Zhang v R

MACFARLAN JA: On 11 May 2022 this Court dismissed applications by Mr Li Zhang for leave to appeal under s 5F(3) of the Criminal Appeal Act 1912 (NSW) against various pre-trial rulings made by Acting Judge Blackmore SC of the District Court. These are my reasons for joining in the making of the orders made on that day.

The trial is presently fixed to commence on 23 May 2022 with an estimated length of 10 months. It relates to two charges alleging a conspiracy between Mr Zhang and certain named conspirators with the intention of dishonestly causing loss to the Commonwealth of Australia, contrary to s 135.4(3) of the Criminal Code 1995 (Cth). The Crown alleges that Mr Zhang and his co-conspirators conspired to prepare and lodge fraudulent Business Activity Statements on behalf of two corporate developers and thereby to defraud the Australian Taxation Office of many millions of dollars. It alleges that the conspiracy involved inflated expenditure claims and false input tax credits and GST refunds.

The proceedings against Mr Zhang were commenced by the filing of Court Attendance Notices in 2014 and 2015, following the execution of search warrants in 2009. As is to be expected, considerable time and expense has been incurred over the intervening years in bringing the proceedings to a point where the commencement of the lengthy hearing is imminent. In these circumstances, Mr Zhang would have had to, but did not, mount a powerful case in order to obtain a grant of leave to appeal which would inevitably interrupt the progress of the proceedings towards their resolution at first instance. As the High Court said in Gedeon v Commissioner of NSW Crime Commission (2008) 236 CLR 120; [2008] HCA 43 at [23], “[t]he fragmentation of the criminal process is to be actively discouraged”. Similarly, in Lazarus v Independent Commission Against Corruption (2017) 94 NSWLR 36; [2017] NSWCA 37 at [32], Leeming JA accepted the DPP’s submission that “there are ordinarily powerful discretionary factors against entertaining applications which fragment criminal proceedings”. The prima facie undesirability of granting leave to appeal in respect of pre-trial rulings, and therefore of fragmenting and delaying the resolution of criminal proceedings at first instance, is all the more acute when that leave is sought at a hearing less than two weeks before the commencement of a lengthy trial.

These “powerful discretionary factors” pointing against granting Mr Zhang leave to appeal were not outweighed by his identification of any arguable, much less strongly arguable, points that ought to be determined at this stage of the proceedings. In these circumstances the matters upon which Mr Zhang relied in seeking leave need only be referred to briefly, as follows.

First, Mr Zhang sought to challenge a decision of Judge Blackmore not to adjourn the trial in order to give Mr Zhang longer to review disclosure material provided to him by the Crown, principally contained on a 4TB hard drive. By his District Court notice of motion filed on 23 February 2022, Mr Zhang sought 60 days from the date of his release from custody to review the material on the hard drive. This release subsequently occurred on 13 April 2022, after he was granted bail on the previous day. The hard drive largely contains scanned copies of documents seized in 2009 under the search warrants referred to above. The material to be relied upon in the Crown’s case is much more limited. It was provided by the Crown to Mr Zhang in the form of a brief of evidence on 24 October 2019, with some additional material being supplied subsequently.

The hard drive was first provided to Mr Zhang on 9 March 2020 whilst he was in custody. Many communications subsequently occurred between him and the Crown concerning his ability to access it in a convenient manner but Mr Zhang conceded in cross-examination on 10 March 2022 that another copy of the hard drive had been provided to his nephew in February 2021 and that it had been uploaded “to the cloud”, with the result that his partner, Ms Meng, had full access to it and could print out what material Mr Zhang required in hard copy. His Honour was fully alive to these and many other considerations relating to Mr Zhang’s access to the disclosure material and in his discretion refused Mr Zhang’s application at a time when the trial was due to commence on 26 April 2022. As the commencement of the trial was subsequently delayed for four weeks, to 23 May 2022, Mr Zhang will have that additional period for pre-trial preparation beyond the time that his Honour had in contemplation at the time of his decision.

