New South Wales Crime Commission v Pettit

1. [1]

   HIS HONOUR: By summons filed on 6 June 2019, the plaintiff, the New South Wales Crime Commission, brought confiscation proceedings against the defendant, Maxwell Pettit, pursuant to the Criminal Assets Recovery Act 1990 (NSW) (“the CAR Act”) seeking, inter alia, the following orders:

   1. (1)

      a restraining order pursuant to s 10A of the CAR Act in respect of “any interest in property” of the defendant, including his interest in a property at Hopkins Creek, New South Wales (“the Hopkins Creek property”); and

   2. (2)

      an assets forfeiture order pursuant to s 22 of the CAR Act in respect of the defendant’s interest in the Hopkins Creek property, being property suspected of being an available interest relating to “serious crime use property”, as defined under s 9B of the CAR Act (“the proposed forfeiture order”).

2. [2]

   On 6 June 2019, following an ex parte hearing, Davies J made a restraining order pursuant to s 10A of the CAR Act. By notice of motion filed on 4 August 2020, the defendant sought an order pursuant to s 25(1) of the CAR Act that its interest in the Hopkins Creek property be excluded from the restraining order and the proposed forfeiture order on the basis that it is not “serious crime use property” because it was not “property that was used in or in connection with” the offence, which is a necessary element pursuant to s 9B(1) of the CAR Act.

3. [3]

   Alternatively, the defendant sought a declaration to that effect.

4. [4]

   The relevant background to the matter is detailed in an affidavit in support of the motion by the defendant’s solicitor (“Mr Weller’s affidavit”) and an affidavit of Warwick Oliver, who is a forensic accountant employed in the office of the plaintiff (“Mr Oliver’s affidavit”). Those two affidavits, together with an affidavit of an authorised officer of the plaintiff in support of the application for a restraining order (“Ms Bourne’s affidavit”) were read at the hearing of the motion.

Factual history

1. [5]

   On 7 February 2019, whilst conducting aerial patrols over Hopkins Creek in northern New South Wales, police observed a large number of cannabis plants growing at the rear of the Hopkins Creek property. Senior Constable Paul Barringer was notified and attended the location shortly after. He introduced himself to the defendant, who stated his name and confirmed that he was the owner of the property.

2. [6]

   Senior Constable Barringer told the defendant that he had received information that there were cannabis plants growing at the back of the property. In an exchange described by the sentencing judge as one of “remarkable frankness”, the defendant replied, “Yep, I’ll show you”. The defendant then escorted the officer to the relevant part of the property, at which the officer observed a crop of cannabis plants. Senior Constable Brett Crossan, who joined Senior Constable Barringer, described the crop as “many very large cannabis plants over 2 metres in height in large pots”. The defendant drew the attention of the police to 147 cannabis seedlings in small pots about 20m away, which he admitted were his.

3. [7]

   Senior Constable Crossan questioned the defendant, the exchange being captured on his body camera. The defendant confirmed that he was the sole owner of the property and gave police permission to enter and search it. The questioning continued:

4. [8]

   The police executed a search warrant, seizing a total of 257 cannabis plants, 110 of which were over 2m in height. Police estimated the value of the plants to be more than $500,000.

5. [9]

   The defendant was arrested and conveyed to Tweed Heads Police Station where he was charged with one count of cultivating not less than the commercial quantity of a prohibited plant contrary to s 23(2)(a) of the Drug Misuse and Trafficking Act 1985 (NSW) (“the DMT Act”). I note that, at the time, the minimum number of cannabis plants for a commercial quantity was 250, pursuant to Sch 1 of that Act. A large commercial quantity was 1,000 plants.

6. [10]

   A notice of sale annexed to the affidavit of Ms Bourne revealed that the defendant purchased the Hopkins Creek property, which is 8.37ha in size, in 2010 for $525,000. A title search annexed to the same affidavit confirmed that the defendant is the sole owner of the property. He informed police that he was the sole resident.

7. [11]

   Following a plea of guilty, the defendant was convicted and sentenced in the District Court at Lismore on 6 December 2019 (“the offence”) by his Honour Judge Priestley SC (“the sentencing judge”).

