Dunesky, Peter Eric & Anor v Commonwealth of Australia & Ors [1996] FCA 624

CATCHWORDS

CRIMINAL LAW AND PROCEDURE - police - search warrants - whether execution valid - whether execution so unreasonable that invalid - whether presence of and participation in execution of warrant by persons unnamed in warrant vitiated execution - whether abdication of responsibility of police - whether documents outside scope of warrant seized - whether percentage of documents outside scope of warrant meant warrant not executed according to its terms - whether police guilty of trespass to goods and to property - whether police guilty of detinue - legal professional privilege - whether applicants estopped from bringing proceeding because of impermissible division of case - obligation of police officers executing a warrant is to act reasonably in all the circumstances of the case: Crimes Act 1914 s. 10(1) - assistance includes assistance in relation to seizure of things, which carries with it inspection of articles to see if they come within terms of warrant - 'practical considerations' must be kept 'steadily in mind'.

Crimes Act 1914: s. 10(1)

PETER ERIC DUNESKY and BAY WOOL PTY LIMITED v COMMONWEALTH OF AUSTRALIA, DAVID KING, EVARNA HART, RUSSELL DEAN McRAE, ROBERT FITTON, ANTHONY SMITH, PAUL DEVINE, SAM SAVVAS

G 249 of 1995

LOCKHART J.

SYDNEY

22 JULY 1996

IN THE FEDERAL COURT OF AUSTRALIA)

)

NEW SOUTH WALES DISTRICT REGISTRY) No. G 249 of 1995

)

GENERAL DIVISION )

BETWEEN: PETER ERIC DUNESKY

First Applicant

BAY WOOL PTY LIMITED

Second Applicant

AND: COMMONWEALTH OF AUSTRALIA

First Respondent

DAVID KING

Second Respondent

EVARNA HART

Third Respondent

RUSSELL DEAN McRAE

Fourth Respondent

ROBERT FITTON

Fifth Respondent

ANTHONY SMITH

Sixth Respondent

PAUL DEVINE

Seventh Respondent

SAM SAVVAS

Eighth Respondent

JUDGE MAKING ORDER: LOCKHART J.

WHERE ORDER MADE: SYDNEY

DATE ORDER MADE: 22 JULY 1996

MINUTE OF ORDER

THE COURT ORDERS THAT:

- 2 -

Co., 2nd floor, 706 Military Road, Mosman, in each case on 27 September 1991, should be returned to the persons from whom they were seized or who are otherwise entitled to their possession, custody or control.

2. Otherwise the application be dismissed.

3. The applicants pay the costs of the respondents of the proceeding including reserved costs, if any, up to and including today.

4. Further consideration and liberty to apply are reserved on 3 days' notice.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA)

)

NEW SOUTH WALES DISTRICT REGISTRY) No. G 249 of 1995

)

GENERAL DIVISION )

BETWEEN: PETER ERIC DUNESKY

First Applicant

BAY WOOL PTY LIMITED

Second Applicant

AND: COMMONWEALTH OF AUSTRALIA

First Respondent

DAVID KING

Second Respondent

EVARNA HART

Third Respondent

RUSSELL DEAN McRAE

Fourth Respondent

ROBERT FITTON

Fifth Respondent

ANTHONY SMITH

Sixth Respondent

PAUL DEVINE

Seventh Respondent

SAM SAVVAS

Eighth Respondent

22 July 1996

REASONS FOR JUDGMENT

LOCKHART J.

Introduction

This case concerns the validity of the execution of two search warrants, one at the home of the first applicant, Peter Eric Dunesky, and the other at the office of a firm of accountants, Messrs Edney Lawrence & Co ('Edney Lawrence'). A further warrant was issued authorizing the search of Mr Edney's home. No challenge is made to the execution of that warrant in this proceeding.

The validity of the decision to issue the warrants was contested in earlier litigation between the parties. A judge of the Court (Whitlam J.) dismissed that challenge to validity in a judgment which was affirmed on appeal by a Full Court of this Court (Lockhart, Beaumont, Hill and Lindgren JJ., Black C.J. dissenting) reported at (1994) 54 FCR 540 (the High Court refused special leave to appeal from the judgment of the Full Court). The current proceeding was instituted thereafter.

The principal attack is made by the applicants on the execution of the search warrant concerning Mr Dunesky's home. That challenge is made on three bases. The first basis is that the search is said to have been carried out so unreasonably that the Court will declare it to be invalid. The second basis is that the presence and, a fortiori, the participation, of four to six officers of the Australian Taxation Office ('ATO') (not being persons named in the warrant as authorized to execute it) during the search of Mr Dunesky's home vitiated the execution of the warrant. The third aspect of the applicant's case concerning Mr Dunesky's home relates to particular documents. The applicants assert that documents falling outside the scope of the warrant were seized, including documents subject to a claim for legal professional privilege, and therefore their seizure was not authorized. The applicants seek recovery of those particular documents.

The search warrant executed at the premises of Edney Lawrence was challenged on some of the grounds that were relied on concerning the execution of the warrant at Mr Dunesky's home, and no fresh grounds. First, execution of this warrant is attacked on the ground of unreasonableness; also, the return is sought of specific documents on the basis that they fall outside the terms of the warrant or are subject to legal professional privilege. An attack is not made on this warrant on the ground relating to the presence of officers of the ATO.

The primary relief sought by the applicants in relation to each of the two warrants is the return of all the documents or, alternatively, such of the documents as fall outside the scope of the warrants including the documents subject to the claim of legal professional privilege. Alternatively, the applicants seek an order that the balance of the case be stood over for an assessment of damages on the basis that the Commonwealth is vicariously liable for the actions of the Australian Federal Police ('AFP') due to the operation of s. 64B of the Australian Federal Police Act 1979 and for the actions of the officers of the ATO at general law. The claim is brought by the applicants in trespass (both to goods and property) and in detinue. The applicants claim injunctive relief under s. 39B of the Judiciary Act 1903, along with declaratory and ancillary relief under the accrued or associated jurisdiction of this Court pursuant to s. 32 of the Federal Court of Australia Act 1976. The equitable jurisdiction of the Court is invoked for orders that the documents be restored to the persons who are entitled to them.

The respondents deny the various assertions of the applicants and say that, even if the applicants were otherwise entitled to bring this proceeding, the Court should decline to grant relief to them because they are estopped from bringing the proceeding. The argument is that the applicants chose to sever their case impermissibly into two parts: the first touching the validity of the decision to issue the warrants, and of the warrants the subject of the prior litigation themselves, and the second being the current proceeding challenging the validity of the execution of those warrants. It was argued by counsel for the respondents that both matters touched directly all material aspects of the warrants and that they should have been determined in the one proceeding. In the result it is said that five years have now passed since the warrants were issued and executed, and that this fact has created unfair difficulty for the respondents. Also, according to counsel for the respondents, it is not in the interests of justice or in the public interest that this proceeding should result in relief being granted to the applicants, even if they were otherwise entitled to it.

