High Court Finds NT Property Forfeiture Scheme Valid; Overturns Court of Appeal Decision
Thursday 10 April 2014 @ 12.19 p.m. | Crime
The High Court today overturned a Northern Territory Court of Appeal decision on constitutional law in Attorney-General (NT) v Emmerson [2014] HCA 13. The case concerned the statutory scheme for the forfeiture of property under two Territory Acts. The Scheme allows the property of a person who has been declared a “drug trafficker” to be forfeited to the state without the need for any further court orders.
Mr Emmerson, who had restraining orders made against his property, had committed three drug offences and was likely to be declared a “drug trafficker”, challenged the constitutionality of the scheme on a number of grounds and was successful at the Court of Appeal.
The Legislation
Section 36A(1) of the Misuse of Drugs Act (NT) (“the Drugs Act”) provides:
(1) The Director of Public Prosecutions may apply to the Supreme Court for a declaration that a person is a drug trafficker.
Section 94 of the Criminal Property Forfeiture Act 2002 (NT) (“the Forfeiture Act”) provides:
(1) If a person is declared to be a drug trafficker under section 36A of the Misuse of Drugs Act:
(a) all property subject to a restraining order that is owned or effectively controlled by the person; and
(b) all property that was given away by the person, whether before or after the commencement of this Act;
is forfeited to the Territory.
Facts
Mr Emmerson had been convicted of various drug related offences between August 2007 and September 2011. In February 2011, the DPP applied to the Supreme Court for restraining orders on the basis that Mr Emmerson was likely, as a result of a pending charge, to be declared a drug trafficker under the Drugs Act. Most of the property subject to the restraining order was not “crime-derived” property according to the Forfeiture Act, and was legitimately acquired, having no connection with any criminal offence. Mr Emmerson was found guilty of the charge in September 2011, and the DPP’s application to have him declared a drug trafficker succeeded in August 2012.
The Court of Appeal
The Northern Territory Court of Appeal concluded that the statutory scheme effected by the Drugs Act and the Forfeiture Act was invalid "because it required the Supreme Court to act in a manner incompatible with the proper discharge of the Court’s function as a repository of federal jurisdiction, and with its institutional integrity" [at 10] – also known as the Kable incompatibility (from Kable v Director of Public Prosecutions (NSW) [1996] HCA 24; (1996) 189 CLR 51).
The Majority Decision
French CJ, Hayne, Crennan, Kiefel, Bell and Keane JJ, in a joint judgment, found that the Court of Appeal judgment should be overturned. They distinguished Kable, saying the argument:
"is based on a misconception of the Supreme Court’s powers and duties under the statutory scheme. The Supreme Court is authorised to determine whether the statutory criteria set out are satisfied and, if they are, the Court must make the declaration sought. The Forfeiture Act provides the consequences which follow from the Supreme Court's declaration. Together, these steps are an unremarkable example of conferring jurisdiction on a court to determine a controversy between parties which, when determined, will engage stated statutory consequences." [at 66]
They also found that because the forfeiture was a punishment for crime, it was incorrect to characterise it as an acquisition of property other than on just terms. They found that:
“It is within the province of a legislature to gauge the extent of the deleterious consequences of drug trafficking on the community and the soundness of measures, even measures some may consider to be harsh and draconian punishment, which are thought necessary to both "deter" and "deal with" such activities.” [at 85]
Gageler J’s Dissent
Gageler J dissented from the majority and agreed with the Court of Appeal. He found that the sole legislative purpose of the law was “to compensate the Territory community for the costs of deterring, detecting and dealing with the [person’s] criminal activities” [at 132]. He found that the sweeping forfeiture laws were not appropriate and adapted to achieve this end. He also dismissed the argument that forfeiture served the purpose of deterrence, and particularly emphasised that the forfeiture does not occur automatically, but rather at the discretion of the DPP, saying “conferral of executive discretion of that nature is not a necessary or characteristic feature of penal forfeiture”. [at 139]
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Sources:
Attorney-General (NT) v Emmerson [2014] HCA 13
Misuse of Drugs Act (NT), Criminal Property Forfeiture Act 2002 (NT) - available from TimeBase LawOne.