8. [12]

   The sentencing judge assessed the objective seriousness of the offending conduct to be in the low range. His Honour stated:

9. [13]

   The sentencing judge noted that the defendant, who was then aged 61, had been a heavy cannabis user, reportedly smoking “up to 100 cones of marijuana a day” at one point in his life. His Honour also noted that the defendant’s criminal record included repeated low-level offending involving cannabis but that he had been a law-abiding citizen for the previous 16 years. In light of this, the sentencing judge stated:

10. [14]

    The defendant was sentenced to 2 years imprisonment with a non-parole period of 9 months and 29 days, backdated to commence on 8 February 2019, being the day following his arrest, over which period he had been held on remand. The sentence expired on 7 February 2021. [1]

Procedural history

1. [15]

   By summons filed on 6 June 2019, the plaintiff made an ex parte application to this Court seeking, relevantly, the following orders:

2. [16]

   Schedule 1 to the summons provided:

3. [17]

   Schedule 2 listed the defendant’s interest in a motor vehicle and funds held in two Commonwealth Bank accounts in the defendant’s name.

4. [18]

   The summons was supported by the affidavit of Ms Bourne who deposed to a suspicion that the defendant had engaged in a “serious crime related activity” on the basis of the police facts sheet which was annexed to her affidavit.

5. [19]

   As noted, the matter was heard ex parte before Davies J on 6 June 2019: New South Wales Crime Commission v Pettit [2019] NSWSC 675. In accordance with s 10A of the CAR Act, Davies J made a restraining order which took immediate effect in the terms set out at order 1 of the summons, reproduced at [15] above, as well as ancillary orders requiring examination on oath of the defendant in relation to his interests in property which are subject to the restraining order.

6. [20]

   On 4 August 2020, the defendant filed a notice of motion seeking the following orders, as amended following a grant of leave at the hearing:

The statutory scheme

1. [21]

   The CAR Act provides for the confiscation or recovery of interests in property of a person who has engaged in “serious crime related activities”, as well as, in some instances, the confiscation or recovery of interests in property that have been illegally or fraudulently acquired.

2. [22]

   Its principal objects, as expressed in s 3, are as follows:

3. [23]

   Section 10A of the CAR Act grants the plaintiff a discretionary power to make an ex parte application to this Court for a “restraining order”, which is defined under s 10 as:

4. [24]

   Section 10A relevantly provides:

5. [25]

   The plaintiff may apply for an “assets forfeiture order” pursuant to s 22 of the CAR Act, which relevantly provides:

6. [26]

   A restraining order remains in force while an assets forfeiture order is pending before the court: s 10D. Where an assets forfeiture order is not made, the court may make an order in relation to the period for which the restraining order is to remain in force: s 20.

7. [27]

   The term “serious crime use property” is defined under s 9B as follows:

8. [28]

   A “serious crime related activity” is defined widely under s 6(1) as:

9. [29]

   A reference to a “serious criminal offence” under s 6 includes, relevantly, offences with respect to prohibited plants contrary to s 23 of the DMT Act: ss 6(2)(b) and 6(3)(a).

10. [30]

    A person affected by a proposed or extant forfeiture order may apply for an “exclusion order” pursuant to s 25 of the Act, to exclude the relevant interest from the operation of the forfeiture order or restraining order. Section 25 relevantly provides:

11. [31]

    A person affected by an assets forfeiture order may also apply for “relief from hardship” under s 24 of the CAR Act where the order will operate to cause hardship to a spouse or any dependant who had no knowledge of any serious crime related activities or illegal activities of the person. In those circumstances the forfeiture order is made, but pursuant to s 24(1)(a), the court:

12. [32]

    Proceedings on an application for a restraining order or an assets forfeiture order are not criminal proceedings, and the rules of construction applicable only in relation to the criminal law do not apply to the interpretation of the Act: s 5 of the CAR Act.

Legislative history

1. [33]

   Between its inception in 1990 and 2016, the Act was subject to a number of amendments widening its application from the property of persons who have engaged in a “drug-related activity” to the property of persons who have engaged in a “serious crime related activity”, or whose property has been derived from serious crime or was otherwise illegally or fraudulently acquired.

2. [34]

   In Lee v New South Wales Crime Commission (2013) 251 CLR 196; [2013] HCA 39, Crennan J, at [95], recognised the wide reach of the Act as falling within Parliament’s “legislative competence”:

3. [35]

   In 2016, a new category termed “serious crime use property” was inserted into the Act by Sch 3 of the Criminal Legislation Amendment (Organised Crime and Public Safety) Act 2016 (NSW) (“the 2016 amendments”) to enable the Court to make a forfeiture order in respect of property used in, or in connection with, a serious crime related activity: s 9B.

