There are certain important words and phrases used throughout the Criminal Assets Confiscation Act ('the Act'). Perhaps the most important follow:
A. Forfeiture Offence
This means an offence that could, on conviction of an accused person, give rise to an order for the forfeiture of property owned by that person to the State. Forfeiture offences under the Act include:
an indictable (serious) offence under the law of the State; ie. any offence that is NOT a summary offence. Summary offences are defined in general terms as being offences for which the maximum penalty is imprisonment for 2 years or less or a fine of more than $120,000.00. Offences of dishonesty involving less than $2,500.00 apart from robbery and offences of violence can also be summary offences;
a serious drug offence, ie. an offence involving trade in a drug or the production, manufacture or preparation of a drug for trade;
unlicensed fishing or trade in fish including abalone;
offences against the Lottery and Gaming Act (eg. unlawful gaming, gambling or lotteries);
unlawfully taking, possessing or disposing of native plants;
the taking or possession of a protected animal or its eggs;
keeping or managing a brothel, or assisting in keeping or managing a brothel, or receiving money paid in a brothel in respect of prostitution;
any dealing in indecent or offensive material (which has a wide meaning);
unlawful possession of personal property (ie. property reasonably suspected by police of having been stolen or obtained by unlawful means);
any offence under the Corporations Law.
B. Tainted Property
Tainted property is liable to forfeiture.
Any property or asset is deemed to be tainted property if:
it was acquired for the purpose of committing a forfeiture offence;
it is used in, or in connection with, the commission of a forfeiture offence; or
it is the proceeds of a forfeiture offence.
If tainted property is converted (by sale, exchange or in some other way)into other property, the other property is also tainted.
If a person acquires title to tainted property in good faith and for valuable consideration, the property ceases to be tainted property.
Serious drug offences and the presumption that property is tainted
All property of a party to the commission of a serious drug offence is presumed to be tainted.
This presumption can be rebutted if the party can establish on the balance of probabilities (ie. that it is more probable than not) that the property was acquired by the party more than 6 years before the commission of the offence the subject of the confiscation proceedings.
The presumption can also be rebutted, insofar as it relates to a particular item of property, by establishing, on the balance of probabilities, that the property is not tainted (see 1-3 above).
Often there is a significant delay between a person being charged and their matter being finalised. In order that the value of the property that might, upon conviction, be forfeited to the State is maintained, Parliament allows the Director of Public Prosecutions ('the DPP') to bring proceedings in the Magistrates Court ('the court') to restrain (prevent) any dealing with the property.
If the court is satisfied that there are reasonable grounds to suspect that property may be liable to forfeiture, the court may make a restraining order prohibiting any dealing with the property.
This does not mean to say that the owner of the property necessarily cannot have access to it or use it. The order generally only prevents any dealing with the property until the charges have been finalised or the order is revoked or lapses.
In relation to a house property, for example, the occupant(s) can continue to live in the property but the DPP would register the restraining order on the title so that the property cannot be sold. Similarly, the owner of a motor vehicle subject to a restraining order can have the vehicle returned subject to the vehicle being comprehensively insured and not sold or altered in some way so as to diminish its value.
A restraining order lapses if no charges are laid within a reasonable time following the making of the order (between 1 and 2 months), or the accused person is acquitted of the charges in respect of which the order was made, or forfeiture proceedings are finalised.
Restrained property and legal fees
Property subject to a restraining order may be applied towards payment of legal costs, but in that event the Legal Services Commission manages the application of the costs subject to the normal terms of legal aid funding. The defence of the charge(s) the subject of the restraining order may accordingly be compromised. Indeed, you may find some lawyers (like us) unwilling to act in such circumstances.
Any funds applied towards payment of legal costs in this way will be recovered by the Legal Services Commission taking a statutory charge over any remaining property.
Ex parte Applications
An application for a restraining order may be made ex parte (in the absence of interested parties). However, if the court makes a restraining order on an ex parte application, the court must allow the owner of the property a reasonable opportunity to be heard on the question whether the order should continue in force and, if after hearing the owner, the court is not satisfied there is good reason for the order to continue in force, the order must be revoked.
