Citation: CEO Customs v Afiouny & Anor [2004] NSWSC 79
Court: Supreme Court of New South Wales, Common Law Division
Date: 25 February 2004
Judge(s): McDougall J
Background
The Chief Executive Officer of Customs commenced proceedings in the NSW Supreme Court against two defendants, a father and son, by statement of claim alleging the smuggling of large quantities of cigarettes into Sydney in April 2001. The allegations included making false or misleading customs declarations through a broker and evading or attempting to evade the payment of customs duty. The plaintiff sought both the conviction of each defendant and the recovery of substantial monetary penalties.
The defendants filed a notice of motion seeking, among other things, that the statement of claim be struck out as an abuse of process. They argued, in the alternative, that the matter should be removed from the court's Differential Case Management List and that any procedural directions could only be formulated on an ad hoc basis, after each defendant had been heard.
The central procedural dispute concerned which of the available pathways under section 247 of the Customs Act 1901 (Cth) should govern how the prosecution was conducted: the usual civil practice and procedure of the court, or specific directions given by the court or a judge tailored to the case.
Legal Issues
- Whether a customs prosecution under section 247 of the Customs Act 1901 (Cth) must be conducted according to the court's usual civil practice and procedure, or instead according to bespoke directions given by the court or a judge.
- Whether the defendants were entitled to be heard before any procedural regime was selected or applied.
- Whether applying civil procedure to proceedings that carry a criminal standard of proof gives rise to procedural unfairness.
- Whether the joinder of two defendants in the one statement of claim engaged substantive rights under criminal law, requiring that civil procedure rules yield to those rights.
- Whether the statement of claim should be struck out as an abuse of process.
Decision
McDougall J dismissed the defendants' notice of motion in its entirety. His Honour held that the customs prosecution could properly be conducted in accordance with the usual practice and procedure of the Supreme Court in civil cases, consistent with the High Court's analysis of section 247 in Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 77 ALJR 1629.
The defendants' argument that procedural directions could only be issued ad hoc, and only after they had been given an opportunity to be heard on the question of procedure, was rejected. The court's power to apply ordinary civil procedure is not conditional on a preliminary hearing about which procedural limb of section 247 should apply.
On the procedural fairness argument, His Honour accepted that a criminal standard of proof applies to customs prosecutions of this kind, but concluded that the application of civil procedure rules does not of itself produce unfairness simply because the underlying standard of proof is the criminal one. The standard of proof and the procedural framework governing the conduct of proceedings are distinct matters.
The specific complaints raised by the defendants in their notice of motion, including the joinder issue and the application of the Differential Case Management regime, were characterised as matters of practice and procedure rather than substantive rights. Applying the reasoning in Labrador and Naismith v McGovern (1953) 90 CLR 336, those matters fell to be dealt with according to the usual civil practice and procedure of the court.
Orders Made
- The plaintiff's notice of motion filed 26 November 2002 (seeking summary judgment) was dismissed.
- The costs of the plaintiff's notice of motion were reserved.
- The defendants' notice of motion filed 3 December 2002 was dismissed.
- The defendants were ordered to pay the costs of their notice of motion, unless they made application to the contrary within 7 days.
- Any costs application was to be made on or before 27 February 2004 by arrangement with the judge's associate.
Key Takeaways
- Under section 247 of the Customs Act 1901 (Cth), a customs prosecution brought in the NSW Supreme Court may be conducted according to the court's usual civil practice and procedure; no preliminary hearing is required before that pathway is applied.
- The Supreme Court confirmed that the distinction between substantive law and procedural law is critical: the criminal standard of proof governs the merits of a customs prosecution, but procedural matters such as case management, joinder, and pleading requirements are governed by ordinary civil procedure.
- A defendant's entitlement to procedural fairness does not, without more, prevent the application of civil procedure rules to proceedings in which a criminal onus and standard of proof operate.
- Complaints about joinder and case management directions, in the context of a customs prosecution, were treated as procedural rather than substantive matters, and therefore fell within the scope of civil practice and procedure.
- The High Court's decision in Labrador Liquor was applied as the governing authority on the operation of section 247, confirming that the usual civil procedure pathway is a legitimate and available choice for conducting customs prosecutions in state Supreme Courts.
Legislation and Cases Referenced
Legislation:
- Customs Act 1901 (Cth), particularly sections 244, 245, and 247
- Excise Act 1901 (Cth)
- Evidence Act 1995 (Cth and NSW), sections 140 and 141
- Judiciary Act 1903 (Cth), sections 79 and 80
- Crimes Act 1914 (Cth)
Cases:
- Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 77 ALJR 1629
- John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503
- Naismith v McGovern (Federal Commissioner of Taxation) (1953) 90 CLR 336