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Confiscation Proceedings: Need to speed confiscation proceedings

Every Issue

Cite as: Jan/Feb 2011 85(1/2) LIJ, p.72

Conducting proceedings as part of a criminal plea may extend a plea hearing but will save resources.

The practice of adjourning confiscation proceedings until the conclusion of associated criminal prosecutions needs changing.

The current system duplicates court, offender, police and Director of Public Prosecutions (DPP) resources, and will often prejudice the offender at the time of sentence. Both issues should be dealt with by the same court, at the plea.

Sentencing and confiscation proceedings

Confiscation proceedings are civil in nature, managed in the Supreme or County Courts’ Confiscation List, excluded from the operation of the Civil Procedure Act 2010 and conducted by the DPP. Related criminal proceedings are conducted by a different section of the Office of Public Prosecutions (OPP) in the Criminal List.

Criminal defence lawyers do not usually conduct confiscation matters, as they don’t have professional indemnity insurance for civil proceedings. There is therefore a disconnection between confiscation and criminal proceedings.

The Sentencing Act 1991 provides for the court to take into account forfeiture orders (FOs) affecting lawfully acquired property and pecuniary penalty orders (PPOs) where they relate to benefits in excess of the profits actually derived from the offence. A PPO is “penal in nature”1 and intended to deter the offender.

It is a mitigating factor when lawfully acquired property is forfeited to satisfy FOs or PPOs. Under s5(2B) of the Sentencing Act, a court may also consider FOs, affecting both lawfully and unlawfully acquired property, as an indication of an offender’s remorse.

Deterrence of offenders may be effected by using an FO to strip them of lawfully acquired property, rather than by prison.

This relationship between sentencing and confiscation proceedings is illustrated by R v McLeod.2

R v McLeod

McLeod was presented on, inter alia, counts of trafficking and dealing with (cash seized on arrest) $30,671, being proceeds of crime. Under Schedule 2 of the Confiscation Act 1997, some counts were automatic forfeiture offences.

The OPP obtained a restraining order over property, seized cash and bank funds of $6600. After the plea, but before sentence, McLeod and his wife made exclusion applications. There was no application regarding the seized cash, which was automatically forfeited.

The McLeods and the OPP resolved the confiscation proceedings. Restrained bank funds were forfeited, and a payment of $30,000 made to the Crown. Other property that was the subject of the restraining order was returned to the McLeods.

At sentencing at first instance, the pending forfeiture of assets was disregarded. McLeod was jailed for three years and four months, with a non-parole period of two years. He appealed, arguing that the likelihood of forfeiture of assets should have been taken into account.

Counsel for the DPP argued that the sentencing judge had insufficient information to assess the extent of any forfeiture, and was correct not to have regard to any pending forfeiture. Counsel further argued that settlement of the confiscation proceedings did not qualify as fresh evidence because it could have been obtained by the exercise of reasonable diligence at the time of sentence and, as the exclusion application had not been pursued at the time of sentence, the opportunity to do so was lost.

The Appeal Court found the forfeiture of assets did constitute fresh evidence, and could be relied on to impose a different sentence [33]. The Court considered the payment of $36,555 “a substantial penalty arising from the forfeiture of his lawfully-acquired property” [45].

Forfeiture of lawfully acquired property has a deterrent effect, and may be a mitigating factor in sentencing. A PPO that relates to the entirety of the benefit from the unlawful activity and not just the profit may “constitute an additional punishment” [16]. Proportionality in sentencing requires consideration of the nature and extent of forfeiture of property [18], but proportionality is not a consideration in confiscation proceedings.

Further, while disgorging the proceeds of crime was not a penalty, in some circumstances it could be viewed as a mitigating factor [16]. This is consistent with s5(2B) of the Sentencing Act.

McLeod’s sentence was reduced to two years and 10 months with a non-parole period of one year and nine months.

Recognising that forfeiture often occurs after sentence, and the evidence may not be available to the sentencing judge, the Court of Appeal recommended that as a matter of urgency the legislation be changed to enable an offender to apply to the sentencing judge for a review of sentence, after forfeiture of assets.

The Court renewed this request in R v Cochrane3 and R v Dang.4 However, there is little prospect of change, as the OPP opposes it.5

Procedural change

In our view, confiscation proceedings should be conducted and concluded as a part of the criminal plea. Doing so may extend a plea hearing, but ultimately will save resources. Achieving justice for an offender requires consideration of the impact of forfeiture proceedings.

Criminal defence lawyers must ensure confiscation and sentencing proceedings are conducted together, and the court has cogent evidence as to the value of forfeited, lawfully acquired property.

The Court of Appeal in McLeod placed that obligation on lawyers and judges. It noted that it would have been preferable for the exclusion application to have been heard and determined prior to, or at the same time as, the hearing of the plea in mitigation, saying that sentencing judges should encourage such a course wherever possible [39].

ANDREW HALE is a lecturer at the College of Law and BARRY APELBAUM is a lawyer at Stynes Dixon Lawyers.

The numbers in square brackets in the text refer to the paragraph numbers in the judgment.

1. DPP v Nieves [1992] 1 VR 257.

2. (2007) 16 VR 682.

3. [2008] VSCA 60.

4. [2009] VSCA 183.

5. “Confiscating the proceeds of crime in Victoria”, paper presented by David Gray, Manager, Confiscations, OPP, 12 February 2008.


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