Citation: R v Alex & Ors (Trial Ruling No 4) [2024] NSWSC 1129
Court: Supreme Court of New South Wales
Date: 5 June 2024
Judge: Fagan J
Background
Six accused faced trial on an indictment alleging, among other charges, a conspiracy to defraud the Commonwealth by failing to remit PAYG withholding tax. PAYG withholding is the mechanism by which employers deduct income tax from employees' wages and pay that money to the Australian Taxation Office. The Crown alleged the conspirators diverted those withheld amounts to other entities instead of remitting them.
The conspiracy charge (count 1) concerned non-remittance of PAYG in connection with two separate Queensland businesses: a labour hire enterprise operated through GHR Consolidated Pty Ltd and Civil Personnel Consolidated Pty Ltd, and a formworking business operated through Superform (Queensland) Pty Ltd. After 63 days of evidence, the Crown closed its case and the defence raised a challenge to count 1.
One accused, Arthur Alex, had a particular position. The Crown's evidence connecting him to count 1 related exclusively to the Superform business. His connection to the money laundering conspiracy in count 2 also depended, for the period after 6 March 2020, on his alleged participation in the Superform aspect of count 1.
Legal Issues
- Whether count 1 was latently duplicitous, meaning whether the Crown's evidence could only support two separate conspiracies (one per business) rather than a single overarching conspiracy
- If the Crown was confined to one conspiracy on count 1, whether Arthur Alex had a case to answer on that count given his evidence related solely to the other business
- Whether, following removal of the Superform aspect, there remained any evidence capable of supporting Arthur Alex's guilt on count 2 (conspiracy to deal with proceeds of crime)
Decision
Latent duplicity and the Crown's election
Fagan J accepted the defence submission that the Crown's evidence, at its highest, was only consistent with two separate conspiracies rather than a single conspiracy spanning both businesses. Latent duplicity arises where a charge is framed as a single conspiracy but the evidence cannot rationally support a finding of one agreement, only multiple distinct ones. The court directed the Crown to close its case on count 1 by reference to the GHRC/CPC labour hire business only, confining the prosecution to that conspiracy.
Arthur Alex and count 1
Once count 1 was confined to the GHRC/CPC business, the court examined whether any evidence connected Arthur Alex to that conspiracy. The only arguably relevant material was a brief exchange in a recorded conversation in which Arthur Alex responded "Yeah" to a remark by co-accused Bryers about his own activities. Fagan J found that response was equivocal: it was consistent with merely acknowledging what Bryers was saying and could not be understood by a jury as agreement to cause non-remittance in the future or as an admission of past involvement in the GHRC/CPC business. With no overt act by Arthur Alex directed at GHRC/CPC, the evidence was insufficient to go to the jury. A directed verdict of not guilty on count 1 followed.
Arthur Alex and count 2
The Crown's pleading on count 2 alleged that Arthur Alex conspired to deal with money he believed to be proceeds of crime, but only from 6 March 2020 onwards. That pleading was premised on the funds handled after that date being proceeds of his own participation in count 1 through the Superform payroll. Once the Superform aspect was removed from count 1, no evidential foundation remained for the allegation that Arthur Alex believed the funds he handled were proceeds of crime. The court noted the Crown had never alleged he held that belief in relation to the GHRC/CPC proceeds, only that he was reckless, and the Crown did not seek to alter its case after evidence closed. The directed verdict of not guilty therefore extended to count 2 as well.
Orders Made
- The jury was directed to return verdicts of not guilty in favour of Arthur Alex on counts 1 and 2.
- The Crown was directed to close its case on count 1 confined to the GHRC/CPC labour hire conspiracy only.
Key Takeaways
- Latent duplicity in a conspiracy charge can arise where the prosecution evidence, even accepted in its entirety, is only capable of proving two or more separate conspiracies rather than a single agreement; in that circumstance a court may confine the Crown to one of them.
- A verdict by direction is available where, after any necessary confinement of the charge, no evidence capable of satisfying the jury of guilt remains against a particular accused.
- An equivocal response in a recorded conversation, with no accompanying overt act, will not constitute sufficient evidence of participation in a conspiracy to survive a no-case submission.
- Where a Crown case on a money laundering conspiracy charge is built entirely on proceeds alleged to flow from a specific aspect of a co-conspiracy, removing that aspect leaves no residual basis on which to seek conviction on the money laundering count.
- The court confirmed that once evidence is closed, the Crown cannot reformulate the basis of its case against an accused in order to salvage a count that has been undermined by a successful defence submission.
Legislation and Cases Referenced
Legislation
- Criminal Appeal Act 1912 (NSW)
- Criminal Code (Cth)
- Evidence Act 1995 (NSW)
- Taxation Administration Act 1953 (Cth), Schedule 1, ss 12-35 and 16-70
Cases
- Ahern v The Queen (1988) 165 CLR 87
- Doney v The Queen (1990) 171 CLR 207
- Gerakiteys v The Queen (1984) 153 CLR 317
- R v Griffiths [1966] 1 QB 589
- R v Greenfield [1973] 1 WLR 1151
- R v Ongley (1940) 57 WN (NSW) 116
- R v West [1948] 1 KB 709
- Saffron v The Queen (No 1) (1988) 17 NSWLR 395