The evidence in this case was given mainly by affidavit and a substantial number of exhibits and annexures thereto. There was limited oral evidence. Questions of reliability and, to a limited extent, credibility arise; but essentially the case turns on facts that are not seriously in dispute.

The warrant concerning Mr Dunesky's home

On 27 September 1991 officers of the AFP, accompanied by officers of the ATO, arrived soon after 7 a.m. at Mr Dunesky's home at 7 Gilmore Close, Glenhaven, purportedly acting under the authority of the warrant issued under s. 10 of the Crimes Act 1914. The home of Mr Dunesky was searched; documents were seized and taken away. Four AFP officers (three of them are respondents, namely, the second, third and fourth respondents) and four ATO officers (the fifth to eighth respondents) were involved in the search; and two additional ATO officers were brought in later in the morning to search computer records with one of the officers already there. The search was led by Detective Sergeant Purvis who died in 1992. Sergeant King and Constable Hart (the second and third respondents) were also present, as was Constable Vintner (not a party to the proceeding) who carried out the role of 'property officer' by recording the documents seized in a document called the 'Property Seizure Record'.

The background to the search is important. It is gleaned sufficiently from the terms of the information on which the warrant was issued. The information is in evidence. It is also conveniently set out in the judgment of Lockhart, Beaumont and Hill JJ. in Dunesky v Elder (1994) 54 FCR 540 at 543-550. The validity of the issue of the warrant and the validity of its execution must be tested in the light of the terms of the warrant and of the sworn information together with (in the case of execution) the circumstances attending the events of 27 September. The truth or otherwise of the statements made in the information is not an issue in this proceeding. Nor was it an issue in the earlier proceeding. I see no useful purpose in setting out this material as it is fully set out in those pages of the report. It is sufficient for present purposes to summarize it.

The warrant is directed to six AFP officers, three of whom are the second, third and fourth respondents. The warrant asserts that there are reasonable grounds for suspecting that at Mr Dunesky's home (also said to be the principal Australian office of a company, Bay Wool Pty Limited ('Bay Wool')) there are documents which are described as satisfying all three of the conditions specified in the warrant which are then specified. Again, the terms of the warrant are sufficiently set forth in the earlier reported case. Large numbers and wide classes of documents fall within the ambit of the warrant. The third condition is said to be that there are reasonable grounds for believing that the documents will afford evidence of the commission of one or more of certain offences against laws of the Commonwealth which are suspected on reasonable grounds to have been committed. Those offences are specified in the information and in the warrant in these terms:

'(i) Between November 1984 and January 1989 Bay Wool Pty Limited defrauded the Commonwealth contrary to section 29D of the Crimes Act 1914 in that it failed to declare all of the assessable income received during the period 1 July 1984 to 30 June 1988 to the Commissioner of Taxation.

(ii) Between November 1984 and January 1989 Peter Eric Dunesky was knowingly concerned in the commission of an offence against section 29D of the Crimes Act 1914 by Bay Wool Pty Limited, namely that Bay Wool Pty limited did defraud the Commonwealth in that it failed to disclose all of the assessable income received during the period 1 July 1984 to 30 June 1988 to the Commissioner of Taxation.

(iii) Between November 1984 and January 1989 Brian Dawson Edney was knowingly concerned in the commission of an offence against section 29D of the Crimes Act 1914 by Bay Wool Pty Limited, namely that Bay Wool Pty limited did defraud the Commonwealth in that it failed to disclose all of the assessable income received during the period 1 July 1984 to 30 June 1988 to the Commissioner of Taxation.

(iv) Between November 1984 and January 1989 Peter Eric Dunesky contrary to section 29D of the Crimes Act 1914 defrauded the Commonwealth in that he failed
to disclose as assessable income by money either received by him from or paid on his behalf from Edney Lawrence and Co accountants, such money having initially been deposited with the said Edney Lawrence and Co on behalf of Bay Wool Pty Limited.'

The warrant authorizing the search of the offices of Edney Lawrence, being the registered office of Bay Wool, is also directed to the same AFP officers who were authorized to search Mr Dunesky's home in the first mentioned warrant.

Each of the two warrants is in the same form, authorizing entry and the seizure of things that would satisfy the three conditions specified in paragraph 2 of the information.

The information asserts the following facts. ATO officers have been conducting enquiries into the financial affairs of Mr Dunesky and Bay Wool in relation to the period 1 July 1980 to 30 June 1989. Mr Dunesky and Mr Edney are directors of Bay Wool, and Mr Dunesky is also its secretary. There are two issued shares: one held by Mr Dunesky, and the other held in trust by Mr Edney for Mr Dunesky. The principal business of Bay Wool is the purchase, exportation and sale of wool and wool products. Bay Wool's income tax returns for each of the financial years 1 July 1984 to 30 June 1988, and the accompanying profit and loss accounts, have been examined by officers of the ATO, and each of the returns was prepared and submitted by Mr Edney. It is asserted that investigations reveal that since 1984 receipts for the sale of wool by Bay Wool have been deposited into a number of banking accounts. The expenditure of Bay Wool was overstated in each of the four financial years. Cheques in favour of Bay Wool were deposited in the trust account of Edney Lawrence, and the amounts were omitted from the amounts of sales reported in the tax returns. Some of the moneys held in the trust account of Edney Lawrence were paid to Mr Dunesky or deposited into his private bank accounts. Private expenditure by Mr Dunesky was met by funds withdrawn from the trust account in the form of bank cheques payable to Mr Dunesky's solicitors, to a company, 'Neverfail Bottled Water Co Pty Limited', and to certain other people. Mr Dunesky's tax returns were prepared by Edney Lawrence. Mr Dunesky underdeclared his income in each of the four financial years as revealed by an audit carried out by the ATO. Withdrawals from the trust account of Edney Lawrence were not declared, nor was there a declaration of interest derived from the operation of various accounts held by Mr Dunesky. Bay Wool understated income by the sum of $4,553,799 during the four financial years and the ATO has calculated the tax avoided to be $2,207,961. Over the four financial years Mr Dunesky failed to declare the receipt by him of funds paid from the trust account; and income in the form of interest was understated in his tax returns to an amount of $1,888,138, the tax applicable to that interest being $1,100,159.

ATO auditors have spoken to Mr Dunesky and Mr Edney. Statements have been prepared by the solicitors for those two gentlemen. ATO officers have interviewed Mr Dunesky and Mr Edney from time to time.

This completes the summary of the information.

On 25 September 1991 Detective Sergeant King obtained from Detective Sergeant Purvis of the AFP an AFP file concerning investigation of Mr Dunesky and Bay Wool for possible Commonwealth offences, being those set out in the search warrant and the information relating to Mr Dunesky's home. The material on the file included documents received from the ATO and a copy of the operational orders. Those operational orders are annexed to Detective Sergeant King's affidavit sworn on 22 September 1995.