4. [36]

   This would appear to be the first occasion that the 2016 amendments have been judicially considered. The second reading speech in the Legislative Council for the Criminal Legislation Amendment (Organised Crime and Public Safety) Bill 2016 was delivered by the Parliamentary Secretary for Justice, the Hon David Clarke, who explained:

5. [37]

   It will be noted that this paragraph, which is the only reference in the second reading speech to the schedule of amendments that affect the CAR Act (Sch 3), primarily concerned “organised criminals” who have previously avoided forfeiture orders by using property at arm’s length for their criminal activities. The reference to items [1] to [3] and [8] of Sch 3 of the Bill are to the following sections of the CAR Act: [1] the definitions in s 4 of “available interest relating to serious crime use property”, “serious crime use property” and “substituted serious crime use property declaration”; [2] s 9(5)(d); [3] s 9B; and [8] s 22AA. Accordingly, there is little assistance to be derived from the second reading speech as to the intended objectives of the amendments and how they are to be interpreted.

Judicial consideration of the meaning of the phrase “used … in connection with”

1. [38]

   The phrase “used … in connection with” in the context of a forfeiture order concerning property utilised in the commission of a criminal offence, has been the subject of judicial consideration in the context of the Confiscation of Proceeds of Crime Act 1989 (NSW) (“the CPOC Act”), its predecessor, the Crimes (Confiscation of Profits) Act 1985 (NSW) and the Proceeds of Crime Act 1987 (Cth) (since repealed), as well as by interstate courts concerning similar state legislation. I exercise caution in having regard to extra-jurisdictional judgments for the purpose of statutory construction, for reasons explained by McHugh J in Marshall v Director-General, Department of Transport (2001) 205 CLR 603; [2001] HCA 37 at [62]:

2. [39]

   A common thread in some cases in relation to the interpretation of the phrase “used … in connection with” is a divergence into two views that could be characterised as the “literal” or “ordinary grammatical” view and the “substantial use” view. The literal view is often adopted on the basis that the relevant legislative scheme allows the court a wide discretion in order to avoid what might be regarded as an injustice, such as the scale of the forfeiture being disproportionate to the offence.

3. [40]

   The CAR Act does not allow a discretion as to whether to make a forfeiture order once the preconditions are satisfied, the only relief being, as noted, a financial payment from sale proceeds of the forfeited property for a spouse or dependant in the circumstances set out in s 24 of the CAR Act. That is not so with the CPOC Act and counterpart legislation in other Australian jurisdictions. When an assets forfeiture order or pecuniary penalty order is sought, the relevant court typically has a wide discretionary power even though the property is found to have been used in, or in connection with, the commission of a serious offence.

4. [41]

   The term “serious crime use property” in s 9B of the CAR Act is similar to the definition of “tainted property” in s 4(1)(a) of the CPOC Act. Section 4(1) provides:

5. [42]

   An application may be made for a forfeiture order in respect of “tainted property”: ss 13(1)(a) or 13(2)(a). Section 18 of the CPOC Act relevantly provides:

6. [43]

   The nature of a determination by a court as to whether to make a forfeiture order pursuant to s 18(1) of the CPOC Act is discretionary, subject to the court being satisfied the property is tainted property and that it takes into consideration the property’s ordinary use and any hardship that may reasonably be likely to arise: Zahrooni v R; Director of Public Prosecutions (NSW) v Zahrooni [2010] NSWCCA 252 per Simpson J (as her Honour then was) at [50].

7. [44]

   In R v Hadad (1989) 16 NSWLR 476, the Court of Criminal Appeal of New South Wales considered whether the phrase “used in, or in connection with”, in s 3(1) of the now repealed Crimes (Confiscation of Profits) Act 1985 (NSW), which defined “tainted property” in the same terms as s 4(1)(a) of the CPOC Act, extracted at [41] above, was to be understood according to its ordinary grammatical meaning or whether a “substantial” connection was to be inferred. In that case, a forfeiture order concerning a vehicle used in the supply of prohibited drugs was opposed by a third party who claimed ownership of it. The third party relied upon R v Ward, Marles and Graham (1987) 33 A Crim R 60; [1989] 1 Qd R 194, a decision of the Court of Criminal Appeal of Queensland, in which Carter J, considering similar legislation, expressed the view that it was necessary to find a “substantial” connection. McInerney J (Enderby and Allen JJ agreeing) said, at 481:

8. [45]

   In The Queen v Rintel (1991) 3 WAR 527, the Court of Criminal Appeal of Western Australia heard an appeal by the Crown against a decision of a sentencing judge to not make forfeiture orders pursuant to the Crimes (Confiscation of Profits) Act 1988 (WA) (since repealed).

