Larceny as a Clerk or Servant

Published by Geoff Harrison | 7 December 2023

The offence provision of larceny as a clerk or servant is under s156 of the Crimes Act 1900 ('the Act') and embezzlement as a clerk or servant is under s157 of the Act. Both offences carry a maximum penalty of 10 years imprisonment. A person caught or deemed to be a clerk or servant is set out in s155 of the Act.

The decision of Day v Rex (No. 2) [2023] NSWCCA 312 looked at what was referred to as the deeming provision of a "clerk" or "servant". It was argued that “employed” in s 155 means employed under a contract of service as distinct from a contract for services. The court, having considered the statutory construction of the section and history of the section, held that the narrow construction contended for did not apply and that s155 does not require proof of a master and servant relationship. The section does not require the Crown to establish that the applicant was bound to the complainant by a contract of service [129].

Other Sources:

• Sentencing Bench Book: Larceny as a clerk or servant

• Public Defenders Sentencing Table: Fraud by Employee

Cases:

• Day v Rex (No 2) [2023] NSWCCA 312

• Itaoui v R [2005] NSWCCA 415

• R v Swadling [2004] NSWCCA 421

Extracted Legislation:

CRIMES ACT 1900 - SECT 155

Definition of clerk or servant

Every person employed for any purpose, as, or in the capacity of, a clerk, or servant, or as a collector of moneys, although temporarily only, or employed also by other persons, or employed to pay as well as receive moneys, or although the person had no authority from his or her employer to receive money, or other property, on his or her account, shall be deemed a clerk, or servant.

CRIMES ACT 1900 - SECT 156

Larceny by clerks or servants

Whosoever, being a clerk, or servant, steals any property belonging to, or in the possession, or power of, his or her master, or employer, or any property into or for which it has been converted, or exchanged, shall be liable to imprisonment for ten years.

CRIMES ACT 1900 - SECT 157

Embezzlement by clerks or servants

Whosoever, being a clerk, or servant, fraudulently embezzles, either the whole or any part of, any property delivered to, or received, or taken into possession by him or her, for, or in the name, or on the account of, his or her master, or employer, shall be deemed to have stolen the same, although such property was not received into the possession of such master, or employer, otherwise than by the actual possession of such clerk, or servant, and shall be liable to imprisonment for ten years.

_________________________________________________________________________________

Day v Rex (No 2) [2023] NSWCCA 312 (6 December 2023)

Court of Criminal Appeal

Supreme Court

New South Wales

Case Name:

Day v Rex (No 2)

Medium Neutral Citation:

[2023] NSWCCA 312

Hearing Date(s):

23 June 2023

Date of Orders:

6 December 2023

Decision Date:

6 December 2023

Before:

Simpson AJA at [1];

Lonergan J at [98];

Dhanji J at [99]

Decision:

1. Leave granted to appeal against conviction.

2. Appeal allowed; convictions quashed.

3. There be a new trial.

4. S/O to the District Court Arraignments List on 15 December 2023.

Catchwords:

CRIME – appeals – appeal against conviction – embezzlement by clerk or servant – statutory construction of ss 155 and 157 of the Crimes Act 1900 (NSW) – definition of “clerk or servant” – meaning of “employed” and “collector of moneys” – where complainant had contractual relationship with a company controlled by applicant

CRIME – appeals – appeal against conviction – miscarriage of justice – closing address to jury by Crown Prosecutor – prohibition on comment on the accused’s failure to give evidence – references to “no evidence” or a lack of “explanation” – reversal of onus of proof – further improprieties – whether improprieties could be redeemed by trial judge’s directions – whether proviso to s 6(1) of the Criminal Appeal Act 1912 (NSW) applied

Legislation Cited:

Bail Act 2013 (NSW), s 49

Corporations Law (repealed), s 998

Crimes Act 1900 (NSW), ss 117, 145, 155, 157, 159, 160, 178A

Crimes Act 1914 (Cth), s 5

Criminal Appeal Act 1912 (NSW), ss 5, 6

Criminal Law Amendment Act 1883 (NSW) (repealed), ss 87, 113, 119

Criminal Procedure Act 1986 (NSW), s 164A

Evidence Act 1995 (NSW), ss 20, 50, 191

Income Tax Assessment Act 1936 (Cth), s 230

Cases Cited:

Day v R [2023] NSWCCA 160

Gregg v R [2020] NSWCCA 245

HCF v The Queen [2023] HCA 35

Hofer v The Queen (2021) 274 CLR 351; [2021] HCA 36

Kalbasi v Western Australia (2018) 264 CLR 62; [2018] HCA 7

Lordianto v Commissioner of the Australian Federal Police (2019) 266 CLR 273; [2019] HCA 39

Mallan v Lee (1949) 80 CLR 198; [1949] HCA 48

Mraz v The Queen (1955) 93 CLR 493; [1955] HCA 59

R v J (1987) 9 NSWLR 615

R v Maharaj (1995) 85 A Crim R 374

R v Manasseh and Austin [2002] NSWCCA 27; (2002) 167 FLR 44

R v Wilford (1876) 14 SCR (NSW) 465

Registrar of Titles of the State of Western Australia v Franzon (1975) 132 CLR 611; [1975] HCA 41

Stephens v The Queen (1978) 139 CLR 315; [1978] HCA 35

The King v Grubb [1915] 2 KB 683

The King v Jacobs Group (Australia) Pty Ltd [2023] HCA 23; 97 ALJR 595

The Queen v A2; Magennis, Vaziri (2019) 269 CLR 507; [2019] HCA 35

Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81

Zhou v R [2021] NSWCCA 278

Texts Cited:

Sir Alfred Stephen and Alexander Oliver, Criminal Law Manual (1883, Thomas Richards, Government Printer)

Theodore F.T. Plucknett, A Concise History of the Common Law (5th Ed, 1956, Butterworth)

Category:

Principal judgment

Parties:

Titus Emanuel Day (Applicant)

Rex (Crown)

Representation:

Counsel:

B Walker SC, T Woods (Applicant)

B Hatfield (Respondent)

Solicitors:

MacDougall & Hydes Lawyers (Applicant)

Solicitor for Public Prosecutions (NSW) (Respondent)

File Number(s):

2020/194883

Publication Restriction:

Nil

Decision under appeal:

Court or Tribunal:

District Court of New South Wales

Jurisdiction:

Criminal

Citation:

Nil

Date of Decision:

30 June 2022

Before:

Gartelmann SC DCJ

File Number(s):

2020/194883

HEADNOTE

[This headnote is not to be read as part of the judgment]

The applicant was found guilty by a jury of 34 counts of embezzlement as a clerk or servant contrary to s 157 of the Crimes Act 1900 (NSW). The charges related to his conduct as the sole director and shareholder of 6 Degrees Management Pty Ltd (“6 Degrees”), which was responsible for the management of the professional activities of the complainant, who is a performer and recording artist. It was the Crown case that the applicant had misappropriated income received into a 6 Degrees trust account, which, after deducting commission and GST, the applicant was obliged to remit to the complainant.

The applicant sought leave to appeal against his conviction on three grounds.

By ground 1, the applicant contended that the evidence could not establish that he was a “clerk or servant” within the meaning of s 157 of the Crimes Act, such that the jury ought to have been directed to acquit him on all counts. This ground turned on the construction and application of the definition of “clerk or servant” in s 155 of the Crimes Act, which is as follows:

“Definition of clerk or servant

Every person employed for any purpose, as, or in the capacity of, a clerk, or servant, or as a collector of moneys, although temporarily only, or employed also by other persons, or employed to pay as well as receive moneys, or although the person had no authority from his or her employer to receive money, or other property, on his or her account, shall be deemed a clerk, or servant.”

The applicant proffered three possible constructions of s 155. First, at trial and on appeal, the applicant contended that s 155 required that an accused be employed by the complainant under a contract of service, as opposed to a contract for services. He submitted that the evidence did not establish such a relationship. Second, on appeal, the applicant contended that, even if the definition of “clerk or servant” could apply to persons beyond those employed under a contract of service, it could not apply to those who received money in the course of business or commerce, as in the present case. Third, in the further alternative, the applicant noted that it was 6 Degrees, rather than the applicant, which had a contractual relationship with the complainant, and contended that s 155 required, at the very least, the existence of a contractual relationship (whether “of service” or “for services”) between the complainant and the applicant himself.

By ground 2, the applicant further complained that a miscarriage of justice was occasioned by the Crown Prosecutor’s closing address. He submitted that the prosecutor impermissibly commented on the applicant’s failure to give evidence, improperly invoked consciousness of guilt reasoning, improperly invoked tendency and coincidence reasoning, misstated the use that could be made of an affidavit filed by the applicant in earlier civil proceedings, and expressed a personal opinion.

By ground 3, the applicant contended the trial miscarried by reason of undue pressure placed upon the jury during the course of their deliberations.

The Court (Simpson AJA, Lonergan and Dhanji JJ) granted leave to appeal, allowed the appeal in part, quashed the applicant’s convictions and ordered that there be a retrial. The Court held:

As to ground 1 (whether the applicant was a “clerk or servant”) (per Dhanji J, Simpson AJA and Lonergan J agreeing):

(1) The applicant was, on no view of the evidence, employed under a contract of service by the complainant. Rather, 6 Degrees was engaged by the complainant in a contractual arrangement by which services were provided to the complainant in return for fees: [118]. It was an agreed fact that the income received by 6 Degrees for the benefit of the complainant was received into accounts operated by 6 Degrees, rather than by the applicant: [139]-[142].

(2) Properly construed, the definition of “clerk or servant” in s 155 of the Crimes Act expressly captures relationships that would not otherwise be “clerk or servant” relationships, and thus expands the meaning of that expression beyond contracts of service. Accordingly, proof that the applicant was bound to the complainant by a contract of service is not necessary to establish guilt under s 157: [115]-[129].

(3) Further, there is no textual basis for excluding the application of s 155 to persons who receive money in the course of business or commerce. It may be accepted that the precursor to s 155 was enacted in response to the decision of R v Wilford (1876) 14 SCR (NSW) 465, which held that, in the absence of a statutory definition, a person who was not employed under a contract of service was not a “clerk or servant”. There is nothing in that history or in the text of s 155 that justifies giving the expansive words of s 155 the limited reading for which the applicant contended: [130]-[136].

R v Wilford (1876) 14 SCR (NSW) 465, considered.

(4) The range of relationships capable of falling within the definition of “clerk or servant” is not limited by the dichotomy of “contracts of service” and “contracts for services”. Section 155 deems “[e]very person employed ... as a collector of moneys” to be a “clerk or servant”. There is nothing in those words that demands the existence of a direct contractual relationship of any kind between the parties. It was for the jury to determine, as a question of fact, whether the applicant was, in substance, engaged to act on behalf of the complainant as a collector of moneys, notwithstanding that the legal relationship was intended to be between the applicant’s corporate entity, 6 Degrees, and the complainant: [143]-[169].

R v J (1987) 9 NSWLR 615; The King v Grubb [1915] 2 KB 683, applied.

Mallan v Lee (1949) 80 CLR 198; [1949] HCA 48; R v Manasseh and Austin [2002] NSWCCA 27; (2002) 167 FLR 44; R v Maharaj (1995) 85 A Crim R 374, considered.

(5) The evidence in the Crown case was capable of establishing that the applicant was employed by the complainant as a collector of moneys within the meaning of s 155 of the Crimes Act. That being so, the applicant was deemed by s 155 to be a clerk or servant for the purposes of s 157: [136], [170]. The Court rejected ground 1: [171].

As to ground 2 (the prosecutor’s closing address) (per Simpson AJA, Lonergan and Dhanji JJ agreeing):

(6) A miscarriage of justice includes any departure from a trial according to law to the prejudice of the accused. That miscarriage of justice will be substantial, for the purposes of the proviso to s 6(1) of the Criminal Appeal Act 1912 (NSW), unless the appellate court concludes, upon its own independent assessment of the whole of the evidence, that, on that evidence, the accused person was proved beyond reasonable doubt to be guilty of the offence (or offences) of which he or she is convicted: [72]-[80].