In keeping with these orders, at about 7 a.m. on Friday, 27 September 1991 Detective Sergeant Purvis, Detective Sergeant King and Constables Vintner and Hart, together with the four ATO officers, Messrs Fitton, Savvas, Devine and Smith, met at the Glenhaven Bushfire Brigade Station, Glenhaven Road, Glenhaven. Detective Sergeant Purvis then gave certain instructions to the officers assembled there. At 7.18 a.m. the four AFP officers and the four ATO officers went to Mr Dunesky's home (for convenience henceforth I shall refer to the AFP officers and the ATO officers simply by their last names).

At the front gate to the property Purvis spoke to Mrs P M Jones who introduced herself as a friend of Mr Dunesky. Mrs Jones said that Mr Dunesky and his wife were overseas. Thereafter a search was made of the Dunesky home. Mrs Jones telephoned Mr Dunesky's daughter, Ms Jacqueline Dunesky. Rooms in the house and a storage shed in the back yard were searched; documents were inspected, seized and later taken away. Towards the end of the search Mr C Tappere, a solicitor employed by the solicitors for the applicants (Mr Tappere gave evidence), arrived at the Dunesky home and briefly examined the search warrant and certain of the material which had then been seized and assembled on a table in the kitchen by Purvis, Hart, Vintner, Fitton and Smith. Purvis said to Tappere that the documents would be sealed in boxes and lodged in the property office of the AFP pending Mr Tappere's inspection with a view to making any relevant claim for legal professional privilege. Mr Tappere agreed with that course. The bundles of documents were checked by Vintner and Tappere against the Property Seizure Record ('PSR') which had been prepared during the search by Vintner. They were then placed in cardboard cartons and sealed in Mr Tappere's presence. Both Vintner and Tappere then placed their signatures on each of the cardboard boxes. Ms Dunesky then signed a receipt for a copy of the PSR sheets. The seized property was then placed in an AFP vehicle and later deposited at the premises of the AFP in Sydney where it was lodged by King in the property room. No force was used in the execution of the search warrant at Glenhaven (nor at the offices of Edney Lawrence).

Subsequently, on a number of occasions, the solicitors for the applicants have attended the property room of the AFP in Sydney and inspected the documents kept in the sealed boxes; and on occasions discussions have taken place between Mr Tappere and certain AFP officers to which reference will later be made.

Affidavits were read at the trial on behalf of the applicants sworn or affirmed by Mr Tappere, Mr M F Star (a member of the firm of solicitors who act for Mr Dunesky), Ms Dunesky, Mr D S J Hing (the solicitor employed by the solicitors acting for the applicants in this matter), Mr J C Hewitt (a law clerk in the employ of solicitors acting for the applicants in this matter), Mr A Vernier (a senior associate of a firm of solicitors acting for Mr Edney in relation to matters arising from the seizure of the documents from the premises of Edney Lawrence), Mr M A Friedgut (a solicitor employed by solicitors acting for the applicants), and Mr T A Atkin (who worked as a clerk at material times for solicitors involved in the matters the subject of the seizure).

Affidavits were sworn or affirmed on behalf of the respondents by the AFP officers King, Vintner, Hart and McRae. Purvis gave no evidence, of course, because he died in 1992, three years before the commencement of this proceeding. The ATO officers who swore or affirmed affidavits are Fitton, Smith, Devine and Savvas.

The witnesses who were cross-examined were Tappere, Ms Dunesky, Hing, King and McRae.

Each of the AFP and ATO officers was involved in particular aspects of the search at the Dunesky home. Large numbers of documents were contained in the storage shed. King gave evidence that he there saw what appeared to be between 50 and 70 boxes, containers and envelopes (probably 70), of which some 50 were boxes. King examined the contents of about 10 to 12 boxes and envelopes of varying sizes which contained thousands of pages, most of which related in one way or another to Bay Wool. King said that most of the documents concerning Bay Wool, though examined, were not in fact seized.

Vintner was designated by Purvis as the property officer, his role being to record on the PSR all documents handed to him by people engaged in the search. King, Hart and the ATO officers Fitton and Smith inspected the documents located in the storage shed. King and the other officers knew that the only documents that could be seized were those described in the warrant. It must be borne in mind that the terms of the warrant are very wide. The ATO officers gave advice from time to time to King and others about the nature and significance of certain documents. King said that he did not isolate any document without being satisfied that it fell within the conditions stated in the warrant. Having isolated the documents which he thought met the conditions of the warrant, he handed them to Vintner who recorded them in the PSR sheets. If Vintner was busy at the time, King left documents near him with a note (a Post-It or similar paper) indicating who found the documents, where, and at what time. It appears that these notes were not retained after Vintner recorded the details on the PSR and placed the documents in the bags. It is not the usual practice of the AFP to retain such notes as the details recorded in them are subsumed by the PSR. Vintner put the documents given to him into plastic bags which had press seals and could be reopened and closed as required. King observed that the bags were numbered by Vintner according to the numbers on the PSR kept by him.

Hart showed King some documents which she had located, and discussed them with him. King considered each document which he inspected during the search of the shed to determine whether it came within the terms of the warrant.

The search for the documents was completed at about 11 a.m., when King, Hart and Vintner, together with the ATO officers Fitton and Smith, assembled the property seized from the shed and placed it on the kitchen table. It was at that time that Tappere arrived.

King observed Purvis doing the search and he observed him examining the contents of the bags in some detail. Hart gave evidence that in the company of Purvis, King, Vintner, Jones and ATO officers, she went to the 'garage/storeroom' (differently referred to throughout the evidence, and for consistency termed 'storage shed' or 'shed' in these reasons) located at the rear of the premises. She searched for and isolated certain documents and asked Purvis or King for directions, depending on who was available. Subject to those directions, she handed the documents to Vintner.

Vintner gave evidence. At the direction of Purvis he remained in the kitchen for much of the time, but for some time he was also in a position outside the shed that was being searched by King, Hart, Fitton and Smith. Documents which were found by other officers were brought to him to be recorded in the PSR. Vintner adopted the procedure of placing these documents in a plastic bag which was numbered, and then recording on the PSR the number of each envelope, a description of its contents, the time located, the officer who found it, and the location where the item was found; the envelopes were eventually put into boxes. Each officer who brought particular items to him furnished the requisite details to Vintner. Purvis came to Vintner on a number of occasions during the search and inspected the bags which were prepared by Vintner. The inspection by Purvis included his taking documents out of the bags and appearing to examine their contents. Vintner remembered Purvis doing this both whilst in the kitchen and whilst Vintner was stationed outside, though Vintner was not with the documents all of the time.

Evidence was given by the ATO officers. Smith, at relevant times, was a team manager in the business audit area of the ATO, Chatswood; was involved in the AFP investigation of Dunesky and Bay Wool; and had previously been involved in the tax audit. Smith examined piles of records in the storage shed and extracted documents and records from them which he thought might be used in the calculation of Dunesky's and Bay Wool's income tax or in the preparation of their returns falling somewhere in the period from 1984 to 1989. Documents which Smith extracted were handed to an AFP officer. He examined only the documents in the shed and not in the main building. Smith was in the shed for a long time. Several times whilst he was in the shed Purvis came in. After the search for the documents in the storage shed was completed, Smith remained there until directed by the AFP to the main house to wait in the kitchen (where the search was still being conducted).