9. [46]

   The Crimes (Confiscation of Profits) Act, s 10(1), provided that the Court “may” make a forfeiture order, if it thinks it “appropriate” and, relevantly, if it is satisfied that the property was “used in, or in connection with”, the commission of the offence (s 10(1)(a)). Subsection 10(2) of that Act allowed the court, in determining whether to make an order, to have regard to the ordinary use of the property and whether any hardship to any person may be likely to be caused by such an order.

10. [47]

    The Court referred to the difference of view between the Courts of Criminal Appeal of Queensland and New South Wales on the proper interpretation of the phrase “used in, or in connection with, the commission of an offence” in legislation containing similar provisions to those in the Crimes (Confiscation of Profits) Act, as expressed in Ward, Marles and Graham by Carter J and in Hadad by McInerney J.

11. [48]

    A majority (Malcolm CJ and Pidgeon J, Wallace J dissenting) rejected the “substantial connection” approach, Malcolm CJ expressing a preference, at 530, for McInerney J’s view in Hadad and Pidgeon J stating, at 542:

12. [49]

    In Director of Public Prosecutions (Cth) v Jeffery (1992) 58 A Crim R 310, Hunt CJ at CL considered the phrase “used … in connection with” as it appeared in s 48(4) of the Proceeds of Crime Act 1987 (Cth), which permitted an application for relief to be made by a convicted person, where he or she has an interest in property that has been restrained under the Act, to apply for a declaration that it not be forfeited. Section 48(4)(c) provided that such a declaration may be made if the court is satisfied that:

13. [50]

    Hunt CJ at CL said, at 315-317:

14. [51]

    In Sultana v R (1994) 74 A Crim R 27, the Court of Criminal Appeal again considered the phrase “used … in connection with”, this time as it appears in the CPOC Act. Gleeson CJ, at [31], approved Hadad. Sully J, at [39], said there was ample authority for the proposition that the phrase is to be regarded as:

15. [52]

    In Director of Public Prosecutions (NSW) v King (2000) 49 NSWLR 727; [2000] NSWSC 394, O’Keefe J, at [14], observed, in relation to the phrase as it appears in the CPOC Act, that:

16. [53]

    O’Keefe J was considering an application for a restraining order sought by the Director of Public Prosecutions (“DPP”) concerning a yacht on which it was alleged that the defendant had committed an offence of aggravated indecent assault against a minor. The DPP submitted that the yacht had been used “in connection with” the alleged offence and thus came with in the statutory definition of “tainted property”. O’Keefe J reviewed cases from other states as well as from this state, as to the meaning of the phrase “used … in connection with”, and concluded, at [33]:

17. [54]

    In Director of Public Prosecutions (SA) v George (2008) 102 SASR 246; [2008] SASC 330, the Full Court of the Supreme Court of South Australia (Doyle CJ, White J agreeing, Vanstone J dissenting) considered the meaning of “used … in connection with” an offence, in an appeal from a decision by a magistrate to not make a pecuniary penalty order pursuant to s 95 of the Criminal Assets Confiscation Act 2005 (SA), in respect of property said to be an “instrument” of a “serious offence”.

18. [55]

    Section 95 provided:

19. [56]

    Section 7(1)(b) provided:

20. [57]

    Doyle CJ and Vanstone J expressed concern for what they regarded as potentially disproportionate consequences for the defendant in making an order if s 95 was found to be mandatory. In that case, police found 32 cannabis plants growing in pots in a shed located at the rear of the defendant’s property. Twelve of the 32 cannabis plants were mature and the remaining 20 were seedlings. A small quantity of cannabis was found drying in the shed. The defendant’s property was suburban land used for residential purposes and was less than one-quarter of an acre in size. The shed in which the plants were found occupied around one-quarter of the land. Electricity and water that were supplied to the land were used to grow the plants hydroponically, including electricity which was unlawfully obtained. The defendant pleaded guilty to producing a controlled substance and knowingly extracting electricity from a power system without proper authority. The plaintiff obtained a restraining order over the property. On conviction, the plaintiff applied for an order requiring the defendant to pay a pecuniary penalty order in relation to the value of the property under s 95 of the Criminal Assets Confiscation Act.