His Honour’s ruling was one of practice and procedure, which was made with a familiarity, far greater than that of this Court, with the complexities of the proceedings and the parties’ preparation for trial. In these circumstances, and in the absence of any specific error being demonstrated, this Court should pay considerable deference to his Honour’s views. For these reasons, Mr Zhang failed to show that he would have had an arguable case for success on an appeal on this issue if this Court had been prepared to grant leave to appeal.

Secondly, Mr Zhang sought in the District Court a stay of the criminal proceedings against him until a new solicitor was retained by the Crown to replace one of the solicitors then working on the proceedings. Judge Blackmore rejected this application by his judgment of 16 March 2022. After a detailed examination of Mr Zhang’s complaints, his Honour held that the application was unfounded because the evidence indicated that the solicitor’s “behaviour has not been brought into disrepute”. Mr Zhang did not establish that there was any, even arguable, error in his Honour’s conclusions.

Thirdly, Mr Zhang seeks leave to challenge Judge Blackmore’s decision to decline to exclude, from the evidence at the trial, documents obtained by the Crown pursuant to the search warrants referred to above. Authority however indicates that a ruling in relation to the admissibility of evidence does not constitute “an interlocutory judgment or order” for the purposes of s 5F of the Criminal Appeal Act, with the result that leave cannot be granted to an accused person to appeal under that section against such a decision (see R v Steffan (1993) 30 NSWLR 633 at 639-640; 67 A Crim R 506; R v EK (2009) 75 NSWLR 302; [2009] NSWCCA 4 at [15] and [19]). In any event, Mr Zhang did not establish any arguable error in his Honour’s decision which might have formed the basis for a grant of leave to appeal.

Fourthly, Mr Zhang sought in the District Court a permanent stay of the criminal proceedings against him upon the basis that they constitute an abuse of process. Judge Blackmore declined to grant such a stay, noting two matters in particular. One was that a previous application for such a stay, based upon substantially the same matters as those upon which the application before him was based, was rejected by Wass SC DCJ on 23 April 2021 and that this Court refused an application for leave to appeal from that decision on 9 November 2021 (Zhang v R [2021] NSWCCA 266). Further, his Honour noted that many of the matters upon which Mr Zhang relied, such as his submissions “about the credibility of Crown witnesses, and in particular, the lead investigator, Mr Crowe” were “matters that are more appropriately addressed in the trial itself”. His Honour said that he did not propose to make “any significant findings with regard to the credit of those witnesses” prior to the trial.

Again, no arguable error has been identified in his Honour’s decision. As his Honour effectively concluded, it would in the circumstances of this matter have been quite inappropriate for him to make a final decision prior to trial concerning the credit of witnesses intended to be called at the trial. There is accordingly no basis upon which leave to appeal ought to have been granted.

The fifth and related complaint made by Mr Zhang related to his Honour’s decision not to draw conclusions about the credibility of Mr Crowe, in particular, prior to the trial. For the reasons just given, there is no basis for the grant of leave in respect of that decision.

Sixthly, Mr Zhang sought leave to challenge Judge Blackmore’s rejection of Mr Zhang’s complaint that the Commonwealth Director of Public Prosecution’s consent to the prosecutions of Mr Zhang under s 135.4(3) of the Criminal Code are invalid by reason of an issue concerning their dates. His Honour found the submission to be misconceived and Mr Zhang has not established that there was any arguable error in that finding.

For these reasons, the Court made the following orders on 11 May 2022:

ROTHMAN J: I have read the reasons expressed by Macfarlan JA in draft. I agree with those reasons and they represent the basis on which I joined in the orders made by the Court on 11 May 2022. In my view, as well, the Court should deny leave to appeal on all of the issues raised, including those raised less formally in the written submissions.

DHANJI J: The reasons of Macfarlan JA reflect my reasons for joining in the orders made by the Court on 11 May 2022.