R v Pratten (No 22) [2015] NSWSC 1138

Supreme Court New South Wales

Medium Neutral Citation: R v Pratten (No 22) [2015] NSWSC 1138 Hearing dates: 8 July 2015 Date of orders: 08 July 2015 Decision date: 08 July 2015 Jurisdiction: Common Law Before: Rothman J Decision: Document admitted Catchwords: EVIDENCE – admissibility of application for a private ruling from the Australian Taxation Office – no danger of unfair prejudice as Crown does not rely on untruths or inconsistencies in documents as consciousness of guilt – danger of unfair prejudice that the jury assume sinister motive from fact that document continually updated is small and not outweighed by probative value Legislation Cited: Evidence Act 1995 Category: Procedural and other rulings Parties: M. McHugh SC/with T. Berberian (Crown) S. Grant/with B. Dean (Accused) Representation: Counsel: M. McHugh SC/with T. Berberian (Crown) S. Grant/with B. Dean (Accused)

Solicitors: Commonwealth Director of Public Prosecutions (Crown) O'Brien & Hudson Solicitors (Accused) File Number(s): 2010/00315475 Publication restriction: None

EX TEMPORE Judgment HIS HONOUR: The second aspect with which the Court must deal today is an application in relation to the contents of the Crown tender bundle which is Exhibits 1 through to 4 on the voir dire, and in particular to the contents of volume 2 between pages 572 and 599. I have already made clear during the course of the discussion with counsel that I did not need to hear from counsel for the accused in relation to the admission of the private ruling from the Australian Taxation Office. In fairness to the Crown, I should point out that during the course of that discussion, the Crown made it clear that the private ruling had been inserted for the purposes of completeness, rather than for the purpose of relying on its contents. I reserve, to the extent necessary, any submission that may be put in relation to the private ruling which is contained from pages 595 to 599. The remainder of the objected material is in pages 572 through to 594 and is the application for a private ruling made for and on behalf of Mr Pratten, the accused. It is sought to be excluded by the defence on the basis that the danger of unfair prejudice to the accused outweighs its probative value. There was, at one stage, an issue relating to whether this application was a business document, but that issue seems to have fallen away. Rather, the submissions relate to the effect of the document on the jury in a number of ways to which I will come. In the course of the submissions made by the Crown as to why the document should be allowed, the Crown took the Court to a number of specific passages in the document that it says are, either by themselves or together with other material, an admission by the accused as to his state of knowledge or state of mind, which is a relevant if not crucial consideration in the charges that are before the Court. The Crown also submits that such passages are otherwise relevant to the fact of the relationship between the accused and the various entities through which the accused may have been dealing. I sought to take counsel for the accused through the document and, in particular, to the passages upon which the Crown relied. That process, which was instructive, resulted in the proposition that the contents of the document do not give rise to the kind of unfair prejudice to the accused that would give rise to the provisions of s 137 or s 135 of the Evidence Act 1995. Rather, it is the nature of the document itself, that is, that it is an application for a private ruling from the Australian Taxation Office, and the fact that the Crown may be suggesting that there were inconsistencies, if not untruths, in other documents before the Court that gives rise to the unfair prejudice because it may lead to conjecture or an impermissible process of reasoning on the part of the jury. The submission that the document may give rise to an impermissible process of reasoning seems to be based upon the proposition that because some of the statements in the document or in other evidence (inconsistent with the document) may arguably be untrue, the jury may take a view of the accused that it is not entitled to take. The Crown has, at this stage, not sought to use any untruths contained in the documentary evidence as evidence of consciousness of guilt in the sense that that term is used in directions before the jury in criminal trials. If the Crown were to seek to use such untruths as a consciousness of guilt, given that this document post-dates the charging of Mr Pratten, it would need to apply to the Court and the Court would need to consider the application and allow or disallow the use of material in that way. The burden to satisfy the Court that these issues, if they be untrue and, frankly, I am not presently satisfied that they are untrue, is a significant burden which I need not discuss any further given that at this stage, it is not a matter on which the Crown relies. The other aspect of unfair prejudice raised by the defence is that the jury may assume a sinister motive from the fact that the document was continuously updated. The business plan, which forms part of the application for a private ruling, is a document on its face dated 1 January 2005. According to a submission by counsel for the accused, the document was continuously updated. I accept that the document, while it may have been originally created on 1 January 2005, bears some hallmarks that it has been updated, at least in relation to certain aspects of it. Counsel for the accused refers, for example, to the passage at page 577 I relating to the negotiation of second-hand diesel engines for the boat. The actual invoice for those engines is dated January and/or February 2006 and accordingly it seems that the negotiations for them did not commence until late in 2005 and therefore is inconsistent with the document date of 1 January 2005. There are two answers to this assertion of danger of unfair prejudice. First, in this day and age with technology as it is, documents are often and for anything other than sinister purposes updated over a period of time. It is a far-fetched suggestion that the jury would assume some sinister motive in the updating of the document, particularly in circumstances where, if requested, a direction to that effect can be given. The second answer is that even if the passage to which I have just referred, albeit as an example, was inserted in or about the period between November 2005 and February 2006, it is still a period during which the state of mind or state of knowledge of the accused and the admissions, if they be admissions, are relevant as that period falls within the period to which the charges relate. Moreover, even if the admissions were made as late as 2011, they would still be relevant, albeit perhaps less persuasive. The other example that is used is the passage at page 577 L that refers to Mr Pratten, the accused, as the managing director of Commercial Pacific Insurance Limited. Yet the accused did not hold that position until 2008. As such, this passage also bears the hallmarks of an update of the original business plan that may have been initially drafted in January 2005. However, my comments in relation to the passage concerning the negotiation of the engine replacement apply equally, if not more so, to this passage. The danger created by the uncertainty in the document's date is, in my view, not a matter that creates a danger of unfair prejudice that in any way outweighs the probative value of the material that is sought to be tendered. Each of these matters will need to be the subject of detailed directions by the Court. This case presents a not uncomplicated factual scenario that requires the jury to have at least some understanding of the capacity of persons to involve themselves in business affairs through entities separate from their identity as persons, as a consequence of which, detailed directions will need to be given as to the way in which documents such as this document can be interpreted, and what necessarily flows from such documents. It seems to me that the combination of the significant probative value of some of the statements made in this document and the necessity of giving detailed directions in relation to the way in which such a document can be interpreted, particularly if it is suggested that the jury may use the document impermissibly, would eliminate any danger of unfair prejudice and I admit the document.