HCF v The Queen [2023] HCA 35; Hofer v The Queen (2021) 274 CLR 351; [2021] HCA 36; Zhou v R [2021] NSWCCA 278; Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81; Mraz v The Queen [1955] HCA 59; (1955) 93 CLR 493 at 514; [1955] HCA 59, applied.

(7) The Crown’s concession that the prosecutor’s closing address was marked by a number of inappropriate comments, including submissions that amounted to comments on the failure of the applicant to give evidence and which had the effect of reversing the onus of proof, was properly made. The accumulation of improprieties was such that they could not be redeemed by the trial judge’s ameliorative directions. Accordingly, the prosecutor’s closing address occasioned a miscarriage of justice: [84]-[90].

(8) The Crown did not attempt to identify the evidence which, it would assert, establishes the guilt of the applicant, and the applicant did not have the opportunity to respond to such a contention. Accordingly, the Court cannot be satisfied that the applicant was shown to be guilty of any of the charges of which he was convicted, and the proviso to s 6(1) of the Criminal Appeal Act 1912 (NSW) did not apply: [91]-[94].

(9) The only available order is that the convictions be set aside and there be a new trial: [95].

As to ground 3 (whether the jury was subject to undue pressure) (per Simpson AJA, Lonergan and Dhanji JJ agreeing):

(10) This ground did not raise any issue of principle that would affect the conduct of a new trial. Given the conclusion in respect of ground 2, it did not need to be resolved: [96].

JUDGMENT

1. SIMPSON AJA: This application for leave to appeal against conviction was heard on Friday 23 June 2023. Having considered the arguments with respect to ground 2, all members of the Court were satisfied that the ground should be upheld. The Court reconvened on Monday 26 June 2023 for the purpose of considering the course to be taken in light of that conclusion. As the Court had not then reached a concluded view with respect to the outcome of ground 1 (which, if successful, would have resulted in entry of verdicts of acquittal) the Court entertained an application by the applicant for a release order under s 49 of the Bail Act 2013 (NSW). A release order was made on that day: Day v R [2023] NSWCCA 160.

2. The facts and circumstances relevant to the trial are set out in detail in the judgment of Dhanji J which I have had the advantage of reading in draft. Some will need to be repeated. However, the account of facts that follows does not purport to be exhaustive and recourse may be had to the reasons of Dhanji J for a complete understanding of the background facts. For convenience I will continue to use the terminology adopted by Dhanji J.

3. I agree with Dhanji J that ground 1 raises an issue in respect of which leave to appeal ought to be granted, and I agree with Dhanji J’s proposed disposition of that ground.

Background to Ground 2

4. The trial commenced on 3 May 2022 before Zahra SC DCJ with, conventionally, an opening by the Crown Prosecutor. In short, the Crown case was that the applicant, through his company 6 Degrees Management Pty Ltd (“6 Degrees”), had an arrangement (not formalised in an executed contract) with the complainant (a successful and well-known entertainer) to receive into 6 Degrees’ bank accounts financial payments due to the complainant from various entities for whom he performed, and entities from whom he received royalties and other payments. The Crown asserted (and so much was not disputed) that the arrangement between the complainant and the applicant commenced in July 2009. Prior to that, the complainant had had a similar arrangement with 22 Management Pty Ltd (“22 Management”) by whom the applicant was then employed. The arrangement with 22 Management was recorded in a formal contract executed by the parties. Although it was common ground that the arrangement with the applicant (through 6 Degrees) was largely based on that contract, there was a dispute about whether the provisions of one clause of the contract (cl 5.04, providing for “trailing commissions”) were incorporated into the arrangement with the applicant. The arrangement entitled the applicant to retain from those payments by way of commission a percentage of the income earned by the complainant (calculated on different bases, according to the nature of the income); the applicant was required to account to the complainant for the remainder, after payment of any expenses.

5. The Crown asserted (and this was also not in issue) that, from about 2015, disputes arose between the complainant and the applicant, culminating in litigation in the Federal Court, commenced by the complainant in about 2018, and in which the applicant filed a cross-claim, and swore an affidavit on 12 April 2019. The complainant then referred the matter to police. On 1 July 2020 the applicant took part in an interview with a Detective Senior Constable David Murphy, which was recorded.

6. It was the Crown case that, in 50 instances (each represented by an odd numbered count on the indictment, to each of which there was an even numbered alternative) the applicant failed to account to the complainant as required and retained all or part of some payments for his own purposes, which was conduct amounting to “fraudulent embezzlement”.

7. The jury were given “jury packs” consisting of three lever arch folders (about 3,000 pages), much of which consisted of banking and other financial records. Included in the “jury packs” was a detailed Statement of Agreed Facts pursuant to s 191 of the Evidence Act 1995 (NSW), to which the Crown Prosecutor made reference, and copies of the affidavit that the applicant had sworn for the purpose of the Federal Court proceedings.

8. Pursuant to s 50 of the Evidence Act the Crown prepared a Schedule (that became Ex 117) showing, in relation to each count on the indictment, the amount it alleged had been paid into a 6 Degrees account, the date of payment, the source of the payment, the amount the applicant was entitled to retain by way of commission, other deductions he was entitled to make, and the amount which the complainant was entitled to be paid. For present purposes, no issue was taken with the accuracy of Ex 117. While the document represents the Crown case, and the following does not purport to represent findings as to the transactions recorded or the calculations, it may, for the purpose of consideration of Ground 2 of the appeal, be taken as factual.

9. At the conclusion of the Crown opening, senior counsel who represented the applicant at trial opened the defence case. Inter alia, he said:

“As the evidence in this case unfolds though, you will come to appreciate that there is an answer to every one of these charges, and in some instances, you will see that the answer is so clear, the answer is so obvious, that you may wonder whether the authorities, particularly the police, were even wilfully blind to that answer, seduced perhaps by [the complainant’s] high profile.”

10. Senior counsel made reference to the Federal Court proceedings, in which the complainant and the applicant made claims against each other, and concluded:

“When we dig deeper into the evidence, and we go beyond a superficial view of it, you will see that there is an answer to each charge. It was in the Federal Court, members of the jury, that what was essentially a business dispute, ought to have remained.”

Senior counsel also made a brief reference to a “claim of right” but without explanation or further elaboration.

11. The trial then proceeded, as recounted by Dhanji J, over the next two days, when Zahra DCJ became ill and subsequently died. The trial resumed, pursuant to s 164A of the Criminal Procedure Act 1986 (NSW), on 16 May 2022 before Gartelmann SC DCJ, and continued until 30 June 2022 when the jury returned the verdicts set out by Dhanji J.

12. The evidence in the Crown case was given principally by the complainant. A great deal of documentary material, largely in the form of financial and banking records, was in evidence, much of it in the jury packs. Ten witnesses other than the complainant gave oral evidence, but the issues raised by Ground 2 can be determined by reference to the evidence of the complainant and the documentary evidence (subject to one matter raised by the Crown in response to the appeal grounds).

13. During the course of the complainant’s examination in chief, senior counsel for the applicant told the trial judge (in the absence of the jury) that he expected that the claim of right would be made good, specifically in relation to certain counts on the indictment.

14. During the course of cross-examination of the complainant, an issue arose concerning documents shown to the complainant for the purpose of the cross-examination, and that were not, prima facie, admissible. Senior counsel said (again, in the absence of the jury) that the documents would (ultimately) be tendered through the accountants or those who created the documents “or they will be admitted through the accused”. In response to a question from the trial judge, senior counsel confirmed that:

“...the defence will be in a position to give an undertaking that if the document is not ultimately admitted through the accountant, it will be admitted through the accused”.

That undertaking was expressed to apply to each document the subject of the discussion.

15. The Crown case closed on 7 June 2022. Contrary to expectations, the applicant did not give or call evidence. The Crown Prosecutor’s final address commenced on 14 June 2022 and concluded the following day.

Ground 2

16. By Ground 2 the applicant complained that a miscarriage of justice was occasioned by the Crown Prosecutor’s closing address. The following are my reasons for concluding that Ground 2 should be upheld.

17. The applicant made a litany of complaints about the address, predominantly (but far from exclusively) on the contention that the prosecutor repeatedly put to the jury submissions that breached the prohibition on the Crown commenting on the failure of an accused person in the trial of an indictable offence to give evidence. Other complaints were that the prosecutor made submissions in the form of expressing a personal opinion, improperly invoked consciousness of guilt reasoning, improperly invoked tendency and coincidence reasoning and misstated the use that could be made of the affidavit filed by the applicant in the Federal Court proceedings.

(i) Comments on the failure of the applicant to give evidence

18. Section 20 of the Evidence Act applies to criminal proceedings for indictable offences. Subsection (2) of s 20 provides:

“(2) The judge or any party (other than the prosecutor) may comment on the failure of the defendant to give evidence. However, unless the comment is made by another defendant in the proceeding, the comment must not suggest that the defendant failed to give evidence because the defendant was, or believed that he or she was, guilty of the offence concerned.” (italics added)

Although it may be somewhat oblique, implicit in that provision is a prohibition on comment by a prosecutor on the failure of an accused person to give evidence in the trial of an indictable offence: Gregg v R [2020] NSWCCA 245 at [573] (Bathurst CJ, Hoeben CJ at CL and Leeming JA concurring) (“Gregg”).

19. There were a number of instances in the prosecutor’s final address which, the applicant contended, contravened the prohibition. In order to judge whether the comments (or any of them) did amount to prohibited comment, and, if so, the gravity of the contravention in the trial as a whole, it is necessary to set out the passages of which complaint is made in context.

(a) The issue of “trailing commissions”

20. An issue in the trial concerned the applicant’s entitlement (or otherwise) to “trailing commissions”. Trailing commissions are commissions payable to a manager upon income earned and received by the artist after the expiry of the contract between the artist and manager. The prosecutor referred to the contract into which the complainant had previously entered with 22 Management, and which was said to be the basis for the arrangement with the applicant.

21. At an early stage in his final address the prosecutor made reference to a contentious email. The email was part of an email exchange between the complainant and Sean Anderson, the Managing Director of 22 Management, from which both the complainant and the applicant were in the process of separating. The complainant, it seems, was negotiating a termination of his contract with 22 Management. The email was relevant to a dispute in the evidence between the complainant and the applicant about whether cl 5.04 of the complainant’s contract with 22 Management (which dealt with “trailing commissions”) had been incorporated into the undocumented arrangement between the complainant and the applicant. The relevant email was dated 12 July 2009, and, on its face, was received by Mr Anderson at 3.40 am, and was posted from the complainant’s email address and signed (to the extent that emails are signed) “Guy” (“the 3.40 am email”). The email contained an acknowledgement that “trailing commissions” were, in some circumstances, payable to 22 Management. In evidence the complainant maintained that “trailing commissions” were not part of the arrangement with the applicant. In his evidence the complainant initially accepted that he had sent the email, but then said that the whole of the content of the email had been composed by the applicant.

22. This Court was not referred to, and I have not located, any cross-examination that called into question the complainant’s evidence that it was the applicant who had composed (at least the substance of) the 3.40 am email. Nevertheless, in closing submissions, the prosecutor said:

“And there’s no evidence before you in clear terms that it wasn’t the accused that drafted that email on 12 January 2009 at 3.48.” (italics added)

(The transcript records 3.48. Whether that is a mistranscription or a slip of the tongue by the prosecutor is not clear; it is apparent that the reference is to the 3.40 am email).

23. Later in his address the prosecutor returned to the subject of the 3.40 am email and said:

“And I have already earlier in the piece taken you to exhibits 2 and exhibits 7 and the evidence of [the complainant] about how the accused had drafted the email on 12 July 2019 at 3.40 am. That’s what [the complainant] told you and you don’t have any evidence to the contrary in relation to that.” (italics added)

24. That was a clear allusion to the fact that the applicant had not given evidence. The obvious (and possibly the only) person who could have given evidence that it was not the applicant who drafted the email was the applicant himself.