The AFP brought into the kitchen documents taken from the storage shed which were then shown to Tappere. The AFP officers bundled them and placed them in cardboard boxes which were taped over with seals placed on the top to ensure they could not be opened. Smith gave evidence that Purvis and Tappere signed all the documents attesting that the seal was intact.

Savvas gave evidence. He has been employed by the ATO since 1987 in various areas including recovery, assessing and audit. He too was involved in the audit of the affairs of Dunesky and Bay Wool, assisting Smith who was the team manager. Purvis assigned officers of the AFP and the ATO to various locations. Devine and Savvas were sent to the home 'office/study' and Smith and Fitton were to go to the shed at the back of the premises with one or more AFP officers.

Devine is an officer of the ATO and he was involved in the audit of the affairs of the appellants. He supervised Savvas. Devine and Savvas undertook a search for financial records pertaining to the applicants. The records held in the study were very voluminous and Devine spent most of his time there with Savvas going through the records. He located a number of records which appeared to relate to the financial affairs of the applicants and they were then handed to Vintner.

Fitton also gave evidence. He too has been engaged in the audit of the affairs of the appellants. Following the instructions of Purvis, Fitton went to the shed with other officers and proceeded to assist the AFP officers to search the shed. That was the only area of the property that Fitton searched. His role was to locate and select from among the documents in the shed documents which appeared to him to meet the search criteria, and this is what he did. Those criteria were explained to him in a prior discussion with AFP officers. He selected only those documents which he believed met the explanation of the search criteria that he had been given. To the best of his recollection, in making those selections he looked for and chose documents which he believed would help to show either that: (a) Dunesky during a particular period covering a number of years during the 1980s fraudulently understated his income to the ATO by not disclosing as income money paid to him or paid to others on his behalf from the Edney Lawrence trust account and initially deposited into that account on behalf of Bay Wool; or (b) the income of Bay Wool was fraudulently understated by Bay Wool during a specified period with respect to particular years of income; or (c) that Dunesky or Edney were knowingly concerned in such fraudulent understatements. He does not remember now the particular period or the particular years of income except to say that the period covered a number of years during the 1980s.

Fitton remembered there were many boxes and other items in the shed and he personally inspected only a small number of them. Of those he did inspect, some of the documents were selected by him and the rest were left where they were. As he located documents which he believed met the search criteria, he handed them to an officer of the AFP. As it was so long ago he does not recall who it was (plainly it was Vintner).

During the course of the search Fitton was told that a computer had been found. Fitton remembered that the AFP officers did not appear to be familiar with the computer or know how to ascertain what information it contained. He said to one of those officers that the ATO has computer experts in its computer support area and he could request people from that section to attend to assist if this was desired. The AFP officer agreed to this. Fitton then rang the ATO's computer support area; about mid-morning, David Ginty of that section arrived. It appears that another officer of the ATO also arrived to inspect and operate the computer.

Ms Jacqueline Dunesky gave evidence by affidavit and she was cross-examined. Her evidence is to some extent inconsistent with the evidence given by the AFP and ATO officers engaged in the search. In my view her evidence is of little assistance in the case. She did not arrive at the Dunesky home until about 9.30 a.m., well after the search had commenced. Many documents had been found before she arrived, although she did see some work being undertaken by the officers present, including the AFP and ATO officers who were engaged in the search of the study. Where her evidence conflicts with evidence of the AFP or ATO officers I prefer to accept the evidence of those officers, except on one rather peripheral question. There is some evidence to suggest that Ms Dunesky was under the influence of alcohol while at the Dunesky home on the occasion of the search. She denied this. It is not necessary for me to resolve this question, and I do not propose to do so, except to say that I am not satisfied that she was unduly influenced by liquor on that occasion.

Mr Tappere gave evidence that he arrived at the Dunesky home at about 11.15 a.m. Shortly after his arrival he noticed a number of bundles of documents on the kitchen table, the majority of which were in plastic bags. He observed while the documents were sealed into boxes by Purvis.

Tappere gave evidence of subsequent conversations which took place between himself and King on 12 January 1995 and 25 January 1995. The conversations took place (ignoring the details for the moment) whilst Tappere was inspecting documents held at the offices of the AFP. The critical aspect of the conversations was, according to Tappere, a statement which is attributed by him to King to the effect of:

'You blokes are doing my job for me. I was always going to have to sort out these documents once we got hold of them. We always have to do that.'

This was on 12 January 1995.

In the case of the conversation of 25 January 1995, Tappere gave evidence to the same effect, but with the following additional words attributed to King:

'We just took everything that looked like it was Bay Wool.'

King denied these statements.

If King did make the statements as asserted by Tappere, at the time they were made more than three years had passed since the execution of the warrant at Dunesky's home. No note was made by Tappere of the statements attributed to King until 30 January 1995, although he said that he regarded the last mentioned statement as 'remarkable'. Also, the statements, if made by King, were not in accordance with the facts. It was said that King stated that all documents relating to Bay Wool were taken, yet in his affidavit of 22 September 1995 King gave evidence that only a small proportion, indeed less than 20% of the documents relating to Bay Wool found at the home of Dunesky were taken. No contrary evidence was led. No evidence was led on this by Dunesky, or by Mrs Jones, or Ms Dunesky (though in fairness to Ms Dunesky there is no cogent evidence of whether she knew documents were present in the home either before or after the execution of the warrant). Finally, Tappere did concede in oral evidence that there was a possibility of error in his evidence, although the ambit of the concession is not entirely clear from the evidence.

It is not necessary for me to make a positive finding that I accept the evidence of Tappere or of King on this point. I do not regard it as critical evidence. But although I do not know one way or the other, I am not persuaded that King did make the statement attributed to him by Tappere. That is the extent of the finding which I need to and am prepared to make.

The execution of the warrant at Dunesky's home

(i) Submissions

Counsel for the applicants submitted that the search of Dunesky's home was not reasonably conducted. Reliance was placed upon Baker v Campbell (1983) 153 CLR 52 per Gibbs C.J. at 70-71; Bartlett v Weir (1994) 72 ACrimR 511 per Beazley J. at 517-519 and 522; Reynolds v Metropolitan Police Commissioner [1985] 1 QB 881; Crowley v Murphy (1981) 52 FLR 123 at 152 and 155; and Arno v Forsyth (1986) 9 FCR 576 at 585-589. It was submitted that no genuine attempt was made by the officers named in the warrant to determine whether the things which were seized fell within the scope of the terms of the warrant. This was said to be apparent from the proportion of the documents seized which were said to fall outside the terms of the warrant. The argument went that some of the documents plainly fall outside the terms of the warrant on any view, and the inferences available from the nature and volume of the material seized establish that no genuine attempt was made to apply the terms of the warrant.

