CRIMINAL ASSETS CONFISCATION (MISCELLANEOUS) AMENDMENT BILL

Standing Orders Suspension

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Business Services and Consumers) (11:45): I move:

That standing orders be so far suspended as to enable the introduction forthwith and passage of a bill through all stages without delay.

The SPEAKER: I have counted the house and, as an absolute majority of the whole number of members is not present, ring the bells.

An absolute majority of the whole number of members being present:

Motion carried.

Introduction and First Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Business Services and Consumers) (11:47): Obtained leave and introduced a bill for an act to amend the Criminal Assets Confiscation Act 2005. Read a first time.

Second Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Business Services and Consumers) (11:48): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation inserted in Hansard without my reading it.

Leave granted.

The contents of this Bill were originally a minor part of the Criminal Assets Confiscation (Prescribed Drug Offenders) Amendment Bill 2011. The Opposition, with the support of sufficient independents, saw fit to strip out and defeat the substance of that Bill. They revealed no opposition to the necessary miscellaneous amendments proposed and so this Bill is designed to propose those amendments again.

The Bill makes amendments in three general areas.

Pecuniary Penalty Provisions

The Bill also amends the pecuniary penalty provisions of the Act. The necessity for this amendment arose directly from the decision of the Full Court in the case of DPP v George [2008] SASC 330. The appellant George was convicted of an offence of producing cannabis. The subject of the charge was 12 mature cannabis plants and 20 seedlings with roots attached. The plants were being grown hydroponically in a shed on his residential property in Seacombe Gardens. He was also convicted of knowingly abstracting (stealing) electricity. He was fined $2,500 for both charges. Under the law applicable at the time the maximum penalty for this offending would have been 25 years imprisonment. Under current law, 10 plants is a trafficable quantity and he was over that, not counting seedlings, so there would be a presumption of sale.

The DPP intended to pursue the defendant under the Criminal Assets Confiscation Act. Accordingly, a restraining order was placed over the residential property. After conviction, the defendant applied for an order excluding the property from forfeiture. In the meantime, the DPP applied for a pecuniary penalty order forfeiting a sum of money equivalent to the defendant's interest in the property. The house was valued at $255,000 with a mortgage of $164,731. It follows that the pecuniary penalty would have been about $90,000. It can be accepted that the defendant would have to sell the property to pay the pecuniary penalty.

The question then arose whether the court had a discretion whether to impose a pecuniary penalty order or not. On the face of it, the legislation seemed to say that there was no discretion. The legislation says that the court must make a pecuniary penalty order about the proceeds of a crime or an instrument of crime. All had assumed hitherto that 'must' meant 'must' and that was that. The magistrate below had threaded a way out of what he thought to be an injustice by holding that the house and land were not instruments of crime. That was an ingenious argument and the Supreme Court on appeal divided 2/1 on the facts, holding that the property was an instrument.

But White J, with whom Doyle CJ and Vanstone J agreed on point, said that must did not mean must. There was a discretion after all. The key passage was:

Moreover, the construction for which the DPP and the Attorney-General contend has the potential to bring the administration of justice into disrepute. This is likely to engender a lack of respect for such proceedings and the authority of the courts conducting them is likely to be undermined. The DPP could, for example, take the attitude before a court hearing an application under ss 47 or 76 that its decision will be immaterial, and conduct the proceedings accordingly. It is inimical to proper respect of judicial authority for one party to an application before the court to be able to take such an attitude.

