Criminal Proceeds Confiscation and When the Proceeding will be Stayed

The Criminal Proceeds Confiscation Act 2002 (Qld) (‘the Act’) applies when the State of Queensland confiscates the proceeds of crime and property connected to persons convicted of particular serious drug offences.

Section 8 of the Act states that proceedings under the Act are civil proceedings and not criminal proceedings, which, among other things, means that:

• Questions of fact must be decided on the ‘balance of probabilities’ and not the criminal and rigorous requirement of ‘beyond a reasonable doubt’; and
• The rules of evidence only apply to the extent that they do in civil proceedings.

Nevertheless, the civil proceeding can and often runs concurrently with the criminal proceeding of the accused.

A common question from our clients is:

Can I stay (delay) my civil or criminal proceeding?

Our firm has represented and protected the interests of many clients with respect to both types of proceedings and has substantial first-hand experience and knowledge of the available avenues to our clients.

This article will explore the law surrounding staying a criminal proceeds confiscation matter and serves as a general overview to the reader, which by no means is definitive or exhaustive.

The content contained herein is not legal advice which should be relied upon and we recommend that you contact our office for a free twenty (20) minute consultation to discuss your matter with a member of our litigation team.

 

The Act and No Stay of Proceedings

Section 93 of the Act states that:

The fact that a criminal proceeding has been started against a person, whether or not under this Act, is not a ground on which the Supreme Court may stay a proceeding against or in relation to the person under this chapter that is not a criminal proceeding.

In other words, the Act does not preclude a stay of the civil proceeding entirely, but it clearly states that a person cannot seek a stay merely because criminal proceedings have commenced against the accused.

This was confirmed in State of Queensland v Bush [2003] QSC 375 where the court found:

[Section] 93 is not an absolute bar to a defence of forfeiture proceedings. However, at the minimum, it would require, in the particular circumstances of the case, a demonstrated reason why the interests of justice would not be served by the forfeiture proceedings being heard in advance of the criminal proceedings before a stay would be given.

 

The ‘McMahon Guidelines’ and the Court’s Discretion to Stay Proceedings

The ‘McMahon guidelines’ were developed in McMahon v Gould (1982) 7 ACLR 202 and continue to be frequently citied and referred to by the Courts in determining whether a court should exercise their general discretion to stay a proceeding.

Justice Wootten stated in McMahon the following guidelines::

            (A) Prima facie a plaintiff is entitled to have his action tried in the ordinary course of the procedure and business of the court;

(B) It is a grave matter to interfere with this entitlement by a stay of proceedings, which requires justification on proper grounds;

(C) The burden is on the defendant in a civil action to show that it is just and convenient that the plaintiff’s ordinary rights should be interfered with;

(D) Neither an accused nor the Crown are entitled as of right to have a civil proceeding stayed because of a pending or possible criminal proceeding;

(E) The court’s task is one of “the balancing of justice between the parties”, taking account of all relevant factors;

(F) Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are the relevant factors;

(G) One factor to take into account where there are pending or possible criminal proceedings is what is sometimes referred to as the accused’s “right of silence”, and the reasons why that right, under the law as it stands, is a right of a defendant in a criminal proceeding;

(H) However, the so-called “right of silence” does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings. The plaintiff in a civil action is not debarred from pursuing action in accordance with the normal rules merely because to do so would, or might, result in the defendant, if he wished to defend the action, having to disclose, in resisting an application for summary judgement, in the pleading of his defence, or by way of discovery or otherwise, what his defence is likely to be in the criminal proceeding;

(I) The court should consider whether there is a real and not merely notional danger of injustice in the criminal proceedings;

(J) In this regard factors which may be relevant include:

(i) the possibility of publicity that might reach and influence jurors in the civil proceedings;

(ii) the proximity of the criminal hearing;

(iii) the possibility of miscarriage of justice eg by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses;

(iv) the burden on the defendant of preparing for both sets of proceedings concurrently;

(v) whether the defendant has already disclosed his defence to the allegations;

(vi) the conduct of the defendant, including his own prior invocation of civil process when it suited him;

(K) The effect on the plaintiff must also be considered and weighed against the effect on the defendant. In this connection I suggest below that it may be relevant to consider the nature of the defendant’s obligation to the plaintiff;

(L) In an appropriate case the proceedings may be allowed to proceed to a certain stage, e.g. setting down for trial, and then stayed.

 

Entitlement to Substantive Relief and ‘Good Cause’ Requirement

The McMahon guidelines serve as an important reference point for applicants seeking a stay of proceedings, however because of the nature and seriousness of the matters which are captured by the Act the courts maintain a certain view.

