NSW CRIME COMMISSION v MACRIS [2002] NSWSC 3

New South Wales Supreme Court

CITATION : NSW CRIME COMMISSION v MACRIS [2002] NSWSC 3 FILE NUMBER(S) : SC S11317 of 2000 HEARING DATE(S) : 15 November 2001 JUDGMENT DATE : 9 January 2002

PARTIES : Plaintiff: New South Wales Crime Commission Defendant: John MACRIS JUDGMENT OF : Hulme J at 1

COUNSEL : Plaintiff: S McNaughton Defendant: C Stein SC, G Jones SOLICITORS : Plaintiff: JM Giorgiutti, NSW Crime Commission Defendant: Galloways DECISION : See paragraph 20

IN THE SUPREME COURT OF NEW SOUTH WALES SYDNEY REGISTRY COMMON LAW DIVISION

No: 11317 of 2000

HULME J

Wednesday, 9 January 2002 NEW SOUTH WALES CRIME COMMISSION v John MACRIS Judgment 1 His Honour: On 29 May 2000, a number of orders were made in these proceedings. They included an order:- "Pursuant to section 10 of the Criminal Assets Recovery Act 1990 that no person is to dispose of, or attempt to dispose of, or otherwise deal with or attempt to otherwise deal with any interest in property (within the meaning of "interest in property" as defined in section 7 of the Criminal Assets Recovery Act 1990) of John Macris, including the interest in property in the property described in Part One of the Schedule hereto." 2 Part One of the schedule included reference to 2 parcels of real estate, motor vehicles, funds held in a nominated bank account and some cash. 3 On 19 March 2001, I made orders in accordance with a form of "Consent Orders" signed by the solicitors for the parties. Those orders included:- "5. Pursuant to section 10(5)(b) of the (Criminal Assets Recovery) Act the restraining order make provision for meeting the reasonable legal expenses of the Defendant agreed at $40,000 out of the property specified in Schedule hereto such sum to be paid to Brett Galloway, Solicitor. 6. Subject of order 5, pursuant to section 22 of the Act the interests of the Defendant in the property specified in the Schedule hereto be forfeited to, and vest in, the Crown ('the assets forfeiture order") 8 Execution of the assets forfeiture order be stayed until 21 May 2001. 9 Leave be granted to the Defendant pursuant to sections 25(4) and 26(4) of the Act to make applications pursuant to sections 25 and 26 of the Act in respect of the interests in property of the Defendant specified in the Schedule hereto within six (6) months of the date of this order." 4 The schedule to those orders was in identical terms to the schedule to the orders of 29 May 2000. The orders were entered on 20 March 2001. 5 On 21 September 2001, there was filed on behalf of the Defendant a Notice of Motion which sought, inter alia, an order that the orders made on 19 March be set aside and orders under section 25 of the Criminal Assets Recovery Act and 26 of the Proceeds of Assessment Act (sic) that certain property in a schedule (which was not attached) be excluded from any Assets Forfeiture Order and/or any Proceeds Assessment Order. Amended Notices of Motion were subsequently filed, the latest version seeking, inter alia, that the orders made on 19 March be set aside and, alternatively, a declaration of the date on which forfeiture has been effected. By agreement the parties sought that I deal with these 2 prayers for relief, deferring consideration of other orders also sought. 6 The inspiration for the first of the orders sought is that neither the Defendant nor his solicitor has as yet received the $40,000 referred to in order 5 quoted above. It seemed common ground that there was no reason to think that, without intervention by the Court, it would be received in the near future even though the Defendant has been in the process of incurring legal expenses. Evidence before me shows that the Public Trustee has become registered as the proprietor of one of the parcels of real estate, collected the proceeds of the bank account and the cash but has not registered itself as the proprietor of the other property. 7 A number of provisions of the Criminal Assets Recovery Act are relevant. Under s10, the Commission can apply for, and in circumstances defined, the Supreme Court must make, restraining orders. The terms of the order made on 29 May 2000 reflect this section. By sub-section 5:- "A restraining order may, at the time it is made or at a later time, make provision for meeting out of the property, or a specified part of the property, to which the order applies all or any of the following: (a) the reasonable living expenses … (b) subject to section 16A, the reasonable legal expenses of any person whose interests in property are subject to the restraining order, being expenses incurred in connection with the application for the restraining order or an application for a confiscation order, or incurred in defending a criminal charge." 8 Under s12 the Court may make ancillary orders. Under s14 the Court may, in limited circumstances order the sale of property subject to the restraining order. So far as is presently relevant, s16A provides:- "(1) The following restrictions apply to a restraining order making provision for the payment of any legal expenses of a person: (a) no provision is to be made except to the extent (if any) that the Supreme Court is satisfied that the person cannot meet the expenses concerned out of the person's unrestrained property, (b) … (e) any such provision must specify the particular interest in property out of which the expenses concerned may be met." 9 Under s22, while a restraining order is in force, the Commission may apply for an order forfeiting to, and vesting in, the Crown all or any of the interests in property that are subject to the restraining order when the assets forfeiture order takes effect and, in circumstances defined, the Supreme Court must make such an order. So far as is presently relevant ss23 and 25 provide:- "23 (1) On an assets forfeiture order taking effect in relation to an interest in property: (a) the interest is forfeited to the Crown and vests in the Public Trustee on behalf of the Crown, and (b) if the person forfeiting the interest was in possession, or was entitled to possession, of the property, the Public Trustee may take possession of the property on behalf of the Crown. (2) An interest forfeited under subsection (1) is to be disposed of by the Public Trustee in accordance with the directions of the Treasurer and the proceeds are to be paid to the Treasurer and credited to the Proceeds Account. (3) The Treasurer may delegate the power to give directions for the purposes of subsection (2). (4) The Supreme Court may, when it makes an assets forfeiture order or at any later time, make any ancillary orders that the Court considers appropriate. For example, the Court may make any ancillary orders for and with respect to facilitating the transfer to the Crown of interests in property forfeited to the Crown under such an order. 25 (1) If an assets forfeiture order: (a) … (b) has been made – a person whose interest in property was forfeited by the order, may apply to the Supreme Court for an order (in this section called an exclusion order ) excluding the interest from the operation of the forfeiture order or an relevant restraining order (4) After an assets forfeiture order has been made, an application for an exclusion order may not be made by a person: (a) if the person was given notice of the proceedings that led to the relevant restraining order or assets forfeiture order – unless it is made within 6 months after the assets forfeiture order took effect and leave to apply has been granted by the Supreme Court, or (b) …