I referred earlier to the absence of any provision in the CAC Act which would enable a court to take account of, or to ameliorate, the harsh consequences of a PPO or the interests of others in the subject property. Nor is there any provision enabling the court to take account of the public interest in the way in which s 76(1)(c) requires in relation to statutory forfeiture. The absence of such provisions is stark if s 95(1) is construed as obliging a court, upon satisfaction of the specified matters, to make a PPO. It is difficult to identify any reason why Parliament should have considered provisions to that effect to be appropriate in relation to forfeiture orders, but not in relation to PPOs. Similarly, it is difficult to identify any reason why Parliament should have intended consideration of the public interest to be relevant in relation to applications for exemption from statutory forfeiture, but not in relation to PPOs. The absence of provisions permitting a court to ameliorate the harsh consequences of a PPO, or to consider the public interest, loses much of its significance however if s 95(1) is construed as vesting a discretionary power, rather than imposing an obligation. (emphasis added)

The lesson was plain. 'Must' does not really mean 'must' because of the harsh, arbitrary and unjust consequences it would bring. 'Must', said the Court, really means 'may'. The Act is amended to fix this. This State should not have on the books a law that is thought to be so unfair and unjust that a Court has to strain the ordinary use of language in that way in order to bring about a fair result. The amendment gives the court a discretion to impose a pecuniary penalty in relation to instruments of crime, just as it does in relation to the forfeiture of instruments of crime. That discretion is informed by an inclusive list of factors identical to those legislated in relation to the forfeiture of instruments of crime.

Restraining Orders

In the course of deciding the main issue in DPP v George, the court, (particularly the contribution of White J) points out another technicality that poses problems. In summary:

The Act contains provision for what is known as 'automatic forfeiture'. The essence of the scheme is that property subject to a restraining order will be forfeited by operation of law after the expiry of a certain time period after conviction.

The only way for a defendant (or any other interested party) to escape this process it to apply for and win an order excluding property from the restraining order.

White J pointed out that a literal reading of the Act could say that the property will be automatically (and irretrievably) forfeited even though an application to exclude that property is on foot and has yet to be resolved. He regards such an outcome (with considerable justification) as unfair and unjust.

White J held that this problem deserved the attention of the Parliament. His Honour did not observe that the legislation permits a person in this position to apply to the court for an 'extension order', which has the effect of postponing the automatic forfeiture. But that omission is in itself telling. The system is just too complicated. And the necessity for a separate extension order is not obvious. If the applicant for an exclusion order knew about it, he or she would surely apply for it and, equally surely, a court would grant it routinely in order to avoid the injustice to which White J referred.

The problem is fixed in this Bill. The way in which it is done is to abolish what used to be called extension orders as a separate phenomenon and instead provide that any person may apply for the exclusion of property from forfeiture and, when that application is made, the forfeiture of property is subject to an extended period terminating when the application for exclusion is finally determined.

Other Amendments

South Australian Police and the DPP asked for an amendment to the Act so that a person who is the beneficiary of a discretionary decision to discount a sentence because of the consequences of forfeiture cannot also be the beneficiary of an amelioration of forfeiture for the same reason. In other words, the defendant cannot get the same benefit twice. This has been done, except for those who have co-operated with law enforcement in cases of serious and organised crime, who may get a sentence discount for their co-operation and also a discretionary form of relief from total forfeiture under the prescribed drug trafficker scheme contained in this Bill. The reason for that is good public policy—every encouragement should be given and every lever should be applied to those who are in a position to inform on serious and organised criminals.

The Bill makes minor amendments to clarify the provisions relating to the forfeiture of a security given by a defendant or other person on the making an application for an exclusion order.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Criminal Assets Confiscation Act 2005

4—Amendment of section 3—Interpretation

This clause makes a consequential amendment by deleting the definition of extension order and inserts a new subsection (2), providing that a reference in the principal Act to an indictable offence includes an indictable offence of a kind that is required to be prosecuted, and dealt with by the Magistrates Court, as a summary offence under a provision of any Act. The amendment to the definition of serious offence is consequential to this latter amendment.

5—Amendment of section 6—Meaning of effective control

This clause makes an amendment of a statute law revision nature, to ensure consistency of language.

6—Amendment of section 34—Court may exclude property from restraining order

Subclause (1) makes a statute law revision amendment consistent with clause 5.

Subclause (2) prevents property being excluded from a restraining order on application by a person convicted of the offence to which the restraining order relates where the convicted person has had the possible forfeiture of the property taken into account in sentencing for the offence.