The court in State of Queensland v Henderson (S 1246 of 2003, 16 May 2003) found that:

It seems to me that before Henderson can be entitled to substantive relief, it is incumbent on him to demonstrate either or both that he has a matter which he wishes to raise in defence of the forfeiture proceedings which if raised would prejudice the criminal proceedings and/or that he has a matter which he would wish to raise in exclusion proceedings to a like effect.

In the High Court case of Commissioner of the Australian Federal Police v Zhao (2015) 255 CLR 46, the court held that:

Courts will not grant a stay of civil proceedings merely because related charges have been brought against a person and criminal proceedings are pending. More is required. To warrant a stay of the forfeiture proceedings, it must be apparent that the person whose property is in question is at risk of prejudice in the conduct of his or her defence in the criminal trial.

It may be accepted that forfeiture proceedings should not be unduly delayed. No litigation should be delayed except for good cause, especially criminal proceedings.

 

Examples of Not Satisfying The Good Cause Requirement

In State of Queensland v Cannon [2003] QSC 459 the court held that:

No specific prejudice is pointed to by Mr Cannon, apart from the generally held fear that something might come out in his examination which will help the prosecution in a derivative sense in the prosecution of the criminal charges against him.

In Justice White’s reasons for his decision he commented:

As will be apparent I am not, therefore, persuaded that in the light of the clear provisions of the Act and no specifically identified prejudice or issues of justice would require the examinations to be stayed or adjourned until the criminal proceedings have concluded.

The defendants in Andrew Koh Nominees Pty Ltd As Trustee for Kl Unit Trust v Pacific Corporation Ltd [no 3] [2010] WASC 248 relied on eight grounds in their application to stay proceedings including:

1. The civil matter has already been on foot for 6 1/2 years, through no fault of the defendants. The plaintiff would not suffer any prejudice if the civil matter was partially delayed until the conclusion of the criminal matter
2. The burden on the second and third defendants in preparing for both a civil trial and criminal trial would be unmanageable and excessive, due to the likely cost and length of both the civil and criminal trials; particularly as the second defendant has numerous business interests overseas and spends most of his time out of Western Australia;
3. The second and third defendants both have various medical and health issues and are likely to suffer adversely, given the stress that they would undergo in having to prepare for and participate in criminal and civil trials, which may occur on or around the same time; and

Notably, the court simply rejected ground A but considered grounds B and C, and in the courts reasons, it was ultimately not satisfied based on the evidence presented to the court that a stay of proceeding should be granted.

 

Examples of Satisfying the Good Cause Requirement

In State of Queensland v Shaw [2003] QSC 436, it was submitted (by the applicant) that there was sufficient justification for granting a stay until the completion of the criminal proceedings on the grounds that:

(A)       The evidence relevant to defending the forfeiture proceedings would include evidence not presently in the possession of the State of Queensland;

(B)       If the stay was refused the State of Queensland would be alerted to further information concerning the financial position of the applicant;

(C)       By defending the forfeiture proceedings the applicant would be disclosing information which would otherwise be subject to his right to remain silent;

(D)       The State of Queensland would therefore be placed in the advantageous position of being alerted to the need for further evidence and the existence of further chains of inquiry in order to meet the defence raised by the applicant; and

(E)       Since the criminal proceedings are listed to be heard in about 3 ½ months’ time there would be no significant delay to the forfeiture proceedings

 

Justice MacKenzie declared, among other things, in his reasons for the decision:

The case is one where there is a well-defined and real advantage available to a person in criminal proceedings in respect of revealing evidence in advance. Depriving a defendant of such an advantage by requiring him to undergo prior proceedings where the State may, in effect, test-run the same case it proposes to lead in the prosecution proceeding and if necessary improve it if it can prior to that time is in my view sufficiently of the character of a demonstrated reason why the interests of justice would not be served by the forfeiture proceedings being heard in advance of the criminal proceedings. In my view the circumstances in which a stay is justified are established by the particular facts of the case.

 

Conclusion

In some cases a stay of proceeding may be the appropriate course of action in light of the individual’s circumstance, and a person may very well have good cause to seek a stay of proceeding. In any event, this will depend on the individual’s circumstance.

Please note that this article is not legal advice and is general in nature which should be relied upon.

If you would like legal advice that you can rely upon we recommend that you seek your own independent legal advice. As aforementioned, we offer a free twenty (20) minute consultation to discuss your matter.