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6
Court of Criminal Appeal 1 December 2000

REGINA v HANNES

[2000] NSWCCA 503

Fraud & dishonesty
CRIMINAL LAW SUMMING UP ADEQUACY AND FAIRNESS CRIMINAL LAW NON CONSENSUAL VERDICT

Citation: [2000] NSWCCA 503
Court: NSW Court of Criminal Appeal
Date: 1 December 2000
Judges: Spigelman CJ, Studdert J, Dowd J

Background

The appellant, an executive director of a division of Macquarie Bank that advised TNT Limited, was convicted in the District Court of one charge of insider trading under the Corporations Law and two charges under the Financial Transaction Reports Act 1988 (Cth). The prosecution alleged that the appellant had used confidential information about an impending TNT takeover to purchase share options under a false name, "M. Booth," generating a profit of over $2 million when TNT was announced as a takeover target at $2.45 per share.

The central question on the insider trading charge was whether the appellant had accessed and used inside information from his employer and whether he was the person who purchased the options under the assumed identity. The Financial Transaction Reports Act charges concerned a series of cash withdrawals and bank cheque transactions allegedly structured to avoid triggering mandatory reporting obligations for transactions of $10,000 or more.

The appellant appealed his convictions, and the Crown separately appealed on a related ground.

  • Whether the trial judge's summing up was fair and balanced, particularly in its treatment of the defence case
  • Whether the trial judge's direction permitting the jury to draw inferences from the appellant's silence (a "Weissensteiner direction") was appropriate in light of subsequent High Court authority in RPS v The Queen
  • Whether the trial judge's direction that it was irrelevant if "another person was involved" risked confusing the jury
  • Whether handwriting comparison documents were properly admitted under the Evidence Act 1995
  • Whether a personal document (MFI 95) was admissible as relevant evidence or was excluded by the hearsay provisions of the Evidence Act 1995, particularly s59
  • Whether photoboard identification evidence was obtained in breach of s3ZO(2) of the Crimes Act 1914 (Cth), triggering potential exclusion under s138 of the Evidence Act 1995
  • Whether the trial judge's directions on the Financial Transaction Reports Act charges correctly identified the elements the Crown needed to prove
  • Whether the jury's verdict was the product of genuine consensus, or a non-consensual verdict resulting from pressure

Decision

Weissensteiner direction: The court's principal reason for allowing the appeal was the trial judge's use of a Weissensteiner direction, which permits a jury to draw inferences more safely because of the accused's failure to give evidence. Since the trial, the High Court in RPS v The Queen had narrowed the circumstances in which such a direction is appropriate. Before the direction can be given, the prosecution must identify specific evidence that could only be expected to come from the accused. The trial judge had not satisfied this requirement in relation to the inference that "Hannes was Booth," and the direction was therefore impermissible. The Court held this error alone warranted quashing all convictions and ordering a retrial.

Summing up: The trial judge's direction to the jury that it was irrelevant whether "another person was involved" created a real risk of confusion. The Court found this direction was capable of misleading the jury about the proper scope of its inquiry, and that it contributed to the overall unfairness of the summing up. Other challenges to the trial judge's directions on elements of the insider trading charge were not upheld.

Hearsay and MFI 95: A personal document referred to as MFI 95 was found to be excluded by the hearsay provisions in s59 of the Evidence Act 1995. All three judges reached this conclusion, though by differing paths. The document was also not saved by s72 (because the appellant's intention at the time of writing was not relevant to a fact in issue) or by s81(2) (because the document lacked a sufficient link to any admission made by the appellant).

Handwriting and identification evidence: The court upheld the admissibility of handwriting comparison documents, confirming that under the Evidence Act 1995, admissibility is determined by the relevance test in s56(1), departing from the previous common law approach. On identification, no breach of the relevant provisions of the Crimes Act 1914 (Cth) was established because investigators did not have a "suspect" at the time the photoboards were used. The Crown's appeal was dismissed.

Orders Made

  • Appeal allowed
  • Convictions quashed
  • New trial ordered on all counts
  • Crown appeal dismissed

Key Takeaways

  • A Weissensteiner direction (allowing the jury to draw inferences from an accused's silence) requires the prosecution to identify specific evidence that could only come from the accused. Where that requirement is not met, giving the direction constitutes a reversible error.
  • The Court of Criminal Appeal confirmed that RPS v The Queen significantly constrained the circumstances in which a Weissensteiner direction is appropriate, and applied those constraints retrospectively to the trial below.
  • Under the Evidence Act 1995, the admissibility of handwriting comparison documents is governed by the general relevance test in s56(1), not by the pre-existing common law rules, representing a clear departure from earlier practice.
  • A personal document constituting a "rumination" not retained by the author may satisfy the relevance threshold under s55 and s56, but where its contents are representations of fact, s59 of the Evidence Act 1995 operates to exclude it as hearsay unless an exception applies.
  • Summing-up directions that risk misdirecting the jury on the proper scope of its fact-finding inquiry, even if individually defensible, can cumulatively render a conviction unsafe and require a retrial.

Legislation and Cases Referenced

Legislation:
- Corporations Law, s1002G(2), s1311
- Financial Transaction Reports Act 1988 (Cth), s31(1)
- Evidence Act 1995 (NSW), ss55, 56, 59, 72, 81, s138
- Crimes Act 1914 (Cth), s3ZO(2)
- Jury Act 1977 (NSW)
- Criminal Appeal Act 1912 (NSW)
- Criminal Procedure Act 1986 (NSW)
- Evidence Act 1898 (NSW)
- Crimes Act 1900 (NSW)

Key Cases:
- Weissensteiner v The Queen (1993) 178 CLR 217
- RPS v The Queen (2000) 74 ALJR 449
- Papakosmas v The Queen (1999) 196 CLR 297
- Lee v The Queen (1998) 195 CLR 594
- Domican v The Queen (1991-1992) 173 CLR 555
- Cleland v The Queen (1982) 151 CLR 1
- Shepherd v The Queen (1990) 170 CLR 573
- Walton v The Queen (1988-1989) 166 CLR 283
- Butera v Director of Public Prosecutions for the State of Victoria (1987) 164 CLR 180
- R v OGD (1997) 45 NSWLR 744
- R v Zorad (1990) 19 NSWLR 91
- Jones v Dunkel (1958-1959) 101 CLR 298
- Spies v The Queen (2000) 74 ALJR 1263