7—Amendment of section 46—Cessation of restraining orders

This clause amends section 46(4) of the principal Act to reflect the fact that restrained property may vest in the Crown under an Act other than the principal Act.

8—Amendment of section 47—Forfeiture orders

This clause makes a minor amendment to section 47(5) of the principal Act to make it clear that subsection only relates to forfeiture orders under section 47(3).

9—Amendment of section 48—Instrument substitution declarations

This clause makes a minor amendment to section 48 of the principal Act to distinguish between forfeiture orders made under section 47(3) and those made under section 47(1).

10—Insertion of section 62A

This clause inserts new section 62A into the principal Act. That provision provides that, if a court has taken a forfeiture of a person's property into account in sentencing the person, the person cannot then apply for an exclusion order or compensation order in respect of the property.

11—Amendment of section 74—Forfeiting restrained property without forfeiture order if person convicted of serious offence

This clause is consequential to clause 12.

12—Substitution of section 75

This clause substitutes a new section 75 of the principal Act, replacing the current 15 month extension orders with an extended period which will apply automatically when an application to exclude property has been made, but not finally determined, at the end of the period of 6 months after conviction (when automatic forfeiture would otherwise occur).

13—Amendment of section 76—Excluding property from forfeiture under this Division

This clause amends section 76 to broaden the range of people who can apply for an order excluding property (currently only the convicted person can apply) and to ensure the provision works properly in relation to securities given under section 38 or 44.

14—Insertion of section 76A

This clause inserts a provision similar to the one proposed in clause 10 providing that, if a court has taken a forfeiture of a person's property into account in sentencing the person, the person cannot then apply for exclusion of the property under this Division.

15—Amendment of section 95—Making pecuniary penalty orders

This clause substitutes subsections (1), (2), (3) and (4) of section 95 of the principal Act. New subsection (1) ensures that mandatory pecuniary penalty orders relate only to benefits derived from crime while new subsection (2) provides the court with a discretion to make such an order in relation to an instrument of crime. New subsection (3) sets out matters the court may have regard to when determining whether to make an order under subsection (2). Proposed subsection (4) ensures that the court is not prevented from making a pecuniary penalty order merely because some other confiscation order has been made in relation to the offence.

Section 95(7) is consequentially amended to apply only to benefits.

16—Amendment of section 96—Additional application for pecuniary penalty order

This clause makes minor statute law revision amendments to simplify section 96.

17—Insertion of section 98A

This clause inserts new section 98A into the principal Act, which provides that, for the purposes of the Division, a court may treat as property of a person any property that is, in the court's opinion, subject to the person's effective control.

18—Amendment of section 99—Determining penalty amounts

This clause clarifies references in section 99 of the principal Act.

19—Amendment of section 104—Benefits and instruments already the subject of pecuniary penalty

This clause amends section 104 of the principal Act to include reference to instruments.

20—Repeal of section 105

This clause repeals section 105 of the principal Act and is consequential upon the insertion of section 98A into the Act by clause 17 of this measure.

21—Amendment of section 106—Effect of property vesting in an insolvency trustee

This clause amends section 106 of the principal Act to ensure it applies in relation to instruments as well as benefits of crime.

22—Amendment of section 107—Reducing penalty amounts to take account of forfeiture and proposed forfeiture

This clause amends section 107 of the principal Act to insert a new subsection (2), setting out reductions to penalty amounts under pecuniary penalty orders that relate to instruments of crime where the instruments have been forfeited in relation to the offence to which the order relates, or where an application for such forfeiture has been made.

23—Amendment of section 108—Reducing penalty amounts to take account of fines etc

This clause amends section 108 of the principal Act to ensure it encompasses instruments of crime.

24—Amendment of section 149—Interpretation

This clause amends the definition of property-tracking document in section 149 of the principal Act, to refer, for the sake of consistency, to property owned by or subject to the effective control of a person, rather than simply the property of the person.