(b) Premier Muzik Royalties

25. Counts 1-32 on the indictment concerned royalty payments made into a 6 Degrees account by Premier Muzik. Count 1 concerned a royalty payment of $6,300.36 from Premier Muzik on 27 January 2015. The Schedule (Ex 117) prepared by the Crown showed (or purported to show) that the applicant was entitled to retain, from the gross amount, the sum of $1386.08 by way of commission, and was obliged to remit to the complainant the balance, being $4,914.28. No amount was remitted to the complainant. Bank records showed that on 28 January 2015 the sum of $6,300.36 was transferred from the 6 Degrees account to “SR Marketing”. In cross-examination it was put to the complainant that he had agreed that 6 Degrees should charge a flat fee for “a considerable contribution” that it (or the applicant and his wife) had made to the organisation of functions, specifically Christmas carol events put on by the Sebastian Foundation, a charitable foundation on whose board the applicant sat. The complainant replied that there was no basis for that suggestion. It was then put, more specifically, that the complainant and the applicant had discussed the applicant charging management fees in relation to the promotion, marketing, booking of artists, logistics and sponsorship for the Sebastian Foundation for a particular concert performance at the end of 2014. The complainant denied that, saying that the Foundation was a charity, for whom all worked without remuneration, and that, in any event, any cost would need to be approved by the Board of the Foundation.

26. The complainant was then shown what is recorded in the transcript as a tax invoice from 6 Degrees to “Guy Tunes Pty Ltd atf Soul Tunes Trust.” The document was marked for identification (no 43) but was not tendered in evidence.

27. The complainant did not accept that the transfer of $6,300.36 had anything to do with the tax invoice that was shown to him in cross-examination and marked for identification 43. Senior counsel then put to the complainant:

“What I want to suggest to you is that in transferring the money out of that account on 28 January 2015 as Mr Day did, all he was doing was taking a sum which he had told you would be taken in payment for the work that had been done in the promotion[,] marketing, booking, et cetera of the Myer Christmas carols?”

The complainant responded:

“I once again reject that, [senior counsel], based on the fact that our foundation, if it had a cost, it would have been allocated to the foundation, to the event, brought up, approved, and definitely not taken out of an overseas royalty that has nothing to do with the foundation whatsoever.”

28. The position thus appears to be this: the evidence showed that an amount of $6,300.36 representing royalties due to the complainant had been paid into a 6 Degrees account. The applicant would have been entitled to deduct from that amount the sum of $1384.08 by way of commission; the complainant was entitled to be paid the balance. No amount was paid to the complainant, nor was any of the amount paid into the complainant’s account. On the day after the amount was received into the 6 Degrees account, an identical sum ($6,300.36) was transferred to an account in the name of SR Marketing.

29. It was the Crown case that the transfer to SR Marketing was not authorised and constituted embezzlement by the applicant. As put to the complainant in cross-examination, it was the defence case that the payment was authorised by the complainant, as remuneration for work the applicant (or his wife, or 6 Degrees) had done in organising, promoting and marketing a charitable event in the name of the Sebastian Foundation. It may be that what the applicant was proposing to advance was a claim of right. If so, that was never clearly put.

30. With respect to Count 1, the transcript records that, in final submissions, the Crown Prosecutor said:

“So a proposition’s put in the question, this is what that money was for, but it is the answer that [the complainant] gives in relation to that, and his answer, you may remember, was an emphatic denial. There is no document in evidence that was shown – there is a document [marked for identification 43] that was shown to [the complainant] but was not tendered in relation to that proposition. But that document can’t inform you in any way whatsoever about the proposition that was put because it is not in evidence and you cannot consider it.

My learned friend told you in the opening to you that it was an explanation to every allegation. There is no explanation as to why no part of this royalty payment ever made its way to [the complainant]. And if you look in the trust account, you will see that by 20 February 2015, the balance is zero, and that’s at jury pack 191. So you know that the funds that the accused had received have not only not been remitted to [the complainant], but there’s nothing left in the trust account by then to meet that payment and he’s embezzled that money from [the complainant].” (italics added)

(c) Commission on “contra deals”

31. Counts 33-46 on the indictment concerned royalty payments made by Warner Music. Count 33 concerned a payment of $26,952.31 paid into a 6 Degrees account on 10 April 2014. Exhibit 117 showed that, pursuant to the agreement between the complainant and the applicant, the applicant (or 6 Degrees) was entitled to retain $5,929.51 of that amount and was obliged to transfer to the complainant $21,022.80. No amount was paid to the complainant or on his behalf.

32. By his cross-examination of the complainant, the applicant appeared to be asserting a claim of right in respect of that sum. There was evidence in the trial to the effect that the complainant entered into arrangements with third parties (“endorsement agreements”) pursuant to which he would be remunerated or compensated for his services in goods and services rather than in money (“contra deals”). One such arrangement was with Toyota Motor Corporation Australia Ltd (“the Toyota agreement”). There was evidence to this effect in the Federal Court affidavit sworn by the applicant.

33. Whether the applicant was entitled to commission on the value of the non-monetary remuneration or consideration was an issue raised in the Federal Court proceeding and the subject of affidavit evidence by the applicant. There, the applicant said that 6 Degrees had never received any commission or other income in respect of these arrangements. The complainant was cross-examined on the subject in the present trial. It was put to him that the applicant had signalled his intention of charging the complainant commission on the value of the Toyota agreement, and that he would take that commission from funds coming into the 6 Degrees accounts on behalf of the complainant. The complainant labelled that proposition a “lie”. The complainant was shown some documents (which were not tendered into evidence) which, it may be inferred, were tax invoices from 6 Degrees. He disputed the validity of the documents he was shown. The complainant insisted that he had “never been commissioned on the contra”.

34. The prosecutor addressed this subject in his final submissions. He referred to evidence of accountants which, he said, was to the effect that they had never seen an invoice or statement that sought payment of commission on “contra”. The prosecutor then said (as recorded in the transcript):

“My learned friend cross-examined [the complainant] about this payment. ... Documents were shown to him, those documents never went into evidence. The accused (as said) [sic: the complainant] disagreed with the propositions that were put that somehow [the payments] related to commission that the accused was entitled for contra, goods that he had received. As I have said several times now, the propositions put are not evidence, the documents you never received are not evidence, what’s evidence is what [the complainant] said. He was firm in his response that no commission had ever been sought for [sic: from] him for contra payments that he received.

...

There is no evidence which demonstrates an honest explanation for the failure to remit and subsequent use for other purposes of the Warner Music royalty payment on 10 April 2014. There is no explanation for that. It goes into the trust account, and is the next day transferred to the transaction account, and then is spent. So you will be satisfied beyond reasonable doubt that the accused embezzled that part of the payment properly due to [the complainant] and you will find him guilty on that charge [Count 33].” (italics added)

35. The remaining instances of submissions which the applicant contends constituted contravention of s 20 of the Evidence Act may be dealt with more briefly.

(d) Sony Music Royalties

36. Counts 47-68 concerned royalty payments made by Sony Music to 6 Degrees on behalf of the complainant. Count 49 involved a payment made on 25 March 2014 of $2458.40 of which the applicant (or 6 Degrees) was entitled to retain as commission $540.85. The complainant was entitled to the balance of $1917.55. No payment was made to him or on his behalf. On 28 March 2015 $2458.40 was transferred into another 6 Degrees account. The accounting records contain a notation:

“FNDS TFR GS COMS."

37.n his final address the prosecutor made reference to these transactions and said:

“And that’s what he’s putting in as the description in relation to that transfer. You have no evidence of any explanation of that transfer. It’s not referred to in the affidavit of the accused.” (italics added)

(e) The British Lions Tour

38. Count 60 concerned the fee paid for a 2013 performance undertaken by the complainant in support of a rugby match involving the “British and Irish Lions”. An amount of $49,114.62 was paid into a 6 Degrees account. Of this, the applicant was entitled to retain $9822.92 and was obliged to remit to the complainant the sum of $39,291.70. No such remittance was made.

39. Cross-examination of the complainant was to the effect that he had authorised the purchase of an overseas convertible note of $15,000, which the applicant had done on 25 July 2013. An email chain (Ex 47) between the applicant and the complainant was capable of supporting the applicant’s proposition.

40. In his submissions the prosecutor referred to the cross-examination and said:

“You’ve heard no evidence from anybody that that payment was a payment connected with the British Lions tour. All you’ve heard is propositions put to [the complainant] which he rejected.

So you would not accept that as an explanation – because there’s supposed to be an explanation for every transaction – you would not accept that as an explanation for the failure by the accused to remit to [the complainant] $39,291.70 in relation to that performance. It’s been kept, it’s been dissipated, it constitutes an embezzlement of those funds. You can see what happens in the trust account.” (italics added)

(f) Taylor Swift tour

41. Count 71 concerned a tour by the performer Taylor Swift for whom the complainant was engaged as a support act. In December 2013 an amount of $494,360.00 was paid into a 6 Degrees account. Of this the applicant was entitled to retain by way of commission $59,335.58 and was obliged to remit to the complainant $435,024.42. An amount of $247,500.00 was paid, leaving a deficit of $187,524.42.

42. In cross-examination it was put to the complainant that he had asked or authorised the applicant to purchase shares in a company called My Medical Records (“MMR”) with the proceeds of the Taylor Swift performance because “you didn’t want those monies going into your account” and because “you didn’t want to pay tax on the monies”. The complainant denied those propositions.

43. The prosecutor addressed the jury on this subject at some length, saying:

“Now you will recall the cross-examination of [the complainant] on this charge resolved [sic: revolved] around a proposition that the accused had, on instructions, funded further investments in the company MMR from those proceeds. That was what was put to [the complainant]. Now again, they were propositions, they’re not evidence. The answers are the evidence. And you have evidence from [the complainant] that he did not authorise any such investments. He told you several times that he paid personally for all his investments in MMR.

...

What the proposition [advanced in cross-examination] suggests is that the accused bought $287,122.70 worth of MMR shares on behalf of [the complainant] and gave him $247,500 as a part payment for that performance. So in effect the accused gave [the complainant] $534,622.70 which is more than $100,000 or just less, sorry, than $100,000 in excess of what [the complainant] was due in any case.

...

All you have before you is the denials of [the complainant] that he did not authorise the purchase of MMR shares by the accused from moneys received into the trust account. There’s no documents that Ms Kemp [an employee of the accounting firm engaged by the complainant at the relevant time] was able to locate that would have shown that sort of transfer, and you have heard Ms Kemp talk about how everything had to be attributed to a source of income, but there’s no documents to that effect that demonstrates that that’s how that shortfall in payment was accounted for. What you have is a failure to pay that money, and no evidence whatsoever that it was somehow explained by a purchase of MMR shares on behalf of [the complainant]. You just do not have that. (italics added)

(g) Michael Hill and BGB performances

44. Counts 75 and 77 concerned, respectively, performances for businesses named Michael Hill in Singapore and “BGB”. In August 2014, in relation to the Michael Hill performance, $69,964.00 was paid into a 6 Degrees account. The applicant was entitled to retain $12,877.07; the complainant was entitled to $57,086.93. No amount was transferred to the complainant (Count 75).

45. In October and November 2014, in relation to the BGB performance, $33,000.00 was paid into a 6 Degrees account. Of this, the applicant was entitled to retain $6,600.00, and the complainant was entitled to $26,400.00. No amount was paid to the complainant (Count 77).

46. The complainant was cross-examined to the effect that he had agreed that the applicant could retain the proceeds of the Michael Hill and BGB performances as a consequence of an arrangement the two had made when the applicant left 22 Management and established 6 Degrees. The complainant’s response was that that was “completely unfounded and ridiculous”.

