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District Court 7 July 2023

R v Campbell; R v Waters (No. 3)

[2023] NSWDC 628

Drugs
TENDENCY PURPOSE.

Citation: R v Campbell; R v Waters (No. 3) [2023] NSWDC 628
Court: District Court of New South Wales
Date: 7 July 2023
Judge: Mahony SC DCJ

Background

Two co-accused were charged on an indictment containing two counts relating to the importation of border controlled drugs. The accused Campbell pleaded not guilty to both counts. The accused Waters pleaded not guilty to Count 1 (a conspiracy to import a large commercial quantity of a border controlled drug between January and October 2017) but pleaded guilty to Count 2 (a separate conspiracy relating to events in late December 2017 and January 2018, culminating in a meeting in Belgrade on 16 January 2018 where Waters was arrested).

The Crown sought to adduce additional evidence against Waters after the close of the main Crown case. It filed an amended tendency evidence notice under section 97 of the Evidence Act 1995 (NSW) identifying three tendencies: involvement in large-scale drug transactions, involvement in large cash transactions, and involvement in illicit shipments including items concealed in metal. The Crown also sought to adduce documents concerning Waters' association with a co-participant, Arnold, as relationship evidence for a non-tendency purpose.

The proposed evidence included encrypted Ciphr messages, cash deposit receipts, a short video of a man operating a cash counting machine, corporate documents relating to a Czech steel company, and other materials. Almost all of this material post-dated the period covered by Count 1.

Legal Issues

  • Whether the proposed tendency evidence was relevant to Count 1 under section 55 of the Evidence Act, given that most of it post-dated the offending period alleged in that count
  • Whether the proposed tendency evidence had significant probative value as required by section 97(1)(b) of the Evidence Act
  • Whether, if the section 97 test was satisfied, the probative value of the tendency evidence substantially outweighed its prejudicial effect on Waters as required by section 101(2)
  • Whether the proposed relationship evidence concerning Waters' association with Arnold should be excluded under section 137 because its probative value was outweighed by unfair prejudice

Decision

Issue 1: Relevance of the tendency evidence to Count 1

The court observed that almost all of the proposed tendency evidence post-dated the period specified in Count 1 (18 January 2017 to 24 October 2017). The bulk of the Ciphr messages occurred between 14 and 16 January 2018, within the period to which Waters had already pleaded guilty under Count 2. The cash deposit receipts and exchange invoice related to November and December 2017. The court found that this post-Count 1 conduct could not rationally affect the assessment of the probability of any fact in issue concerning Count 1, and therefore did not meet the relevance threshold in section 55 (at [90], [99], [101]).

The court assessed each category of proposed evidence individually. The Ciphr messages with various contacts were indicative of involvement in international drug activity but did not increase the likelihood of commission of the offence in Count 1 (at [98]-[99]). The cash deposit receipts and exchange invoice were irrelevant to Count 1, particularly because the Crown could not establish that Waters personally made the deposits or organised the exchange (at [101]). The cash counting machine video, corporate documents relating to Omilex sro and Bosmet One, and other items such as a roof edge protection report, iPhone screenshots, and the offer to purchase Bruno Holdings, were similarly found to be irrelevant to any fact in issue in Count 1 (at [102]-[111]).

Issue 2: Significant probative value under section 97(1)(b)

Even setting aside the relevance findings, the court held that none of the evidence, considered individually or cumulatively, could satisfy the significant probative value test in section 97(1)(b). The Crown conceded that no single item would establish the tendency alone and pressed a circumstantial case. The court was not persuaded that the cumulative effect of the evidence rose above an insinuation that Waters was the kind of person more likely to have committed the offence in Count 1. Applying McPhillamy v The Queen [2018] HCA 52, the court found this was insufficient (at [112]). The court also noted the considerable generality of the tendencies alleged, and that the evidence relating to large cash transactions and illicit shipments could not be characterised as having specific enough connection to the charged importation (at [91], [112]).

Issue 3: Prejudicial effect under section 101(2)

The court found, in the alternative, that even if the tendency evidence had significant probative value, the probative value did not substantially outweigh the significant prejudicial effect on Waters. Given that Waters had already pleaded guilty to Count 2, the tendency evidence would primarily establish involvement in other uncharged illegal drug activities at the same time. The court considered there was a real risk the jury would attach too much weight to the evidence or use it impermissibly, and that a direction could not adequately cure that prejudice (at [113]).

Issue 4: Relationship evidence

The Crown sought to adduce seven categories of documents as relationship evidence showing a connection between Waters and Arnold concerning steel production activities in the Czech Republic. The court noted that Waters' counsel accepted the existence of a relationship between the two men, making the documents' additional contribution to that fact minimal. The court found the documents were not relevant to any other fact in issue and that any probative value was outweighed by the unfair prejudice arising from linking Waters to the steel production activities, given the high risk the jury would use the material for impermissible tendency reasoning (at [116]).

Orders Made

  • The Crown application based on the amended Tendency Evidence Notice under section 97 of the Evidence Act 1995 (NSW) was refused.
  • The tendency evidence was not to be adduced at the trial of the accused Waters.
  • The Crown application to adduce the relationship evidence as a non-tendency purpose was refused.
  • The relationship evidence (Items 1 to 7) was not to be adduced at the trial of the accused Waters.

Key Takeaways

  • Proposed tendency evidence that post-dates the period of the charged offence faces a significant hurdle at the threshold relevance stage under section 55 of the Evidence Act: the District Court found that conduct occurring after the charged period could not rationally affect the probability of a fact in issue in relation to that earlier offence (at [90], [99]).

  • Where an accused has already pleaded guilty to a separate count covering the same period as the proposed tendency evidence, the tendency evidence's capacity to add anything of significance to the case on an earlier count is substantially diminished; it risks doing no more than insinuating general criminal propensity (at [112]-[113]).

  • Under section 97(1)(b), a circumstantial accumulation of individually insufficient items of evidence does not automatically produce significant probative value collectively; the court assessed the evidence in categories and found the cumulative effect still fell short of the threshold (at [112]).

  • Relationship evidence tendered for a non-tendency purpose may be excluded under section 137 where the fact of the relationship is not genuinely in dispute and the documents carry a high risk of prompting impermissible tendency reasoning by the jury (at [116]).

  • The generality of an asserted tendency is a material consideration: tendencies expressed in broad terms such as involvement in "large-scale drug transactions" or "large cash transactions" may struggle to demonstrate the specific connection to the charged conduct required for significant probative value under section 97(1)(b) (at [91]).

Legislation and Cases Referenced

Legislation
- The Evidence Act 1995 (NSW)

Cases
- El-Haddad v R (2015) 248 A Crim R 537; [2015] NSWCCA 10
- Geraghty v R [2023] NSWCCA 47
- Hughes v The Queen (2017) 263 CLR 338; [2017] HCA 20
- IMM v The Queen (2016) 257 CLR 300; [2016] HCA 14
- Marsh v The Queen [2018] ACTCA 55
- McPhillamy v The Queen (2018) 92 ALJR 1045; [2018] HCA 52
- O’Keefe v The Queen [2009] NSWCCA 121
- R v Bauer (a pseudonym) (2018) 266 CLR 56; [2018] HCA 40
- R v Ford (2009) 201 A Crim R 451; [2009] NSWCCA 306
- R v Sheard [2022] NSWSC 735