25—Amendment of section 219—Consent orders

This clause makes a consequential amendment to section 219 of the principal Act to reflect changes made by this measure.

26—Substitution of section 224

This clause substitutes section 224 of the principal Act to include forfeiture, or pecuniary penalty orders, under the law of other relevant jurisdictions as matters to which a sentencing court must not (under new paragraph (b)) or must (under paragraph (c)) have regard to in determining sentence.

Ms CHAPMAN (Bragg) (11:48): The Criminal Assets Confiscation (Miscellaneous) Amendment Bill 2012 will be supported by the opposition. Essentially, this bill makes reasonable amendments to the act to ameliorate the unjust elements of the current scheme in respect of confiscation of assets consistent with judicial determinations. Furthermore, the bill is also identical to the version of the bill created by the Liberal amendments to the Criminal Assets Confiscation (Prescribed Drug Offender Assets) Amendment Bill in September 2011 and again in March 2012.

We are very proud of this bill. It might be under the name of the Attorney now, but it has been a child of the Liberal Party. I want to make this point: it is very concerning to us that it has taken such a long time in the gestation period of the development of the first bill to remedy these issues, which had been clearly identified as a result of the Full Court decision in the case of DPP v George (2008) SASC 330. The then chief justice Doyle and justices Vanstone and White had considered a number of aspects in relation to the interpretation of pecuniary penalty provisions and also restraining orders in that judgment. I do not know where the previous attorney was; I hate to even try to hazard a guess at what he was do doing between 2008 and 2010, except for getting himself into trouble in all sorts of ways. I think it is a bit like Gulliver's Travels when it comes to 2010 to 2012. Here we are in October, 2½ years since the election, four years since the judgement of the Full Court, and we finally have some redress and proposed remedy to be able to manage this. It is unfortunate.

Why is it like Gulliver's Travels? My recollection, in relation to childhood fables, is that Gulliver is a normal-sized person and he finds himself shipwrecked on an island and he is captured by the little people. I am not sure whether that is the politically correct way to describe it these days, but anyway the little tiny people.

Mr Griffiths: The Lilliputians or something like that.

Ms CHAPMAN: The Lilliputians, the member for Goyder reminds me. While he is sleeping or half drowned they tie him up and put stakes in the ground and lock him down and all sorts of things happen before he is able to wake up, and he then apparently has quite a good relationship with these people, even though he had been their prisoner. In any event that is possibly one thing that has happened to the Attorney-General—I do not know. It seems rather odd to me that someone who is so intent in other circumstances on bringing into the parliament a remedy for these things, yet it is 2½ years after his elevation to Attorney-General before we are here to deal with this and finalise it. I just find it very disappointing, and it had to take the Liberal opposition and the Hon. Stephen Wade and others, with stakeholders who had been putting submissions to the government, to get this fixed up before they deal with it.

Does that just tell us that really they do not give a tink about the confiscation of assets and what it might recover from these criminals? So far in the government's submissions I have not even heard how many of these people they have actually arrested or prosecuted successfully and how much money they have taken from the offenders in these cases, but it just seems to me that it is all about show, about them making it look like they are doing something when they are caught out after a sustained period of failure to do something.

In any event, the substance of the bill relates to the Full Court decision of DPP v George, and the Attorney-General set out in his second reading contribution the history of the case, the determinations of which were the subject of the Full Court decision, and he sets that out quite well. I am sure that is because of the preparation from his advisers, but in any event the essential aspect was that the appellant George had been convicted of an offence of producing cannabis and there was a very significant change in the penalties that applied to that offence and to the law that was applicable at the time compared with the legal position at the time of the addressing of the charges and conviction. In essence, the question this arose was whether or not the court had a discretion to impose a pecuniary penalty in respect of those offences. On the face of it, the legislation appeared to say that there was no discretion. Reading from the second reading explanation:

The legislation says that the court must make a pecuniary penalty order about the proceeds of a crime or an instrument of crime. All had assumed hitherto that 'must' meant 'must' and that was that.