47. In his final address the prosecutor referred to the cross-examination, quoted the complainant’s response, and said:

“[The complainant’s] response to that was that this proposition [was] completely unfounded and ludicrous. That is the evidence upon which you must act and there is no evidence to [the] contrary to support any other proposition. The fact is that payments in the order of $83,000, that’s the combined amounts of Michael Hill and BGB, were never remitted by 6 Degrees to [the complainant]. The funds were directed to other purposes, there is no explanation for this use of the funds.” (italics added)

(h) The “Big Bash” cricket performance

48. Count 85 concerned a performance for the “Big Bash Cricket” on 1 January 2017 at the Melbourne Cricket Ground. $57,200.00 was paid into a 6 Degrees account of which the applicant was entitled to retain $9,582.00 as commission and was required to remit $47,618.00 to the applicant. $36,298.65 was remitted, leaving an alleged deficit of $11,319.35.

49. In cross-examination the complainant was shown a series of documents, each marked for identification but not tendered into evidence, which (according to the cross-examination) purported to show (or perhaps did show) that funds paid into the 6 Degrees account had been disbursed in payment of public relations services in the United Kingdom, and management fees for the Big Bash performance. The submissions of the prosecutor with respect to count 85 and the Big Bash payment were:

“There is no evidence before you that would enable you to link those payments with the receipts by 6 Degrees of the money for that performance at the cricket, and what you have is simply a deficiency with no explanation whatsoever.” (italics added)

(i) McDonalds in Cancun

50. Count 91 concerned a performance at a McDonalds outlet in Cancun, Mexico. In June and September 2017 a total of $66,000.00 was paid into a 6 Degrees account, of which the applicant was entitled to retain $13,200.00, and was obliged to remit to the complainant $52,800.00. $33,000.00 was paid to the complainant, leaving a deficit of $19,800.00.

51. In his affidavit in the Federal Court proceedings the applicant asserted that $20,500.00 had been paid into an account in the joint names of himself and his wife as reimbursement for a payment they had made on the complainant’s behalf to a music promotor in the United Kingdom as a fee payable for the complainant to appear as a support act for another performer. In cross-examination in the trial the complainant denied that that had happened.

52. Of that, the prosecutor said, in final address:

“The next count is count 91. That relates to a performance for McDonald’s in Cancun. There’s no dispute as far as the Crown’s aware about the figures and calculations that appear in the spreadsheet, so I’m not going to go through the same process. I suggest to you, you can accept the calculations demonstrate a shortfall of about $19,800 that should have been paid to [the complainant]. The explanation in relation to this claim by [the complainant] is found at paras 69 to 72 of the accused’s affidavit filed in the Federal Court. Let me just go there. This is the Shane Filan support performances that the accused asserts in his affidavit cost £12,000 that he paid and reimbursed himself from [the complainant’s] entitlements with respect to the Cancun performance.

It's in an affidavit, but it hasn’t been subject to cross-examination. There’s been no opportunity for the Crown to test the assertions that are contained in those paragraphs, but even on face value you’re not going to accept that its anything more than an attempt in hindsight to explain away why he hasn’t properly remitted moneys owing to [the complainant] for the Cancun performance. (Italics added)

(j) Warner Music royalties

53. Counts 33-46 on the indictment concerned royalty payments made by Warner Music.

54. Count 39 concerned a payment of $18,845.08 made to a 6 Degrees account in September 2017. The applicant was entitled to retain $4145.92. The complainant was entitled to receive $14,699.16. No amount was paid to the complainant.

55. In cross-examination it was put to the complainant that he had participated in a tour in the United Kingdom, which involved retaining two supporting performers for whose payment he was liable, but that the complainant terminated his involvement in the tour early. It was put that the applicant had used the receipts from Warner Music to meet the complainant’s liability in respect of those performers. The complainant denied that.

56. In his submissions the prosecutor said:

“Of course, the question that my learned friend put ... about these costs being in some way related to count 39 on the indictment is again a question only. It’s got no evidentiary value. And you received no evidence that this is what the accused understood to be the case. There is no explanation for the failure to remit royalty payments as alleged in count 39.” (italics added)

(ii) Consciousness of guilt reasoning

57. Following the close of the Crown case on 7 June 2022 the trial judge and counsel debated, over a number of days, questions of law and directions to be given to the jury. During the course of that discussion the question of consciousness of guilt reasoning was raised. The trial judge expressed a strong view that the evidence did not admit of the proposition that the applicant had misstated facts out of a consciousness of guilt of all or any of the offences charged. He said:

“So, for all of those reasons it seems to me that the evidence is incapable of founding an inference of consciousness of guilt and the Crown ought not go there.”

After further discussion, his Honour said:

“...my ruling on that application is that the Crown may not use as evidence of consciousness of guilt, cross-examination of the complainant and documents shown to him during it.”

58. The prosecutor then made submissions to the jury which the applicant contends on two occasions invoked consciousness of guilt reasoning.

59. Count 83 concerned payment of $57,670.00 for a performance at a wedding in Venice in 2016. It was alleged that the applicant had fraudulently embezzled $20,914.58 by failing to remit that sum to the complainant. Cross-examination of the complainant suggested that the applicant had paid certain costs on behalf of the complainant for which the funds constituted reimbursement. In final address the prosecutor said:

“What he’s trying to do now, in hindsight, because he knows he’s $20,000-odd short on the money that he should have remitted to [the complainant] in relation to that performance, is to re-categorise the payment so that he can convince you that it should be offset against the shortfall for that performance, just like he tried to suggest that you should offset $15,000 in airfares for that performance.”

60. In relation to count 89 which involved a performance for Harvey Norman, the prosecutor said, after referring to the applicant’s Federal Court affidavit, and answers he gave in his police interview:

“Having come to an appreciation, I suggest, that that explanation just won’t wash, he’s come up with a different explanation for trial. And there was cross-examination of [the complainant] about this ...”

61. At the next break the trial judge raised with the prosecutor the submissions that had been made, saying that it seemed to him that they invoked considerations of guilt reasoning. After discussion, the prosecutor conceded that he had contravened the ruling earlier made and apologised.

(iii) Tendency evidence reasoning

62. The applicant also complained that the prosecutor improperly invoked tendency or coincidence reasoning in relation to a performance in the Hunter Valley (Count 87), as to which the applicant said, in his Federal Court affidavit, that the transfer of the payment into another 6 Degrees account had been accidental. In relation to that the prosecutor said:

“That’s what he says. ‘I accidentally transferred the whole amount to the transaction account and didn’t realise it until after as well.’ Ladies and gentlemen, you’re not going to accept that it was an error. I’ve talked about his experience, his qualifications, and this is consistent with the practice that the Crown says he is engaged in to transfer moneys to himself rather than account to [the complainant] for it.”

63. Complaint was made about this submission and the prosecutor conceded that the use of the words “the practice” did suggest reliance on or reasoning along tendency or coincidence lines. On appeal, the Crown implicitly accepted that the complaint is validly made.

(iv) Expression of personal opinion

64. Mention has been made above of the counts on the indictment that involved payments from Premier Muzik (Counts 1-32). In opening his submissions with respect to those counts, the prosecutor said:

“I think its arguable that in fact no commission was payable on any of the royalty payments because[,] as you know, they are royalty payments for performances of [the complainant’s] recordings outside of the territory which is specified in the contract ...”

65. The applicant complained that this submission transgressed the principle that a prosecutor should not, in the course of address to the jury, express personal opinions as to the outcome of the trial or any part of the evidence.

(v) Misstatements concerning the applicant’s affidavit in the Federal Court proceedings

66. The applicant complained of two submissions made by the prosecutor concerning his affidavit in the Federal Court proceedings.

67. The first was a submission that the applicant had falsely stated in his police interview that the Premier Muzik payments were not part of the Federal Court proceedings. The prosecutor later withdrew the submission.

68. The second complaint was of the submission made to the jury concerning the Sony Music royalties, in which, having told the jury that it had no evidence of any explanation for the transfer, the prosecutor added “It’s not referred to in the affidavit of the accused” (see [37] above). It is not clear that the Sony music counts were involved in the Federal Court proceedings.

Application for discharge of jury

69. On 16 June 2022 (the day following the completion of the prosecutor’s closing address) senior counsel for the applicant applied for discharge of the jury, citing “the cumulative effect” of imperfections and improprieties in the prosecutor’s address. After considering the application, on 17 June 2022 the trial judge refused the application and the trial proceeded. On 1 July 2022 the trial judge gave reasons for the refusal. It is apparent from the reasons that his Honour accepted that improprieties were pervasive in the prosecution address. Those he (either expressly or by implication) accepted were:

(i) the multiple references to there being “no explanation” or “no evidence” with respect to certain propositions put to the complainant in cross-examination; the effect of those submissions, his Honour held, was “to highlight that [the applicant] gave no evidence”;

(ii) the prosecution submissions that invited the jury to engage in consciousness of guilt reasoning, which the trial judge had ruled to be unavailable and that could not, in any event, rationally be sustained;

(iii) the prosecution submissions that invoked tendency reasoning, which was not permitted;

(iv) a prosecution submission that contradicted one of the agreed facts; and

(v) the misstatement of evidence given by the applicant in his affidavit in the Federal Court proceedings.

70. Notwithstanding the accumulation of improprieties, the trial judge considered that the adverse effects could be ameliorated by adequate directions. As I have indicated above, no ground of appeal directly challenged the refusal of the discharge application. However, ground 2 raises essentially identical issues.

71. The ameliorative directions given by the trial judge after the Crown’s closing address were comprehensive and extensive. They need to be set out in full. As recorded in the transcript, His Honour told the jury:

“The accused is presumed innocent unless and until the Crown proves his guilt. He need not prove anything. He is not obliged therefore to provide any explanation. He was not obliged to give or call any evidence. He has a right to silence. We all do. He exercised that right to silence in not giving or calling any evidence. It would be no right at all if the accused exercised that right but then found it was used against him. You cannot do so. The fact he did not give or call evidence cannot help the Crown prove its case, cannot fill in any gap that might exist in its evidence or make up for anything missing in its case. It cannot help the Crown prove its case in any way at all. It does not amount to any admission of guilt. No inference can be drawn against him because of it.

It follows that you must disregard all submissions the Crown made based on claims there had been no explanation for certain matters. You must decide whether the Crown has proved the alleged offences it brings against the accused beyond reasonable doubt based solely on the evidence that it has presented.

The next direction I am going to give you concerns submissions the Crown made to the effect that you would draw conclusions from propositions counsel put to witnesses. Let me tell you how you should approach these suggestions. Most fundamentally, propositions counsel put to witnesses are not evidence. You might recall the Crown repeatedly acknowledged that in his closing address. As I have already said, you must decide the issues in the trial only on the evidence. It follows that you cannot draw conclusions from propositions counsel put to witnesses. You must therefore disregard all submissions of the Crown to the effect that you would draw conclusions from propositions counsel put to witnesses.

There are further difficulties with the submissions to the effect that you might draw conclusions from propositions counsel put to witnesses so far as they concern the state of mind of the accused. Counsel cannot be equated with the accused. Counsel exercise judgment and make their own decisions about the questions they ask. Propositions counsel put to witnesses cannot be viewed as reflecting the state of mind of the accused. It follows from this too that you must disregard all submissions of the Crown to the effect that you would draw conclusions from propositions counsel put to witnesses about the state of mind of the accused in particular.

The next direction I’m going to give you concerns submissions the Crown made to the effect that explanations of the accused in his accounts in the affidavit and interview with police were false. You might recall the Crown made a submission to the effect that the accused gave a false explanation in his affidavit and that you would conclude from this that he had attempted falsely to explain his fraud.

As you will recall, the Crown withdrew that submission soon after it was made. The accused had not been charged with anything when he made the affidavit. It follows that you could not draw any conclusion from anything said in it that it was an attempt falsely to explain any fraud. The Crown acknowledged that submission could not be sustained for that reason. But the Crown went on to suggest explanations in the affidavit were relevant to the accused’s credibility, and the Crown also made reference to other explanations the Crown said were false in the affidavit, or in the interview.

As I have already explained, you must decide all the issues on the evidence. It follows that you could only draw any conclusion about any assertion of the accused whether in the affidavit or in the interview from other evidence in the trial. It is a matter to [sic] you subject to that as to whether any assertion in either was false as the Crown suggested. But let me tell you know [sic] how you must approach these suggestions that explanations in the affidavit or the interview were false.

