Commissioner of the Australian Federal Police v Yi Hua Jiao [2015] NSWSC 1302

Supreme Court New South Wales

Medium Neutral Citation: Commissioner of the Australian Federal Police v Yi Hua Jiao [2015] NSWSC 1302 Hearing dates: 30 July 2015 Date of orders: 30 July 2015 Decision date: 30 July 2015 Jurisdiction: Common Law Before: Hamill J Decision: See orders. Legislation Cited: Civil Procedure Act 2005 (NSW) Proceeds of Crime Act 2002 (NSW) Cases Cited: Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR State of NSW v Public Transport Ticketing Corporation (No 3) (2011) 81 NSWLR 394 State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 Category: Principal judgment Parties: Commissioner of the Australian Federal Police (Plaintiff) Yi Hua Jiao (First Defendant) Sho Cheng Jiao (Second Defendant) Representation: Solicitors: Solicitor for the AFP (Plaintiff) No appearance (Defendants) File Number(s): 2013/21332 Publication restriction: Nil

ex tempore Judgment 1. Before the Court is the defendant in proceedings commenced by summons filed on 23 January 2013 by the Commissioner of the Australian Federal Police. Also before the Court is an applicant seeking orders in relation to those proceedings. The defendant and the applicant are siblings. 2. The summons, which sought orders for restraint of property, examination of nominated persons and ultimately forfeiture orders, all pursuant to the provisions of the Proceeds of Crime Act 2002 (NSW), is listed for final hearing on 7 October 2015. 3. Counsel for the defendant and applicant, and his instructing solicitor come before me as duty judge today seeking some form of relief which will enable them to resurrect the applicant's claim that the property subject to the summons be exempted pursuant to the provisions of the Act. They do so in the absence of any evidence in support of the orders that they seek and without any clear indication or, it seems, idea of precisely what orders might resurrect their client's position. 4. The plaintiff reads an affidavit of one of its solicitors which sets out the chronology of the matter since January of 2013 when the proceedings were commenced. 5. The situation as it currently stands is that there are before the Court two notices of motion filed on behalf of the applicant. The first was filed in Court on 13 February 2014 and seeks, amongst other things, a declaration that the whole of the sum subject to the forfeiture application be excluded under the Proceeds of Crime Act. 6. The second notice of motion filed in Court on 11 March 2014 purports to seek an order pursuant to s 29 of the Act, that the whole of the property subject of the order be excluded from the restraining order. 7. It will readily be seen that the two notices of motion cannot stand together or, at any event, seek different things. The first appears to seek relief from the final order for forfeiture which is sought by the Commissioner. The second purports to revisit the question of whether all of the subject property should be subject to the restraining order which was made on 23 January 2013 by McDougall J sitting in the Common Law Division. 8. Counsel for the defendant was unable to articulate any valid reason why the Court should entertain at this stage an application relating to the restraining order. 9. The purpose of such an order, as was discussed by McDougall J in his judgment of 23 January 2013, is to prevent or alleviate the risk that the property sought ultimately to be forfeited to the Commonwealth will be dissipated or disposed of pending a resolution of the case. 10. In this case, the property comes in two forms. First, there is a sum of around $325,000 held in an account in the defendant's name at the Star City Casino. 11. Secondly, there is an amount of $300,000 in cash which was seized prior to the institution of the present proceedings. 12. I should indicate that the conflict or amendment to the notices of motion arose following the preparation of those notices by solicitors retained by the defendant or, probably more correctly, the applicant, at an earlier stage and who no longer act for him. 13. On the material currently before me, all of which was provided by those representing the Commissioner, it seems that his current legal representatives did not come into the case until around May of 2015. Nevertheless, it is necessary and convenient to point out that on 10 and 11 March 2014 consent orders were made for the examination of certain named individuals pursuant to s 180 of the Act. 14. Those consent orders were signed by the solicitors then retained. There is nothing to indicate that at the time that those consent orders for examination were made there was any indication that the defendant sought any exemption from the restraining order that had been in place by that stage for over a year. 15. For those reasons, I indicated plainly in the course of argument that absent some sensible submission to the contrary, I did not propose to do anything in an attempt to resurrect the notice of motion filed in Court on 11 March 2014. 16. The notice of motion filed on 11 February 2014 appears to have been dismissed by virtue of the non-compliance by the defendant and/or plaintiff with the so-called guillotine clause which was part of a timetable set by consent on 2 July 2015. It is noted in passing that that was after the current legal representatives had been retained. 17. The relevant order was in these terms: "(a) The amended notice of motion filed 14 February 2014 will be dismissed unless by 24 July 2015 the applicants (INSERT NAMES) have filed and served all affidavits on which they seek to rely as evidence in chief in the proceedings and a certificate in writing from the solicitor on the record that the applicants have filed all the evidence in chief on which they seek to rely." 1. Order (b) went on to say: "That after 24 July 2015 the applicants may filed any further evidence in chief in support of the amended notice of motion filed on 14 February 2014 without either the consent of the Commissioner of the Australian Federal Police or leave of a judge." 1. Initially I thought that there was a real ambiguity between those two orders and counsel for the Commissioner accepted that they did not sit well together. However, after considering the matter further, counsel submitted that order (b) was only calculated to stop the defendant from filing further evidence and was dependent on order (a) having been complied with. If order (a) was not complied with, the notice of motion of 14 February 2014 was, by operation of the consent orders, dismissed. 2. I accept that submission and, accordingly, it seems to me that the notice of motion of 14 February 2014 has already been dismissed. 3. In the absence of any argument to the contrary, it seems that the amended version of the notice of motion filed on 11 March 2014 is also dismissed. 4. Accordingly, the registrar was correct in refusing to accept the attempted filing of affidavit evidence after 24 July 2015. There was no relevant proceeding in relation to which that affidavit evidence could be filed. 