It was submitted that the officers executing the warrant were obliged to follow strictly the directions contained in it and not to exceed the limits of the authority which it confers; reliance was placed upon Crowley v Murphy, supra, per Lockhart J. at 150. The authority of the officers did not extend to the seizure of everything or anything they found simply in the hope that it might turn out to be or to include something described in the warrant. Reliance was placed upon Trimboli v Onley (No 3) (1981) 56 FLR 321 at 333. It was said that the fact that the terms of the warrant are very wide indeed does not detract from this proposition. All three conditions in the warrant operate together by a process of screening or refining to identify the object of the search, but all conditions must be met; if the document does not fall within each of the conditions then it cannot lawfully be seized according to the applicants.

Particular reliance was placed upon the second condition on the basis that certain documents do not satisfy that condition because they are said to relate to, or to arise out of, or to be connected with the purchase of wool by companies other than Bay Wool, principally Pacific Wool Pty Limited ('Pacific Wool'). The challenge is made, not simply because the documents relate primarily to a person other than Bay Wool, or Dunesky, or Edney, but because the documents do not relate to or arise out of, and they are not connected with 'the purchase or sale of wool by Bay Wool' (sub-para. (i) of the warrant). It is insufficient to simply point to the fact that there may be a close relationship between Bay Wool and Pacific Wool according to the applicants. Sub-paragraph (i) of condition 2 of the warrant does not refer to the purchase or sale of wool by or on behalf of Bay Wool (cf. sub-para. (iii) of condition 2), or to the purchase or sale of wool by a company which is closely connected with Bay Wool.

Reliance was also placed by counsel for the applicants on the third condition of the warrant, which provides that there must be reasonable grounds for believing that the documents which otherwise satisfy the descriptions in the first two conditions will afford evidence of the commission of the specified offences. It was put that the seizing officer must entertain the requisite belief at the time of seizure and at every point at which lawfulness is claimed under the warrant for taking and keeping the seized goods. It must not only exist contemporaneously with the act of seizure; but it must thereafter exist at least whenever it is sought to justify retention of the property. Reliance was placed upon Trimboli at 337.

And it was submitted conversely that ex post facto justification is also not possible. If the officer does not hold the requisite belief at the time of seizure, then the seizure is unlawful even if the officer subsequently discovers something which could have formed the basis of the belief. What was put before the Justice of the Peace when the information was laid did not lead to the nomination in the warrant of documents concerning Pacific Wool. Seizure of documents which exclusively concern Pacific Wool could not be justified on the basis that the officer subsequently learnt of the connection between the two companies or even suspected from elsewhere that such a connection existed. The relevant question is what does the warrant authorize the police to seize.

It was also submitted on behalf of the applicants that the presence and participation of the ATO officers during the search of Dunesky's home vitiated the warrant.

Counsel for the respondents submitted that it has not been established that the search was conducted unreasonably; there was no abdication of responsibility of the AFP officers named in the warrant to others, including the ATO officers, but the latter were simply relied upon as sources of advice concerning the seizure of documents (although it is not disputed that certain of the ATO officers found documents and brought them to Vintner for inclusion in the record of documents to be taken and to be examined by Purvis). Reliance was placed upon George v Rockett (1990) 170 CLR 104 to support the reasonableness of the execution of the warrant.

(ii)Findings

It is important to keep in mind that this case is not concerned with the adequacy of the information upon which the warrants were granted, nor with the validity of the warrants themselves, the terms of which authorize seizure of large classes of documents covering many transactions over a number of years of income.

A search warrant is a severe intrusion into a person's privacy, home or place of business. The law takes care to ensure that the powers of police officers entrusted with the task of executing a search warrant are not exceeded; but at the same time it must be borne in mind that execution of a search warrant is a practical exercise carried out by police officers who, though trained in their task of law enforcement, are generally not qualified lawyers. Just as a person's privacy must be respected so must the investigation of criminal offences not be unreasonably impeded.

To adopt the language of Mason J. in Baker v Campbell at 83:

'In approaching the scope of the authority given by the warrant we must keep practical considerations steadily in mind. It is simply impossible for a police officer executing a warrant to make an instant judgment on the admissibility, probative value or privileged status of the documents which he may encounter in his search. Generally speaking, it is in the course of the subsequent investigation following seizure of the documents that informed consideration can be given to the documents and an assessment made of their worth or significance in the respects already mentioned. These considerations suggest that par. (b) and the concluding words of the section [s. 10], in so far as they relate back to par. (b), are looking to documents as to which there are reasonable grounds for believing that they will in some way implicate the persons named in the warrant, or, if no person is named, someone in the commission of the offence. To say that the section excluded documents the subject of legal professional privilege from the scope of the authority given by the warrant would unduly inhibit the investigation of crime and lead to the institution of legal proceedings before trial which would require a determination of the existence of the privilege because the Crown's right to retain the documents would depend on the resolution of this issue. In the case of production on discovery and under subpoena duces tecum there is a court or tribunal already exercising jurisdiction in the matter which could determine questions of relevance and privilege. It is otherwise in the case of search and seizure under a warrant.'

See also Crowley v Murphy at 143 and 150-8; Parker v Churchill (1985) 9 FCR 316 at 326-7; Allitt v Sullivan [1988] VR 621 per Murphy J. at 628 and per Brooking J. at 640; MF1 v National Crime Authority (1991) 33 FCR 449 at 465 per Jenkinson J., with whom Gray J. agreed, and at 471-2 per Ryan J.; and Melbourne Home of Ford Pty Limited v Trade Practices Commission (No 3) (1980) 47 FLR 163 at 173-175. As was said in Crowley v Murphy at 143 and 151, the expression in s. 10 of the Crimes Act 'will afford evidence' means that it is sufficient that the documents will in some way implicate the persons named in the warrant, or, if no person is named, someone in the commission of the offence.

As Burchett J. said in Parker v Churchill at 326:

'The expression "will afford evidence" does not import a requirement that the documents must be necessarily sufficient to achieve a conviction; it is sufficient that they have relevance or probative connection with, an issue arising upon an allegation of the offence alleged, ...'

Also in Parker v Churchill, Burchett J. said at 327:

'Unless the constable abdicates his responsibility to consider and exercise judgment upon the documents, there can be no valid objection to his receiving information which will bear upon his discharge of his task.'

His Honour recognized at the same page that police officers executing search warrants will in practice receive briefings, at least in complex cases, about the issues; and that to afford 'reasonable grounds for believing' within the meaning of s. 10 may include what the police officer has been told by other police or by investigators of the Taxation Department.

The obligation of police officers executing warrants is to act reasonably in all the circumstances of the case (Crowley v Murphy at 152-155; Bartlett v Weir at 518). The
warrant must be executed according to its terms and in accordance with the requirements of s. 10: Dunesky v Elder at 556.

Consideration can be given to what is contained in the information in order to decide whether or not documents fall within the scope of the warrants. In the present case there was a briefing of the relevant police officers prior to the search; the information together with its attachments was available to the police officers; and the police officers had advice from ATO officers who had been involved in the preceding lengthy audit and who understood the issues.

