NSW Crime Commission v Mahoney [2002] NSWSC 1009

New South Wales Supreme Court

CITATION : NSW Crime Commission v Mahoney [2002] NSWSC 1009 CURRENT JURISDICTION: Common Law FILE NUMBER(S) : SC 11437/00 HEARING DATE(S) : 25 & 26 October 2002 JUDGMENT DATE : 29 October 2002

New South Wales Crime Commission PARTIES : Robert Bradley Mahoney Public Trustee JUDGMENT OF : Sperling J at 1

COUNSEL : Mr I Temby QC for the Plaintiff Mr R Lovas for the Defendant SOLICITORS : New South Wales Crime Commission for the Plaintiff Curtis Gant Irving Solicitors & Attorneys for the Defendant CATCHWORDS : Criminal Law - proceeds of crime - application for injunction to restrain sale of forfeited property pending determination of exclusion order LEGISLATION CITED : Criminal Assets Recovery Act 1990, s10, s22, s25, s26 DECISION : See paragraph 9.

- 4 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION Proceeds of Crime List

Sperling J

Tuesday, 29 October 2002

11437/00 NSW Crime Commission v Mahoney

Judgment 1 Sperling J: On 8 June 2000, a restraining order was made pursuant to s 10 of the Criminal Assets Recovery Act 1990 in relation to the property of the applicant, Robert Bradley Mahoney. He was then living on a farm at Black Hill, New South Wales, which he owned jointly with his mother. 2 On 9 April 2001, an assets forfeiture order pursuant to s 22 was made by consent pursuant to s 22 in relation to the applicant's interests in property. The property to which it related included the Black Hill property. A similar order was made in relation to the applicant's mother. That included her interest in the property. 3 The forfeiture order relating to the applicant distinguished between the applicant's interest in the Black Hill property and other property of the applicant. The terms of the order provided for the payment of $40,000 to the applicant's then solicitors out of the Black Hill property. A stay against disposition of certain of the applicant's property pending determination of any application for exemption pursuant to ss 25 or 26 did not include the Black Hill property. 4 Plainly, the forfeiture order contemplated the sale of the Black Hill property. That, however, was not, according to the applicant, his understanding of what was to be done or of what had been done in his name. He said on oath that he had instructed his lawyers at that time that he would not give up the Black Hill property. He said further, on oath, that he first became aware of a prospective sale of the Black Hill property on 8 August 2002 at Newcastle District Court when he heard a crown prosecutor say that the property was to be sold. 5 An auction sale of the Black Hill property was scheduled for Saturday 26 October 2002. 6 By notice of motion filed on 21 October 2002, the applicant sought orders setting aside the forfeiture order of 9 April 2001 and an order restraining the sale. The application for an injunction to restraint the sale was heard by me on 25 October 2002. 7 I need not review the events which account for the delay since August 2002 in making the present application. There was no serious dispute that the delay was satisfactorily explained. 8 The application for the injunction was initially put on the basis of preserving the status quo pending the determination of the application to set aside the forfeiture order. Later in argument, the application was put on the basis of preserving the status quo pending the determination of an application for an exclusion order, listed for hearing in February 2003. 9 On 25 October 2002, having heard evidence and argument, I reserved my decision. On 26 October 2002, I granted an injunction until further order. I said I would give my reasons a later time. 10 As will appear, a case was made out for the grant of an interim injunction pending the determination of the application for an exclusion order. Accordingly, it was unnecessary for me to decide whether a case would otherwise have been made out on the alternative basis. 11 The application for an exemption order relating to the whole of the applicant's interest in the Black Hill property will turn on the prospect of the applicant establishing that he acquired his interest in that property without the use of what I will loosely call tainted funds. There is evidence available to the applicant that this is so. The Commission challenges that evidence. However, at the least, there is a serious prospect that the applicant's evidence will be accepted. Accordingly, there is a serious issue to be tried in relation to the application to exempt the whole of the Black Hill property from the forfeiture order. 12 As to balance of convenience, I had to take into account that, where property is a person's home, it has a special value. The property was the applicant's home until he was prevented from living there by bail conditions imposed in about September 2000. 13 Opposing considerations were that if the sale was cancelled the expense of mounting the auction sale would be thrown away if the applicant failed in his application for an exclusion order. That may amount to $2000 to $3000 on what I was told. Another consequence was that the previous solicitor would be kept out of his money, but it seemed that something in the order of $1500 was in fact owing there, rather than the larger sum mentioned in the forfeiture order. 14 The applicant offered the usual undertaking as to damages, plus an undertaking in the following terms: I further undertake to the Court that any property described in the Schedule to orders made on 9 April 2001 (and entered 18 April 2001) will be applied to fulfil my undertaking to the Court before it is paid, transferred or otherwise returned to me or paid or transferred to anyone on my direction.