[His Honour then gave a direction in accordance with Zoneff v The Queen (2000) 200 CLR 234; [2000] HCA 28.]

... The next direction I am going to give you concerns submission [sic] the Crown made to the effect that the accused had a ‘practice’. The Crown rightly told you in opening address you must consider each count separately. It follows from this that you cannot view evidence on multiple counts together as showing some practice. You must consider each count and the evidence on it separately. You cannot use evidence on one or more counts as showing the accused had some tendency to act in a particular way that makes more likely [that] he did the act alleged for another count. You cannot use evidence on one or more counts as showing he had some tendency to have a particular state of mind that makes more likely he had the state of mind alleged for another count. Nor can you use evidence of several alleged events in considering any particular count.

...” (italics added)

Some of these directions were repeated in his Honour’s summing-up.

Relevant legal principles

72. Section 6(1) of the Criminal Appeal Act 1912 (NSW) provides as follows:

Determination of appeals in ordinary cases

(1) The court on any appeal under section 5 (1) against conviction shall allow the appeal if it is of opinion that the verdict of the jury should be set aside on the ground that it is unreasonable, or cannot be supported, having regard to the evidence, or that the judgment of the court of trial should be set aside on the ground of the wrong decision of any question of law, or that on any other ground whatsoever there was a miscarriage of justice, and in any other case shall dismiss the appeal; provided that the court may, notwithstanding that it is of opinion that the point or points raised by the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred.

73. Section 6(1) thus allows a conviction to be set aside on any one (or more) of three separate bases:

(i) that the verdict of the jury is unreasonable or cannot be supported having regard to the evidence;

(ii) that there was a wrong decision of any question of law; or

(iii) that on any other ground whatsoever there was a miscarriage of justice.

The onus lies on the convicted person who appeals against a guilty verdict to establish one of these grounds. If one of the grounds is successfully invoked, a fourth question may, under the proviso to s 6(1), potentially arise:

(iv) whether, notwithstanding that a relevant ground has been established, no substantial miscarriage of justice has actually occurred.

74. The onus lies on the Crown to establish the fourth proposition.

75. In this case the applicant invoked only the third limb of s 6(1). He contended that, by reason of the multiple flaws in the address of the prosecutor, a miscarriage of justice has been established for the purposes of s 6(1). A miscarriage of justice occurs where there is any departure from the entitlement of an accused person to a trial in which the relevant law is correctly explained to the jury and the rules of procedure and evidence are strictly followed, as a result of which the accused person has been deprived of chance that was fairly open to him (or her) of being acquitted: Mraz v The Queen [1955] HCA 59; (1955) 93 CLR 493 at 514; [1955] HCA 59 (Fullagar J) (“Mraz”); Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81 at [18] (“Weiss”).

76. In Hofer v The Queen (2021) 274 CLR 351; [2021] HCA 36 at [41] (“Hofer”) Kiefel CJ, Keane and Gleeson JJ said, relying on Weiss, that a miscarriage of justice to which s 6(1) refers includes any departure from a trial according to law to the prejudice of the accused. (The last six words are an addition to the principle as stated in Weiss but consistent with what was said by Fullagar J in Mraz).

77. In Zhou v R [2021] NSWCCA 278 at [22] (“Zhou”), after citing Hofer, Beech-Jones CJ at CL said, with the concurrence of Davies and Wilson JJ:

“... To constitute a miscarriage of justice under s 6(1) of the Criminal Appeal Act 1912 such an irregularity has to be prejudicial in the sense that there was a ‘real chance’ that it affected the jury’s verdict (Hofer at [41] and [47] per Kiefel CJ, Keane and Gleeson JJ; at [118] per Gageler J) or ‘realistically [could] have affected the verdict of guilt’ (at [123] per Gageler J) or ‘had the capacity for practical injustice’ or was ‘capable of affecting the result of the trial’ (Edwards v The Queen [2021] HCA 28 at [74] per Edelman and Stewart JJ).”

(In Zhou the irregularity was the failure of the trial judge to explain or expand orally on written directions, which, in an earlier case, had been characterised as a failure to observe the requirements of the criminal process in a fundamental respect, something that was held to be a miscarriage of justice.)

This paragraph was endorsed by the majority (Gageler CJ, Gleeson and Jagot JJ) in the High Court in HCF v The Queen [2023] HCA 35 at [2].

The proviso

78. The proviso to s 6(1) supposes that one of the three limbs of s 6(1) has been established. The proviso does not come into contemplation unless the court concludes that the circumstances of the trial justify upholding one of the three s 6(1) grounds. Where, as here, the proviso is invoked by the Crown, this Court is called upon to focus on the nature and effect of the circumstance that justifies upholding of one of the s 6(1) limbs.

79. In Weiss, the High Court (unanimously) declared that, where the proviso is invoked, the task of the appellate court is to determine for itself whether, as a result of the departure from applicable standards, a substantial miscarriage of justice has actually occurred, by making its own independent assessment of the whole of the evidence, and determining whether, on that evidence, the accused person was proved beyond reasonable doubt to be guilty of the offence (or offences) of which he or she was convicted.

80. However, in Kalbasi v Western Australia (2018) 264 CLR 62; [2018] HCA 7 the majority (Kiefel CJ, Bell, Keane and Gordon JJ) acknowledged (at [15]) that some errors will be of a kind that will prevent the appellate court from being able to assess whether guilt was proved to the criminal standard.

The parties’ contentions

81. The applicant’s simple contention with respect to ground 2 of the appeal is that the prosecutor’s address occasioned a miscarriage of justice. All of the extracts in paragraphs 18 to 56 above have a common element, which the applicant contends to be a contravention of the Evidence Act, s 20 prohibition on comment by a prosecutor on the failure of an accused in a trial on indictment to give evidence. That is the principal basis for this ground of appeal although the applicant also relies on the additional matters set out above.

82. The Crown did not dispute that the prosecutor’s address was marked by a number of inappropriate comments, including submissions that amounted to comments on the failure of the applicant to give evidence, and which had the effect of reversing the onus of proof.

83. The Crown, however, contended that the remedial directions given by the trial judge were effective to counteract the adverse effects of the improprieties, and that, in all of the circumstances (including the trial judge’s strong directions) those improprieties did not give rise to a miscarriage of justice within the third limb of s 6(1).

Consideration

84. It is necessary to consider the complaint in the context of the trial as it unfolded. Two background facts are important. First, senior counsel who appeared for the applicant at trial opened to the jury with a statement that there would be “an answer” to each allegation made by the Crown. This may be thought to have conveyed a signal that the applicant would give evidence in response to the prosecution case (although there was no explicit statement of intent to this effect). The signal was strengthened when senior counsel for the applicant later undertook that documents shown to the complainant in cross-examination would be tendered through the applicant or another witness. They were not. In the event, the applicant did not give evidence. Nor was any evidentiary answer given to any of the charges, although senior counsel attempted (unsuccessfully) to adduce answers through cross-examination of the complainant. Second, in cross-examination of the complainant, propositions of fact were repeatedly put to the complainant, virtually all of which he rejected. On a number of occasions the complainant was shown documents that were marked for identification, but were never tendered into evidence.

85. Two themes permeated the address of the prosecutor. One was the perfectly correct and legitimate proposition that the questions put to the complainant in cross-examination did not constitute evidence, and that it was only the answers of the complainant, invariably denying the proposition, that constituted evidence. No criticism can be made of the prosecutor in relation to those submissions. The second theme, however, went beyond what was legitimate and drew the jury’s attention to the fact that the applicant did not give evidence. These remarks were, in many cases, made in a context in which the only person who could have given that evidence (or, at least, the obvious person to give that evidence) was the applicant. For example, in the first extract above (at [20]-[24]) the dispute was about who had composed the email sent to Sean Anderson at 3.40 am on 12 July 2009. The complainant said in evidence that it was the applicant who did so. Although that assertion does not appear to have been directly challenged in cross-examination, the prosecutor nevertheless submitted to the jury that there was “no evidence before you in clear terms that it wasn’t [the applicant] that drafted that email”. That was an unmistakable allusion to the fact that the applicant had not given evidence. So it was with the remainder of the submissions. This was a clear departure from the prohibition in s 20 of the Evidence Act.

86. The first question for determination is whether any or all of the submissions of the prosecutor extracted above was or were such as to give rise to a miscarriage of justice.

87. In submissions in this Court the Crown very fairly acknowledged that there were infelicities and improprieties in the prosecutor’s address. It was acknowledged that the references to the lack of any “explanation” by the applicant were “inappropriate”. This concession was properly made. There can be little doubt that each of the submissions that commented on the absence of evidence on a particular issue constituted a contravention of s 20 of the Evidence Act. In Gregg at [586]-[588] similar submissions were held to have amounted to comment on the failure of that accused to give evidence, to be unfair and unbalanced and, to a significant extent, to have reversed the onus of proof. So it is in this case.

88. Other aspects of the address, while not insignificant, were less egregious. I would discount the complaint about the expression of personal opinion by the prosecutor, which, in my opinion, was of little moment. Certainly, it did not cause any concern in the mind of senior counsel who did not raise it in the detailed application for jury discharge. But the complaints that, contrary to the trial judge’s rulings, the prosecutor addressed in a way that invoked consciousness of guilt reasoning and tendency reasoning, and misstated the effect of the applicant’s affidavit, all are of some substance. It is not necessary to consider whether, alone, they would have constituted a miscarriage of justice.

89. The real question is whether the extensive directions given by the trial judge had the effect of ameliorating the damage done by the prosecutor’s address.

90. I have concluded that the accumulation of improprieties in the address gave rise to a miscarriage of justice within the meaning of s 6(1) of the Criminal Appeal Act that were beyond the redemption of the trial judge, despite his Honour’s best endeavours in that respect.

The proviso

91. The Crown submitted (somewhat forlornly) that the proviso to s 6(1) of the Criminal Appeal Act could be applied.

92. As noted above the task of this Court when the proviso is invoked is to determine for itself whether the evidence established beyond reasonable doubt the guilt of the accused person, the onus lying on the Crown to establish that it did.

93. This was a trial that proceeded over a number of weeks and depended on very large quantities of documentary material. In this Court the Crown did not attempt to identify the evidence which, it would assert, establishes the guilt of the applicant, and the applicant has accordingly not had any opportunity in the appeal to respond to such a contention.

94. I cannot be satisfied that the applicant has been shown to have been guilty of any of the charges of which he was convicted. The Crown has failed to discharge its onus.

95. The only available order with respect to Ground 2 is that the convictions be set aside and there be a new trial.

Ground 3

96. By Ground 3 of the appeal the applicant asserts that a miscarriage of justice occurred by reason of undue pressure placed upon the jury during the course of their deliberations. The ground does not raise any issue of principle that would affect the conduct of a new trial. It is entirely concerned with circumstances that are unlikely to be repeated. It is unnecessary, in this instance, to embark upon resolution of that ground of appeal.

97. The orders I propose are:

(1) leave granted to appeal against conviction;

(2) appeal allowed; convictions quashed;

(3) there be a new trial;

(4) S/O to the District Court Arraignments List on 15 December 2023.

98. LONERGAN J: I agree with Simpson AJA, for the reasons given by her Honour, that ground 2 of the appeal should be upheld. I also agree that as a result, ground 3 does not need to be determined. I agree with Dhanji J that leave to appeal should be granted with respect to ground 1, but that ground of appeal should be dismissed for the reasons given by his Honour with which I agree.

99. DHANJI J: Titus Emanuel Day (the applicant) seeks leave to appeal against his conviction of 34 counts of embezzlement as a clerk or servant contrary to s 157 of the Crimes Act 1900 (NSW).

100. The complainant is a well-known performer and recording artist. The applicant was the sole director and shareholder of 6 Degrees Management Pty Ltd (“6 Degrees”) which was responsible for the management of the complainant’s professional activities. It is through that position that the applicant was alleged to have embezzled money to which the complainant was entitled.