George v Rockett is authority for the proposition (at 120) that a warrant may authorize the taking of a bundle of pages 'if the bundle of pages should, in the circumstances, be seen as a single thing' or if 'pages in the bundle other than those containing relevant statements should be seen as part of the evidentiary context within which the relevant statements should be read'.

It is to be remembered in this case, where the classes of documents which may be seized pursuant to the terms of the warrant are wide indeed, that documents will not fail to satisfy the three conditions contained in the warrant merely because (a) they bear dates outside the period of the commission of the alleged offences specified in the warrant; or (b) they relate also to persons other than persons revealed by the warrant as being suspected of committing the offences; or (c) they relate to some subject distinct from the matter under investigation. Documents may meet all three conditions notwithstanding those matters.

Purvis was the officer in charge of the search of the Dunesky house. It is not known from Purvis himself what role he played in that search because, as mentioned earlier, he died in 1992. But we do know from the evidence, including the affidavits of King and Vintner, that Purvis had the opportunity to make the decisions to seize all of the relevant documents and that he did in fact examine certain documents. It seems to me to be a fair inference to draw from the evidence that Purvis and at least one or more of the other AFP officers concerned did examine the documents before deciding whether they should or should not be seized. In my opinion the police officers named in the warrant did not abdicate their responsibility to consider the relevant documents and decide whether or not they fell within the scope of the warrant. Abdication is said to be in favour of the ATO officers who also attended the search. It is plain that certain of the ATO officers not only examined, but selected documents, whereupon they were given to Purvis or other AFP officers and noted in the PSR. But the presence of persons other than those authorized to execute the warrant is not fatal to the validity of the execution. I do not accept the argument of counsel for the applicants that on its proper construction s. 10 does not authorize persons, other than the police officers named in the warrant, to give assistance beyond assistance in the nature of 'locksmith's assistance'. The authority conferred by s. 10 upon constables named in the warrant to enter premises and seize things found there is to pursue these activities 'with such assistance ... as is necessary and reasonable'. The obtaining of the assistance with entry, search (by implication), and seizure is not limited merely to assistance with entry of the premises. This follows both from the literal construction of s. 10 and its obvious intent. The assistance includes assistance in relation to seizure of things, which in turn must carry with it, by implication, inspection of the articles, including documents, to see if they come within the terms of the warrant.

The facts and circumstances that surround this matter are complex and have involved years of investigation by the Australian Taxation Office into the activities of the applicants. In my view it is not only permissible under s. 10 of the Crimes Act for ATO officers to accompany the police officers on the search; but it is probably in the interests of both the prosecuting authorities and the applicants that they do so. Who better to assist in the identification of relevant documents (i.e. relevant according to the terms of the warrant) than the ATO officers who are intimately conversant with the subject matter of their audits? It is true that the ATO officers cannot take over the role of the police officers in the conduct of the search and seizure of documents; but plainly they were retained for the purpose of distinguishing between relevant and irrelevant material, that is material which would or would not answer the description of the documents in the warrants themselves.

On the facts as I have found them there was no impermissible delegation of authority to the ATO officers. All ATO officers and police officers present were under the control of Purvis. It was a large house that was to be searched and there were large numbers of documents to be perused. In Freeman v Bateson, unreported, 15 November 1984 (No 8536 of 1994), Beach J. held that it was permissible for an officer of the Health Insurance Commission to be present at the conduct of the search there with a view to identifying documents relevant to the alleged fraud (at 8 and 9). But see Applebee (1995) 79 ACrimR 554 per Higgins J. at 559 to the contrary.

There is no complete consistency in the evidence of the witnesses for the respondents concerning the events surrounding the search. But this is hardly surprising after the time that has elapsed between the conduct of the search and the commencement of this proceeding. Devine says that he and Savvas searched the study in the main house. Savvas does not refer to the study as a room which he searched. Neither was cross-examined. Whatever the position be, the fact is that the documents were not seized as such by the ATO officers, they were simply taken from various points of the property to the police officer who acted as the record keeper (Vintner). Fitton believed that any decision with respect to seizure in respect of the documents which he found 'would be taken by one of the AFP officers attending the premises that day'. In this vein, King gave evidence that from time to time he received information from the ATO officers concerning the nature and significance of certain documents about which he himself was undecided, but that he did not isolate any document without being satisfied, himself, that it fell within the conditions stated in the warrant.

Fitton, Devine and Smith removed documents from places where they found them and took them to Vintner. But this was not seizure; this was mere collection of documents from within the Dunesky premises for ultimate collation and recording.

None of the ATO officers claims to have had a copy of the warrant whilst conducting the search; but Savvas said in his affidavit that at the briefing outside the fire station King asked one of the AFP officers to obtain copies of the search warrants and he, Savvas, recalls that a packet was given to Purvis. He recalls Purvis saying that three conditions had to be observed when obtaining documents. He is not sure if Purvis read those conditions out or if he just left it to all the officers, including the ATO officers, to read them on the way to the premises.

I am not satisfied that in the circumstances of this large-scale and difficult search relating to complex issues, the search was improperly undertaken. I am satisfied that appropriate attention was given by the AFP officers, in particular, Purvis and King, to the documents that were presented to them or which they otherwise found or examined on the premises, acting with the advice of the ATO officers or certain among them.

I reiterate the statement by Mason J. in Baker v Campbell at 83 that 'practical considerations' must be kept 'steadily in mind', and that:

'It is simply impossible for a police officer executing a warrant to make an instant judgment on the admissibility, probative value or privileged status of the documents which he may encounter in his search. Generally speaking, it is in the course of the subsequent investigation following seizure of the documents that informed consideration can be given to the documents and an assessment made of their worth or significance ...'

Nor does it follow that if a relatively small number of documents might fall outside the scope of the warrant that the execution is excessive or unlawful: Propend Finance Pty Limited v Commissioner of the Australian Federal Police (1995) 128 ALR 657 per Hill J. at 682; Inland Revenue Commissioners v Rossminster Limited [1980] AC 952 per Viscount Dilhorne at 1006.

With these cautionary notes in mind, I turn to another aspect of the applicants' case with respect to the search of the Dunesky home, namely, that documents falling outside the scope of the warrant were seized, rendered the seizure invalid, and lead to the result that such documents which ought not have been taken must be returned. The applicants seek recovery of those documents, particularly those subject to a claim for legal professional privilege.

This aspect of the challenge to the execution of the warrant commences with the description of documents taken on the search and recorded in the PSR. The submissions of the parties, in particular those made in writing, identify the various categories of documents of which complaint is made by the applicants. There are four broad subject matters which are the subject of the contention, namely, those relating to: (a) Pacific Wool; (b) Kanematsu-Gosho documents; (c) documents which, on their face, fall outside the period of the alleged offences (November 1984 to January 1989); and (d) real estate documents. I will deal with each heading.

