - - -

FRENCH CJ: There was an application for a directed verdict.

MR GAME: There was an application, yes. There is no discord between what the judge had to consider and what was ultimately considered, so it is not as though you would have a different argument later, but there would be an argument if the case was put on different bases, some of which were permissible and some of which were not, but that there was a complaint about the directions given, which is kind of why I have been at pains to say that it is not about that issue. So that, for example, when I stood up I made a concession about – just because they are the subject matter of the offence does not mean that you can – the Court of Criminal Appeal, we saw in a passage, adopted that as one of its reasons it would seem. If I can establish

another reason, the second reason they gave, which is what I have sought to defend, then we would still hold the conviction. .

HAYNE J: What do you say about the orders which are sought by the appellant?

MR GAME: We accept that if you uphold the appeal that they would be appropriate orders to make and the appellant would then have to go back before Justice Fullerton and get her to fix a non-parole period and that would be the simplest way to deal with it.

FRENCH CJ: Thank you, Mr Game. Yes, Mr Dhanji.

MR DHANJI: Thank you, your Honour. Your Honours, I will be brief. Ultimately, it seems that reliance is put on this formulation of – it is in paragraph 3 of the respondent’s outline of oral submissions, the:

offence can apply in cases where a person deals with property intending that, as a result of, or by, that dealing, the property will become property that is used –

It loses, in our submission, the idea of use but it also involves, in our submission, in a sense, a temporal shift by looking at the result – once one is looking at a result one is looking at something that occurs in the future, so as soon as one looks at something that occurs in the future, one is shifting to a point anterior to the dealing and so once you are anterior to the dealing you have this future use being the dealing but of course one cannot go to the point anterior to the dealing, the dealing is the point at which the person deals with the property and the use, we say, must be a use in the future.

The respondent took your Honours to various aspects of the evidence in relation to what happened subsequent to 3 February 2005. Your Honours, I did deal with this but I will just go back to make it clear that it was in answer to that submission that I took your Honours to at page 831 - that is the written direction.

It is in that context that it is important that there is this formulation, and to pick up what your Honour Justice Keane said, it might have been better if the Crown had focused on the Temenos shares because that is in a sense, in terms of what has been put, the heart of any possible use, and we do not accept that, but the point being that, insofar as the Admerex shares are used – well, the Admerex shares are disposed of to obtain the Temenos shares, that is the dealing. The Temenos shares were – and this is at the top of 831 – the Temenos shares were accepted by Barat Advisory as consideration for the Admerex shares on that day.

So that is the event, and whatever happens with the Admerex shares subsequent to that does not matter because, insofar as the respondent is able to formulate some form of use, they have served their purpose; the Temenos shares have been obtained. But ultimately in terms of where the respondent ends up – and this was in response to what your Honour the Chief Justice put – the creation of a state of affairs which is then taken advantage of ultimately stretches beyond capacity, the expression in the statute.

KEANE J: Well, you can see the stretch when you look at the definition of “dealing” in 400.2(1)(a), the various forms of dealing:

receives, possesses, conceals or disposes of –

not transforms.

MR DHANJI: Yes. Your Honours, those are the submissions in reply for the appellant.

FRENCH CJ: Thank you, Mr Dhanji. The Court will reserve its decision. The Court adjourns until 10.00 am tomorrow.

AT 12.06 PM THE MATTER WAS ADJOURNED