101. The applicant was, on 3 May 2022, arraigned before a jury panel on an indictment containing 50 counts of embezzlement as a clerk or servant and 50 alternative counts of larceny, each in the alternative, contrary to s 117 of the Crimes Act. On 30 June 2022, following directed verdicts on three of the embezzlement counts and directed verdicts on all of the alternative counts of larceny, the jury returned guilty verdicts to 34 counts of embezzlement and not guilty verdicts as to the remaining 13 counts of embezzlement.

102. On 17 November 2022, the applicant was sentenced by Gartelmann SC DCJ to an aggregate sentence of 4 years imprisonment comprising a non-parole period of 2 years and 6 months commencing on 17 November 2022 and expiring on 16 May 2025 and a balance of term of 1 year and 6 months expiring on 16 November 2026.

103. The applicant’s amended grounds of appeal are as follows:

“(1) The trial Judge erred in concluding that the definition of clerk or servant in the Crimes Act 1900 was capable of applying to the applicant;

(2) The Crown Prosecutor’s closing address occasioned a miscarriage of justice; and

(3) The verdicts of guilty should be set aside because it appears they were reached as a result of undue pressure rather than proper deliberations.”

104. It was accepted by both parties that if ground 1 was successful, the Court would enter verdicts of acquittal and if the ground 2 or 3 were successful, it would be at the Court’s discretion to order a new trial.

105. In the form in which it is expressed, ground 1 raises a question of mixed law and fact and leave is required pursuant to s 5(1)(b) of the Criminal Appeal Act 1912 (NSW). The issue at the heart of this ground could, however, be expressed as a question of law alone and I would, accordingly, grant leave. Grounds 2 and 3 are questions of mixed fact and law and require leave.

Procedural history

106. The trial commenced on 3 May 2022 and continued on 4 May 2022 before the late Zahra SC DCJ. Both parties gave opening addresses, and the Crown called its first witness. On 5 May 2022, the jury was informed that Zahra DCJ had fallen ill, and the trial was adjourned until 16 May 2022. Tragically, for the profession and all who knew him, Zahra DCJ had, by that time, died and Gartelmann DCJ was appointed as the new trial judge pursuant to s 164A of the Criminal Procedure Act 1986 (NSW).

A brief overview of the Crown case

107. The applicant worked at a management company called 22 Management Pty Ltd (22 Management) from around 2004. In 2007, the complainant entered into a management agreement with 22 Management and the applicant began working as the complainant’s manager. In 2009, the applicant informed the complainant that he was leaving 22 Management to form his own management company, 6 Degrees. The complainant agreed to leave 22 Management and join 6 Degrees as a “marquee client”. The complainant negotiated a release from his contract with 22 Management. Although a written agreement was prepared between the complainant and 6 Degrees, it was never executed. It was apparently understood that the arrangement was to be consistent with the agreement with 22 Management, which was reflected in the unsigned agreement subject to a dispute between the applicant and the respondent as to whether one particular clause of the unsigned contract was part of the agreement between the parties.

108. The applicant’s role as the complainant’s manager involved facilitating a range of contractual arrangements on behalf of the complainant including tours, record deals, publishing deals, royalty arrangements, corporate performances, television appearances, and commercial ambassador relationships. As part of the agreement with 6 Degrees, gross income from the complainant’s performances, royalties, and ambassadorships were, in most cases, paid into the 6 Degrees trust account. A different account was used for a small number of the later offences. On the Crown case, the agreement was that, after deducting commission and GST, the applicant was obliged to remit the balance of the money to the complainant within 14 days. As noted above, there was a lack of formality in the contractual relationship between the complainant and 6 Degrees.

109. It was the Crown case that the applicant misappropriated the money because he either withdrew or transferred money from the trust account of 6 Degrees and used that money for a purpose other than for the complainant’s benefit. The Crown argued that the applicant knew that he was not entitled to deal with the money in the trust account as he did. In support of this submission, the Crown relied on evidence that the applicant was a qualified lawyer with experience in managing artists.

110. The individual counts on the indictment dealt with a variety of payments that, on the Crown case, were received by the applicant and not properly remitted to the complainant. These counts can be broadly categorised as follows:

(1) counts 1 to 31 related to the failure of the applicant to remit the transfers of royalty payments from Premier Muzik to 6 Degrees to the complainant;

(2) counts 33 to 45 related to the failure of the applicant to remit royalty payments from Warner Music to 6 Degrees to the complainant;

(3) counts 47 to 67 related to the failure of the applicant to remit royalty payments from Sony Music to 6 Degrees to the complainant; and

(4) counts 69 to 99 related to the failure of the applicant to remit payments, or portions of payments received by 6 Degrees relating to various individual or corporate performances, events, tours, and ambassadorships to the complainant.

111. The odd numbered counts were the offences of embezzlement as a clerk or servant. The even numbered counts were the corresponding alternatives charging larceny as a clerk or servant. Gartelmann DCJ, while rejecting the application for directed verdicts on the primary counts, held that the applicant was entitled to directed verdicts on the larceny counts (in the event that these came to be considered by the jury).

112. The agreement between 6 Degrees and the complainant was terminated in November 2017, following a breakdown in the relationship between the applicant and the complainant, and, in July 2018, upon discovering financial inconsistencies, the complainant filed a civil action against the applicant in the Federal Court. The applicant filed a cross-claim in the Federal Court, supported by an affidavit. 6 Degrees was placed into administration in 2018 and in 2020, the complainant reported the matter to the New South Wales Police Force, whereupon the applicant was arrested and charged.

The applicant’s position at trial

113. There was no evidence called by the applicant at the trial. The position taken by the applicant was that the Crown could not prove beyond reasonable doubt that the applicant acted dishonestly. The defence relied on the good character of the applicant, and it was submitted that the dispute between the applicant and the complainant was one that should have remained in the civil jurisdiction. The defence also pointed to asserted shortcomings in the police investigation.

Ground 1 – The trial judge erred in concluding that the definition of clerk or servant in the Crimes Act was capable of applying to the applicant

114. As noted above, an application for directed verdicts on the basis that the evidence was not capable of establishing the applicant was a “clerk or servant” for the purposes of the offence provision, was rejected at trial. On the appeal, the applicant contends the trial judge was in error in doing so. The applicant relies on the argument raised at trial but raises additional arguments not made at trial. The first of his additional arguments was raised in his written submissions on the appeal and the second in senior counsel’s oral submissions on the appeal. I will deal with each of the arguments in turn.

The argument at trial

115. At an early stage of the trial, senior counsel for the applicant foreshadowed an application for directed verdicts on the primary counts on the basis that the evidence in the Crown case could not establish that the applicant was a “clerk or servant” within the meaning of the offence provision as this required proof of an employer/employee relationship. It was agreed between the parties that the evidence could not support such a relationship. The Crown contended that the provision should be construed more broadly and thus included the relationship between the applicant and the complainant. The primary judge refused the application for directed verdicts for the embezzlement counts. The applicant contends he was wrong to do so. To resolve the question, it is necessary to consider the applicable provisions.

116. The offence provision, s 157 of the Crimes Act, provides:

157 Embezzlement by clerks or servants

Whosoever, being a clerk, or servant, fraudulently embezzles, either the whole or any part of, any property delivered to, or received, or taken into possession by him or her, for, or in the name, or on the account of, his or her master, or employer, shall be deemed to have stolen the same, although such property was not received into the possession of such master, or employer, otherwise than by the actual possession of such clerk, or servant, and shall be liable to imprisonment for ten years.

117. The central provision relevant to the determination of this ground, however, is s 155 of the Crimes Act, which provides the definition of “clerk or servant”:

155 Definition of clerk or servant

Every person employed for any purpose, as, or in the capacity of, a clerk, or servant, or as a collector of moneys, although temporarily only, or employed also by other persons, or employed to pay as well as receive moneys, or although the person had no authority from his or her employer to receive money, or other property, on his or her account, shall be deemed a clerk, or servant.

118. The applicant contended below, and maintains on this appeal, that “employed” in s 155 means employed under a contract of service as distinct from a contract for services. In the present case, the applicant was, on no view of the evidence, employed under a contract of service by the complainant. Rather, he (or at least 6 Degrees, a matter relevant to the further arguments in this Court) was engaged by the complainant in a contractual arrangement by which services were provided to the complainant in return for fees.

119. The question is one of statutory construction, principally of s 155. The task is to be approached in the manner described by Kiefel CJ and Keane J in The Queen v A2; Magennis, Vaziri (2019) 269 CLR 507; [2019] HCA 35, where their Honours said (at [32]-[33]):

“32 The method to be applied in construing a statute to ascertain the intended meaning of the words used is well settled. It commences with a consideration of the words of the provision itself, but it does not end there. A literal approach to construction, which requires the courts to obey the ordinary meaning or usage of the words of a provision, even if the result is improbable, has long been eschewed by this Court. It is now accepted that even words having an apparently clear ordinary or grammatical meaning may be ascribed a different legal meaning after the process of construction is complete. This is because consideration of the context for the provision may point to factors that tend against the ordinary usage of the words of the provision.

33 Consideration of the context for the provision is undertaken at the first stage of the process of construction. Context is to be understood in its widest sense. It includes surrounding statutory provisions, what may be drawn from other aspects of the statute and the statute as a whole. It extends to the mischief which it may be seen that the statute is intended to remedy. “Mischief” is an old expression. It may be understood to refer to a state of affairs which to date the law has not addressed. It is in that sense a defect in the law which is now sought to be remedied. The mischief may point most clearly to what it is that the statute seeks to achieve.” (footnotes omitted)

120. Similarly, in the same case, Bell and Gageler JJ said (at [124]):

“The principles of interpretation were not in issue on the hearing of the appeals. In assigning legal meaning to the words of a provision, the court starts with consideration of the ordinary and grammatical meaning of the words taking into account both context and legislative purpose. Consideration of context in its widest sense and the purpose of the statute informs the interpretative task throughout. That consideration, and the consequences of giving a provision its literal, grammatical meaning, may lead the court to adopt a construction that departs from the ordinary meaning of the words. Purposive construction, however, does not extend to expanding the scope of a provision imposing criminal liability beyond its textual limits.” (footnotes omitted)

121. Despite the similarity of approach, Bell and Gageler JJ were in dissent as to the proper construction of the provision in question, demonstrating that uniformity of approach in this field does not necessarily result in uniformity of outcome.

122. There has been no substantial amendment of the operative provisions since they were enacted in 1900. Prior to the enactment of the Crimes Act they formed part of its predecessor, the Criminal Law Amendment Act 1883 (NSW).

123. Prior to the enactment of the definition in s 155 of the Crimes Act (introduced by its forebear, s 119 of the Criminal Law Amendment Act), the words “clerk or servant” in the offence provision (now s 157 of the Crimes Act) had been given their apparent meaning. In R v Wilford (1876) 14 SCR (NSW) 465, Sir James Martin CJ, with whom the other members of the Court agreed, on a question of law reserved, found that on the facts of the case, the “relationship of master and servant” did not exist between the prisoner and the complainant. The prisoner had been engaged occasionally by the complainant. Martin CJ observed (at 466), after referring to authority, that “a person who is employed to get orders and receive money, but who is at liberty to get those orders and receive that money where and when he thinks proper, is not a clerk or servant within the meaning of the statute”. As the prisoner was “not under the control of the [complainant] when the money was misapplied” he was not guilty of the offence.

124. Following the decision in R v Wilford, s 119 of the Criminal Law Amendment Act was enacted to provide a definition of “clerk or servant”. This provision was subsequently enacted as s 155 of the Crimes Act.