Forfeiture of property
Once a person has been convicted (in effect, found guilty of) of a forfeiture offence, the DPP can apply to the court for a forfeiture order. A forfeiture order may be made in respect of tainted property or, where a benefit has been obtained from the commission of a forfeiture offence, specified property or a specified sum of money to the value of the benefit obtained.
A court must make an appropriate forfeiture order if the court is satisfied that forfeiture is necessary to prevent a defendant from retaining the profits of criminal activity. The court's power to order forfeiture of property beyond this is discretionary.
In deciding whether to impose a discretionary forfeiture and, if so, the extent of the forfeiture, the court may take into account any penalty imposed on the defendant for the forfeiture offence and, conversely, the court may take a discretionary forfeiture into account in fixing penalty for the relevant forfeiture offence.
A person who has an interest in property for which a forfeiture order is sought (for example a joint owner) is entitled to notice of the application for forfeiture and may appear and be heard on the application.
Serious drug offences, restraining orders and forfeiture orders
The consequences of being charged with a serious drug offence are considerable in the context of restraining orders and forfeiture orders.
If the offence the subject of the restraining order is a serious drug offence, the restraining order cannot be revoked or varied unless the owner of the property satisfies the court, on an application made before the conversion of the order into a forfeiture order, that the owner acquired the property more than 6 years before the commission of the relevant forfeiture offence and the property is not tainted.
Further, if the offender is convicted of a serious drug offence, then 6 months after all rights of appeal are exhausted or expire or 6 months after the restraining order is made (whichever is the later) the order is automatically converted into a forfeiture order for the forfeiture of all the property to which it then applies. There is no need for the DPP to make an application for forfeiture.
You should seek urgent legal advice if you are charged with a serious drug offence so that any related restraining order proceedings are properly dealt with at an early stage and your proprietary interests protected if possible.
The court may also revoke or vary a restraining order, or order payment of compensation if the restraining order has converted to a forfeiture order, to protect the interests of a person who satisfies the court that the person acquired an interest in the property to which the order relates in good faith and for valuable consideration (and did not have an opportunity to protect their interest before the restraining order converted to a forfeiture order).
Contravention of a restraining order is an offence
A person is guilty of an offence if the person, knowing of the existence of a restraining order, deals with or permits a dealing with property subject to the order contrary to the terms of the order or for the purpose of evading or frustrating the order. The maximum penalty for this offence is $10,000.00 or imprisonment for 2 years.
A dealing with property in these circumstances is void against anyone except a person who acquires an interest in the property in good faith and without notice of the terms of the order.
Investigation and Seizure
Police officers have wide powers to seize property that may then be subject to a restraining order and later forfeited.
A police officer may seize property if:
the seizure is authorised by warrant; or
the officer suspects on reasonable grounds the property is liable to forfeiture and the person in possession of the property consents to its seizure; or
the property is found in the course of a legitimate police search (eg.during a drug raid) and the officer suspects on reasonable grounds that the property is liable to forfeiture.
Any property seized must be returned if:
it later appears there are no reasonable grounds to believe that the property is liable to forfeiture; or
restraining order or forfeiture proceedings are not commenced by the DPP or the police within 25 days after the property is seized (although a court can authorise an extension of this period); or
a court, on application by a person entitled to possession of the property, orders its return.
This Information Outline is provided courtesy of Michael Dadds &Associates Lawyers who are a specialist in this area of law. They are located at 75 Gouger Street Adelaide SA 5000 or call them on 1300 132 674 if you would like more information on this legal topic, or you wish to obtain formal advice regarding your situation.
Michael Dadds and Associates specialize in all aspects of criminal law including Corporate Crime, Customs, Dishonesty, Driving, Drugs, Forensic Procedures, Sex Offences, Violence and Victims of Crime Applications. You can contact us 24 hours a day on 1300 132 674.