So, the judgements can be read. They have been extensively quoted in the second reading contribution by the Attorney; I will not repeat them. I simply say that the courts had also found that the provisions have had the potential to 'bring the administration of justice into disrepute' and seem to be inconsistent with the parliament's intention when viewed together with the statutory forfeiture provisions. As has been clearly outlined, this bill will cover an amendment to remedy that situation and essentially allow for the court's discretion.

The property forfeiture aspect under the act is automatic following the expiry of a restraining order period on an asset, so the second purpose of this bill is to deal with that aspect. If an application to exclude property from the order has not been accepted within the expiry time, a literal reading of the act means the property is permanently forfeited. It has been identified that this might cause an injustice where an application is underway but not yet resolved for property to be excluded.

If the expiry period is reached before the matter has been heard, it might be technically impossible for the application to exclude the property that is subject to the application. Obviously, this is a sensible reform and we want to allow time for exclusionary proceedings to be completed before the forfeiture is finalised.

The other aspects covered by this bill come as a result of the DPP and the police—I assume the commissioner—requesting an amendment so that a person cannot receive a discounted sentence in compensation for the forfeiture, but then also a discount in forfeiture for the same reason. The bill seeks to amend the act so that the discount is applied to only one or the other, not both.

There is an exception to this proposed in the Criminal Assets Confiscation (Prescribed Drug Offender Assets) Amendment Bill 2012 which of course we have just passed in this house and which proposes further discounts to be available for cooperation with a law enforcement agency. So, we are hear to fix up what the Full Court told us about over four years ago.

Shame on the previous attorney-general for doing nothing, while he was jumping out there, trying to grab the limelight on all sorts of issues at the time, although I notice he was promptly disposed of after the election, and we saw the elevation of the current Attorney-General, so I will not dwell on him; he is old news. But I will say that the current Attorney has comprehensively failed on this occasion to deal with this matter expeditiously.

It was clear; the opposition made it clear, other relevant parties made it clear, but so hell-bent was the government on tying this up with other controversial aspects that there was, at least, the potential for ill to have come from future interpretations. Now, it may be that the government just has not bothered to deal with confiscation in the circumstances where it has not applied—I do not know; we have not had any detail of that.

But, for a government that is in so much of a hurry to make it look like it is out there being tough on the criminals, you would have thought that it would be in here saying, 'It is important that we get this legislation through, because we've got four pending cases,' or, 'We've got other proceedings which we need to be on the hunt on, and to be able to get this money in.' But, for whatever reason, Gulliver lay sleeping.

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Business Services and Consumers) (11:59): I got off a bit more lightly this time than last time. I have been chastened but not brutalised like I was in relation to the last bill. In response, can I say, first of all, I do appreciate the member for Bragg speaking on behalf of the opposition and expressing support for this legislation. It is always a joy for me when the member for Bragg and I agree on something, and today is no exception; I am going to mark it in my calendar.

It is great that we have support from the opposition on this very important measure. To the extent that my chastisement was directed toward a lack of vigour on my part in pursuing these matters, I would point out for the record that this is now the third time I have tried to get these measures through the parliament. So, I would have thought that would not indicate a lack of interest in pursuing the matter on my part or, indeed, on the part of the government.

I hope the support the member for Bragg has flagged in this place will be replicated somewhere else (certainly by the opposition), and if that is the case then I would also hope the opposition will be happy to cooperate in effecting the speedy passage of at least this piece of legislation through the other place without lengthy and tedious delay. In between the houses, I am happy to speak with the member for Bragg and anybody else who wants to talk about the great merit of the bill we are going to be coming back to a bit later, but that is another matter. Again, I thank the member for Bragg for her contribution on the matter, I thank her for the opposition's support for this important measure and I commend the bill to the house.

Bill read a second time.

Third Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Business Services and Consumers) (12:01): I move:

That this bill be now read a third time.

Bill read a third time and passed.