125. The first thing to be observed with respect to s 155 of the Crimes Act is that, while headed “Definition of clerk or servant” (and I have referred to it above as a definition), it is not strictly a definition but is rather a deeming provision. That is, persons within the description in s 155 are deemed to be a “clerk or servant”. The section thus takes an expression “clerk or servant” and includes within the expression relationships which would not otherwise be clerk or servant relationships. By doing so, s 155 gives an expanded meaning to the expression “clerk or servant” beyond that which applied in R v Wilford. In particular, it includes persons employed as “collectors of money”. Subject to the further arguments raised in this Court, this included the applicant without the need to prove an employer/employee relationship. As explained by Gartelmann DCJ:

“The legislature's intention to extend the scope of the offence is apparent from the text. The phrase "employed for any purpose as" applies to each category of persons deemed to be clerks or servants. These include not only clerks and servants but also persons employed as collectors of moneys. This disjunctive grammar informs the proper construction of the provision. It cannot be reconciled with a construction of the word "employed" as comprehending only master and servant relationships. That would make redundant the inclusion of the discrete category of persons employed as collectors of moneys that [are] deemed to be clerks or servants. Language otherwise used in the provisions does not indicate any contrary intention. "Employer" is used as an alternative to "master" in the offence provision. It must be construed cognately with the word "employed" in the definitional provision."

126. His Honour’s reasoning is persuasive and I would adopt it.

127. His Honour also noted that the phrase “employed for any purpose” and the clarification that a person may be “employed to pay as well as receive moneys”, reinforce an intention to provide a broad definition of “clerk or servant”. His Honour additionally noted the use of the term “employed” in ss 145 and 151 of the Crimes Act, as enacted. Those provisions were also adopted from the Criminal Law Amendment Act (ss 87 and 113) and used “employed” in a manner that does not appear to be confined to master and servant relationships. This supports giving a similar, broad ambit to the word as used in s 155 of the Crimes Act. I pause to note here that ss 159 and 160 use the expression “being employed in the Public Service”, which may suggest a more limited role for the word “employed”, at least in those provisions. The use of the word “in” in the expression “employed in the Public Service”, is good reason not to give the word “employed” the same meaning in those sections as in s 155 (and ss 145 and 151). This is particularly so when considered together with the textual indicators that compel a broader meaning be given to the word in ss 145, 151, and importantly s 155: see The King v Jacobs Group (Australia) Pty Ltd [2023] HCA 23; 97 ALJR 595 at [25]; Registrar of Titles of the State of Western Australia v Franzon [1975] HCA 41; (1975) 132 CLR 611 at 618; [1975] HCA 41.

128. In R v Wilford, in finding that the prisoner was not a clerk or servant on the basis of not being in a master and servant relationship, Martin CJ described him as having been “employed” by the complainant to “get orders and receive money”, effectively using “employed” as a synonym for “engaged”. This use is similar to the apparent use of the term in ss 145 and 151 of the Crimes Act. It is also, in my view, the sense in which the word is used in s 155.

129. For the reasons given above, which are essentially those given by Gartelmann DCJ, a clerk or servant for the purposes of s 157 of the Crimes Act, as defined in s 155, does not require proof of a master and servant relationship. It does not require the Crown to establish that the applicant was bound to the complainant by a contract of service. In fairness, the applicant, while maintaining the submissions made below, acknowledged the difficulties with the argument as put at first instance and it was only faintly pressed. The greater emphasis was given to arguments which had not been put at first instance.

The applicant’s argument as put in his written submissions on the appeal

130. In his written submissions on the appeal, the applicant submitted that the argument which may call for “more serious consideration” is that (assuming rejection of his first argument) while s 155 of the Crimes Act extends to persons beyond those engaged by a contract of service, “it only does so to fill the gap exposed by cases such as R v Wilford” and was not inserted to “create liability for persons engaging in business that is commercial in character”.

131. The applicant noted that the principal authors of the 1883 statute were Sir Alfred Stephen, the former Chief Justice, and Alexander Oliver, the New South Wales Parliamentary draughtsman. They were also responsible for a publication titled the Criminal Law Manual (1883, Thomas Richards, Government Printer), which was an annotated version of the Criminal Law Amendment Act. The applicant points to the commentary in that publication on s 119 (at 49):

“There is no corresponding section to this in the Imperial Act. The definition of Clerk or Servant given in the Digest is “A person bound either by an express contract of service, or by conduct implying such a contract, to obey the orders and submit to the control of his master, in the transaction of business which it is in his duty as such clerk or servant to transact.

Under this section, such a conviction as that in R v Wilford, S.M.H., 9 December, 1876, would not be quashed on the ground of temporary or occasional employment of the accused.”

132. Reference was made, by the applicant, to what was said by Theodore F.T. Plucknett in his book, A Concise History of the Common Law (5th Ed, 1956, Butterworth) (at 450), where the author noted that the English Parliament responded to gaps in the common law definition of larceny, exposed by what were regarded as “unusually disturbing decision[s] of the courts”, to extend liability beyond that covered by the common law. The author observed that the amendments “as a rule went little further than reversing” the particular decision prompting its enactment.

133. From this somewhat shaky foundation, the applicant argues that the introduction of s 119 in the Criminal Law Amendment Act intended to go “no further than reversing [R v] Wilford, and was not intended to effect a radical change to the legal and commercial landscape by extending criminal liability to all persons receiving money in the course of business and commerce”.

134. Of course, it is not necessary to decide whether s 119 of the Criminal Law Amendment Act extended liability to “all persons receiving money in the course of business and commerce”, although plainly it does not. While it may be that s 119 was a response to the decision in R v Wilford, there is nothing in the words of the section or the text more generally, that warrant giving the intentionally expansive words of the section a limited reading. Indeed, it is not at all clear what, on the applicant’s written submissions, that reading would be. There is nothing in the text of the section excluding the application of the definition as a result of the commercial nature of the relationship between the complainant and the applicant.

135. The submission in writing is that the definition covers a person such as the prisoner in R v Wilford who “misappropriated money which he was engaged ad hoc to collect on behalf of another, without any contract of service between the two”. The prisoner in R v Wilford was described by Manning J (at 466) as “an idler who was willing to do occasional jobs for the sake of the few shillings”. What then would have been the case had Mr Wilford been somewhat more industrious? It is not clear, on the applicant’s argument, at what point the situation would change. Section 155 of the Crimes Act itself explicitly allows that the person to be deemed a clerk or servant might be employed by multiple persons. There is nothing in the words of the provision to suggest that if the prisoner in R v Wilford was engaged full-time in collecting money for the complainant and others he would have escaped the boundaries of the definition in s 155 of the Crimes Act.

136. Subject to the further argument discussed below (that is, putting to one side any distinction between the applicant and 6 Degrees), the question was whether there was evidence capable of establishing that the applicant was employed as a collector of moneys within the meaning of s 155 of the Crimes Act. The evidence in the Crown case was capable of establishing that the applicant was engaged by the complainant to collect money on behalf of the complainant. This was the use to which he was employed by the complainant. Being thus employed as a collector of moneys, the applicant was, within the meaning of s 155, deemed to be a clerk or servant.

The applicant’s argument as put in his oral submissions on the appeal

137. While not abandoning any submissions previously made, at the hearing of the appeal, the applicant’s submissions took on a different flavour. In oral submissions it was contended that the applicant was not a “clerk or servant” as the evidence in the Crown case was that the complainant’s agreement was with 6 Degrees and not the applicant. As a result of the different nature of the argument, the Crown was given leave to provide supplementary submissions, and the applicant filed submissions in reply to the supplementary submissions of the Crown.

138. As discussed above, while there was some dispute about the precise terms, there was no issue that the complainant had entered into a contractual relationship with 6 Degrees with respect to his management, and that, pursuant to that arrangement, moneys were received into accounts held by the company. It was thus argued that it was 6 Degrees that had obligations pursuant to the contractual arrangements and thus 6 Degrees, and 6 Degrees only, was the collector of moneys.

139. The factual foundation for the applicant’s contention was supported by the agreed facts, which were before the jury pursuant to s 191 of the Evidence Act 1995 (NSW) and included the following:

“1. 6 Degrees Management Pty Limited (6 Degrees) is an Australian company that was first incorporated on 11 July 2009.

2. The [applicant] was at all material times the sole shareholder and director of 6 Degrees.”

140. The agreed facts stated that “6 Degrees operated” two Westpac bank accounts, the first labelled as a “trust account” and the second labelled as a “transaction account”, from 26 April 2012 to 11 July 2019. The facts additionally stated that “Titus Day opened and operated an account titled ‘6 Degrees Plus Pty Ltd Business Everyday Account’” from 18 June 2019.

141. The agreed facts were then divided into sections relating to the various counts in the indictment. The agreed facts provided that payments related to each of the counts were made to 6 Degrees, generally nominating the particular account into which payments were made. The jury were also provided with the relevant bank statements and tables showing amounts received into the bank accounts from the various sources and the details of transfers out of the accounts.

142. It was submitted by the Crown that at trial, the applicant was treated as synonymous with 6 Degrees, although the applicant contends that a distinction between the two was maintained (at least by him). Nothing, however, turns on this. The agreed facts established the existence of the corporate entity and payment of money into accounts operated by it. If the applicant’s point is a good one, it does not matter that the Crown (or the applicant) approached the matter at trial on an erroneous basis.

The application of the text of s 155 of the Crimes Act to the circumstances of this case

143. It is convenient to consider the argument, in the first instance, by reference to the text of the relevant provisions, before considering relevant authority.

144. As discussed above, the applicant originally framed his argument in terms that distinguished between a contract of service, that is, a traditional master and servant relationship, and a contract for service, and contended that s 155 of the Crimes Act was limited to the former. That argument has been dealt with above. Adopting the categorisations utilised by the applicant for the purposes of that argument necessarily placed a focus on the nature of the contractual relationship between the parties. The applicant’s argument is that he had neither a traditional master servant relationship with the complainant, that is, a contract of service, nor a contract for service, as the contract for service was between the complainant and 6 Degrees. On the applicant’s argument, it follows that the applicant could not be deemed to be a “clerk or servant”.

145. The flaw in the applicant’s argument is that it takes the dichotomy used by the applicant to illustrate the first argument and treats those alternatives as describing the world of potential relationships that might fall into the category of “clerk or servant”. The question, as framed by the applicant’s ground of appeal, is whether there was evidence before the jury sufficient to prove that the applicant was deemed to be a clerk or servant pursuant to s 155 of the Crimes Act. For this purpose, it was sufficient that there was evidence that the applicant was “employed ... as a collector of moneys”. There is nothing in the words of the section that require this question to be determined by the existence or non-existence of a contractual relationship between the parties.

146. It is to be recalled, as discussed above, that s 155 of the Crimes Act is plainly intended to include persons beyond those in ordinary master servant relationships with the complainant. The result, as discussed above, is that “employed” is not limited to persons engaged as employees in such a master servant relationship, but rather extends to persons employed for a purpose. In other words, it extends to persons engaged or put to use for some purpose. In the present case, while the company may have been formally engaged in the contractual sense, that does not deny that the relevant dealings were with the applicant. The complainant, in this sense, engaged the applicant to act on his behalf, albeit it was intended that the legal relationships were to be with a corporate entity. This supports the view that it was, at least, open to find the complainant employed the applicant in the relevant sense.

147. It is, of course, not enough that the complainant employed the applicant. It is necessary that he was employed “as a collector of moneys”. As the agreed facts above set out, two of the accounts were said to be operated by 6 Degrees and the third, the NAB Business account, was said to have been opened and operated by the applicant. This change appears to have been the result of events affecting the company. The applicant’s case is strongest in relation to the accounts operated by 6 Degrees and the argument can be determined as if all the accounts were operated by 6 Degrees.

148. Payments into the company bank accounts resulted in the company obtaining legal title to that money. This puts matters in somewhat simplistic terms, having regard to the nature of what is ordinarily described as money in a bank account. The “money” paid into the account was actually a chose in action which required the bank to pay the company all or part of what was credited to the account: see Lordianto v Commissioner of the Australian Federal Police (2019) 266 CLR 273; [2019] HCA 39 at [5]. There is, however, no argument in the present case directed to the nature of the relationship between the bank and the company and accordingly, no argument that the transfers into the accounts did not involve a relevant collection of money.