Pacific Wool

This is by far the largest category of documents that are the subject of challenge as falling outside the scope of the warrant. They are documents which refer to correspondence between Edney or Edney's firm and Pacific Wool, documents concerning shipping, storage and testing of wool and payment advices, bank statements, bank remittance advices, Bureau of Statistics forms, documents concerning purchase inspection, testing, storage and sale of wool by Pacific Wool. The applicants complain that these documents contain no specific reference to Bay Wool and thus fall outside the terms of the warrant.

I have examined the documents of which complaint is made. The documents in respect of Pacific Wool generally relate not only to Pacific Wool, but to Bay Wool, including its income and expenditure, either within the period specified in the offences or within periods which go outside those periods, but which may be very relevant to the determination of patterns of income and expenditure of Bay Wool and the conduct of Dunesky in relation to the periods covered by the offences. Correspondence from Edney to Dunesky about Pacific Wool is addressed to the same address as is the correspondence about Bay Wool; and in the correspondence by Edney to Dunesky reference is made to Pacific Wool as one of 'your companies' in a context where, plainly enough, the only other is Bay Wool. The documents - principally the journal of Bay Wool and the ledgers of both Bay Wool and Pacific Wool - indicate a close financial interrelationship between Bay Wool and Pacific Wool.

The documents relating to Pacific Wool support the conclusion that Dunesky had used Bay Wool and Pacific Wool to process, sell and ship wool purchased by Bay Wool. The affairs of the two companies are plainly closely interrelated. Documents concerning Pacific Wool may reasonably have been suspected by the searching officers to be relevant to the income and expenditure of Bay Wool, Pacific Wool and Dunesky, and thus to issues of undisclosed income and overstated expenditure. In my opinion it was reasonable for the police officers executing the search warrant to treat Pacific Wool documents as being sufficiently related to Bay Wool to satisfy the conditions specified in the warrant, especially the second condition.

Kanematsu-Gosho Documents

Six folios of Kanematsu Fund and Kanematsu-Gosho documents or related documents fall into the category of those challenged by the applicants. I accept as correct the submission of counsel for the respondents that given the presence in the list annexed to the information of sources of undisclosed deposits for Bay Wool to the Edney Lawrence trust account, of the name of that entity, and the large number of documents (including many unchallenged ones) from Kanematsu-Gosho, the executing police officers acted reasonably in seizing the documents under challenge here because there is material tending to show Kanematsu-Gosho was involved in the matters listed in the second condition of the warrant and because the documents concerned would tend to show that the applicants were committing the offences referred to in the third condition.

Documents outside the offence period of November 1984 to January 1989

Obvious interrelation of the income and expenditure of Dunesky, Bay Wool and Pacific Wool is relevant to the question of determining whether the alleged offences of understated income and overstated expenditure were committed. The fact that the documents fall outside the offence period does not render them immune from seizure. Documents which pre-dated November 1984 which tend to prove the income and expenditure of the applicants, or overstatement of expenditure and understatement of income, may bear upon the offences within the period alleged in the warrant.

Real estate documents

Many of the documents that emanate from solicitors acting for one or other of the applicants are documents concerning the sale of real estate. Although they mostly post-date the period in which the third condition offences are alleged to have been committed, they do bear upon the question whether there was an intent on the part of Dunesky to transfer legal title to properties at Jane Place, Dural, from himself to Bay Wool so that he 'might no longer be regarded as the owner' (to use the phrase adopted in the letter from the solicitors of 3 December 1987). Also of note is the fact that many of the documents of 1990 name as the addressee, or as conferring authority to list and sell property, not Bay Wool but Dunesky. ATO officers who were involved in the search at Glenhaven knew from their previous audits that the Jane Place properties had been purchased by Dunesky via a firm of solicitors with undisclosed funds of Edney Lawrence (this does not suggest that the solicitors knew of this, that is not a issue that would involve the Court).

Certain of the documents relating to other purchases and sales of property were also challenged. In my view the submissions of counsel for the respondents are correct, namely, that:

. They were entitled to be seized on a number of bases, in particular, the properties concerned were all either purchased or sold by or for Dunesky, and their purchase raised the question of the source of Dunesky's funds which enabled the purchases to take place, being an issue relevant to the third condition.

. They concerned real sales. The disclosure of proceeds of those sales and the nature of the acquisition of the property sold were material to the second and third of the warrant's conditions. Notwithstanding that some of the transactions occurred outside the period of the offences alleged in the third condition, the ATO audit did raise issues concerning a history of use of the Edney Lawrence trust account by Dunesky for private purposes.

. Also, the destination of proceeds of the sales of previously owned properties was material to the question of the source of funds for purchasing during and before the period 1984 to 1989.

. Material concerning the use to which Dunesky put other properties with which he dealt and the way in which he conducted those other transactions might reasonably have a bearing upon his state of mind in the case of the impugned property transactions.

I am not persuaded that any attack has been made out by the applicants with respect to the seizure of documents from Dunesky's house.

Edney Lawrence premises

The search of the Edney Lawrence premises was also conducted on 27 September commencing at about 9.05 a.m. The search was conducted in the presence of Edney.

At the Edney Lawrence offices, McRae was in charge of the search, and with him were three AFP officers - Emmanuel, Madden and Sykes - and three ATO officers - Groney, Mitchell and Peter Smith; none of whom, except McRae, is a party to the proceeding. This search was conducted under the leadership of McRae immediately after the search of Edney's home had been undertaken (at which no documents were seized).

McRae seized certain items of property which were handed to Sykes who recorded the particulars of the items seized on a PSR form. At the completion of the search Edney inspected everything that had been seized during the search and then signed for the receipt of a copy of the PSR form. The search concluded at about 12.45 p.m., when the police officers returned to the AFP offices in Sydney where the property seized was lodged in the property office. Decisions in relation to the seizing or otherwise of items of property found during this search were in all cases made by McRae. He deposed to the fact that he had a thorough understanding of the matters to which the search warrant related and I accept his evidence. I also accept that he did not seize any document unless he personally believed it met all the conditions in the warrant. Documents found during the search, which were not seized even though they may have related to Dunesky and, or Bay Wool were not taken because in the police officer's opinion they did not relate to a particular period of time detailed in the warrant or because there was some doubt about whether they met the conditions of the warrant.

The attack made by the applicants upon the execution of this warrant is that so many documents fall outside the scope of the warrant that the Court should infer that the search was not carried out properly or was carried out unreasonably.

Counsel for the applicants submitted that it should be inferred from the percentage of the documents seized outside the scope of the warrant that the warrant was not executed according to its terms. It is said that information known to all police officers, but not contained or referred to in the warrant, was used to ground the seizure of documents and to define the boundaries of the search. The criticism was made, as it was made with the search of the Dunesky home, that no procedure was in place to deal with questions of legal professional privilege.

It was accepted by counsel for the applicants that there is no evidence that the ATO officers physically participated in this search.

