Citation: NSWCC v Crotty & Anor [1999] NSWSC 146
Court: Supreme Court of New South Wales (Common Law Division)
Date: 17 February 1999
Judge: Wood CJ at CL
Background
The NSW Crime Commission brought proceedings against a defendant under the Criminal Assets Recovery Act 1990 seeking two forms of relief: a proceeds assessment order, and an assets forfeiture order over residential property at North Curl Curl jointly owned by the defendant and his wife. The proceedings followed the defendant's conviction for supplying a prohibited drug under the Drug Misuse and Trafficking Act 1985, following a plea of guilty.
The underlying conduct involved the defendant's importation and subsequent sale of heroin purchased in Thailand, as well as a controlled purchase of cocaine by an undercover police operative in mid-1994. The defendant's importation methods and prior dealings were captured in recorded conversations made pursuant to warrant during the undercover operation.
When the hearing commenced, the defendant and his wife declined to participate after a renewed adjournment application was refused, and the matter proceeded in their absence.
Legal Issues
- Whether the Commission had established the requisite standard of proof under the Criminal Assets Recovery Act 1990 to obtain a proceeds assessment order and an assets forfeiture order
- How proceeds should be assessed under sections 27 and 28 of the Act, including whether expenses and the possible involvement of a co-offender required any reduction in the assessed amount
- Whether leave should be granted to the defendant to apply for an exclusion order over the residential property on grounds of hardship to a spouse or dependants
Decision
The Supreme Court found the Commission had established an overwhelming case for both orders sought. The defendant's conviction was a matter of record, and recorded conversations contained clear admissions about his importation and sale of heroin within the relevant six-year period. Those admissions were corroborated by travel records, and the defendant made no attempt to explain or contest the material.
On the assets forfeiture order, the Court held that the defendant's conviction for supplying a quantity of heroin exceeding five grams constituted involvement in a serious crime-related activity involving an indictable offence, engaging the Court's jurisdiction under the Act. The forfeiture order over the residential property followed as a matter of course. However, the Court granted the defendant leave to apply for an exclusion order under section 25(4) of the Act, on the basis that his wife had an interest in the property and hardship grounds were available to be argued.
For the proceeds assessment order, the Court applied a "broad brush" approach, acknowledging that precise records of criminal dealings are rarely available. Under sections 27 and 28 of the Act, the figure to be assessed is the total amount of money that passed through the offender's hands, with no deduction for expenses or outgoings incurred in the illegal activity. The Court calculated the heroin proceeds at $720,000, based on the defendant's own admissions about quantities and prices, and added a further $3,700 representing buy money received but not recovered in the cocaine transaction.
The Court rejected any reduction on account of the possible involvement of a partner. Although one conversation contained a passing reference to a partner, the defendant's role as the driving force in every stage of the operation was clear, and he had separately admitted to a solo importation of three kilograms of heroin.
Orders Made
- Assets forfeiture order made in relation to the residential property, subject to the defendant's application for leave to exclude the premises from the order
- Proceeds assessment order in the sum of $731,700
- Defendant to pay the plaintiff's costs of the proceedings, including any reserved costs
Key Takeaways
- Under the Criminal Assets Recovery Act 1990, a conviction for supplying a prohibited drug in excess of the indictable quantity is sufficient to establish involvement in serious crime-related activity and to attract the Court's jurisdiction to make forfeiture and assessment orders.
- A "broad brush" approach to proceeds assessment is appropriate where, as is typical in criminal dealings, precise records do not exist. Courts assess the total money passing through the offender's hands, not net profit after deduction of expenses.
- Section 28(4) of the Act expressly precludes any reduction for expenses or outgoings incurred in connection with the illegal activities, regardless of how those costs were funded.
- Where an offender claims to have acted in concert with a partner, the court may decline to reduce the proceeds assessment if the evidence establishes the offender as the central operative and there is insufficient detail about the partner's role or share.
- The Supreme Court confirmed that a defendant retains the right to apply for an exclusion order under section 25(4) of the Act on hardship grounds, even where an assets forfeiture order has been made over jointly owned property.
Legislation and Cases Referenced
Legislation
- Criminal Assets Recovery Act 1990 (NSW), ss 6, 22, 25, 27, 28
- Drug Misuse and Trafficking Act 1985 (NSW), s 25
Cases
- Fagher (1989) 16 NSWLR 67
- Pepin (1996) 86 A Crim R 327
- New South Wales Crime Commission v Yenice (Supreme Court of NSW, 5 November 1997, unreported)