Examining Third Parties Under Restraining Orders

The court granted an examination order under s 180 of the Proceeds of Crime Act 2002 to examine third parties related to the defendant about the defendant's affairs, provided certain conditions were met.

Supreme Court New South Wales

Medium Neutral Citation: Commissioner of the Australian Federal Police v [NAME] [2013] NSWSC 1350 Hearing dates: 12 September 2013 Decision date: 12 September 2013 Jurisdiction: Common Law Before: Beech-Jones J Decision: Examination order made. Catchwords: PROCEEDS OF CRIME - no question of principle. Legislation Cited: - Corporations Act 2001 (Cth) - Proceeds of Crime Act 2002 (Cth) Category: Principal judgment Parties: The Commissioner of the Australian Federal Police (Plaintiff) [NAME] (Defendant) Representation: Counsel: [redacted] [NAME] (Sol) (Defendant) Solicitors: [redacted] [NAME] (Defendant) File Number(s): 2013/190226

EX TEMPORE Judgment 1In these proceedings the Commissioner has proffered various orders contained in a document "Short Minutes of Order" as being initialled by me. The bulk of the orders affect the defendant, [NAME]. A solicitor has appeared on his behalf and has signed the orders. The orders also affect [NAME]'s spouse, [NAME], and she has signed the orders in their own right. On that basis and subject to the provision of an undertaking as to damages by the Commissioner which was proffered, I will make those orders. 2Quite properly the solicitor for the Commissioner has pointed out that one part of the orders also affects third persons in that they seek to examine [NAME] and [NAME] about the affairs of the defendants. Those persons have not consented to the orders. As far as I am aware, they have not been given notice that those orders would be sought. I should add that that is not uncommon in applications of this kind. 3The basis for the order sought against them is s 180 of the Proceeds of Crime Act 2002 (Cth) (the "Act") which provides: "Examination orders relating to restraining orders (1) If a restraining order is in force, the court that made the restraining order, or any other court that could have made the restraining order, may make an order (an examination order) for the examination of any person, including: (a) a person whose property is, or a person who has or claims an interest in property that is, the subject of the restraining order; or (b) a person who is a suspect in relation to the restraining order; or (c) the spouse or de facto partner of a person referred to in paragraph (a) or (b); about the affairs of a person referred to in paragraph (a), (b) or (c). (2) The examination order ceases to have effect if the restraining order to which it relates ceases to have effect." 4The definition of "affairs" in s 180 is as follows: "affairs of a person includes, but is not limited to: (a) the nature and location of property of the person or property in which the person has an interest; and (b) any activities of the person that are, or may be, relevant to whether or not the person has engaged in unlawful activity of a kind relevant to the making of an order under this Act. 5In support of the application for orders requiring the attendance of [NAME] for examination, the Commissioner has read an affidavit of [NAME] sworn 21 June 2013. By way of very brief summary, that affidavit reveals a reasonable basis for suspecting that at various times, [NAME] may have passed on inside information to [NAME] which may have then led [NAME] to engage in share trading. In relation to one particular transaction, there is a reasonable basis for suspecting that the source of [NAME] obtaining the inside information was [NAME]. 6The submission of the Commissioner is that the order under s 180(1) in relation to [NAME] is warranted because he is a person who could reasonably be expected to have information about the "affairs" of [NAME]. Based on what is stated in [NAME]'s affidavit, I accept that contention. Similarly, the same submission is put in relation to [NAME]. Given the breadth of the definition of "affairs" and that an element of unlawful activity in this context is that the relevant information was truly inside information according to the appropriate definition in the Corporations Act 2001 (Cth), I think there is a reasonable basis for believing that [NAME] has some information about the affairs of [NAME]. Accordingly I will make an order for the examination of both of them. Two matters should be noted. First, the form of orders at present has a provision for liberty to apply. I will clarify that to make it liberty to apply on 24 hours' notice. Secondly, so far as the examinations of [NAME] are concerned, I will make it a condition that such examination is not to occur within two weeks of today so that they will have the opportunity, if they see fit, to apply to set aside the order. 7Accordingly I will make orders 1 to 5, 6A, 7 and 8 in the Short Minutes of Order. I will make order 9 but with the addition of the words "on 24 hours' notice". I will make a further order that, subject to such examination not taking place prior to 26 September 2013, pursuant to s 180 of the Act the following persons to be examined about the affairs of the defendant are [NAME] and [NAME].

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