Much of what I have said in relation to the challenge to the documents seized at Dunesky's house applies also to documents seized at the accountant's offices. I need not repeat what I said. Again I rely on the description of the documents referred to in the written submissions of counsel for both parties. There is only a very limited area of dispute over the accuracy of the description of the documents. The dispute centres on the capacity to draw appropriate inferences from them so as to relate the documents to the three conditions specified in the warrant, especially conditions 2 and 3.

Criticism was made in relation to other documents by counsel for the applicants, in particular a 'With Compliments' slip seized from Edney's office concerning a deed of undertaking by Dunesky as a shareholder in Neverfail Bottled Water Co Pty Limited. The slip was signed by Mr 'Tony' (Hamilton). I accept as correct the submission of counsel for the respondents that the relevance of this document to the search lies in its relevance to an investigation that there exists a person called Tony Hamilton who appears to have held the belief that Dunesky and Bay Wool are appropriate signatories of the deed of undertaking sought by Macquarie Bank from the 'shareholders and principals' of Neverfail. The document may assist police in their investigation of the offences nominated in the third warrant condition by directing them to enquire what induced that belief in Mr Hamilton. The document also appears to relate in some way to the receipt or payment of moneys by Bay Wool and the receipt or payment of moneys by Dunesky.

This document illustrates the force of the principle that in a complicated investigation like the one involved in the present case documents must be judged in their context and in the context of other documents, not in isolation from them. I reject the submission of counsel for the applicants that what was involved here was a 'negative search', that is a search not to determine which documents were relevant, but rather based only upon rejection of documents which, on their face, were plainly irrelevant. The attack on the seizure of the documents at Edney Lawrence fails.

Estoppel

I turn to the submissions made on behalf of the respondents that the applicants are estopped from bringing the present proceeding on the basis of what was described by counsel for the respondents as a form of estoppel. The argument was based upon Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502 and Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 489.

Counsel for the respondents said that, since Tappere had conceded that there was no actual impediment to him inspecting the documents that had been taken upon execution of the warrants, at any time after execution, and since instructions concerning what had been taken could presumably have been obtained from Dunesky or from Mrs Jones, there is no reasonable explanation given by the applicants for the delay which occurred in the commencement of the present proceedings.

It was argued in the alternative that, even if technically the applicants are not estopped from bringing the present proceeding, nevertheless the Court ought in its discretion to refuse relief upon the basis that the applicants have delayed unreasonably and to the prejudice of the respondents. What the applicants have done is akin to splitting a case. Prejudice arises particularly from the inability of the respondents to take instructions from Purvis because he is dead. Also prejudice arises because of the lost opportunity to take detailed instructions from all of the officers attending upon the execution of the warrant regarding precisely what occurred and why individual documents were considered to fall within the warrant. It must be remembered that the police officers concerned with the seizure have not had access to the documents after they were sealed and placed in the offices of the AFP. It is only the lawyers for the respondents who have had access to them and they have not been assisted by the background knowledge of their clients. The lawyers are without instructions from their clients concerning their particular reasons for considering the documents to fall within the warrant. The fact that the police officers cannot see the documents seized is pursuant to orders of and undertakings given to the Court by and on behalf of the respondents.

Counsel for the applicants argued that the issues which were determined by the Court in the earlier case of Dunesky v Elder arose from an administrative law challenge to the decision of the Justice to issue the warrants. The issues were whether the warrants were invalid on their face and whether there was a relevant failure to disclose material matters to the Justice. The earlier proceeding did not raise, in any form, the question of the manner of execution of the warrants - the issue now before this Court.

I agree with the submission of counsel for the applicants. The present application is essentially founded on trespass and detinue, challenging the lawfulness of the execution of the warrants. Although there is a certain commonality of fact concerning both proceedings, this case relies upon different facts to found different causes of action against parties who are not the same.

The conduct of the parties from the outset of the challenge to the warrant is relevant. It was agreed between the parties that the question of claims of legal professional privilege should be left until after the proceeding challenging the validity of the warrants had been determined. The AFP undertook to secure the documents which had been seized from both the Dunesky house and the offices of their accountants, denying removal or inspection by any person until the final determination of the challenge to the search warrant. The undertakings were renewed and continued following the decision of Whitlam J. on 30 May 1994. Following the decision of the Full Court on 20 December 1994 the Director of Public Prosecutions wrote offering to continue the undertakings upon certain conditions which I need not recite.

Deane, Toohey and Gaudron JJ. said in Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502 at 509:

'In truth, Henderson v Henderson was not concerned with res judicata in its strict sense but rather with its implications when an issue is sought to be raised "which could and should have been litigated in the earlier proceedings": Port of Melbourne Authority (1981) 147 CLR at 598'.

Henderson v Henderson established that parties to proceedings are required to bring forward the whole of their case and that the Court:

'will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest ...': (1843) 3 Hare 100 at 115; 67 ER 313 at 319.

In my opinion there is no bar to the bringing of the present proceeding; nor in the exercise of the Court's discretion should relief be refused on the basis alleged by the respondents. However, I must say that I am uneasy because the warrants involved were executed on 27 September 1991, nearly five years ago. This was followed by contested proceedings in this Court, both at first instance and on appeal, and by an application for special leave to appeal to the High Court. This was then followed by the institution of the present proceeding. Even now the AFP has not been able to have access to the documents seized from what I have held to be lawful seizure.

Relief

There remains the question of the fate of the documents in two classes, namely: (a) documents which it is agreed by the parties fall outside the scope of the warrants; and (b) documents which are the subject of a legitimate claim for legal professional privilege.

I repeat again the words of Mason J. in Baker v Campbell at 83 that:

'Generally speaking, it is in the course of the subsequent investigation following seizure of the documents that informed consideration can be given to the documents and an assessment made of their worth or significance ...'

The parties should be able to agree on the documents which should be returned to the applicants or other persons in whose possession or custody the documents should reside. If they cannot do so, the matter can be restored to the list for further consideration.

The orders of the Court are as follows:

1. The proceeding be adjourned to a date to be fixed for the purpose of considering which, if any, documents seized by officers of the Australian Federal Police from the premises of the first applicant at 7 Gilmore Close, Glenhaven, or from the offices of Messrs Edney Lawrence & Co., 2nd floor, 706 Military Road, Mosman, in each case on 27 September 1991, should be returned to the persons from whom they were seized or who are otherwise entitled to their possession, custody or control.

2. Otherwise the application be dismissed.

3. The applicants pay the costs of the respondents of the proceeding including reserved costs, if any, up to and including today.

4. Further consideration and liberty to apply are reserved on 3 days' notice.

I certify that this and the preceding forty-nine (49) pages are a true copy of the reasons for judgment herein of the Honourable Justice Lockhart.

Associate

Dated: 22 July 1996

Counsel for the Applicants : D H Bloom QC

N J Williams

M Wigney

Solicitors for the Applicants : Freehill Hollingdale & Page

Counsel for the Respondents : M S Weinberg QC

G T Johnson

D A Buchanan

Solicitors for the Respondents: Australian Government Solicitor

Date of Hearing : 1 - 4 April 1996

Date of Judgment : 22 July 1996

Top