149. That payments were made to accounts held by the company, does not, in my view, deny that the applicant was employed as a collector of moneys. The evidence was that the acts of the company were brought about by the applicant (irrespective of whether the distinction between the applicant and the company was alluded to or maintained at trial). The applicant directed that the moneys be paid to the particular accounts. While he may have been acting on behalf of the company in doing so, it was his acts that brought about the payments to the accounts. The applicant controlled, again on behalf of the company, the money in those accounts. The intervention of the company did not necessarily mean that the applicant was not employed as a collector of moneys. There was, at least, evidence on which the jury could find he was a collector of moneys.

150. To return to the example of R v Wilford, there is no issue that Mr Wilford would have been deemed to have been a clerk or servant had s 155 of the Crimes Act been enacted at the time. What if Mr Wilford, having been engaged to collect moneys on behalf of complainant, chose not to perform the task himself but subcontracted it to another who was to hold the money subject to the directions of Mr Wilford? Mr Wilford would, in my view, still have been employed by the complainant, and importantly for the purposes of this point, even though using an intermediary, would still have been employed as a collector of money. It matters not that another person, natural or non-natural was utilised. The example is not an exact analogy. The complainant here had relationships with both the applicant and the other person, that being the company. But there was evidence that what the company did was carried out through the applicant. On this view, there was evidence before the jury sufficient to establish the applicant was employed by the complainant as a collector of moneys.

Relevant authority

151. The view I have expressed above is supported by relevant authority. Before explaining my reasons for this conclusion, it is necessary to consider the distinction that arises between provisions that impose liability as a principal for acts done by the individual even if acting for a company, and those where it will be necessary to determine, as a question of fact, whether the acts were those of the individual or of the company.

152. Mallan v Lee (1949) 80 CLR 198; [1949] HCA 48 provides a clear example of the first type of case. There, a company was charged with having contravened s 230 of the Income Tax Assessment Act 1936 (Cth). The charge was that the public officer of the company, on behalf of the company, knowingly and wilfully understated the amount of income of the company in the relevant tax year. The public officer, Mr Mallan, was charged with being knowingly concerned in the offence of the company, contrary to s 230 of the Income Tax Assessment Act and s 5 of the Crimes Act 1914 (Cth) which provided for accessorial liability. The reasons of the High Court make clear that the reliance on accessorial liability was misconceived. Latham CJ said (at 212):

“I agree with my brother Dixon, for the reasons which he states, that s. 230 makes it an offence for any person to understate or misstate income in any income-tax return, whether his own or that of another person. Thus the appellant, if guilty at all, is simply guilty of an offence against s. 230 and s. 5 of the Crimes Act has no application in the present case.”

153. Dixon J said (at 213-4):

“The charge against the appellant [the public officer] is that by act he was directly knowingly concerned in the commission of the offence above alleged. The charge refers to the Crimes Act 1914-1916, s. 5. I think that the charge against him should have been for an offence against so much of s. 230 (1) as says that any person who in any return knowingly and wilfully understates the amount of any income shall be guilty of an offence. It was in my opinion neither necessary nor possible to treat the appellant’s signature as public officer of the company’s return, in which, according to the allegation, he knowingly and wilfully understated the income, as exposing him to liability under s. 5 of the Crimes Act as one knowingly concerned in the company’s offence under s. 230 (1). The company’s offence consists only in its vicarious responsibility for his alleged act in knowingly and wilfully understating on behalf of the company in its return the amount of income derived by the company. That act amounts in my opinion to an offence by him under s. 230 (1). The provision may be divided into two parts. The one part says that any person who in any return knowingly and wilfully understates the amount of any income or makes any misstatement affecting the liability of any person to tax or the amount of tax shall be guilty of an offence. The other part says that any company on whose behalf the public officer or a director servant or agent of the company in any return knowingly and wilfully understates the amount of any income or makes any misstatement affecting the liability of any person to tax or the amount of tax shall be guilty of an offence. A public officer cannot, I think, make his company responsible under the second part of the provision without himself becoming liable under the first part. The first part is not confined to a taxpayer making a return of his own income. This is designedly done because there are many cases in which persons may or must make returns of income in which they have no beneficial interest or which they do not derive.”

154. See also per McTiernan J (at 218).

155. A similar conclusion was reached in R v Manasseh and Austin [2002] NSWCCA 27; (2002) 167 FLR 44, in relation to offences charged against s 998(1) of the Corporations Law which provided:

False trading and market rigging transactions

(1) A person shall not create, or do anything that is intended or likely to create, a false or misleading appearance of active trading in any securities on a stock market or a false or misleading appearance with respect to the market for, or the price of, any securities.

156. The appellants, in that case, were charged in relation to transactions entered into by them on behalf of various companies. At trial, the Crown argued that the appellants had effective control of the companies, or that the respective companies were the “alter ego” of the appellants, and that, in giving instructions to various brokers to trade shares, the appellants did so in a personal capacity and not on behalf of the company, with the result that they were directly liable as principals. On the appeal, Sheller JA, with whom Simpson J (as her Honour then was) and Howie J agreed, found (at [69]) that the Crown approach, while not resulting in any miscarriage, introduced unnecessary confusion.

157. Sheller JA described the issue as follows (at [33]):

“In the relevant transactions ... when either appellant placed the order to sell or to purchase he did so on behalf of another party. Thus it could be said that the appellant on behalf of the particular company entered into or carried out directly a transaction of sale or purchase of or offered to sell or offered to buy shares. On the other hand it could be said that the company, by its agent the appellant, entered into or carried out indirectly the transaction of sale or purchase of or offered to sell or offered to buy the shares. As a matter of language both the agent and the principal entered into the transaction or offered to sell or buy. The question in such a case is whether s998 applied to both principal and agent or only to the principal. The language was capable of embracing both.”

158. Having reviewed various authorities, including Mallan v Lee, Sheller JA said (at [55]):

“The physical act of placing the order to buy or the order to sell was the physical act of the appellants. The relevant mind was the mind of the appellants. The purpose or purposes to be proved [to establish liability], was the purpose or purposes of the appellants.”

159. The question in the present case is, to my mind, somewhat different. The issue here is whether the applicant was employed as a collector of moneys. This raises issues beyond the question of whether the applicant performed particular acts with a particular state of mind. It raises the question of whether the complainant engaged the applicant as a collector of moneys or whether, while the physical engagement was with the applicant, the complainant in fact engaged the company as a collector of moneys. This raises the flaw in the analogy referred to above (at [150]). The complainant had relationships with both the applicant and the company. In these circumstances, I am of the view that it was a question of fact for the jury, properly instructed, to determine. No issue arises with respect to that qualification, there being no complaints about the directions given to the jury.

160. This conclusion is supported by R v J (1987) 9 NSWLR 615. There, this Court considered a question submitted by the Attorney General with respect to the correctness of a decision to direct the jury to acquit an accused of charges of fraudulent misappropriation contrary to s 178A of the Crimes Act. The charges related to cheques drawn in favour of a company of which the accused was the managing director. The offence provision (in a sufficient paraphrase for present purposes) made liable a person who fraudulently misappropriates money or valuable security, “having collected or received” that money or security on “terms requiring him to deliver or account for or pay to any person” the whole or some part of the money or valuable security. The trial judge directed verdicts of acquittal on the basis that there was no evidence that the accused had “received” any of the cheques the subject of the charges because the cheques were received by the company and not the accused.

161. Lee CJ at CL (with whom Hunt J, as his Honour then was, and Carruthers J agreed), having reviewed various authorities, said (at 623-624):

“... it is apparent that in a case where the evidence shows that a director of a company is not only in a position of control but in fact personally controls the receipt and disposition of cheques paid to the company upon terms requiring the company to account for or pay a the whole or any part of the proceeds, it will be a question of fact for the jury whether his receipt and disposition of those moneys is to be regarded only as a receipt and disposition by the company or whether the conclusion is open that it is he personally, apart altogether from the company, who has received the cheques on terms.”

162. The same conclusion would presumably have followed in the case of an offence against s 178A of collecting cheques or money (noting that that provision has since been repealed). While not directly on point, the same analysis applies to the present situation. In R v J, it was open to find the director had personally “received” the cheques.

163. Amongst the authorities considered by Lee CJ at CL in R v J, was the English case of The King v Grubb [1915] 2 KB 683. That case concerned the liability of a director of a company charged with the fraudulent conversion of cheques. It was contended that the cheques were received by the company, not the accused. Lord Reading CJ said (at 690):

“A company has no mind and cannot have an intention; if the person directing and controlling the affairs of the company and by whose instructions the property has passed into the possession of the company and has been converted, intended to convert it fraudulently, he would be guilty of an offence whether the property was fraudulently converted to the use or benefit of the company or to his own use or benefit. If he did the acts with an intent to defraud, it would not be an answer to prove that he did them as the agent or servant of another person whether a company or an individual. Moreover, if the company was used by his directions as the instrument to enable him in the name of the company to become possessed of the property and by means of the company to convert it fraudulently to his own use or benefit, he would be guilty of an offence under this statute.”

164. Similarly, it was, in the present case, at least open to find that the applicant, as the person “directing and controlling the affairs of the company” was employed by the complainant as a collector of moneys. In R v J, Lee CJ at CL noted that The King v Grubb had been applied in various cases and referred to with approval by the High Court in Stephens v The Queen (1978) 139 CLR 315; [1978] HCA 35 at 318, 332-333.

165. R v J was applied by this Court in R v Maharaj (1995) 85 A Crim R 374. The issue in R v Maharaj was not so much the principles at play, but the adequacy of the directions. There, the appellant was charged with having fraudulently omitted to account for the proceeds of a cheque, in violation of the terms on which it was received, contrary s 178A of the Crimes Act.

The appellant received a cheque from the complainant, but the cheque was payable to a corporation controlled by the appellant. Gleeson CJ, with whom Kirby P and Dowd J agreed, observed (at 376):

“A threshold question that required consideration was whether, for the purposes of s 178A, it was the appellant who relevantly received the valuable security, and was required to account for the proceeds, or whether, on the other hand, it was the corporation.”

166. Gleeson CJ said (at 380):

“What needed to be explained to the jury was that the question was whether, when [the complainant] handed over the cheque, [the complainant] was dealing with the appellant personally, or whether in such dealings the appellant was simply acting as the agent for the appellant’s company.”

167. Gleeson CJ, after referring to R v J and The King v Grubb, said (at 380-1):

"There was evidence upon which it was open to conclude, as urged by the Crown, that [the complainant] only ever intended to deal with the appellant personally, and that the appellant, for his part, made use of the company as an instrument to enable him to obtain the proceeds of the cheque for $50,000 and apply them for his own benefit.”

168. Gleeson CJ, however, noted that there was also evidence that the dealings were with the company, and it was necessary that the jury be properly directed in order to resolve the question of whether the appellant received the cheque. As noted above, the issue of directions with respect to the present issue has not been raised on this appeal.

169. The authorities discussed above are capable of application to s 155 of the Crimes Act. They are against the applicant’s argument as framed in his oral submissions.

Conclusion on ground 1

170. The applicant’s ground of appeal does not extend beyond the question of whether the definition of clerk or servant in s 155 of the Crimes Act was capable of applying to him on the evidence at trial. For the reasons given above, I am of the view there was evidence before the jury sufficient to establish that the applicant was employed as a collector of moneys on behalf of the complainant, sufficient to result in him being deemed, pursuant to s 155 of the Crimes Act, to be a clerk or servant. No issue was raised on the appeal as to whether the money was “delivered to, or received, or taken into possession by him” within those terms as used in s 157 the Crimes Act. The same principles would appear to apply.

171. Contrary to the applicant’s argument, the trial judge did not err in finding that the definition of clerk or servant in s 155 was, on the evidence led by the Crown, capable of applying to the applicant. I would dismiss this ground.

Grounds 2 and 3

172. In relation to ground 2, I agree with Simpson AJA, for the reasons her Honour gives that the ground should be upheld. I also agree that, in these circumstances, ground 3 does not need to be determined. I therefore agree with the orders proposed by Simpson AJA.