AI-generated summaries. Not legal advice. Always verify against the official judgment on NSW Caselaw.
← All decisions
Court of Criminal Appeal 21 December 2021

R v Kinghorn

[2021] NSWCCA 313

Fraud & dishonesty
CRIME FEDERAL OFFENCES DISHONESTY OFFENCES PRINCIPLE OF LEGALITY CRIMINAL PROCEEDINGS AND POST

Citation: R v Kinghorn [2021] NSWCCA 313
Court: NSW Court of Criminal Appeal
Date: 21 December 2021
Judges: Bathurst CJ and Payne JA (joint judgment); Bell P, Ward CJ in Eq, and Bellew J (each agreeing)

Background

The respondent was charged in 2017 with two counts of dishonestly representing to a public official, contrary to s 135.1(7) of the Criminal Code (Cth), that he did not control two companies. The particulars of those charges included that he made false representations during a compulsory examination conducted by the Australian Taxation Office (ATO) under s 264 of the Income Tax Assessment Act 1936 (Cth) (ITAA 1936), some twelve years before charges were laid.

Before trial, separate questions were referred to a primary judge to determine whether the ATO had lawfully disclosed the transcript of that examination to the Australian Federal Police (AFP) and the Commonwealth Director of Public Prosecutions (CDPP), and whether the Crown could use it at trial. The primary judge answered that the accusatorial principle and the companion rule (explained below) had the effect that investigative and prosecutorial authorities should not have received or used that material, and that it was inadmissible at trial.

The Crown appealed. The Attorneys General for the Commonwealth and New South Wales intervened in support of the Crown. A constitutional question also arose mid-appeal when the respondent's senior counsel sought to argue that, if the relevant legislation authorised the disclosures, those provisions were constitutionally invalid.

  • Whether the accusatorial principle (broadly, that the prosecution must build its case independently of the accused) and the companion rule (that an accused cannot be compelled to assist the prosecution) applied to restrict the ATO's pre-charge dissemination of compulsory examination material to the AFP and CDPP.
  • Whether the Queensland Court of Appeal's decision in R v Leach [2019] 1 Qd R 459, which supported a broad application of those principles to compulsorily acquired tax material, should be followed.
  • Whether the relevant provisions of the Taxation Administration Act 1953 (Cth) (TAA) and the ITAA 1936 authorised the disclosures, and if so, whether that statutory authority displaced the common law principles.
  • Whether the companion rule applies at all before criminal charges are laid (the pre-charge question).
  • Whether, even if pre-charge dissemination was lawful, the material became unusable once charges were laid (the "crystallisation argument").
  • Whether any legislative provisions authorising such disclosure and use were constitutionally invalid.

Decision

On the accusatorial principle and the companion rule pre-charge: The Court held unanimously that the companion rule has no application before charges are laid. This followed from the High Court's analysis in R v Independent Broad-based Anti-corruption Commissioner (2016) 256 CLR 459. The accusatorial principle similarly did not operate to restrict the ATO's power to disclose the examination transcript to the AFP and CDPP in the pre-charge period.

On whether Leach should be followed: The Court declined to follow R v Leach, finding it inconsistent with Yates v R (1991) 102 ALR 673, the earlier NSWCCA decision in DPP (Cth) v Kinghorn [2020] NSWCCA 48, and decisions of the Western Australian Court of Appeal. Because intermediate appellate courts had reached conflicting conclusions on the point, the Court was not bound by the Farah Constructions line of authority to follow Leach unless convinced it was plainly wrong; the Court was in any event persuaded it was wrong. Sofronoff P's reasoning in Leach that it cannot matter whether compelled answers are given after charge or earlier for another purpose was held to be inconsistent with the High Court's approach in the IBAC case.

On statutory authority and abrogation: The Court held that ss 3G, 355-50, 355-70, and 355-175 of Sch 1 to the TAA conferred express authority to make the disclosures in question. Even if the accusatorial principle and companion rule had some pre-charge operation, those provisions exhibited a necessary legislative intention to permit disclosure and use of compulsorily acquired material despite those principles. Parliament has the power to abrogate such common law principles, and it had done so here.

On the crystallisation argument and admissibility: The Court rejected the respondent's argument that lawfully disclosed material becomes unusable once charges are laid. Nothing in the legislation imposed such a constraint, and accepting the argument would undermine the statutory information-gathering regime and its established role in facilitating criminal investigations. The transcript was therefore admissible at trial, but only for the limited purpose of proving that the representations particularised as having been made during the examination were in fact made by the accused, and proving their terms.

Orders Made

  • Appeal allowed.
  • The primary judge's answers to the three separate questions set aside and replaced as follows:
  • The Leach question: The accusatorial principle and companion rule do not have the effect that investigative or prosecuting authorities should not have disseminated, accessed, or used the s 264 examination transcript in circumstances where prosecution under s 135.1(7) of the Criminal Code (Cth) may occur and the alleged offences involve conduct including statements made during that examination.
  • Evidence question 1: The content of the s 264 examination is admissible at trial.
  • Evidence question 2: Its use is limited to proving that the representations particularised as made during the examination were made by the accused, and proving the terms of those representations.

Key Takeaways

  • The companion rule, which protects an accused from being compelled to assist the prosecution's case, applies only after criminal charges are laid. The Court of Criminal Appeal confirmed it has no operation in the pre-charge period, consistent with the High Court's analysis in the IBAC case.
  • Where intermediate appellate courts across jurisdictions have reached conflicting conclusions on a legal question, the Farah Constructions obligation to follow a decision of another intermediate appellate court unless it is plainly wrong does not arise; the Court is free to reach its own view.
  • Statutory secrecy regimes governing compulsorily acquired tax information, including the disclosure and use provisions in the TAA, can and do abrogate common law principles such as the accusatorial principle and companion rule where Parliament has demonstrated a sufficiently clear legislative intention to that effect.
  • The "crystallisation argument" was rejected: material lawfully disclosed to investigators before charges are laid does not become inadmissible or unusable simply because charges are subsequently filed.
  • Admissibility of compulsory examination transcripts in subsequent criminal proceedings is not unlimited. The Court confined the Crown's use of the s 264 transcript to proving the fact and terms of the representations alleged in the particulars of the charges, not as evidence of guilt more broadly.

Legislation and Cases Referenced

Legislation:
- Criminal Code (Cth), s 135.1(7)
- Income Tax Assessment Act 1936 (Cth), ss 161, 162, 263, 264
- Taxation Administration Act 1953 (Cth), ss 3E, 3G, 8C, 8D, Sch 1 Div 355, ss 355-25, 355-50, 355-70, 355-175
- Judiciary Act 1903 (Cth), s 78B
- Commonwealth Constitution, s 80

Key Cases:
- R v Leach [2019] 1 Qd R 459 (not followed)
- R v Independent Broad-based Anti-corruption Commissioner (2016) 256 CLR 459; [2016] HCA 8 (followed)
- Director of Public Prosecutions (Cth) v Kinghorn; Kinghorn v Director of Public Prosecutions (Cth) (2020) 102 NSWLR 72; [2020] NSWCCA 48
- X7 v Australian Crime Commission (2013) 248 CLR 92; [2013] HCA 29
- Lee v New South Wales Crime Commission (2013) 251 CLR 196; [2013] HCA 39
- Do Young Lee v The Queen (2014) 253 CLR 455; [2014] HCA 20
- *