5. The practical and legal upshot of this was explained to me by counsel appearing for the Commissioner. In effect, what will happen on 7 October 2015, as matters currently stand, is that the Commissioner will be required to prove those things necessary to obtain an order for forfeiture of the $625,000. Assuming it does so, the order for forfeiture will be made. 6. The defendant and applicant will not be in a position to resist that order or to pursue their application that all or part of the money should be exempted from the forfeiture order. 7. On my perusal of the material, it is difficult to know whether the failure to comply with the timetables that have been set for the orderly conduct of these proceedings is the fault of the defendant himself, his previous legal representatives or his legal representatives. As best as I can tell, it may be a combination of all of the above. 8. However, it is the case that the current legal representatives did not come into the matter until around 18 May 2015 and I accept that the case involves a large amount of material and that there are language difficulties and geographical complications that explain, to some degree, the failure to comply with the timetables. 9. I should go back one step to note that the case management orders, to which I have hitherto referred, were made on 2 July 2015, by which time the current solicitor for the defendant had been involved in the matter for over a month. They also came in the aftermath of the failure by the defendant to comply with consent orders made on 9 April 2014 which provided the following: "12. On 9 April 2015, the Court made orders, by consent, as follows: Defendant to file and serve further affidavit material on which it relies in respect of the Defendants Amended Notice of Motion filed 14 February 2014 by 22 May 2015. Plaintiff to file and serve any affidavit evidence on which it relies by 3 July 2015. Defendant to file and serve any affidavit evidence in reply by 14 August 2015. Defendant to file and serve written submissions by 28 August 2015. Plaintiff to file and serve written submissions by 11 September 2015. Defendant's Amended Notice of Motion filed 14 February 2014 is listed for hearing on 7 October 2015 with an estimate of one day. Liberty to restore on 3 days' written notice." 1. The law requires me to attempt to fashion a solution which results in the just, quick and cheap resolution of the real issues between the parties: s 56(1) Civil Procedure Act 2005 (NSW), State of NSW v Public Transport Ticketing Corporation (No 3) (2011) 81 NSWLR 394, Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR 411 at 421 per Kirby P and 430 per Samuels JA, State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 at 154. 2. The matter would certainly be disposed of more quickly and more cheaply if the defendant and applicant were locked out. Further, the Commissioner's position in urging that I take that course is entirely understandable in view of the history of the matter and the repeated failure of the defendant, the applicant and those who represent them, to comply with Court orders and to articulate with any degree of clarity precisely what orders they seek. 3. I initially thought that the Commissioner's position was somewhat unreasonable and unnecessarily robust but as I have come to understand the history of the matter and the various failures of communication - which I will not go into but which remain unexplained - I have resiled altogether from that view. However, I am unable to come to the conclusion that locking the defendant and the applicant out at this stage would constitute a just resolution of the messy state of affairs that exist as at today's date. 4. What has been clear from at least February and March of 2014 is that the applicant claims some ownership of the money and no doubt will seek to establish that it was money that was lawfully his and not acquired by unlawful means. I am in no position to judge the merit of such contentions but I have come to the firm view, in spite of the conduct of the litigation to this point and before me today, that it is only just and fair that he be permitted to present a case in that regard. 5. In coming to that conclusion there are two matters which are most persuasive to me. 6. The first is that the hearing is not until 7 October 2015 and that this allows the Commissioner sufficient time to investigate and, if necessary, to contest the factual assertions made on the applicant's behalf. 7. Secondly, the applicant and the defendant have now served on the plaintiff the affidavit material upon which their case is based. 8. For those reasons, I indicated to the parties that I sought assistance in fashioning orders that would allow the defendant and the applicant to conduct their case on that evidence that has now been served but on no additional evidence, apart from common evidence such as the transcript of examinations and similar. 9. The parties then assisted me in coming to some conclusion as to the appropriate order or orders and the applicant has now filed a notice of motion upon which it seeks, or he seeks, to conduct the hearing on 7 October. 10. Before making my orders I wish to extend my gratitude to the legal representatives of the plaintiff for assisting me in fashioning these orders, in helping me to find my way through the legal and factual mire and in accepting in good grace the decision which I foreshadowed before I adjourned. 11. The result is that I make the following orders for the reasons I trust are transparent from what I have just said: 1. Leave is granted to the plaintiff to file in Court a notice of motion in substitution for the notices of motion filed 13 February 2014 and 11 March 2014. 2. For the sake of clarity, each of those earlier notices of motion are dismissed. Any previous versions of those notices of motion are also dismissed. 3. Leave is granted to the applicant to file in Court his affidavit dated 27 July 2015 in its current form, on the undertaking of his solicitor to file the original within 14 days. I note that an affidavit with annexures of the defendant has already been filed. 4. The defendant is not to file or rely on any further affidavits or other evidence in chief other than with the consent of the plaintiff or with the leave of the Court. 5. The Commissioner is to file and serve any evidence on which it relies by 11 September 2015. 6. The defendant and applicant are to file and serve any affidavit evidence in reply by 21 September 2015. 7. The applicant's written submissions are to be filed and served by 21 September 2015. 8. The Commissioner's written submissions are to be filed and served by 5 October 2015. 9. The hearing date of 7 October 2015 is confirmed with an estimate of one day. 10. The applicants are to pay the costs of and incidental to today's hearing within a period of 14 days. 11. Liberty to restore on 24 hours' notice to either party.