Citation: R v Thompson; R v Farrugia (No.3) [2019] NSWDC 332
Court: District Court of New South Wales
Date: 15 July 2019
Judge: Smith SC, DCJ
Background
Two accused faced an indictment containing three counts. The Crown alleged, in respect of count 1, that the accused had conspired to falsify the books of a company on an ongoing, as-needs basis over a period spanning November 2008 to June 2011, with the aim of manipulating the company's EBIT (earnings before interest and tax) results.
At the close of the Crown's case, both accused applied for a verdict by direction on all three counts. The court directed not-guilty verdicts on counts 2 and 3 but declined to do so on count 1, finding it was then open to conclude that an overarching ongoing agreement had existed. The trial continued, and both accused gave evidence.
At the close of the defence case, the accused renewed their application for a verdict by direction on count 1. The renewed application focused specifically on the evidence of a Crown witness, Ms Cousins, whose testimony consistently denied the existence of any ongoing agreement to falsify the books.
Legal Issues
- Whether the court retained jurisdiction to revisit and redetermine an earlier decision declining to direct a not-guilty verdict, once the full evidence had been heard.
- Whether, in light of Ms Cousins' unchallenged and Crown-accepted evidence, it remained rationally open for a properly instructed jury to find beyond reasonable doubt that the accused intended to enter into the overarching conspiracy alleged in count 1.
- Whether Ms Cousins' evidence could be excluded beyond reasonable doubt as a possible alternative hypothesis to the Crown's theory of an ongoing agreement.
Decision
The court first addressed a preliminary objection by the Crown, which argued the earlier refusal to direct had finalised the question for the jury. Smith SC DCJ rejected that objection, accepting the defence argument that the court remains seized of legal questions in a trial until verdict or discharge. The earlier decision not to direct carried no finality, and the court had jurisdiction to reconsider the application.
Turning to the substance, the court reviewed Ms Cousins' evidence in detail. Across multiple specific transactions, she had denied entering any agreement with either accused to make false book entries as part of an overarching scheme. She was not challenged on that evidence and the Crown, in its closing address, effectively accepted it while arguing the jury could nonetheless infer an agreement from the overall pattern of conduct.
The court applied the principle from Smith v R (2017) 259 CLR 291 that an inference of intent must be the only reasonable inference open on the facts. The Crown's circumstantial case was, in the court's view, equally consistent with Ms Cousins' account of ad hoc, case-by-case conduct as it was with the existence of a premeditated ongoing agreement. That meant the Crown's preferred inference was not the only one rationally open.
Because it was not rationally open to exclude Ms Cousins' evidence beyond reasonable doubt, no properly instructed jury could reach a verdict of guilty on count 1. The court therefore directed the jury to return a verdict of not guilty on that count.
Orders Made
- The jury was directed to enter a verdict of not guilty in respect of count 1 of the indictment.
Key Takeaways
- A trial court retains jurisdiction to reconsider and grant a verdict by direction even after previously refusing such an application, provided a verdict has not yet been returned and the jury has not been discharged.
- The District Court confirmed that, on a conspiracy charge, the prosecution must establish beyond reasonable doubt that the accused intended to enter the specific agreement alleged. Circumstantial evidence that is equally consistent with an innocent hypothesis cannot sustain a conviction.
- Where a Crown witness gives direct, unchallenged evidence negating an essential element of the offence, and the Crown does not contest the truthfulness of that evidence at trial, it becomes very difficult to exclude that evidence as a rational alternative to the Crown's theory.
- The court drew on Smith v R (2017) 259 CLR 291 for the proposition that an inference of guilt must be the only reasonable inference available on the facts before a jury can be directed to act on it.
- Evidence consistent with both a criminal agreement and a series of independent, uncoordinated acts cannot, without more, establish the singular ongoing agreement required for a conspiracy charge.
Legislation and Cases Referenced
Cases:
- R v Thompson; R v Farrugia (No.2) [2019] NSWDC 329
- Smith v R (2017) 259 CLR 291
Legislation: No specific legislation was cited in the provided text.