21. [58]

    Doyle CJ noted the impact that a forfeiture order would have on the respondent:

22. [59]

    The first issue for determination was whether the property was an “instrument” of the offence pursuant to s 7(1)(b). The second was whether, if so, the Court was obliged to make a pecuniary penalty order pursuant to s 95, given the mandatory terms of the section.

23. [60]

    In considering the nature of the connection required by the phrase “used … in connection with”, Doyle CJ and Vanstone J treated the consequence of the construction, in terms of whether there remained a judicial discretion as to its application, as a relevant consideration. I note that this approach was conformable with that of McInerney J in Hadad and Hunt CJ at CL in Director of Public Prosecutions (Cth) v Jeffery, in the passages extracted above at [44] and [50] respectively.

24. [61]

    Both Doyle CJ and Vanstone J found that s 95(1) should be construed as vesting in courts a discretion as to whether to make a pecuniary penalty order. In relation to the construction of “used … in connection with”, Doyle CJ rejected the “substantial connection” test, preferring one of “significantly sufficient use”:

25. [62]

    Vanstone J required a “substantial connection” to be established:

26. [63]

    Vanstone J appeared to qualify that view later in her judgment on the basis of a finding that s 95 allowed a judicial discretion, at [170]:

The degree of connection required

1. [64]

   As noted, the mere fact that the offence was committed on the property in question will not ordinarily be sufficient to render it used in connection with the offending conduct: Director of Public Prosecutions (NSW) v King at [33].

2. [65]

   Similarly, in Hadad, McInerney J held that although a substantial connection between the use of the property and the commission of the offence is not required (indeed, “an accidental or incidental connection is sufficient”), the property must be “an operating tool” in the commission of the offence. The property in that case, a motor vehicle, was held to be an “operating tool” in the commission of drug supply offences, because:

3. [66]

   In Sultana, the Court of Criminal Appeal held that although the words “in connection with” are of wide import, there must be demonstrated “in a real sense” some connection between the offence and the property in question.

4. [67]

   In Taylor v Attorney-General for the State of South Australia (1991) 55 SASR 462, the Full Court of the Supreme Court of South Australia considered whether premises from which drugs had been traded were liable to forfeiture under the Crimes (Confiscation of Profits) Act 1986 (SA). Debelle J stated, at 472:

5. [68]

   Further, in Queensland, the court may make an “innocent interest exclusion order” where an applicant can prove, on the balance of probabilities, that a stated proportion of the value of the interest in property which has been forfeited is not attributable to the proceeds of an illegal activity: Criminal Proceeds Confiscation Act 2002 (QLD), s 73(2).

Submissions of the parties

1. [69]

   The defendant conceded that the offence constituted a “serious crime related activity” within the meaning of s 6 of the CAR Act but submitted that the Hopkins Creek property was not “serious crime use property” within the meaning of s 9B, because it had not been “used in, or in connection with” the serious crime related activity, and for that reason it should be excluded from the plaintiff’s pending forfeiture order.

2. [70]

   The essence of the defendant’s submission is that the cannabis plants did not form part of the real property that was sought by the plaintiff to be forfeited, by reason of them being cultivated in pots rather than in the ground, and therefore at common law they remained chattels and did not become part of the real property. The defendant further submitted that there was an absence of evidence as to a physical or temporal connection of these chattels to the Hopkins Creek property, so that it was not “used … in connection with”, the cultivation of the cannabis.

3. [71]

   The defendant sought to differentiate the circumstances from those in Director of Public Prosecutions (SA) v George to demonstrate their status as chattels and that their connection to the Hopkins Creek property and the cultivation of the cannabis plants was therefore insufficiently intimate to render it “serious crime use property” pursuant to s 9B(1). In furtherance of this submission, the defendant noted:

   1. (1)

      The plants were grown outdoors in pots and, although fertilised and watered from a dam on the property, there was no evidence before the District Court as to the regularity of the application of fertiliser and watering;

   2. (2)

      There was no evidence before the District Court of any equipment used to cultivate the plants, or of a sophisticated operation to distribute the cannabis for profit or advantage. For example, there was no evidence of dried cannabis, plastic bags, scales or large sums of money to evidence an operation of a commercial dimension;

   3. (3)

      There was no evidence of the topography of the area used to grow the plants, and the relationship between that area and the total area of the property; and

   4. (4)

      Of the 257 plants seized, 147 were seedlings, and there was no evidence before the District Court of when the plants had been planted, how long they had been growing, or whether they were moved to different parts of the property.

4. [72]

   The defendant submitted that this Court should apply the “substantial connection” test of Vanstone J in Director of Public Prosecutions (SA) v George extracted at [62] above, as opposed to Doyle CJ’s “significantly sufficient use” test extracted at [61] above, because otherwise a forfeiture order could be disproportionate to the offence.

5. [73]

   The defendant also submitted that s 9B(1) must be construed so as to ensure the relevant interest in property to be restrained or confiscated is, firstly, proportionate to the level of objective criminality of the offending conduct; and, secondly, sufficiently connected to the commission of the offence. The defendant said that adopting a wide construction of s 9B would result in unintended and unjust consequences.

6. [74]

   The defendant concluded that the penal nature of the legislation necessitates a narrow interpretation of s 9B(1); namely, one that requires the nexus between the offending conduct and the use of the property to be “intimate, unequivocal” such that the relevant offence could not have been committed “but for the involvement of the property”.

7. [75]

   The plaintiff submitted that the meaning of the expression “serious crime use property” in s 9B is “clear and unambiguous” and does not lend itself to an interpretation that gives significance to the common law of fixtures, as such language does not appear in the text of the Act. In relation to the meaning of “used in, or in connection with”, the plaintiff notes the meaning of “use” in the Oxford English Dictionary is to “[t]ake, hold, or deploy (something) as a means of accomplishing or achieving something; employ”.

8. [76]

   As to the degree of connection between the offence and the Hopkins Creek property, the plaintiff referred to the 257 pots of cannabis being cultivated on the property, stating in its written submissions: “The plants had to be located somewhere to be cultivated. This ‘somewhere’ was the Hopkins Creek property”. In addition, the defendant pumped water from a dam on the property up a slope to water the plants.

9. [77]

   The plaintiff noted the mandatory nature of the Court’s obligation pursuant to s 22(2B) of the CAR Act to make an assets forfeiture order if it finds, on the balance of probabilities, that the property is “serious crime use property”, reflects the legislature’s intention to enact harsh measures to deter the commission of serious offences. The fact that relief from hardship may be sought by s 24 of the CAR Act further reinforces an interpretation of that Act that gives effect to the legislature’s intent in providing for a strong deterrent to commit serious crime.

Consideration

1. [78]

   The issue in dispute between the parties is narrow in compass; whether the Hopkins Creek property was “used … in connection with” the defendant’s cultivation of the cannabis. The other elements required for the making of a forfeiture order are conceded. No discretion is allowed to the Court in the making of such an order if the Court is satisfied that this remaining element is established on the balance of probabilities.

2. [79]

   In Murphy v Farmer (1988) 165 CLR 19; [1988] HCA 31 at 28, the High Court considered the construction of penalty provision pursuant to s 229(1)(i) of the Customs Act 1901 (Cth) that applied to a customs declaration form that had been filled out with incorrect information. The majority stated, at 28:

3. [80]

   In Director of Public Prosecutions (NSW) v King, O’Keefe J at [43] was of the view that Murray v Farmer was authority for the proposition that statutes providing for the forfeiture of property are to be construed strictly.

4. [81]

   The 2016 amendments significantly expanded the scope of the CAR Act beyond the forfeiture of property that was derived from the proceeds of crime, to property that had a “connection” to a “serious crime related activity”, and with no discretion available to the court to correct a disproportionate or unreasonable outcome; the making of a forfeiture order is mandatory once the necessary conditions are established, the only amelioration being in the form of a payment from sale proceeds following forfeiture, to a spouse or dependants in limited circumstances, pursuant to s 24 of the CAR Act.

5. [82]

   A principal object of the CAR Act (s 3(a)), being the only one that has any relevance to the 2016 amendments, is to:

6. [83]

   Clearly the 2016 amendments could be applied in a manner that would produce a result that would be wholly disproportionate to the criminality involved, and with no authority afforded to the Court to ameliorate its effect so as to avoid a patent injustice, other than to allow a payment from the proceeds of sale for any hardship occasioned to a spouse or dependant who was ignorant of the offence: s 24.

7. [84]

   As noted earlier, in Hadad, McInerney J, in favouring a grammatical construction of the phrase “in connection with” rather than one of “substantial” connection, took into account the fact that the legislative provisions in question allowed the court a discretion in determining whether to make a forfeiture order; an order might be refused on the legislative bases of ordinary use and/or hardship. Similarly, in Director of Public Prosecutions (Cth) v Jeffery, Hunt CJ at CL had regard to the absence of judicial discretion in final orders, in finding that a “substantial” connection was appropriate, thus distinguishing Hadad.

8. [85]

   If the CAR Act had the protections that are available at s 18 of the CPOC Act to avoid an outcome that was unduly harsh, it would have been open to the defendant to make submissions as to, for example, the ordinary use of the Hopkins Creek property, what improvements it had on it and what hardship might result to him if it is forfeited. All that is known in relation to the Hopkins Creek property and the circumstances of the defendant is that it is a large rural property (8.37ha) that he purchased in 2010, being nine years before his arrest, for the sum of $525,000, and that he was the sole occupant of it at the time of his arrest. I note that the particular circumstances of the defendant are only illustrative of the wider issue; I have not had regard to them in my construction of s 9B(1) of the CAR Act.

9. [86]

   I apply the reasoning of the Court of Criminal Appeal in Hadad and of Hunt CJ at CL in Director of Public Prosecutions (Cth) v Jeffery and, in so doing, I conclude that, in the absence of a judicial discretion to avoid an assets forfeiture order that would be disproportionate to the offence, a narrow interpretation of the phrase in s 9B(1) of the CAR Act is appropriate. The phrase “used … in connection with” obliges the Court to be satisfied that there is a substantial connection between the property that is the subject of the assets forfeiture order and the offence.

10. [87]

    I note that my conclusion coincides with the reasons expressed in Director of Public Prosecutions (SA) v George, Doyle CJ and Vanstone J both being of the view that whether there was a discretion in making final orders was a relevant consideration in the construction of the phrase. In the absence of such a discretion, Vanstone J preferred a narrow construction, that a “substantial” connection was required.

11. [88]

    In coming to this view, I echo the concerns implicit in the judgments of the Court of Criminal Appeal in Hadad, Hunt CJ at CL in Director of Public Prosecutions (Cth) v Jeffrey and Doyle CJ and Vanstone J in Director of Public Prosecutions (SA) v George in relation to a statutory power to make an order forfeiting property that has been used in connection with a criminal offence, where there is no or a limited judicial discretion, may lead to unwarranted hardship and/or a forfeiture that is disproportionate to the offence.

12. [89]

    I turn to the parties’ submissions concerning the relationship between the Hopkins Creek property and the cultivation of the cannabis plants.

13. [90]

    In my view, whether as a matter of law the potted plants were chattels or part of the real property is irrelevant to the issue of whether the property the subject of the application was used in connection with the offence. The fact that the plants were cultivated in pots on the Hopkins Creek property, rather than in the ground, is a circumstance that tends against the connection being substantial. However, the pots being located on private property rather than, for example, on Crown land or in a national park, afforded the defendant a degree of control and protection from others who might interfere with his cultivation, but does not, of itself, constitute a substantial connection to the Hopkins Creek property.

14. [91]

    The fertilising and watering of the plants by the defendant, per se, are neutral factors; they do not constitute a connection between the Hopkins Creek property and the plants.

15. [92]

    Similarly, the fact that the defendant watered the plants, in itself, is a neutral factor. However, the watering of the plants via a pump from a dam on the property constitutes a use of the property in connection with the cultivation of the plants to a substantial extent. The water was collected on the property in the dam and then, via a pump, transported to the plants.

16. [93]

    A reasonable available inference is that the defendant formed the view that watering the plants, rather than relying on rainfall, was either necessary for their cultivation or at least desirable for a better outcome. He utilised the dam on the property to do so. It could also reasonably be inferred that the seedlings required regular watering in order to survive in pots, which was effected by the use of the dam. For those reasons, I conclude that the property was used in connection with the offence and that the connection was substantial. That being so, the motion fails.

17. [94]

    In relation to costs, I note that although the defendant’s notice of motion is refused, his submission as to the appropriate construction of the phrase in question, which has not previously been the subject of judicial consideration, is accepted. In those circumstances, each party should pay its own costs.

Orders

1. [95]

   I make the following orders: