Senate

Revised Explanatory Memorandum

(Circulated by authority of the Minister for Justice and Customs, Senator the Honourable Amanda Vanstone)

Schedule 1 - amendment of the Criminal Code Act 1995

Item 1A of Schedule 1 - Offshore installations

7. This will provide clarification in existing section 3B of the Criminal Code Act 1995 that the general rule that an offshore installation may generally be taken to be part of Australia for the purposes of the Criminal Code may be over-ridden by a provision expressing a contrary intention, and therefore enabling proposed section 16.3, and where indicated, other provisions to operate as intended. Proposed section 16.3 links the meaning of Australia to the relevant primary offence.

Item 1 of Schedule 1 - Regulations

8. This item inserts new clause 5 which will enable the making of regulations under the Criminal Code Act 1995 (the Act). This would be made necessary by this Bill because it is proposed in item 23 of Schedule 1 that there should be a definition of Commonwealth authority which may require the exclusion of some additional bodies by regulation.

Items 2 and 3 of Schedule 1- Adjustments to notes

9. The Act contains notes to assist readers. These provide for a reference to proposed Part 2.7 of Chapter 2 of the Criminal Code which deals with geographical jurisdiction.

Item 4 of Schedule 1 - engage in conduct

10. Subsection 4(2) of the Criminal Code contains the important definition of conduct which means an act, an omission to perform an act or a state of affairs. Offences refer to engaging in conduct. The proposed definition of engaging in conduct is designed to make it clear that engagement does not only infer the relevant conduct must only be an act. The use of engaging in conduct is meant to cover omissions as well. This will simplify the drafting of offences.

Item 5 of Schedule 1- repeal of a note

11. Item 5 repeals a note under section 5.1 of the Criminal Code which contains an example which refers to a Crimes Act 1914 offence which will be replaced in the proposed amendments. It is not necessary to replace the example.

Item 6 of Schedule 1 - amendment to section 5.6

12. Item 6 would omit the words of an offence from section 5.6 of the Criminal Code because they are unnecessary and could result in misinterpretation of this important provision. Section 5.6 contains the rules which will apply in relation to fault where the relevant offence does not specify a fault element. It is possible some might interpret the rule as only applying to offences made up of only conduct, or only of a circumstance or a result. This was not the intention of those who developed the Model Criminal Code.

Item 7 of Schedule 1 - defence of lawful authority

13. Part 2.3 of the Criminal Code contains a range of general defences. In its 1998 and 1999 Offences Against the Person Reports, the Model Criminal Code Officers Committee recommended that there be a general lawful authority defence. This is in recognition that a code must specify this longstanding principle if it is to continue to apply. The defence is particularly relevant to offences against the person. Proposed Part 7.8 of Chapter 7 in this Bill includes offences of that nature. It is important that where, for example a law enforcement officer is authorised by law to physically restrain a person and does so within the scope of his or her authority, then the officer cannot be charged for harming that person. There will be many other examples throughout the Criminal Code. The main thing to keep in mind here is that the defence will not apply if there is no clear justification or excuse provided for by or under another law of the Commonwealth.

Items 7A and 7B of Schedule 1 - amendments to section 11.1 (attempt)

14. Prior to the Government Amendments in the House of Representatives, proposed section 600.1 in Chapter 11 (item 16 of the Bill as originally introduced) was for the purpose of ensuring that where there is a special liability provision (such as one applying absolute liability to the Commonwealth element in the offence of theft of Commonwealth property at proposed subsections 131.1(1) and (3)) then that rule should carry through to ancillary offences, such as an attempt (section 11.1). On reflection, proposed section 600 was an obscure way of achieving that result. Indeed, consistent with approach taken with the Criminal Code in relation to other matters, it was concluded that rules of this nature need to be much clearer. Items 7A and 7B were inserted by the Government Amendments to include proposed subsections 11.1(3A) and (6A) which specifically provide as part of the ancillary offence of attempt that special liability provisions apply. The same provisions are also provided for in relation to other relevant ancillary offences: complicity (proposed subsections 11.2(3A) and (6)); incitement (proposed subsections 11.4(2A) and (4A)); and conspiracy (proposed subsections 11.5(2A) and (7A)). It is proposed that a definition of special liability provision be inserted into the Criminal Code dictionary by Item 39A. It provides a special liability provision is where absolute liability applies to one or more (but not all) of the physical elements of an offence. This will mean that while the rules which require proof of fault with respect to ancillary offences (such as subsection 11.2(3) in attempt) will continue to apply to every offence (including the extremely rare occasion where absolute liability might apply to all elements of an offence), it will not be necessary where it concerns a subsidiary element such as the example given in relation to theft of Commonwealth property.

15. It is also proposed that the definition of special liability provision include those special provisions which provide that it is not necessary to prove the defendant knew or believed a particular thing. An example of this is proposed subsection 141.1(2) which concerns bribery. It provides it is not necessary to prove that the defendant knew the official bribed was a Commonwealth public official. The amendments will mean it will not be necessary to prove knowledge about the Commonwealth characteristic of the public official providing the defendant was attempting to bribe a public official of some kind.

Item 8 of Schedule 1 - amendment to subsection 11.1(7)

16. Section 11.1 of the Criminal Code concerns the general principles which apply in relation to an attempt to commit an offence. Subsection 11.1(7) provides that it is not an offence to commit complicity and common purpose (section 11.2) or conspiracy (section 11.5). It does not make sense to provide for attempting those offences. The proposed amendment simply extends the rule, for the same reason, to another form of conspiracy which it is proposed should be included in Chapter 7 of the Criminal Code - conspiracy to defraud (proposed section 135.4).

Items 8A to 8F of Schedule 1 - amendments to sections 11.2 (complicity), 11.4 (incitement) and 11.5 (conspiracy)

17. These are the proposed amendments in relation to the ancillary offences of complicity, incitement and conspiracy which are explained in the note on items 7A and 7B.

Items 9, 10 and 11 of Schedule 1 - amendments to section 11.6

18. Section 11.6 of the Criminal Code is an interpretative provision which provides that references to offences against an Act also include relevant extensions of criminal responsibility such as attempt, complicity and conspiracy. This simplifies the drafting of criminal statutes. The proposed amendments in items 9 and 10 make it clear this rule extends to not only Acts but other laws of the Commonwealth that create offences (for example, regulations). Proposed new subsection 11.6(4) which would be inserted by item 11 preserves references in existing laws to extensions of criminal responsibility.

Item 12 of Schedule 1 - Part 2.7 - Geographical Jurisdiction

19. Item 12 proposes the insertion of a new set of general principles into Chapter 2 of the Criminal Code which deal with the geographical reach of Commonwealth offences. These are contained in Part 2.7 entitled Geographical Jurisdiction.

20. The purpose of Part 2.7 is to clarify, and to provide in an orderly way for, the geographical application of Commonwealth offences. There are several instances where the geographical reach of Commonwealth offences is not clear, or where general application provisions are not adapted to the purpose of particular offence provisions. Commonwealth offence provisions are usually enacted to give effect to a specific governmental purpose. Depending on that purpose, and considerations of international law, practice and comity, it might be appropriate for an offence to have a broad or narrow application.

21. The scheme of Part 2.7 is to provide for the most appropriate of those categories to be chosen. First, for a standard geographical jurisdiction to govern the geographical application of future offences in the absence of any provision to the contrary. Provision is then made for four categories of extended geographical jurisdiction. One of those categories might be chosen for express application to govern the geographical application of a particular offence. The five options for geographical jurisdiction set out in Part 2.7 make available a convenient way of covering most offence provisions, although it is possible that for some reason a future law might need to specify yet another kind of jurisdiction.

Proposed section 14.1 of Division 14 - Standard geographical jurisdiction

22. Proposed subsection 14.1(1) enables standard geographical jurisdiction to be applied to a particular offence by an express provision to that effect. However, express application will not be necessary for offence provisions commencing at or after the commencement of proposed section 14.1, where standard geographical jurisdiction will apply unless contrary provision is made. The same form of jurisdiction will also govern a related ancillary offence. (Ancillary offence is to be defined in the Dictionary (item 19), and includes, for example, attempt, incitement and conspiracy.)

23. Proposed subsection 14.1(2) sets out the situations where a particular case will fall within standard geographical jurisdiction. It does so by reference to conduct and result, these being possible physical elements of an offence as stated in section 4.1 of the Criminal Code . When Part 2.7 refers to a result it is referring to a result that is an element of the offence itself and not to something that is merely a consequence or effect of the offence having occurred. (See proposed section 16.4.)

24. Standard geographical jurisdiction will be satisfied if the conduct constituting the alleged offence occurs wholly or partly in Australia (see proposed section 16.3) or wholly or partly on board an Australian aircraft or an Australian ship (see the proposed definitions in the Dictionary (items 20 and 21).

25. The jurisdictional requirements will also be satisfied if a result of the conduct occurs wholly or partly in Australia or wholly or partly on board an Australian aircraft or an Australian ship. As noted, this condition of jurisdiction can only be satisfied where a result is an element of the offence. Only a few Commonwealth offences have a result in that sense, so the result basis for jurisdiction will only be applicable to those offences. An example might be an offence of destroying an aircraft where the conduct occurs outside Australia but the destruction of the aircraft (say a foreign aircraft) occurs in Australia, or an offence of obtaining something by deception where the deceptive conduct occurs outside Australia but the thing is received in Australia.

26. In the case of an ancillary offence, such as attempt, incitement or conspiracy, it may be that the conduct occurs wholly outside Australia and there is no relevant result in Australia of the ancillary offence itself. In that case, by virtue of proposed paragraph 14.1(2)(c), the jurisdictional requirement might still be satisfied by reference to the primary offence, for example where D incites a person, in a foreign country, to commit an offence and the person commits that offence (the primary offence) in Australia or D intends that the primary offence be committed in Australia.

27. Proposed subsection 14.1(3) provides the possibility of a defence where standard geographical jurisdiction is satisfied but the conduct occurs wholly in a foreign country, for example where only a result occurs in Australia or (in the case of an ancillary offence) the primary offence is intended to occur in Australia. The defence is that there was no offence (or ancillary offence) in the place where the conduct occurred (country X) corresponding to the Commonwealth offence charged. The inquiry is not into whether the particular conduct alleged would have amounted to an offence of some kind or other under the law of X. Therefore it need not be relevant that in country X there is an applicable defence, relating, for example, to age, nationality or other capacity. The inquiry is into whether X has in its law a corresponding offence. Corresponding does not mean exactly the same but means of a corresponding kind. For example if the charged offence was bribing an Australian official, a corresponding offence of X could be bribing an official of X. If the charged offence was destruction of (or theft of) Australian government property and X had not legislated specifically for government property, a corresponding offence could be simple destruction of (or theft of) property.

Proposed Division 15 - Extended geographical jurisdiction

28. This includes the categories A, B, C and D. A being the most limited extension, D being the broadest.

Proposed section 15.1 Extended geographical jurisdiction - category A

29. Where this category of jurisdiction applies, jurisdiction will be satisfied if a requirement for standard geographical jurisdiction is met or the alternative requirement in proposed paragraph 15.1(c) is met. That alternative requirement is met if at the time of the alleged offence the person charged with the offence was an Australian citizen or was a body corporate incorporated by or under a law of the Commonwealth or of a State or Territory (a national).

30. As in proposed section 14.1, there is a defence in proposed subsection 15.1(2) which may be available depending on the law of a foreign country where the conduct has wholly occurred. However, that defence is not available if jurisdiction is to be exercised under proposed paragraph 15.1(c) on the basis of the persons nationality.

Proposed section 15.2 Extended geographical jurisdiction - category B

31. This category of jurisdiction is the same as under category A, except that a further possible basis for jurisdiction is added in proposed subparagraph 15.2(1)(c)(ii). This is that at the time of the alleged offence the person was a resident of Australia . The defence in subsection 15.2(2) is in the same terms as the defence in subsection 15.1(2). It may be available if jurisdiction is to be exercised on the basis of residence, but not if jurisdiction is to be exercised on the basis of nationality.

Proposed section 15.3 Extended geographical jurisdiction - category C

32. Category C jurisdiction is unrestricted . It applies whether or not the conduct or the result of the conduct constituting the alleged offence occurs in Australia. However, by virtue of proposed subsection 15.3(2) a defence may be available depending on the law of a foreign country where the conduct occurs . The defence is in the same terms as in proposed subsections 15.1(2) and 15.2(2) and is not available if the person charged is of Australian nationality.

Proposed section 15.4 Extended geographical jurisdiction - category D

33. Category D jurisdiction is unrestricted and is in the same terms as in proposed section 15.3, except that there is no foreign law defence corresponding to that in proposed section 15.3(2).

Proposed section 16.1 - Attorney-Generals consent

34. The purpose of proposed section 16.1 is to require the Attorney-Generals consent where a prosecution is to be brought in reliance on Part 2.7 and the conduct constituting the alleged offence occurs wholly in a foreign country and the person charged or to be charged is not of Australian nationality.

35. There will be situations, among those situations where the Attorney-Generals consent is required, where it will not be appropriate for a prosecution to proceed in Australia even if the usual criteria for a prosecution are met. It is intended that the Attorney-General will have regard to considerations of international law, practice and comity, international relations, prosecution action that is being or might be taken in another country, and other public interest considerations and decide in his or her discretion whether it is appropriate that a prosecution should proceed.

36. Proposed subsection 16.1(2) contains the usual provision enabling a prosecution to be initiated before consent is given. If another Commonwealth law requires the consent of the Attorney-General or another person for a prosecution, and consent of the Attorney-General is also required under proposed section 16.1, it will be necessary for consents to be obtained under both provisions.

Proposed section 16.2 When conduct taken to occur partly in Australia

37. Proposed subsection 16.2(1) is directed to the situation where a thing is sent to or from Australia. If a person, while outside Australia, sends a thing to Australia (for example by mailing a parcel) or causes it to be sent (for example by arranging for another person to mail a parcel), that action of the person might be conduct constituting an offence, and by virtue of subsection 16.2(1) it is conduct that is taken to have occurred partly in Australia. On that basis, an alleged offence could be within the jurisdiction provided by proposed sections 14.1(1), 15.1(1), or 15.2(1). (It would not matter if the sending of a thing from Australia would otherwise be conduct wholly within Australia, because those subsections do not distinguish between conduct wholly or partly in Australia.)

38. Moreover, such conduct would not be conduct wholly outside Australia or wholly in a foreign country within the meaning of those expressions in Part 2.7, for example for the purposes of the defences in proposed sections 14.1(3), 15.1(2), 15.2(2) or 15.3(2).

39. Proposed subsection 16.2(3) has a corresponding effect to subsection 16.2(2) where what is sent or caused to be sent is an electronic communication. An electronic communication is not defined, but is intended to describe any communication by electronic means, for example by telephone, fax, or telegram, by wire, cable or radio, or through the Internet or a closed computer network. However, an electronic communication is only within the subsection if it is sent or caused to be sent from a point outside Australia to a point in Australia or from a point in Australia to a point outside Australia. That limitation could exclude some broadcast transmissions, although an email to multiple recipients, for example, would be a number of communications sent to a number of points. Proposed subsection 16.2(3) gives an inclusive definition of point.

Proposed section 16.3 - Meaning of Australia

40. The purpose of this section is to bring the operation of the jurisdiction provisions in this Part into line with the scope of particular offence provisions. Australia when used in a geographical sense may be given different meanings in different statutes. For example, sometimes it will include some or all of the external Territories, sometimes it will not. For the purpose of this Part, the meaning of Australia will depend on the meaning it would have if used in the relevant offence provision.

Proposed section 16.4 Result of conduct

41. This section makes it clear that, in this Part, a reference to a result of conduct is a reference to a result in the sense of a physical element of an offence as provided in proposed section 4.1(1). Therefore result is not to be interpreted as meaning a consequence or effect following from or caused by an offence but not forming an element of the offence. The destruction of an aircraft is a result and an element of the offence of destroying an aircraft. However, a consequence of that offence in the form of collateral damage to other property or a loss to an insurance company would not be an element of the offence and hence would not be a relevant result.

Item 13 of Schedule 1 - definition of foreign country at section 70.1

42. Section 70.1 provides for a definition of foreign country in Division 70 of Chapter 4 of the Criminal Code (The integrity and security of the international community and foreign governments) which it is proposed should be repealed and moved by item 33 of this Bill to the Dictionary at the end of the legislation. The definition is to be used more generally, so it is more appropriate to place it in the Dictionary. Division 70 of Chapter 4 was inserted into the Criminal Code by the Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999 which contains offences which prohibit the bribery of foreign public officials.

Item 14 of Schedule 1 - definitions aircraft and ships at subsection 70.5(4)

43. This is another amendment to Division 70. It repeals the definitions of Australian aircraft, Australian ship, defence aircraft and defence ship. These definitions are moved by Items 18, 19, 29 and 30 of this Bill to the Dictionary. The definitions are unchanged.

Item 15 of Schedule 1 - Chapter 7 - The proper administration of Government

44. The bulk of the proposed new theft, fraud, bribery and related offences are in Chapter 7. It is proposed that this chapter will eventually include a range of other offences relevant to the protection of the proper administration of Government, such as damage and computer offences. However, effective theft, fraud and corruption offences are a very important component of the Criminal Code. Fraud against the Commonwealth is considerable and corruption is something about which no society can be complacent.

Proposed Part 7.1, Division 130 - Preliminary

45. This deals with the definitions and interpretative clauses which it is proposed should apply throughout the chapter. Some of these are likely to be relevant to the damage offences which it is proposed will be inserted later.

Proposed section 130.1 - Definitions

46. The first word to be defined is duty . Duty is used in many of the offences, ranging from general dishonesty (proposed section 135.1), to corruption offences such as bribery (proposed section 141.1), and forgery (proposed section 144.1).

47. Paragraph (a) of the definition ensures duty is given its widest meaning and appropriately covers those duties which the Commonwealth public official may not technically have but is able to hold himself or herself out as having. The community cannot be expected to know what the exact duties of an official are, so it would not be unreasonable to expect some dishonest officials will try to seek favours by promises to do things that have nothing to do with their duties.

48. Paragraph (b) of the definition of duty provides for a similar definition in relation to public officials. This is necessary, because many of the offences only require the prosecution to prove that the person relevant to the offence is a public official, not that they are a Commonwealth public official (see the bribery offence, proposed section 141.1). Many in the community are not precisely aware of what public officials are State public officials, as opposed to Commonwealth public officials.

49. Commonwealth public official and public official is defined in the proposed Dictionary to the Criminal Code at items 27 and 36 of the Bill. Commonwealth public official includes a broad group of people including Commonwealth employees and officers, Members of Parliament, judges, police, contractors, military personnel and those employed by Commonwealth authorities. Public official covers the same categories but includes State and Territory officials as well as those with Commonwealth functions.

50. Gain is defined in terms of a gain in property, whether temporary or permanent, or by way of the supply of services, and includes keeping something that one has. This is much the same as subsection 14.3(1)(a) of the Model Criminal Code but also mentions services in recognition of the context of the Commonwealth Criminal Code which is concerned with the protection of the Commonwealth. The Model Criminal Code offences reflect the State and Territory Government responsibility for criminal offences that apply more generally. Services are often very valuable and costly, and therefore the protection of the proposed offences need to specifically cover them as well. Dishonestly obtaining a gain is an important element of many dishonesty offences such as conspiracy to defraud (proposed section 135.4) and the unwarranted demands offences (proposed sections 139.1 and 139.2).

51. Loss covers temporary or permanent losses and includes not getting what one might get. It follows the Model Criminal Code definition and is usually used in the same offences as gain to cover the flip-side consequence of dishonest behaviour. While there will invariably be a loss to someone whenever there is a gain for another, in some cases it is more appropriate to the facts of the case to prove the defendant dishonestly caused a loss rather than a gain. Either way there is a victim and the culprit should be penalised.

52. Obtaining is defined to include obtaining for another. This is an important part of the proposed dishonesty offences. Often the defendant will be motivated to assist a relative or friend. Whether it is for himself, herself or another - there will be a victim of dishonesty. In the Commonwealth jurisdiction it will invariably be the taxpayer. This is based on subsection 14.3(2)(a) of the Model Criminal Code.

53. Property is defined widely. Like section 14.4 of the Model Criminal Code, it covers real and personal property, money, intangible property such as the right to recover funds, electricity and even wild creatures. Even in the Commonwealth context, it could include a captive wild creature. There may be very valuable Commonwealth assets which are captive wild creatures (for example, where an outback station is forfeited to the Commonwealth as a proceed of crime).

54. Services is defined broadly in recognition of the range of services provided by the Commonwealth . The definition is included in recognition of the special definition of gain in the Criminal Code which is not found in the State-based Model Criminal Code.

55. Supply is also included in support of the definitions of services and gain for the same reasons.

Proposed section 130.2 - When property belongs to a person

56. This definition is of critical importance to the theft, theft related and property fraud offences (such as proposed sections 131.1, 132.1 and 134.1). The basic definition at subsection 130.2(1) provides that property belongs to any person who owns it, or has any other proprietary right or interest in it, or who has possession or control of the property. One effect of the section is that co-owners or people with different rights to a piece of property can be guilty of theft from one another. For example, one owner of property can be guilty of theft from another owner (eg theft by one business partner from another), or an owner can be guilty of theft by taking his or her property away from someone who has possession or control of it (eg an owner who dishonestly took back his or her own goods from a pawnbroker). The owner cannot deny appropriation by relying on his or her own consent to the appropriation. Proposed sections 131.3(1) and 131.9 requires the consent of all those to whom it belongs. In the example, the owner of the pawn shop has not consented to the appropriation of his or her right to possession. The Commonwealth can co-own property with someone else - so this interpretative provision is as relevant to it as the Model Criminal Code provision upon which it is based (section 14.5).

57. The definition in proposed subsection 130.2(1) also provides that property also belongs to people who have any proprietary right or interest (not being an equitable interest arising either from an agreement to transfer or grant an interest, or from a constructive trust). One example of the effect of this is that a trustee (who is the legal owner of the trust property) who dishonestly appropriates trust property will be guilty of theft from the beneficiaries (who do not own the trust property but do have an equitable proprietary interest in the trust property). Where there is no specific beneficiary (eg in the case of a trust for general public purposes), proposed subsection 131.5(1) makes this theft (subsection 15.5(1) of the Model Criminal Code).

58. However, equitable interests arising from agreements to transfer or grant an interest (eg to sell land or shares) are excluded. These equitable interests arise by the operation of legal rules but only in relation to contracts which are specifically enforceable. For example, the defendant agrees to sell a valuable painting to the victim. Before the sale goes ahead and the painting is transferred, the defendant gets a better offer and sells it to X. In general, contracts agreeing to sell goods are not specifically enforceable but they are when the goods have special qualities. Hence, a contract like the one in the example would be specifically enforceable and the victim would have an equitable interest in the painting. However, the framers of the Theft Act judged that this conduct should not be theft and that civil remedies were sufficient. The qualification in proposed subsection 131.5(1) will mean that this is not property belonging to another and therefore not theft.

59. Similar considerations arise in relation to constructive trusts. In an English case, the proprietor of a tied pub operated it on the basis that he would only sell the brewerys beer. In fact he also sold some of his own home brew. He was charged with theft on the basis of an argument that he was a constructive trustee of the proceeds of the sale of the home brew and that the brewery had an equitable proprietary interest in the proceeds. The Court of Appeal found that no constructive trust arose in these circumstances and, in any event, rejected the notion that a person should be guilty of theft based on the operation of such intricate legal concepts which strayed so far from ordinary conceptions of theft. The same point applies to constructive trusts generally, such as have been found to arise in the case of mistaken overpayment. Hence, proposed subsection 131.5(1) extends the qualification contained in the Theft Act so that equitable interests arising from constructive trusts do not fall within the definition of property belonging to another. Constructive trusts - based on equitable notions of unconscionability - may be appropriate for recovery in civil actions, but they stray too far from the common conception of theft and the much more culpable sort of dishonesty involved in theft to form part of the definition of the offence of theft. Their ambit is uncertain and likely to expand. To attach the boundaries of theft to such an uncertain concept would offend the important principle that the criminal law should be knowable in advance. No doubt that principle calls for judgements of degree on occasion. On this occasion in relation to constructive trusts and the law of theft, the better view is to agree with what the Court of Appeal said in Attorney-Generals Reference (No 1 of 1985)
[1986] 1 QB 491 , 503:

"... the court should not be astute to find that a theft has taken place where it would be straining the language so to hold, or where the ordinary person would not regard the defendants acts, though possibly morally reprehensible, as theft."

60. The general definition of property belonging to another contained in proposed subsection 131.5(1) is supplemented for the purposes of the offence of theft by proposed sections 131.5 to 131.9 (section 15.5 of the Model Criminal Code).

61. Proposed subsection 131.5(2) makes it clear that the same rules also apply to money transfers under the property fraud offence (proposed subsections 134.1(9) and (10)). The Model Criminal Code does not have a special provision covering money transfers.

Proposed section 130.3 - Dishonesty

62. An important concept in the Model Criminal Code offences is the fault element of dishonesty (subsection 14.2(1) which has a straight-forward definition which was developed by the courts and is known as the Ghosh test. The Ghosh test is a familiar concept in Australia because until February 1998, it had been used in all jurisdictions, both common law and Code, in relation to conspiracy to defraud and in most jurisdictions, including the Commonwealth, in relation to the main fraud offences (s.29D and s71(1) of the Crimes Act 1914 which use the fault elements of defraud and fraudulent.) In Peters v R (1998)
151 ALR 51 the High Court held that the Ghosh test was no longer appropriate and developed a new test which does not include a subjective component.

63. The approach in Peters is not favoured because it is necessary for offences like theft to retain a broad concept of dishonesty to reflect the characteristic of moral wrongdoing.

64. Paragraph (a) of the definition of dishonest seeks to achieve this by linking the definition of dishonesty to community standards (this is not novel, whether a person is negligent is assessed by a jury on the basis of what the reasonable person would have done in the circumstances).

65. Paragraph (b) of the definition requires knowledge on the part of the defendant that he or she is being dishonest according to the standards of ordinary people. This is crucial if the Criminal Code is to be true to the principle that for serious offences a person should not be convicted without a guilty mind. It reflects a preference for the law which existed prior to the 1998 decision of the High Court in Peters and is particularly important to the Criminal Code because it has additional offences which rely on dishonesty even more so than the Model Criminal Code offences (see proposed sections 132.8, 135.1 and 135.2). The proposed definition was preferred over the Peters approach by the Standing Committee of Attorneys-General at its April 1998 meeting.

Proposed section 130.4 - Determination of dishonesty to be for the trier of fact

66. Consistent with subsection 14.2(2) of the Model Criminal Code, it is proposed that the question of whether a person is dishonest is only appropriate for the jury (or court, if there is no jury) as the trier of the facts to determine. It is the jury which is best able to judge community standards.

Proposed Part 7.2 - Theft and other property offences

67. These offences include theft itself, receiving, robbery and aggravated robbery, burglary and aggravated burglary, making off without payment, going equipped for theft and dishonest taking or retention of property. The enactment of these offences would give the Commonwealth a comprehensive array of offences to replace a very outdated and vague stealing offence (section 71 of the Crimes Act 1914 ) and reliance on varying State and Territory offences which have no similarity to the stealing offence for more serious theft related conduct such as a robbery or burglary.

Division 131 - Theft

68. The proposed Division on theft begins with the offence of theft which is followed up by a number of interpretative provisions which are important to the proper operation of the offence. They are necessary because under Australian civil law concepts of property ownership are by no means simple. Being a transparent law, the Criminal Code provides an explanation of how those concepts interact with the offence of theft.

Proposed section 131.1 - Theft

69. Proposed subsection 131.1(1) contains the elements of the offence of theft. A person is guilty if the person dishonestly appropriates property belonging to another with the intention of permanently depriving the other of the property.

70. The elements of the theft offence at subsection 15.1(1) of the Model Criminal Code have been faithfully followed in this Bill notwithstanding the different nature of the Commonwealth jurisdiction. This is in recognition that theft is sufficiently complex as it is without restructuring it just for the purpose of providing the Commonwealth jurisdictional connection, but also because it is convenient and transparent to place the connection in a separate paragraph.

71. Referring to the property belonging to the Commonwealth entity at paragraph 131.1(1)(b), which is defined as the Commonwealth or a Commonwealth authority in the Dictionary to the Criminal Code (item 25 of the Bill), also has the advantage of isolating that precise element of the offence so that the prosecution is not required to prove the person knew the person /organisation who owned the property was a Commonwealth entity. Under the existing law the prosecution is not required to prove the defendant knew it was the Commonwealth that he or she was stealing from for the person to be found guilty but under the Criminal Code this must be made clear in the legislation. The Criminal Code requires laws that create offences to be very clear about anything that does not need to be proved, otherwise fault must be proved in accordance with section 5.6. It is therefore appropriate that the offence should make it clear that proof the person knew the victim was a Commonwealth entity is not required. This is achieved in subsection 131.1(3) which provides that absolute liability applies to the property belongs to a Commonwealth entity element of the offence.

72. Subsection 6.2(2) provides that if a law that creates an offence provides that absolute liability applies to a particular physical element of the offence (in this case property belonging to the Commonwealth entity), then a fault element (for example, knowledge) does not have to be proved and there is no defence of mistake of fact.

73. This method of preserving the status quo with respect to proof of the Commonwealth jurisdictional connection is transparent, precise and preserves the structure of the offence. It is used throughout the Bill.

74. The penalty for theft is a maximum of 10 years imprisonment The current stealing offence has a maximum penalty of 7 years. The proposed penalty is consistent with that for State and Territory offences and the Model Criminal Code. A single theft can involve millions of dollars worth of property. The Commonwealth can be a victim just like any other organisation. There is no reason why the penalty should be less than that for State theft offences.

75. Proposed subsection 131.1(4) nominates extended geographical jurisdiction category D for the purpose of Part 2.7 (applying whether or not any part of the offence occurs in Australia). The reasons for that approach are as follows.

76. Australia, as a country following the common law system of criminal justice, has not, traditionally and as a general rule, sought to bring within its criminal laws conduct occurring beyond Australia. It has been, and is, accepted that general law offences such as theft by one individual from another, should not be given extended reach unless there is a particular reason to do so, for example a need to fill a law enforcement vacuum.

77. However, an offence, such as theft, against the national government is of a different character, as signified by the placing of these offences in a chapter of the Criminal Code entitled The proper administration of Government Moreover, offences that have been contained in the Crimes Act 1914 , which for the most part are offences against the Commonwealth government or government services, have for a long time been given extended reach. (See section 3A of the Crimes Act 1914 .)

78. The offences under consideration are all ones where the victim will be, by definition, not merely an Australian victim but an Australian government entity. The offences exist to protect Australian government property, other Australian government interests or both (protection of a Commonwealth entity). It is inevitable that, in the course of performance of necessary government functions, that property and those interests will be exposed to criminal activity outside Australia. Action by way of Commonwealth prosecution will generally be justifiable to protect national interests, and will sometimes be necessary, for example if no foreign authority is able and willing to take such action. Conversely, if a foreign authority is able and willing to take such action there will be no need for the Commonwealth to do so.

79. It should be noted that in Australian law and practice the creation of an offence does not signify an intention that all conduct capable, legally, of prosecution will be prosecuted. At the Commonwealth level prosecutions by the Director of Public Prosecutions are subject to discretions guided by the Directors published policy, and all prosecutions are subject to the over-riding powers of the Director and the Attorney-General.

80. Moreover, proposed section 16.1 requires the Attorney-Generals consent where a prosecution is to be brought in reliance on Part 2.7 and the conduct constituting the alleged offence occurs wholly in a foreign country and the person charged or to be charged is not of Australian nationality. It is intended that, in deciding in his discretion whether to give consent, the Attorney-General will have regard to considerations of international law, comity and practice, any prosecution action that is being or might be taken in another country, and other public interest considerations bearing on the particular case.

Proposed section 131.2 - Special rules about the meaning of dishonesty

81. As mentioned above, there are a number of interpretative rules that go with the offence of theft. The first concerns the meaning of dishonesty. The general meaning is defined at proposed section 130.3.

82. The first of the special rules for theft are that a persons appropriation of property belonging to another is taken not to be dishonest if done in the belief the other cannot be discovered (proposed subsection 131.2(1)). This is a longstanding rule that is operates well in relation to abandoned property. If it did not exist others would not even be able to remove junk dumped near their land. There is no reason why the rule should not operate in relation to property owned or co-owned by the Commonwealth. However, subsection 131.2(2) provides an exception to the rule in relation to trustees or personal representatives. There should be no incentive for them to benefit from losing the person to whom the property belongs. The rule is the same as that provided in subsections 15.2(1) and (2) of the Model Criminal Code.

83. Another special rule is that a persons appropriation of property belonging to another may be dishonest even if the person or another is willing to pay for the property (proposed subsection 131.2(3)). To do otherwise would undermine the offence.

84. It should also be noted that there is a general claim of right defence at secton 9,5 of the Criminal Code. The defence will apply in relation to any property offence if at the time of the conduct constituting the offence the person is under a mistaken belief about a proprietary or possessory right and the existence of that right would have negated any fault element.

Proposed section 131.3 - Appropriation of property

85. This is a critical interpretative provision for the theft offence and closely follows section 15.3 of the Model Criminal Code. The UK Theft Act (which is the inspiration for the Model Criminal Code theft provisions) has a definition of appropriation whichtreats any assumption of the rights of the owner as an appropriation. By contrast, the common law equivalent of this element of theft required a taking and carrying away without the consent of the owner. The Theft Act term is more abstract on its face than the common law . It is possible to assume the rights of an owner in relation to goods without touching them: to point to someone elses car and offer to sell it would amount to an appropriation. The true breadth of the term has been the subject of considerable controversy.

86. The first view is that appropriates is the equivalent of the old term convert and has as its natural meaning a one-sided transaction which is adverse to the owner. This was the view expressed by the House of Lords in Morris in 1984
[1984] AC 320 . But Morris conflicted with the second view expressed in 1972 in another House of Lords case, Lawrence [1972] AC 626. The majority held that an appropriation could occur even if the owner consented. In 1992 in Gomez
[1992] 3 WLR 1067 , the majority of the House of Lords resolved the conflict in favour of the second view. It overturned the Morris view and held that appropriation is neutral and not to be read as importing the common law concept of without the consent of the owner ( a phrase which the majority found to have been deliberately omitted from the new definition of theft). There was a powerful dissent from Lord Lowry. Gomez has been subjected to strong criticism. For example, the leading commentator on the law of theft, (Smith, The Law of Theft (7th ed, 1993), paragraphs 2-08 and 2-12, pages 12-13) has commented:

"The majority gave scant consideration to the merits of the two views [ie Lawrence versus Morris ]. The proposition in Lawrence was ratio decidendi , that in Morris obiter dictum, and that was good enough for the majority. They thought it would serve no useful purpose to seek to construe the Act by reference to the CLRC Report. Lord Lowry who did refer to the Report, demonstrated convincingly in his dissenting speech that it was the dictum in Morris which truly represented the intention of the CLRC and therefore that of the Parliament which enacted the CLRCs proposals with no material change. . . Sadly only Lord Lowry was prepared to give these words their ordinary meaning and the decision of the majority excludes it."

87. The consequences of the distinction can be demonstrated in an example based on Lawrence . Say a taxi driver deceives a foreign traveller by telling her that the fare for a journey is $50.00. In fact it is $20. The customer hands the driver her purse and allows the driver to take whatever money is necessary. The driver takes $50.00. On the neutral view of appropriation, the driver could be convicted of either theft (despite the fact that the victim consented to the defendant taking the money) or obtaining property by deception. On the adverse interference approach, the defendant could only be convicted of obtaining property by deception: because of the victim's consent, the taking would not amount to an appropriation.

88. Those developing the Model Criminal Code faced a choice between these views. The choice has conceptual and practical consequences. First, if virtually any dealing with goods counts as an appropriation, the more work dishonesty has to do to distinguish theft from innocent transactions. Although considerable reliance is placed on the concept of dishonesty - especially for the difficult cases - it is obviously preferable to rely on more clear-cut criteria where possible. Second, there was strong support in consultation for retaining the distinction between theft and fraud. The effect of Gomez is to collapse the distinction between theft and fraud because all obtaining by deception cases will also be theft. This is because under Gomez , consent is not relevant to appropriation. The Model Criminal Code Officers Committee concluded that this strays too far from the central and commonly-understood meaning of theft as involving non-consensual takings. So far as possible, the law should reflect common understandings of offences as basic as theft and fraud.

89. The practical consequences of maintaining the distinction between theft and fraud in cases like Lawrence and Gomez are not great whichever way it is resolved. The penalty for both offences is the same. If all deception cases are charged as obtaining by deception, there will be no difficulty in obtaining a conviction. The difficulty in Lawrence and Gomez arose because the prosecution made a mistake andcharged the defendant with theft instead of fraud and there were no provisions for obtaining alternative verdicts. If the defendant had been charged with obtaining by deception there would have been no difficulty in obtaining a conviction. Under proposed subsection 131.3(1), if the defendant were charged with theft in a case where the property had been obtained by deception, the result would be not guilty of theft because the victim consented to the appropriation. This consent is not vitiated by fraud. This difficulty is cured by making obtaining by deception an alternative verdict to theft. The consultation on the Model Criminal Code favoured this solution but suggested that it should also work in reverse so that if fraud was wrongly charged it would also be possible to convict of theft (as in proposed subsections 134.1(15) and (16)).

90. The issue of consent in cases where there are multiple owners is also important. Proposed subsection 131.3(1) provides that anyone to whom the property belongs consents to having their rights assumed (...without the consent of a person to whom it belongs...). Thus in cases where an object belongs to a number of people - as can be the case under the proposed provisions - if the consent of any one of them is missing at the time of the assumption of their rights, an appropriation may occur. That does not mean that the defendant is automatically guilty of theft. For example, if the defendant did not know of the other owners interest, then the defendant lacks the fault element for an appropriation (knowledge about the lack of consent) and is not dishonest. On the other hand, a defendant who knows full well of the other owners interest and dishonestly proceeds to assume those rights cannot rely on the consent of another co-owner to deny the appropriation. Assuming the presence of the other elements, such a defendant will be guilty of theft. So where one co-owner of a painting sells it to the defendant, and the defendant knows that the other co-owner does not and would not consent to the sale, the defendant cannot rely on the consent of the one co-owner to deny appropriation.

91. Subsection 131.1(1) also addresses the nature of the rights of the owner which are protected - ownership, possession or control of property. It is important that it should not be too vague.

92. Proposed subsection 131.1(2) deals with bona fide purchasers and recipients. It covers cases where a person innocently acquires property (eg goods) and subsequently discovers that the person from whom he or she received the goods did not have the right to dispose of them, usually because the goods were stolen. For example, a person sells a car to the defendant who was acting in good faith. Later the defendant finds out that the first person had stolen the car, but the defendant decides to keep it. Despite the fact of payment, this is either dishonest or liable to be regarded as dishonest and the other elements of the offence of theft are present. The defendant could not rely on the consent of the thief because he or she does not have the consent of the owner as required by proposed subsections 131.1(1) and 131.10(1). Proposed subsection 131.1(2) prevents this from being theft by providing it is not an appropriation. This also closely follows the relevant provisions of the Model Criminal Code (subsections 15.3(2)).

93. Under the UK Theft Act, where the defendant was given the car, the analogous section to subsection 131.1(2) does not operate because it only protects transactions which were for value. Both are situations where the defendant was honest at the point he or she acquired the goods and the culpability derives from failure to return the goods. As in other situations where the defendant discovers that goods belong to another subsequent to acquiring them (where there is a mistake), the fact that the defendant did not initiate a dishonest transaction distinguishes him or her from the thief or the fraudster. Although the fact that the defendant paid for the goods in the one case but not the other makes some difference to the assessment, payment is not enough of a difference to warrant conviction for theft in one case but not the other. They are also substantially different from the case of a person in possession of goods on some basis of trust (eg an employee or a bailee) who makes off with the goods. In both these cases, the defendant initially believed he or she had become the owner of the goods. It was concluded that as a matter of consistency, the section should be widened slightly to include the bona fide recipient of a gift.

94. However, the proposed exemption is limited. If the defendant sold the car to another, he or she would be guilty of obtaining the purchase price by deception (see the proposed fraud offences at sections 134.1 and 134.2. This is because the defendant does not obtain ownership of the car and the real owner could claim it back from the defendant or anyone to whom the defendant sold it.

Proposed section 131.4 - Theft of land or things forming part of land

95. Proposed section 131.4 is much the same as section 15.4 of the Model Criminal Code and follows the traditional approach on the question of theft of land. The one difference is that the proposed provision does not refer directly to tenancy but it is covered by subparagraph 131.4(1)(b)(ii) which is more general but reflects the same principle. Generally, under the existing law it is not possible to commit theft in relation to land or things forming part of the land and severed from it by the person.

The exceptions are where:

(a)

a trustee appropriates land by dealing with it in breach of trust;

(b)

a person who is not in possession of the land severs something forming part of it;

(c)

a tenant steals a fixture.

96. These restrictions appear to be based on the concept of theft as involving things that can be taken and carried away. Land can be the subject of the separate fraud offence and that is generally the more appropriate way of dealing with dishonesty in relation to land. The Model Criminal Code Officers Committee canvassed in consultation as to whether land should be the subject of theft, for example where a person moves a fence in order to appropriate another persons land. While many favoured extending the provisions to include land, to do so may trespass on areas better dealt with by the civil land laws. Indeed if the defendant adversely possessed the land for 15 years, he or she would become its owner. It would seem inconsistent if the defendant could also be guilty of theft for the same conduct. There are no demonstrated problems justifying the proposed extension. The Committee concluded that although including land may appeal to logic, there were uncertainties and the benefits were hard to identify.

Proposed section 131.5 - Trust property

97. Proposed section 131.5 is the equivalent of subsection 15.5(1) of the Model Criminal Code. It has been placed in a separate section to improve reader awareness of the provision.

98. Proposed subsection 131.5(1) provides that property also belongs to people who have any proprietary right or interest (not being an equitable interest arising either from an agreement to transfer or grant an interest, or from a constructive trust). One example of the effect of this is that a trustee (who is the legal owner of the trust property) who dishonestly appropriates trust property will be guilty of theft from the beneficiaries (who do not own the trust property but do have an equitable proprietary interest in the trust property). Where there is no specific beneficiary (eg in the case of a trust for general public purposes), proposed subsection 131.5(1) makes this theft.

99. However, equitable interests arising from agreements to transfer or grant an interest (eg to sell land or shares) are excluded because of the definitions of property and what is meant by property belonging to a person (proposed sections 130.1 and 130.2). These equitable interests arise by the operation of legal rules but only in relation to contracts which are specifically enforceable. For example, the defendant agrees to sell a valuable painting to the victim. Before the sale goes ahead and the painting is transferred, the defendant gets a better offer and sells it to X. In general, contracts agreeing to sell goods are not specifically enforceable but they are when the goods have special qualities. Hence, a contract like the one in the example would be specifically enforceable and the victim would have an equitable interest in the painting. However, the framers of the UK Theft Act judged that this conduct should not be theft and that civil remedies were sufficient. The qualification in proposed section 131.2 means that this is not property belonging to another and therefore not theft.

100. Similar considerations arise in relation to constructive trusts which are also excluded by proposed section 131.2. In an English case, the proprietor of a tied pub operated it on the basis that he would only sell the brewerys beer. In fact he also sold some of his own home brew. He was charged with theft on the basis of an argument that he was a constructive trustee of the proceeds of the sale of the home brew and that the brewery had an equitable proprietary interest in the proceeds. The Court of Appeal found that no constructive trust arose in these circumstances and, in any event, rejected the notion that a person should be guilty of theft based on the operation of such intricate legal concepts which strayed so far from ordinary conceptions of theft. The same point applies to constructive trusts generally, such as have been found to arise in the case of mistaken overpayment. Hence, proposed section 131.2 extends the qualification contained in the UK Theft Act so that equitable interests arising from constructive trusts do not fall within the definition of property belonging to another. Constructive trusts - based on equitable notions of unconscionability - may be appropriate for recovery in civil actions, but they stray too far from the common conception of theft and the much more culpable sort of dishonesty involved in theft to form part of the definition of the offence of theft. Their ambit is uncertain and likely to expand. To attach the boundaries of theft to such an uncertain concept would offend the important principle that the criminal law should be knowable in advance. It would also strain the common understanding of what is meant by theft.

101. Proposed subsection 131.5(2) makes it clear that an intention to defeat a trust is an intention to permanently deprive for the purposes of the offence. This also follows subsection 15.5(1) of the Model Criminal Code.

Proposed section 131.6 - Obligation to deal with property in a particular way

102. Proposed section 131.6 follows subsection 15.5(2) of the Model Criminal Code. The general definition of property belonging to another contained in proposed section 130.2 is supplemented for the purposes of the offence of theft by proposed section 131.6. So, for example, if the defendant receives money from another person and is under an obligation (this must be a legal obligation) to retain and deal with that money in a particular way but the defendant deals with it another way, the money is said to belong to the victim. The cases have held that the obligation must be legal rather than moral. This is made explicit in proposed section 131.6. The application of this provision will depend very much on the facts of the transaction. The most difficult cases involve cash deposits. The section only applies if the particular cash is to be used, for example for the purchase of tickets. If the cash is to be mixed with the general cash of the organisation and there is a liability to provide tickets or a refund at a later time, then the cash ceases to belong to another. There is a debt to the depositor and the situation is dealt with on the normal principles relating to debtors and creditors.

Proposed section 131.7 - Property obtained because of fundamental mistake

103. Proposed section 131.7 follows subsections 15.5(3) and (4) of the Model Criminal Code. It also includes an additional provision that makes it clear money includes cheques, negotiable instruments and electronic funds transfers.

104. Proposed section 131.7 deals with the problem when the victim makes a fundamental mistake and gives the defendant some property; the defendant does nothing to induce the mistake. Fundamental mistakes are mistakes about the identity of the defendant, the essential nature of the property, or the quantity of the goods (but not the amount of money). The problem is whether the victim's mistake is so fundamental that it vitiates the consent to the defendant appropriating the property and the victim's intention to transfer ownership of the property to the defendant. Other sorts of non-fundamental mistakes (eg the year of manufacture of a car) do not give rise to this problem. These mistakes do not vitiate consent or intent to pass ownership and the defendant does not incur any criminal liability. However, in the case of fundamental mistakes, if the defendant decides to keep the goods the question is whether he or she should be guilty of theft.

105. There are two situations relating to fundamental mistakes: (i) where the defendant knows of the mistake at the time (T1) of transfer and decides to keep the goods; and (ii) where the defendant does not know of the mistake at T1 but discovers it later (T2) and then decides to keep the goods. At common law in England, the defendant was guilty of theft in both T1 and T2 situations ( Middleton (1873) LR 2 CCR 38

106. The more difficult cases arise when the defendant only finds out about the mistake later at T2 and then the defendant decides to keep the property. This came up in the case of Ashwell (1885)
16 QBD 190 . The prevailing view was that the taking did not occur at T1 when a valuable coin was handed over. Their view was that the appropriation did not occur until T2, when the defendant discovered what the coin really was, namely a sovereign. At T2, on the authority of Middleton, the mistake as to the nature of the subject matter meant that there was no consent to the taking and that ownership had not passed (ie it was still property belonging to another). The opposing view was as follows. The taking occurred at T1, was with consent and occurred at a time when the defendant lacked fraudulent intent. At T2, when the intent became fraudulent, there was no taking without consent and ownership of the property had passed to the defendant.

107. In Australia, the majority judges in the High Court case of Ilich (1987)
162 CLR 110 expressed their disapproval of the reasoning in Middleton and Ashwell . Ilich was a decision on the WA Code but in the course of the decision, the majority indicated its agreement with the reasoning in Potisk (1973)
6 SASR 389 (a SA Full Court decision on common law larceny which had also rejected the English cases). In Ilich , the High Court ruled that cases where property passes because of a non-fundamental mistake are not theft under the Codes because at the time of the conversion (ie T2) the property belongs to the defendant. The reasoning of the High Court was that at T1, the owner knew the identity of the payee and the nature of what he was transferring, namely money. The normal presumption with money is that ownership passes with possession. Consent to the taking is not required under the WA Code, so that issue did not arise. At T2, the time of the conversion, ownership of the $500 in question had passed to Ilich and therefore it was not property belonging to another.

108. Under the UK Theft Act , fundamental and non-fundamental mistakes can count as theft, even at T2. The Theft Act approach in this type of case is to say that the appropriation occurs at the time the defendant dishonestly decides to keep the money. The question is whether the property belongs to another at this point. There are a variety of routes to the conclusion that it does. This is because the UK Theft Act has such a wide definition of property belonging to another: it includes any case where the victim has a proprietary right or interest or is under a legal obligation to return the property.

109. First, in cases of fundamental mistakes as to the identity of the transferee, the nature of the subject matter or the quantity of the goods, the intent to pass ownership is vitiated by the mistake and hence the property still belongs to the victim. If the defendant is aware of the mistake at either T1 or T2 and dishonestly decides to appropriate the property, he or she will be guilty of theft.

110. Second, English cases have held that where certain sorts of mistakes are made, although legal ownership of the property passes, there is a constructive trust and the transferor retains an equitable proprietary interest in the property transferred. Thus, the property still belongs to another under s5(1) of the UK Theft Act because the person has a proprietary right or interest in it. The type of mistake here is not so fundamental as to prevent ownership passing but must be serious enough that it would be unconscionable for the defendant to retain the property; hence he or she becomes a constructive trustee for the victim who, as beneficiary, has an equitable proprietary interest in the property. Exactly when this is so will vary according to the essentials of the transaction, but it is wider than mistakes as to the identity of the transferee or the nature of the subject matter. In England, the Court of Appeal has cast doubt on the notion of using constructive trusts as a basis for the law of theft. For the reasons outlined above, proposed section 131.2 specifically excludes constructive trusts from the ambit of property belonging to another and hence from the ambit of theft. Hence, this route to a conviction for theft is not open under the proposed provisions.

111. The third category of cases produces the most difficult problem. These are cases of non-fundamental mistake where the ownership does pass - such as in a case where a $200 debt is mistakenly paid twice. Under the Theft Act, this will be theft if the defendant is under a legal obligation to repay the money. This is because s5(4) of the UK Theft Act deems the property to belong to the victim if the defendant receives the money by anothers mistake and is under a legal obligation to make restoration in whole or in part of the property or its proceeds.

112. Whether the defendant is under such an obligation is a matter of civil law and may include, among other things, decisions about the law of quasi-contract and whether a contract is void or voidable. If the contract is voidable, it may be argued that the defendant is not under a legal obligation to return the property until the contract is avoided. In many of these cases, the intricacies of the civil law are such that the defendant may be able to argue that he or she is not dishonest because he or she did not know that keeping the property was dishonest. However, defendants who take advantage of others mistakes or who make secret profits may be regarded as dishonest. But that does not necessarily mean that such people are guilty of theft. Dishonesty is an important element of the law of theft and fraud but it is not the only element. Leaving such cases to be determined solely by reference to the concept of dishonesty avoids the basic question about whether the intricacies of the civil law appropriately mark out the boundary of the physical elements of theft.

113. Proposed section 131.7 is therefore a rejection of the uncertain ambit of constructive trusts for the purpose of extending the boundaries of when property belongs to another for the purposes of the law of theft.

114. There are strong arguments that the mistake cases - particularly the T2 cases - should not be treated as theft but as matters involving civil liability. The victim has brought about his or her own misfortune and it is unduly harsh to cast the onus of rectifying the situation onto the defendant on pain of committing theft. Thus, while the victim in Ilich is certainly entitled to sue to recover his money, he should not be able to have the other person arrested and prosecuted for theft, any more than any other creditor could if the debtor spent money on a holiday rather than paying the creditors account. In some cases these overpayments will arise because the victim has chosen to set up business arrangements which are prone to error because this is cheaper than setting up a less error-prone system. Although the defendant may be under an obligation to return the property, the culpability is of a much less serious sort than theft or fraud where the defendant initiates a dishonest transaction. In these cases, the defendant has had temptation thrust upon him or her. To make a defendant like Ilich, or the recipient of a social security overpayment, guilty of theft in these T2 cases is to cast a duty to act in relation to innocently acquired property on pain of committing theft.

115. The potential width of this sort of liability is also of concern. In theory, it turns civil obligations into criminal ones where hitherto that has not been the case. It may be that all sorts of business transactions involving mistakes would now carry potential criminal liability. The 1995 Model Criminal Code report mentions the following examples of cases which now would be brought within the law of theft. (1) A purchaser pays a vendor for goods; neither realised that the purchaser already owned them. The vendor refuses to repay the money. (2) An insurer pays money to an insured for goods that both believed to have been destroyed by fire. Subsequently the defendant finds the goods but does not tell the victim. (3) An employer pays a manager a lump sum to terminate her contract. It turns out that breaches of the contract would have entitled the employer to terminate the contract without payment. Neither knew of the breaches at the time of the contract. They subsequently discover this but the employee refuses to repay. The House of Lords and the Court of Appeal in England differed on whether the defendant was under an obligation to repay in the employment case. In all these cases (save the last), the defendant would be civilly liable to give back the money or goods mistakenly given to him or her. The question is whether it is justifiable to impose criminal liability for the offence of theft as well.

116. While the consultation on the Model Criminal Code revealed that opinion was divided on this issue, for the reasons advanced in relation to constructive trusts, it has been concluded that the civil law distinctions - while appropriate to the context of determining civil recovery - are too obscure on the whole to define the boundaries of an offence as serious as theft. It is therefore proposed that it is appropriate to limit the use of the law of mistake to the existing Australian law as stated by the High Court in Ilich , subject to the qualifications outlined below. This involves the following rules:

(a)

Mistakes as to the nature of the subject matter or the identity of the transferee will continue to negate the intent to confer ownership (subsections 131.7(1) and (3)). If the defendant knows of this sort of mistake either at T1 or T2, the property still belongs to the victim and the victim will be deemed not to have consented to its appropriation and the defendant will commit theft. (Mistakes as to quantity are not included on the basis that they are not sufficiently fundamental: the person intends to hand over goods of that sort and there is no mistake about the identity of the transferee).

(b)

Other mistakes do not vitiate either the consent to the appropriation or the intention to pass ownership. The defendant does not commit theft if he or she knows of the mistake either at T1 or T2 because the property no longer belongs to another.

(c)

Mistaken overpayments by cash, cheque or direct credit are a special case (subsections 131.7(1) and (3)(b)). Where the defendant is aware of the mistake at the point of transfer(T1), the absence of what may be termed the inertia factor makes this case sufficiently like the finding cases to warrant the offence of theft. This raises a question about when the relevant time is. In a supermarket if the defendant immediately knows the overpayment at the register, this is clearly a T1 situation. On the other hand, in a case like Ilich, where the defendant does not become aware of the mistake until some time after transfer, it is clearly a T2 situation. the defendant will not be guilty of theft but the victim would be able to recover the money civilly. Cases where the defendant receives a cheque in the mail are more difficult. In accordance with the reasoning of Kriewaldt J in Wauchope that this would not be theft because the defendant did not become aware of the mistake until some time after the drawer intended to convey ownership (ie it is a T2 situation). Mistaken direct credits to bank accounts are similar to cheques. If a bank customer saw the teller mistakenly credit his or her account with $2000 rather than $200, and said nothing, that would be theft. In practice, direct credits will overwhelmingly be T2 cases because the defendant will only find out about the mistake some time after the transfer. If there was a fundamental mistake (eg wrong account because of a mistaken identity), the defendant would be liable for theft at T2. If it was a non-fundamental mistake (eg the correct account but the wrong amount), the defendant would not be guilty of theft. The victim would have civil remedies to recover what is in effect a debt.

117. These are fair rules developed after consultation and a thorough review of the relevant case law by the Model Criminal Code Officers Committee.

Proposed section 131.8 - Property of a corporation sole

118. Proposed section 131.8 follows subsection 15.5(5) of the Model Criminal Code and preserves ownership for a corporation sole where there is a vacancy in the corporation.

Proposed section 131.9 - Property belonging to two or more persons

119. Proposed section 131.9 follows subsection 15.5(6) of the Model Criminal Code. It provides that the person to whom property belongs includes all the owners.

Proposed section 131.10 - Intention to permanently deprive

120. The proposed theft offence (section 131.1) retains the longstanding common law element of intention to permanently deprive. Proposed section 131.10 provides guidance as to the meaning of intention to permanently deprive and is based on section 15.6 of the Model Criminal Code. There was strong support for the retention of this element of the offence in consultation in recognition of the significant penalty for theft.

121. Proposed subsection 131.10(1) expands the concept of permanent deprivation by including an intention to treat the property as one's own to dispose of regardless of the rights of the other person. This is a helpful crystallisation of the common law position and judicial interpretations seem to favour that view. Disposals and borrowings will need to have a quality of permanence about them before the section can be satisfied (eg the defendant melts down the victim's antique bracelet intending to give back the melted silver). Similar points apply to proposed subsection 131.10(2) relating to parting with property under conditions which the person may not be able to fulfil. This is treated as an example of disposing of property regardless of the others rights in terms of proposed subsection 131.10(1).

Proposed section 131.11 - General deficiency

122. Proposed section 131.11 follows section 15.7 of the Model Criminal Code and replaces a similar provision at section 71A of the Crimes Act 1914 . It is an evidentiary provision which allows the prosecution to prove the defendant guilty of theft even though the prosecution cannot identify the particular sums of money or property taken if the prosecution can prove a general deficiency in the victims money or property referable to the defendants conduct. A typical example is where the defendant is an employee and takes small amounts of money from the till over a period of time. This type of provision exists in many jurisdictions.

Proposed Division 132 - Other property offences

123. Division 132 contains the theft related offences of receiving, robbery, aggravated robbery, burglary and aggravated burglary, each of which link back to the offence of theft, or in the case of burglary other serious offences. The Division also contains the lesser offences of making off without payment going equipped for theft or other property offences, the dishonest taking and retention of property offence.

Proposed section 132.1 - Receiving

124. Proposed subsection 132.1(1) contains the elements of the offence of receiving. A person is guilty if the person dishonestly receives stolen property, knowing or believing the property to be stolen. Proposed section 132.1(2A) makes it clear that it is not necessary to prove knowledge or belief that the property belonged to a Commonwealth entity. Proposed subsection 132.1(3) provides that property is stolen whether it is original stolen property, tainted property or previously received property. These terms are defined with reference to theft (proposed section 131.1) and property fraud (proposed section 134.1). The definition of previously received property was inserted by a Government Amendment to make it clear that no matter how the property was received in the first place (whether by theft or fraud), subsequent receiving will also be caught by the offence.

125. The maximum penalty is the same as theft and property fraud - 10 years imprisonment. This is appropriate since it involves much the same type of activity.

126. The proposed offence is based on section 16.8 of the Model Criminal Code, although it is drafted slightly differently. Receiving property belonging to the Commonwealth is an offence under subsection 71(3) of the Crimes Act 1914 . Like the existing offence of stealing Commonwealth property, the existing receiving offence has a lower penalty (7 years).

127. While both the Gibbs Committee and the Model Criminal Code Officers Committee thought there was scope for eliminating the offence of receiving and relying on theft, there was very strong support in consultation for having a separate offence of receiving. Most considered the receiving label corresponded with community understanding of a form of criminality which is different from theft. It is important that where it is appropriate the language of the Criminal Code should reflect community understanding.

128. Apart from that reason, receiving is also relevant to the property fraud offence (proposed section 134.1) where the property is obtained by deception. Unlike fraud, theft does not cover property appropriated with the consent of the owner. There will also be situations where there was uncertainty about whether the property had been stolen or obtained by deception - but certainty that one or the other occurred. There are good reasons for having an offence of receiving.

129. Proposed section 132.1 is a much less complex form of the offence than that contained in the UK Theft Act . The Theft Act attempts to graft a variety of complicity provisionsinto the basic receiving offence. It produces a complex and unwieldy offence with overlaps into the law of complicity. Section 132.1 confines itself to receiving. The normal rules of complicity and accessory after the fact apply to those who assist a thief or a receiver.

130. The definition of original stolen property in subsection 132.1(5) covers property, or part of property, appropriated in the course of theft and in the possession and custody of the person who appropriated it. Alternatively property in the possession of the person who obtained it in the course of property fraud (proposed section 134.1). This is the equivalent of paragraphs 16.8(2)(a) and (b) of the Model Criminal Code.

131. Proposed subsection 132.1(6) makes it clear that after the property is restored it ceases to be original stolen property for the purposes of the proposed offence. The same is also the case where the person who previously had it ceases to have a right to its restitution. This follows similar provisions in Victoria and the ACT. There is a public interest in encouraging people to return stolen property or to regularise ownership where there is a dispute over the property. This is similar to subsection 16.8(3) of the Model Criminal Code.

132. Proposed subsection 132.1(7) deals with tainted property. The definition ensures that the offence of receiving still attaches to the receiver where stolen property is sold or exchanged. The proceeds of the transaction is defined as tainted property if the receiver still has possession or custody of them whether it derived from theft or property fraud. The aim here is not to make receiving an offence that can continue down a chain of people. To do so would make the offence too open ended. Although the drafting is different, this approach follows subsection 16.8(2)(c) of the Model Criminal Code.

133. Proposed subsection 132.1(8) extends the offence to make it clear that it covers the receipt of funds credited into an account. This additional provision is as a consequence of changes to the property fraud offence (proposed subsections 134.1(9) and (10)) which clarify the position with respect to money transfers. The money transfer provisions will be dealt with in more detail in the notes on proposed section 134.1. However it should be noted that paragraph 125(8)(b) is included to provide for an equivalent to subsection 132.1(6) in the context of money transfers.

134. Proposed subsections 132.1(9) and (10) includes alternative verdicts provisions which is quite different from subsection 16.8(4) of the Model Criminal Code. It enables the trier of fact (a court or jury) to conclude the person is guilty of theft or property fraud rather than receiving, or vice versa. There was concern that the subsection 16.8(4) could lead to an uncomfortable result because it does not require the jury to agree on which charge should prevail - if they believe the person is guilty of one of the offences but cannot agree on which, then the person is to be convicted of theft. This means that if the trier of fact is a jury and half of the members think the person has committed theft, the other half receiving, it suggests there is an unhealthy level of uncertainty. There really should be agreement as to whether the person committed one offence or the other. If the legislature agrees with this change, the Standing Committee of Attorneys-General can be asked to consider amending the Model Criminal Code to reflect proposed subsections 132.1(9) and (10).

135. Proposed subsection 132.1(11) is a transitional provision designed to ensure that property illegally appropriated or obtained contrary to Commonwealth law before the commencement of the legislation will be caught by the proposed offence. The amendment recognises that the existing offences vary from the proposed offences and is therefore carefully drafted to ensure there is no retrospectivity.

Proposed section 132.2 - Robbery

136. Proposed section 132.2 is relatively straight forward and follows section 16.1 of the Model Criminal Code.. A person is guilty of the offence of robbery if the person commits theft (which is of course theft against a Commonwealth entity) and proximate to the theft the person uses or threatens to use force on another person with the intent to commit the theft or to escape. Proposed subsection 132.2(3) was inserted by a Government Amendment to make it clear that it will not be necessary for the prosecution to prove the person knew that the property belonged to a Commonwealth entity.

137. The proposed maximum penalty is 15 years imprisonment. This is higher than the 12 1/2 year penalty proposed in the Model Criminal Code but reflects growing community concern about the prevalence of this type of crime and the fact it involves violent conduct.

138 There is currently no Commonwealth robbery offence. If there is a robbery involving the Commonwealth, it relies on State or Territory law. The Gibbs Committee favoured retaining Commonwealth theft and fraud offences because they are of direct and real concern to the Commonwealth, noting that while the AFP has authority to investigate State and Territory offences, the prosecution decision and the priority given to these matters would remain with the State and Territory authorities. The aggravated offences like robbery and burglary should be of concern to the Commonwealth for the same reasons. Although robbery and burglary are not commonly committed against the Commonwealth entities, the same can be said in relation to many other offences that are covered by Commonwealth legislation.

139. To have the aggravated offences and the general offences under the law of different jurisdictions would be untidy and fragment what is an integrated system of offences. Robbery is intimately connected to the scope of theft - it is theft involving the use of force or a threat to use force. It would be clumsy and confusing to charge a person for a Commonwealth theft offence which has different concepts from an accompanying charge of robbery based on a completely different State theft offence. While it is possible to overcome some of the problems with this by providing for the concurrent operation of Commonwealth and State offences, it is desirable that the Commonwealth provide for its own complete scheme of offences. When the prosecution uses the Commonwealth law it will have a complete set of offences. There will be no further need for mixing the offences.

140. For the convenience of State and Territory authorities, proposed section 261.1 provides it is not intended to exclude or limit the operation of State or Territory laws. This will overcome potential operational difficulties in some circumstances (such as where the robbery is part of a series involving non-Commonwealth premises) and will be necessary to negative any inference that the Commonwealth offences are exhaustive and exclusive ( Queen v Loewenthal; ex parte Blacklock (1974)
131 CLR 338 ). This follows the approach at section 75 of the Trade Practices Act 1974 which was upheld in the High Court in The Queen v Credit Tribunal; ex parte General Motors Acceptance Corporation (1976)
137 CLR 545 at 563 and section 76F of the Crimes Act 1914 (which achieves a similar outcome in relation to computer offences).

Proposed section 132.3 - Aggravated robbery

141. Proposed section 132.3 contains a separate more serious offence where a robbery is committed in the company of others or with an offensive weapon. This is similar to section 16.2 of the Model Criminal Code and has the same maximum penalty of 20 years imprisonment. Proposed subsection 132.3(2A) was inserted by a Government Amendment to make it clear that it will not be necessary for the prosecution to prove the person knew that the property belonged to a Commonwealth entity.

142. Proposed subsection 132.3(3) provides for a definition of offensive weapon. This term was not defined in the Model Criminal Code. It has been defined here to take into account the particularly frightening practice of threatening people with syringes.

Proposed section 132.4 - Burglary

143. Proposed section 132.4 contains the burglary offences. There is more to this provision than section 16.3 of the Model Criminal Code because of the peculiarities of Commonwealth jurisdiction. However, the substance of the offence is much the same.

144. The policy of the proposed amendments was considered by the House of Representatives Standing Committee on Constitutional and Legal Affairs and the subject of a recommendation in its 24 June 2000 advisory report (recommendation 5, paragraphs 3.22 - 3.26 at pages 17 and 18). The Standing Committee did not agree with the approach in the version of proposed subsection 132.4(1) introduced in the House of Representatives and observed that People who would otherwise be guilty of burglary would escape conviction merely because they were unaware or did not care whether the property they intended to steal belonged to the Commonwealth or not.

145. However, the Standing Committee recommended the deletion of proposed subsection 132.4(11) because it disapplied a provision which removes the need to prove knowledge of the Commonwealth connection in relation to the theft element of the robbery offence.

146. A more comprehensive and clearer way of achieving the preferred approach of the Standing Committee was to redraft proposed subsection 132.4(1) to make it clear that where someone breaks in to steal a particular item of property, it is not necessary to prove the person knew that the property concerned belonged to a Commonwealth entity. Proposed subsections 132.4(2A), (3A) and (6A) were inserted by Government Amendments to deal with other problems concerning proof of knowledge of jurisdictional elements of the offence. These are:

(a)

whether the relevant harm or damage offences were Commonwealth, State or Territory offences;

(b)

whether the offence involved had a penalty of imprisonment for life or 5 or more years imprisonment.

147. The maximum penalty of 13 years imprisonment is less than robbery because the basic offence does not involve violent conduct, but it is more than theft because it involves trespassing in a building.

148. Subsection 132.4(3) provides a person is guilty of the offence of burglary if he or she enters, or remains in a building as a trespasser with intent to commit an offence in the building which is against the Commonwealth law and involves causing harm to another or damage to property. The offence must be one which is punishable by 5 or more years imprisonment .

149. Subsection 132.4(6) provides for a similar offence with the same penalty, but one where it is a building owned or occupied by a Commonwealth entity and the relevant offence is against the law of the Commonwealth, State or Territory. In this case subsection 132.4(7) provides it is not necessary to prove the person knew the offence was punishable by imprisonment for 5 or more years or due to subsection 132.4(8) that the building is owned or occupied by the Commonwealth. Many people do not have an appreciation of the differences between Commonwealth, State and Territory functions and legislative responsibilities.

150. Subsection 132.4(10) follows subsection 16.3(2) by providing that a person is not a trespasser just because the person is permitted to enter or remain in the building for a purpose that is not the persons intended purpose or because of deception. In those circumstances it would only be appropriate to charge the person with theft. Burglary is all about obtaining entry without permission. The person would of course be a trespasser if he or she gained entry for a specific period and then stayed on longer. A theft in those circumstances would be burglary.

151. Finally, proposed subsection 132.4(12) defines building to include part of a building, a mobile home or caravan or other structures adapted for residential purposes. This closely follows subsection 16.3(3) of the Model Criminal Code and is appropriate in the Commonwealth context. Commonwealth entities do have mobile and fixed residential accommodation for staff which requires the protection provided for by this Bill.

Proposed section 132.5 - Aggravated burglary

152. Proposed section 132.5 contains a separate more serious offence where a burglary is committed in the company of others or with an offensive weapon. This is similar to section 16.4 of the Model Criminal Code but has a slightly higher maximum penalty of 17 years imprisonment (rather than 15 years). The penalty is less than aggravated robbery (20 years) as it can be committed in the absence of other people, while robbery involves using or threatening force. If that occurs, the charge should be aggravated robbery. Proposed subsection 132.5(3) provides it is not necessary to prove the person knew that the property concerned belonged to a Commonwealth entity, subsection 132.5(4) that the offence involved was against a Commonwealth law and subsection 132.5(5) that the offence was punishable by imprisonment for 5 or more years (few people would know such details).

153. Proposed subsection 132.5(6) provides for a definition of offensive weapon. This term was not defined in the Model Criminal Code. It has been defined here to take into account the particularly frightening practice of threatening people with syringes.

Proposed section 132.6 - Making off without payment

154. The offence in proposed section 132.6 is necessary where ownership of property passes to the defendant before he or she decides to dishonestly appropriate it (eg filling up a car with petrol and deciding to leave without paying). The defendant has not committed theft, as the dishonest intention was not formed until after the defendant has taken the property and ownership has passed. There is also no deception because the defendant merely leaves without paying and so the obtaining property or financial advantage by deception offences do not apply either. The offence also applies to services. The offences is based on section 16.6 of the Model Criminal Code. It has a place in Commonwealth law because Commonwealth entities now often have shop-front agencies which sell valuable items.

155. As with the UK and ACT, the penalty for making off is substantially lower than theft (2 years imprisonment) in recognition of the fact that it does not contain all the elements of theft and is less culpable conduct.

Proposed section 132.7 - Going equipped for theft or a property offence

156. Proposed section 132.7 contains another lesser theft related offence which, for completeness, should accompany theft, robbery, burglary and property fraud. It is a preparatory offence which can be committed well before it can be said that an attempted theft or burglary offence has occurred. Although it has been argued that the law should be restricted to attempt, this offence has a long history and where it can be proved from the nature of the article or admissions that the defendant had the article in order to commit theft then offence will be useful. As it is a preparatory offence the maximum penalty is lower than the other theft related offences - 3 years imprisonment. The offence closely follows section 16.7 of the Model Criminal Code.

157. As with the related offence of burglary, proposed subsections 132.7(2), (3) and (4) provide it is not necessary for the prosecution to prove knowledge that the property in question belonged to a Commonwealth entity, that the offence involved was an offence against a law of the Commonwealth or that it the maximum penalty was life or 5 or more years imprisonment.

Proposed section 132.8 - Dishonest taking or retention of property

158. Proposed section 132.8 contains the final theft related offence. It is based on section 16.5 of the Model Criminal Code which deals with the dishonest taking of motor vehicles. In the Commonwealth context the problem of people taking motor vehicles is probably not as much a problem as people taking equipment, computers and other such items because of the significant number of assets possessed by Commonwealth entities and the size of their work places.

159. Under proposed section 132.8 there is no need to prove intention to permanently deprive so the maximum penalty for this offence is significantly less than theft - 2 years imprisonment. The offence will provide for a replacement of section 30 of the Crimes Act 1914 which although favoured by the Gibbs Committee, is a very broad offence which could cover very minor infringements. It is proposed at paragraphs 132.8(1)(a) and (2)(b) that the offence should only cover items of significance.

160. Of course, improper disposal or misapplication of the property would amount to theft. Theft covers any person who dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it (proposed sections 131.1(1) and 131.1(3).

Proposed section 132.9 - Geographical jurisdiction

161. For the same reasons as indicated above with theft, these offences should have category D extended geographical jurisdiction.

Proposed Part 7.3 - Fraudulent Conduct

162. Proposed Part 7.3 contains the fraud and fraud related offences. These include two fraud offences: obtaining property by deception (property fraud) and obtaining a financial advantage by deception (financial fraud); a general dishonesty offence (which has a lower penalty); conspiracy to defraud and an obtaining financial advantage offence. The Bill no longer includes an organised fraud offence (proposed section 135.3 of what was introduced on 24 November 2000). The removal of the offence was recommended by the House of Representatives Standing Committee on Legal and Constitutional Affairs. The Standing Committee concluded that the offence was unnecessary, given that there are other fraud offences (proposed sections 134.1 and 134.2) which can be used to provide for appropriate sentences and the trigger for the operation of automatic forfeiture and special restraining order provisions of the Proceeds of Crime Act 1987 can be achieved by other means, (see recommendation 2, paragraphs 3.1 - 3.6 at pages 13 and 14 of the Standing Committees advisory report which was tabled on 26 June 2000). The related amendments to the Act are Proceeds of Crime Act 1987 are explained in the clause notes on the amendments to that Act which are found in Schedule 2.

Proposed Division 133, section 133.1 - Preliminary - definitions

163. Proposed section 133.1 contains some definitions which are exclusive to Part 7.3:

164. The definition of account is included to provide assistance with the scope of the proposed provisions in relation to money transfers which are covered by the property fraud offence (proposed subsections 134.1(9) and (10)). These will be discussed further below.

165. The definition of deception is critical to the two fraud offences (proposed sections 134.1 and 134.2). The requirement to prove deception distinguishes these two serious offences (with maximum penalties of 10 years imprisonment) from the less serious offences. The definition is very similar to the one at section 17.1 of the Model Criminal Code except that it makes the fault elements with respect to the deception more explicit. The deception may be intentional or reckless. This accords with the intentions of the Model Criminal Code Officers Committee as explained in their 1995 report on this topic and the existing UK Theft Act. The definition also brings the law on fraud up to date by taking into account the deception of computers, machines and electronic devices. This aspect has been drafted a little more broadly to make the Bill less dependent on existing technology. The existing Crimes Act 1914 fraud provisions were not developed with an eye to computer technology. This is particularly important now that Government does much of its business electronically.

Proposed Division 134 - Obtaining property or a financial advantage by deception

166. Proposed Division 134 contains the two central fraud offences based on the offences at sections 17.2 and 17.3 of the Model Criminal Code.

Proposed section 134.1 - Obtaining property by deception

167. Proposed section 134.1 is the property fraud offence. This offence is separate from obtaining a financial advantage by deception offence (proposed section 134.2) because it shares concepts with the theft offence (proposed section 131.1). A person is guilty if the person, by a deception, dishonestly obtains property belonging to another with the intention of permanently depriving the other of the property. Some of these concepts have been explained in the context of the theft offence and will not be repeated again here (for example, dishonestly). The maximum penalty of 10 years imprisonment is the same as theft and the obtaining a financial advantage offence, and is consistent with existing State and Territory offences. This is appropriate as it includes similar conduct. The offence is based on section 17.2 of the Model Criminal Code.

168. There is no equivalent proposed section 134.1 in the Crimes Act 1914. The main existing offence, section 29D, has the same penalty but is an unacceptably broad in its coverage. It is proposed that section 29D be replaced by the two fraud offences for more serious conduct involving a deception, and a lesser general dishonesty offence with a lower penalty of 5 years imprisonment. This merely reflects the reality of how courts are likely to sentence under section 29D. Where deception is not proven, the sentence will invariably be lower.

169. Like the other offences, proposed subsection 134.1(2) makes it clear the prosecution does not have to prove the defendant knew he or she obtaining property from a Commonwealth entity.

170. The word by in the phrase, by any deception, requires that there be a causal link between the deception and the obtaining. The fact that the defendant practised a deception will not be enough if that deception was not the cause of the obtaining. If the defendant falsely represented he or she was starving in order to obtain food from another person but, unbeknown to the defendant, that person was giving food away to anyone as part of a sales promotion, the defendant's deception would not have been the cause of obtaining the food. However, the person may be guilty of attempting the offence (under section 11.1 of the Criminal Code ).

171. A causation issue arises in cases involving credit cards where the merchant is presented with a credit card with authorisation. Apart from cases in which the merchant and the person using the card are partners in fraud, presentation of the card is always an implied representation that the person is an authorised user. Cases on the corresponding UK Theft Act provision accept that unauthorised use of a credit card is an implied deception which induces the other person to part with the goods or services. It has been objected that the deception does not induce the transaction in these cases, since the merchant is assured of payment in any event. But English courts have taken a more robust view of the law, holding that the implied deception does induce the transfer because the transaction will not proceed if the merchant knew for certain that use of the card was authorised. This has been accepted as a sufficient causal connection by English courts ( Charles
[1977] AC 177 and Lambie
[1982] AC 449 ). Australian courts can adopt the same course.

172. The definition of obtaining at proposed subsection 134.1(3) is wider than the definition of appropriation adopted in proposed section 131.3 in that it does not involve any absence of consent. The deception causes the defendant to consent to the transfer. This offence is wider than the common law offence of obtaining by false pretences which only applied to obtaining ownership. Proposed subsection 134.1(3) applies to obtaining ownership, possession or control of property. It includes obtaining for another or enabling another to obtain or retain. So where the defendant deceives the victim into giving goods to another person, the defendant is guilty. The definition also takes into account money transfers. Subsection 134.1(4) is included to make it clear that the general definition of obtaining in proposed section 130.1 does not apply. Subsection 134.1(5) makes it clear that willingness to pay is irrelevant to this offence.

173. Proposed subsection 134.1(6) provides that intention to permanently deprive is an element for this offence as it is for theft. The extended meanings of intent to permanently deprive set out proposed section 131.10 are for the convenience of readers repeated again in this offence at proposed subsections 134.1(6), (7) and (8). The requirement is met if the defendant intends to treat the property as his or her own to deal with, or keeps it in circumstances equivalent to a permanent deprivation, or parts with it on conditions he or she may not be able to comply with. An intention to return the equivalent quantity of a fungible (an interchangeable commodity) is a sufficient fault element for the offence. A fraudster who obtains money by deception with the intention of repaying an equivalent amount at a later date will be convicted of the offence so long as the court is satisfied that the money was obtained dishonestly. The intention to return an equivalent sum is no answer to the charge.

174. Proposed subsections 134.1(9) to (11) extend the offence of obtaining property by deception to cover fraudulently induced electronic money transfers. In these cases, a deception by the offender induces an electronic transfer of funds from the victims account to an account held by the defendant or another person. The proposed provisions are intended to outflank the decision of the House of Lords in Preddy
[1996] 3 WLR 255 , which held that fraudulent inducement of an electronic money transfer did not fall within the scope of the equivalent to this offence.

175. The problem which concerned the House of Lords arises when A, a fraudster, deceives in order to induce an electronic transfer of funds from the account of B to an account held by A or a third person. Though most people speak of having money in the bank, the money has no tangible existence. If the account is in credit, the bank is merely a debtor and the bank customer B is a creditor who has no more than a chose in action (an enforceable legal right) against the bank. In Preddy , the House of Lords held that the fraudster does not obtain or appropriate property belonging to another when funds are transferred electronically from the victims account. The effect of the transfer is to extinguish, in part or whole, Bs claim against the bank by the fraudster A or the third person. The House of Lords declined to take the view that customer Bs rights had been transferred from B to A.

176. The analysis in Preddy is remote from community understanding of bank transactions and it is possible that the High Court might decline to follow that case. However, in view of the rapid growth of electronic transactions and the corresponding decline in transactions involving tangible tokens of monetary value, a cautious approach is warranted. The proposed provisions accordingly extend the scope of the offence of obtaining property by deception to include electronic money transfers.

177. It should be noted that the need to rely on the new provisions only arises when the money transfer does not involve the use of a cheque or other tangible token of value. The High Court has recently held in Parsons that the unmodified offence of obtaining property by deception applies if the transfer is effected by means of a cheque or other valuable security.

178. The Model Criminal Code Officers Committee made the point in its May 1997 Conspiracy to Defraud Report, that fraudulently induced money transfers will be covered by the obtaining a financial advantage by deception fraud offence (proposed section 134.2). It is nevertheless desirable to maintain the existing structure of liability in which the offence of obtaining property by deception extends to cover fraudulent inducement of a money transfer. The offence of obtaining property by deception is linked to the offence of receiving (proposed section 132.1). The new provisions, which treat an electronic transfer of funds as a transfer of property, ensure that a person who receives the benefit of the transfer, knowing that it was a product of fraud, will be guilty of the offence of receiving.

179. Turning to the new provisions, proposed subsection 134.1(9) makes it clear that the offence covers money transfers by providing that such amounts are taken to be property belonging to the victim and that the other person arranging the transfer is taken to have obtained the property with the intention of permanently depriving the victim. Proposed subsection 134.1(1O) stipulates that the amount transferred should be taken to be the property of the victim and that there was an intention to permanently deprive the person of it. Proposed subsection 134.1(11) stipulates that a debit to one account debits which is causally related to a credit in another account is taken as the transfer of the amount of credit from the debited account to the credited account.

180. As with theft, proposed subsections 134.1(13) and (14) contains general deficiency provisions because just like theft, property fraud can take place over a period of time in small hard to identify sums.

181. Proposed subsections 134.1(15) and (16) contain alternative verdict provisions in recognition that theft and property fraud are similar offences and that it is not always easy to identify the most appropriate charge from the outset. The penalties for each offence are of course the same (a maximum of 10 years) and the provision makes reference to the need for procedural fairness. It is critical that when the alternative verdict becomes a more realistic proposition than the original charge, the defendant is provided with adequate opportunity to address the elements of the alternative offence.

Proposed section 134.2 - Obtaining a financial advantage by deception

182. Proposed section 134.2 is the financial fraud offence. Though this offence will extend to cases in which money or other tangible items of value are obtained by deception, the primary effect of the proposed provision is to impose criminal liability on those who obtain intangible financial benefits by deception. Obtaining services without payment by means of a deception is a classic instance falling within the scope of this offence.

183. A person is guilty if the person, by a deception, dishonestly obtains a financial advantage. The maximum penalty of 10 years imprisonment is the same as theft and the obtaining property by deception offence, and is consistent with existing State and Territory offences. This is appropriate as it includes similar conduct. The offence is based on section 17.3 of the Model Criminal Code.

184. The offence does not have an extended definition of obtaining because of the abstract nature of a financial advantage compared to property. Proposed section 134.2 follows section 82 of the Victorian Crimes Act which does not attempt to define financial advantage. Victoria did not follow the UK Theft Act formulation of the offence of obtaining a pecuniary advantage by deception. The definition of the concept of pecuniary advantage was characterised by the English courts as a judicial nightmare. The ACT uses the term financial advantage but then restricts it to things like obtaining an overdraft or an increase in remuneration. This follows amendments to the UK Act in 1978, but there is no justification for limiting the concept of financial advantage.

185. It is of note that the meaning of financial advantage has been rarely litigated in Victoria, where the legislation leaves it undefined. In Mattthews v Fountain
[1982] VR 1045 , 1049-50 the Victorian Supreme Court held that financial advantage was a simple concept wisely left to the commonsense interpretation of juries and magistrates. In that case, the court held that a penniless debtor, who wrote a valueless cheque to gain relief from being harried by a creditor, gains a financial advantage by deferring the demand for payment. Reliance on the ordinary meaning of the words has not resulted in uncertainty or confusion.

186. Although the concept of financial advantage is broad enough to cover virtually all cases of obtaining property by deception, the practice in Victoria, supported by the principal text for prosecutors, appears to be to confine proposed section 134.2 to cases which do not involve obtaining tangible property (eg credit, services, etc). This approach conforms with the structure of the legislation.

Proposed section 134.3 - Geographical jurisdiction

187. For the reasons given in relation to theft, extended geographical jurisdiction category D applies to the fraud offences.

Proposed Division 135 - Other offences involving fraudulent conduct

188. These additional offences were not included in the Model Criminal Code. However, they are justified in a Criminal Code designed to protect the administration of the Commonwealth government.

Proposed section 135.1 - General dishonesty

189. Proposed section 135.1 contains a codified equivalent to section 29D of the Crimes Act 1914. Section 29D is not a very transparent offence. It relies on the meaning of defraud which is dependent on case law for its meaning. Indeed most jurisdictions do not have a defraud offence and the Model Criminal Code Officers Committee did not consider it to be suitable for general use. However, the Gibbs Committee favoured retaining it and there is a case for using it to protect Commonwealth entities because of their vulnerability to dishonest conduct.

190. Consistent with decisions such as that of the House of Lords in Scott
[1975] AC 819 and Australian cases ODonovan v Vereker (1987)
76 ALR 97 at 110 and Eade (1984) 14 A Crim R 186, the proposed offence does not require the prosecution to prove that the accused deceived the victim and as such falls below the appropriate level of culpability required for an offence with a maximum penalty of 10 years imprisonment. In recognition that the offence is much broader than fraud, it is proposed that section 135.1 should have a maximum penalty of 5 years imprisonment. Where there is evidence of deception, the more serious fraud offences should be charged (proposed sections 134.1 and 134.2). Indeed the vast majority of the offences charged under section 29D of the Crimes Act 1914 involve deception and can be charged under proposed sections 134.1 and 134.2. There will be the occasional case where obtain by deception cannot be charged. In those circumstances there may be questions as to whether it is appropriate that the person be charged with a serious offence, but there will no doubt be some cases where it is justified. Human ingenuity is such that schemes have been and will continue to be devised that make it difficult to establish that the accused deceived the victim. In most jurisdictions, including the UK, it has been decided that such schemes should only be dealt with where there is a conspiracy or by specific offences developed to combat the scheme after it is discovered (for example, taxation legislation).

191. Section 29D of the Crimes Act 1914 was developed in the aftermath of the bottom of the harbour scandal on the recommendation of the Special Crown Prosecutor, Roger Gyles QC in his 1982/83 annual report. There is little said about the reasons for the offence in his report or in the explanatory documents for the legislation, but it would seem much of the motivation for the amendment was to deal with bottom of the harbour type cases about which there was concern deception could not be established. Against this, deception can be established in most of the bottom of the harbour cases but there was significant concern that there be a strong response to such cases. The Commonwealth has special problems in protecting public revenue given its broad and vulnerable interests (taxation, social security, grants, etc) and obligations to the community as a result of the sheer size of Commonwealth activities.

192. The idea of special protection for the public revenue is also consistent with the way the law developed in the UK where section 32(1)(a) of the Theft Act preserved the common law offence of cheating the public revenue. Cheating the public revenue does not require proof of deception, though it is narrower than conspiracy to defraud in that it must be shown that the public is affected by the conduct ( Mavji (1987) 84 Cr.App.R 34 at p.38).

193. Turning to the substance of proposed section 135.1, the first part of it (subsection 135.1(1) concerns the person who does anything with the intention of dishonestly obtaining a gain from another - in this case a Commonwealth entity. Subsection 135.1(2) making it clear that it is not necessary to prove the person knew the other person was a Commonwealth entity. While the common law interpretation of defraud tends to focus on causing losses, it would be anomalous and artificial require the prosecution to prove losses if it is more natural to present the case as one of obtaining a gain.

194. Proposed subsection 135.1(3) focuses on doing anything with the intention of dishonestly causing a loss to a Commonwealth entity. This is at the heart of the common law meaning of defraud. Proposed subsection 135.1(4) and (6) remove the requirement to prove the person knew it was a Commonwealth entity.

195. Proposed subsection 135.1(5) imposes liability for conduct where the person dishonestly causes a loss or risk of loss, provided the person realises that conduct involved substantial risk, at least of causing loss. The offence resembles section 17.4 of the Model Criminal Code which is the conspiracy to defraud offence, which specifies a fault element of recklessness. In the Model Criminal Code and the Criminal Code recklessness requires proof that the defendant was both aware of a substantial risk and also lacked justification for incurring that risk (section 5.4). The proposed offence requires awareness of a substantial risk, but omits the implied reference to community standards of acceptable conduct in the definition of recklessness, where it refers to unjustifiability of the risk. Since liability for the proposed offence requires proof of dishonesty, which is determined by reference to the standards of ordinary people, any further reference to the general standards of conduct inherent in the concept of recklessness unnecessary and would be likely to breed confusion.

196. Proposed subsection 135.1(5) imposes liability if loss or a risk of loss is caused dishonestly and the offender was aware that loss would occur or that there was a substantial risk of loss. The element of dishonesty requires proof that the offender realised the conduct which caused the loss or risk of loss would be considered dishonest according to the standards of ordinary people in the community. This captures the common law meaning of defraud that it should also include imperilling another persons assets ( Wai Yu - Tsang
[1992] 1 AC 269 at 280 ). Proposed subsection 135.1(5) is an improvement on the Model Criminal Code provision and is repeated in comparable offences elsewhere in the Bill (for example, conspiracy to defraud at proposed section 135.4).

197. Finally, subsection 135.1(7) reflects another meaning that has been given by the courts to defraud. A person is guilty of the offence if the person does anything with the intention of dishonestly influencing a public official in the exercise of the officials duties as a public official. This is also consistent with the case law in Withers
[1975] AC 842 and Scott . It is proposed that public official should be defined in the dictionary as covering State, Territory and Commonwealth officials in recognition that many in the community are not knowledgable of the distinction between different governmental functions and officials. It would therefore be unreasonable to require the prosecution to prove that the person knew the public official was a Commonwealth public official. Subsection 135.1(8) provides for this.

198. As mentioned above, the maximum penalty for these offences is 5 years imprisonment.

Proposed section 135.2 - Obtaining a financial advantage

199. Proposed section 135.2 supplements the protection provided by proposed section 135.1 with yet another lesser offence. This covers those who obtain a financial advantage for themselves or someone else from a Commonwealth entity knowing they are not eligible to receive that financial advantage. While the offence will often overlap with more serious theft and fraud offences, it provides an alternative with a lower penalty where it is difficult to establish dishonesty. The maximum penalty reflects this - it is 12 months imprisonment. The proposed offence is similar to sections 1347 and 1348 of the Social Security Act 1991 and recognises a general provision of that nature is likely to be useful in relation to many different types of Commonwealth payments, whether it be welfare, bounties or grants. The proposed offence will enable the Bill to repeal a number of obtaining offences in other legislation (for example, subsection 18(2)(a) of the Bounty (Bed Sheeting) Act 1977 ). The proposed offence was recommended by the Gibbs Committee in 1990 and is consistent with the position of the Model Criminal Code Officers Committee 1995 report in that it recognises there is a place for some summary offences. The Gibbs Committee considered that the offence would be too broad if it extended to any advantage. They recommended that it be limited to knowingly obtaining a pension, benefit, bounty or grant from the Commonwealth to which the person is not entitled. Proposed section 135.2 achieves the much the same result by using the financial advantage terminology. It is also more consistent with the rest of the Bill and less open to argument (it would not be helpful to have a debate about what is, or is not a benefit).

Proposed section 135.4 - Conspiracy to defraud

200. Like proposed section 135.1, proposed section 135.4 is a series of general dishonesty offences. Proof of deception is not required. Indeed it has all the same components as proposed section 135.1 except there must be a conspiracy. The explanation of those components will not be repeated again here. The other difference is that the maximum penalty is 10 years imprisonment. While conspiracy usually carries the same penalty as the primary offence, the proposed penalty reflects what was recommended for the Model Criminal Code (May 1997 report) and the Gibbs Committee. Proposed section 135.1 will replace subsection 86(2) of the Crimes Act 1914 which has a maximum penalty of 20 years imprisonment. This is far too high and is inconsistent with the penalty for similar offences in other jurisdictions. The usual maximum penalty is 10 years imprisonment.

201. Since the May 1997 report was published, the High Court in Peters v R (1998)
151 ALR 51 (a case which concerned the Commonwealth conspiracy to defraud offence) indicated it disagreed with the way the Model Criminal Code conspiracy to defraud offence was drafted. Proposed section 135.4 takes into account the suggestions of the High Court by attaching dishonesty to the various types of conduct. This approach was endorsed by the Standing Committee of Attorneys-General at its April 1998 meeting.

202. Subsections 135.4(9) to (14) contain a number of interpretative and procedural provisions which reflect what is contained in the general conspiracy offence at section 11.5 of the Criminal Code which was enacted in 1995 and section 86 of the Crimes Act 1914 which at the same time was harmonised with section 11.5.

Proposed section 251 - Geographical jurisdiction

203. Proposed section 135.5 provides for extended geographical jurisdiction category D which is the same as that for theft of Commonwealth property.

Proposed Part 7.4 - False or Misleading Statements

204. False or misleading statements are often made as a prelude to committing fraud. For many years now Governments have been enacting false and misleading statement offences which have relatively low penalties (ranging from fines to 2 years imprisonment) in a very wide range of legislation. The offence is useful where the person is caught early in the process and the particular conduct did not involve large amounts of money. In 1990 the Gibbs Committee concluded that centralising these offences in the Criminal Code would be more efficient by standardising the offence for practitioners but would also simplify and reduce the size of the Commonwealth statute book. The proposed offences in this Division will allow the repeal of over 130 offences and therefore make an important contribution to the Governments statute stocktake initiative. The proposed offences will replace a limited untrue representation offence at section 29C of the Crimes Act 1914.

Proposed section 136.1, Division 136 - False and misleading statements in applications

205. There are two types of offences. The more serious offence requires proof that the defendant knew the statement in the application was false and misleading. It provides for a maximum penalty of 12 months imprisonment (proposed subsection 136.1(1)). The other only requires proof that the defendant was reckless as to whether the statement was false and misleading. It provides for a maximum penalty of 6 months imprisonment (proposed subsection 136.1(4)).

206. Both offences provide for a defence where the defendant can point to evidence that the false or misleading statement was not false or misleading in relation to a material particular (subsections 136.1(2),(3), (5) and (6)). It would be too onerous to require the prosecution to prove that the defendant knew or was reckless as to materiality. However the proposed defence should ensure that materiality is taken into account.

207. Proposed subsection 136.1(7) provides for alternative verdicts in similar terms to other provisions elsewhere in the Bill. There will be situations where it becomes apparent during the hearing that the defendant is guilty of the second offence rather than the first.

208. Consistent with other theft and fraud related offences, proposed subsection 136.1(8) provides for extended geographical jurisdiction category D.

209. It is important that benefit is defined broadly at proposed subsection 136.1(9) because the applications covered by this offence covers a wide range of functions.

Proposed Division 137 - False or misleading information or documents

210. There are also a considerable number of offences of this type. While the Gibbs Committee concluded in its 1990 report that these offences might be more convenient to locate in the relevant legislation, there are more advantages in centralising the offences and slimming down the statute book.

Proposed section 137.1 - False or misleading information

211. Proposed section 137.1 requires proof that the person knows the information provided or omitted is false or misleading. The information must be given to a Commonwealth entity, given to a person exercising powers or performing functions under or in connection with a law of the Commonwealth or in compliance or purported compliance with a law of the Commonwealth. There is no restriction on the mode by which the information is given - it may be in writing, electronic, verbal or in the form of a document. The maximum penalty is 12 months imprisonment. Again there is a defence were the information is not false or misleading in a material particular. While a recklessness offence is appropriate where the person is involved in completing an application, it would go too far to extend it to this offence.

212. Government Amendments have provided in subsections 137.1(4) and (5) for additional defences to the false or misleading statement offences in subparagraphs 137.1(1)(c)(i) and (ii) as recommended by the House of Representatives Standing Committee on Legal and Constitutional Affairs (recommendation 3 at paragraphs 3.11 - 3.15 at pages 15 and 16 of the advisory report). The Standing Committee concluded There may be cases where people do not consider that by providing false information they may be committing a criminal offence.

213. The proposed defence does not apply to subparagraph 137.1(1)(c)(iii) because it deals with the situation where the defendant gives the false or misleading information in circumstances where he or she is aware it is being provided in compliance or purported compliance with the law.

214. Proposed subsection 137.1(6) provides for a concise short-form of the notice which it is proposed should be taken to be sufficient information. It is important that unnecessary litigation about the wording of the information provided is avoided.

Proposed section 137.2 - False or misleading documents

215. Proposed section 137.2 is an additional offence which has been found necessary as a result of the review of the various offences. It is also suitable for including in the central offence. The person is guilty if he or she produces a document, knows it is false or misleading and it is produced in compliance or purported compliance with a law of the Commonwealth. The maximum penalty matches the other offences - 12 months imprisonment. Proposed subsection 137.2(3) contains a defence often found in this type of offence where the document has been identified as being false.

Proposed section 137.3 - Geographical jurisdiction

216. Consistent with other theft and fraud offences, proposed subsection 137.3(8) provides for extended geographical jurisdiction category D.

Proposed Part 7.5 - Unwarranted Demands

217. There is no Commonwealth equivalent to the proposed unwarranted demands offences. The Model Criminal Code provides for a blackmail offence at sections 18.1 to 18.3 and raised the question of the need for a similar Commonwealth offence. While the description blackmail is more associated with a more general offence, there is no doubt that the Commonwealth could be a victim of this type of offence and should be able to deal with such demands without having to resort to State or Territory offences. The existing obstruction and threat offences (sections 30K and 76 of the Crimes Act 1914 ) provide for a maximum penalty of 12 months and 2 years imprisonment. This is clearly inadequate when compared to the State and Territory offences where the proposed penalty for blackmail is 12 years imprisonment.

Proposed Division 138, section 138.1 - unwarranted demands with menaces

218. Proposed subsection 138.1(1) defines what is an unwarranted demand with menaces. This is based on section 18.2 of the Model Criminal Code. Paragraph 138.1((1) provides that the person making the demand must not believe that he or she has reasonable grounds for making the demand and does not reasonably believe that the use of menaces is a proper means of enforcing the demand. Not all demands with menaces count as blackmail. The fault element of the offence is to make an unwarranted demand. Whether the demand is warranted (eg whether a sum of money is owed) and whether the menace is warranted (eg whether that type of threat is a proper means of enforcing that demand) distinguish criminal from non-criminal demands backed by menaces. If a demand for payment is backed by a menace (eg a threat to sue where a debt is owed), that is not an offence under proposed Part 7.5. A threat to sue for that debt is a proper means of enforcing that demand.

219. The first limb of the test proposed in section 138.1 is subjective: did the defendant believe there were reasonable grounds for making the demand. The test for the second limb is objective: did the defendant reasonably believe that the use of the menace was a proper means of enforcing the demand.

220. Under the UK Theft Act and in the jurisdictions that have followed it, the test for whether a menace is proper is subjective. In the non- Theft Act jurisdictions, the test of whether the demand or the threat was proper is objective : The objective test was criticised by the Criminal Law Revision Committee in the UK because it had led to cases such as Dymond where a woman had written to a man who she alleged had sexually assaulted her demanding that he apologise and pay her money. If he did not, she threatened to summons him and let the town know all about your going on. The fact that the threat was construed as a threat to bring a criminal rather than a civil prosecution was found to be improper, despite the fact that the woman believed it was proper and that she would have been entitled to threaten civil action. (For example, it is not blackmail to write a solicitors letter demanding compensation for a negligently caused injury, threatening to bring a civil action for damages if the compensation is not paid). It was also said to be improper to threaten to tell the town about it, though it would not be improper to tell the town that he refused to pay the damages in respect of the civil assault claim. These are very fine distinctions for a serious blackmail type offence.

221. The approach taken in proposed subsection 138.1(1) provides for a carefully balanced test which is similar to other evaluative elements in the Bill, such as dishonesty and elsewhere in the Criminal Code (for example, in some of the defences - self defence and duress, sections 10.2 and 10.4).

222. Proposed subsection 138.1(2) makes it clear the demand may be for something other than property and subsection 138.1(3) that it need not be in relation to conduct to be engaged in by the person making the demand (the person could be associated with someone who enforces demands). Subsection 138.1(3) is based on subsection 18.3(4) of the Model Criminal Code.

223. Proposed section 138.1 defines menaces. This is based on subsection 18.3(1) of the Model Criminal Code. It covers things which are a threat of conduct which is detrimental or unpleasant to another person or something more general in nature which is implied by the position of the person making the threat.

224. Subsection 18.3 (3) of the Model Criminal Code attempts to adapt the concept of a menace to suit one directed at an organisation. This is of course very important in the Commonwealth context. Proposed subsections 138.1(2) and (3) provide guidance as to what is involved in a menace against an individual compared to what is involved where it is directed against an organisation. The concept of the menace causing a person of normal stability and courage to act unwillingly is of course more suited to the circumstances of an individual. What would ordinarily cause an unwilling response and or vulnerability is a more appropriate and realistic criteria for an organisation.

Proposed Division 139 - Unwarranted demands

225. It is proposed that there be two offences: unwarranted demands of a Commonwealth public official (proposed section 139.1) and unwarranted demands by a Commonwealth public official (proposed section 139.2). The proposed offences do not deal with unwarranted demands made against the Government as a whole. Threats of that nature are more appropriate to be dealt with by special national security offences which at a later stage can be included in Chapter 5 of the Criminal Code which has tentatively been entitled The integrity and security of the Commonwealth.

Proposed section 139.1 - Unwarranted demands of a Commonwealth public official

226. Proposed section 139.1 provides that a person is guilty if the person makes an unwarranted demand of another person and the demands or the menaces are directly related to the other persons capacity as a Commonwealth public official or any influence the person has in that capacity; and the person does so with the intention of obtaining a gain or causing a loss or influencing the official in the exercise of the officials duties as a Commonwealth public official. The maximum penalty is 12 years imprisonment. The penalty is more than bribery (10 years) because it involves threats.

227. As it is a Commonwealth offence, proposed section 139.1 focuses on the Commonwealth public officials capacity and influence. Unwarranted demands in relation to matters that have nothing to do with the persons capacity and influence as a Commonwealth public official will be dealt with by equivalent State or Territory offences.

228. The requirement that the prosecution prove the person intended to obtain a gain, cause a loss or influence the official in the exercise of those duties is consistent with other Chapter 7 fraud and bribery related offences. If the conduct consisted of a threat alone, then proposed section 147.2 would apply. This approach follows section 18.1 of the Model Criminal Code and the UK Theft Act which provides these terms as substitutes for the common law requirement that there be a demand for property. Of course these are supplemented with the intention to influence the official in the exercise of his or her duties as a Commonwealth public official (subparagraph 139.1(c)(iii)).

Proposed section 139.2 - Unwarranted demands made by a Commonwealth public official

229. Proposed section 139.2 deals with the opposite situation to section 139.1. The Commonwealth public official is guilty if he or she makes an unwarranted demand of another person and the demand or menaces are directly or indirectly related to either that persons capacity as a Commonwealth public official or influence they have as a result of that capacity (for example, threatening a member of the public with the release of humiliating information contained in a file). Like the other offence, the official would need to do so with the intention of obtaining a gain, causing a loss or influencing another Commonwealth public official in the exercise of the other officials duties. The other Commonwealth public official could be a work colleague - the aim of the threat may be to influence the work colleague to approve a project which benefits the family of the defendant.

230. This type of offence covers some of the same ground as extortion which also overlaps with the proposed bribery offence. Extortion meant the taking of money by any officer by colour of his office, either where none at all is due, or not so much is due, or it is not yet due. The Model Criminal Code Officers Committee report recommended that blackmail and bribery should be designed in a way whereby those offences were wide enough to cover extortion. The same approach was taken with the UK Theft Act and the equivalent Victorian legislation. The Gibbs Committee saw the need for an extortion type offence but proposed that it only have a maximum penalty of 2 years imprisonment. The proposed offence is more focused on significant conduct and has the more appropriate maximum penalty of 12 years imprisonment.

Proposed section 139.3 - Geographical jurisdiction

231. Proposed section 139.3 provides that there be extended geographical jurisdiction category C (proposed section 15.3) for the unwarranted demands offences.

Proposed Part 7.6 - Bribery and related offences

232. The new offences proposed in this Part are very significant. They build upon the Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999 which inserted offences of prohibiting the bribery of foreign public officials in Chapter 4 of the Criminal Code : The integrity and security of the international community and foreign governments. The new offences deal with bribery and other forms of corruption of Commonwealth public officials. The existing offences, sections 73 and 73A of the Crimes Act 1914 and section 4 of the Secret Commissions Act 1905 only have a maximum penalty of 2 years imprisonment. It is proposed that the maximum penalties for the new bribery offences (proposed section 141.1) be 10 years imprisonment which will give it the same penalty as theft, fraud and the new bribery of foreign public officials offences. The new offences are consistent with the statement made by the Government in the context of the bribery of foreign public officials offences that bribery will not be tolerated in Australia. Other offences include giving and receiving corrupting benefits (proposed section 142.1) and abuse of public office (proposed section 142.2). These new offences will set appropriately high standards and targets the key object and title of chapter 7: The proper administration of government.

Proposed Division 140 - Preliminary

233. Proposed Division 140 contains some important interpretative provisions.

Proposed section 140.1 - Definition

234. Benefit is defined to include any advantage and is not limited to property. Bribes can be paid by many different means. This follows section 20.1 of the Model Criminal Code.

Proposed section 140.2 - Obtaining

235. Subsection 140.2(1) makes it clear that a person is taken to have obtained a benefit for another if he or she induces someone else to give that person a benefit.

Proposed section 141.1 - Bribery of a Commonwealth public official

236. The drafting of proposed section 141.1 varies from subsection 20.2(1) of the Model Criminal Code more than what otherwise would have been the case had it not been for the recent enactment of the Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999. The bribery offence inserted by that Act into Chapter 4 (section 70.2) closely follows a model which is being followed by OECD countries. It is therefore important that there be consistency in drafting with section 70.2 as well as the Model Criminal Code offence if misinterpretation is to be avoided.

Proposed subsection 141.1(1) and (2) - Giving a bribe

237. Proposed paragraph 141.1(1)(a) and (b) therefore closely follows the bribery of foreign public officials offence rather than the slightly less wordy Model Criminal Code offence. However, it differs from section 70.2 because it requires proof that the person dishonestly provided the benefit.

238. The essence of the common law fault elements for bribery was an intent to incline an official to perform his or her duty in a way that is contrary to the known rules of honesty and integrity. The original Griffiths Codes used the term corruptly to capture this meaning in the general offence of bribery but the amended offence in WA has omitted the word. The term is not used in a number of the Code offences relating to a member of Parliament, but it is used in the WA offences. In South Australia, the new statutory provision uses the term improperly. However, sections 73 and 73A of the Crimes Act 1914 have no equivalent to dishonesty. The offences are very broad, they simply require proof that the payment was in order to influence or affect a Commonwealth officer or member of either House of Parliament.

239. In many cases, it will be clear that a benefit given to a public official in order to influence his or her duty to do or refrain from doing an act will constitute a bribe. However, unless some additional fault element is specified, payment of the officials salary would constitute bribery because it is a benefit given in order to influence the officials duty, as would an officials demand for salary or a salary increase as a condition of doing his or her job. There are also very difficult questions in this area about the legitimate ambit of politics. Offering a parliamentarian a benefit to vote in a certain way seems a clear case of bribery, but few would want to see ordinary political negotiations coming within the scope of the bribery offence. The fault element of dishonesty therefore provides an important safety-valve. Dishonesty provides for a flexible assessment of the particular dealing against the standards of ordinary people and provides a workable way of capturing the essence of bribery and corrupt payments.

240. Proposed subsection 141.1(2) also requires that the person providing the benefit does so with the intention of influencing a public official in the exercise of the public officials duties as a public official. Public official is to be defined in the dictionary to the Criminal Code (see item 36 of this Bill) to be a Commonwealth, State or Territory official. This is in recognition that some in the community cannot distinguish between the functions of the Commonwealth and State Governments. It would therefore be too onerous to require the prosecution to prove the defendant knew the person they were bribing was a Commonwealth public official and that it was with the intention of influencing the person in relation to Commonwealth duties. Subsection 141.1(2) makes it clear that it is not necessary to prove that the defendant knew these things.

241. As mentioned above, the maximum penalty is 10 years imprisonment. This is appropriate - it is a crime that is not only dishonest but undermines community confidence in the integrity of Government. It deserves the same penalty as theft and fraud.

Proposed subsection 141.1(3) - Receiving a bribe

242. Proposed subsection 141.1(3) provides a Commonwealth public official is guilty of an offence if the official dishonestly asks for a benefit, or receives one, or agrees to receive one and does so with the intention that the exercise of the officials duties as a Commonwealth public official will be influenced. This is based on subsection 20.2(2) of the Model Criminal Code, though it is drafted quite differently. Again, it is necessary for the offence to relate appropriately to the other bribery offences in the Criminal Code. The maximum penalty is the same as that for the other bribery offence, 10 years imprisonment.

243. Proposed paragraph 141.1(3)(b) has been redrafted in an amendment to provide clarification that the bribery offence applies regardless whether the Commonwealth public official is taking the bribe without any intention of acting upon it. It is possible a corrupt official could take bribes in those circumstances. Page 295 of the 1995 Model Criminal Code Report on Theft, Fraud, Bribery and Related Offences suggests this was intended to be covered by the model bribery offence.

Proposed subsection 141.1(4) - Geographical jurisdiction

244. Subsection 141.1(4) provides for similar reasons to theft that extended geographical jurisdiction category D applies to both offences.

Proposed Division 142 - Offences relating to bribery

245. The Model Criminal Code makes no distinction between public and private sector 'bribery'. Instead, it recommended a two-level offence structure with a serious offence of bribery and lesser offences of giving and receiving other corrupting benefits that apply to both the public and the private sector. These lesser corrupting benefits offences carry a maximum penalty of 5 years imprisonment. It was decided not to use the existing term 'secret commissions' to describe these lesser offences as secrecy is not an element of either the existing or the proposed offences. The term corrupting benefits is more descriptive of the offence and will avoid confusion with the secret commissions offences.

246. While bribery is traditionally the public sector corruption offence and secret commissions covers private sector bribery, the Commonwealth Secret Commissions Act 1905 (although its scope does extend to some private sector activity) is only used to combat Commonwealth public sector corruption. The proposed corrupting benefits and abuse of public office offence will, because of the restricted jurisdiction of the Commonwealth, continue the focus on public sector corruption. In doing this there is no suggestion that the Government is opposed to having the same rules for the private and public sectors as proposed by the Model Criminal Code Officers Committee. There are compelling arguments for that approach which State and Territory Governments will need to consider when implementing the Model Criminal Code.

Proposed section 142.1 - Corrupting benefits given to, or received by a Commonwealth public official

247. The drafting of these offences has been influenced by the bribery offences which have been harmonised with the bribery of foreign public officials offences as well as the Model Criminal Code offences. It is important that the scheme of offences in the Criminal Code is integrated. Therefore the drafting of proposed section 142.1 does vary from section 20.3 of the Model Criminal Code. However, the substance is of these offences is very similar.

Proposed subsection 142.1(1) - Giving a corrupting benefit

248. Proposed subsection 142(1) provides a person is guilty if the person dishonestly provides/ offers a benefit to another and the receipt, or expectation of the receipt, of the benefit would tend to influence a public official in the exercise of the officials duties as a public official. This differs from bribery where the prosecution must prove the person dishonestly provided / offered the benefit with the intention of influencing the public official. A person will be guilty of the corrupting benefits offence if the person is reckless as to the circumstance that the benefit may tend to influence the public official. (Subsection 5.6(2) of the Criminal Code provides that if the offence does not specify a fault in relation to a circumstance of conduct then recklessness will be the fault element). This means that the person will be guilty if the prosecution can prove he or she was aware of a substantial risk that the tendency to influence exists or will exist and having regard to the circumstances it is unjustifiable to take that risk (see section 5.4(1) of the Criminal Code). It is in view of this that the maximum penalty is 5 years imprisonment.

249. The maximum penalty of 5 years imprisonment is more than double that for the offence which it will replace at section 4 of the Secret Commissions Act 1905 (2 years imprisonment). The penalty in the secret commissions offence is justifiably lower because it contains a very draconian presumption at subsection 4(2), that any gift or consideration is an inducement. All the prosecution has to demonstrate is that the accused, without the knowledge and agreement of the principal, accepts a gift and that this gift was in any way likely to influence the agent. The prosecution establishes that this gift is an inducement or reward through the deeming provision in subsection 4(2), which states that a gift or consideration is deemed to be given as an inducement or reward if the receipt or any expectation thereof would be in any way likely to influence the agent to do or to leave undone something contrary to his or her duty. The accused cannot even escape liability by proving the gift did not influence him or her. (Subsection 4(2) has been described by a leading Australian commentary on fraud offences as a conclusive presumption.) It is contrary to the principles governing the standard of proof in the Criminal Code that a corruption offence which can result in significant stigma and loss of employment should be able to be proven in this way. Further, where the person has significant culpability and the amount is large, a maximum penalty of 2 years imprisonment is manifestly inadequate.

250. Like the giving a bribe offence (proposed subsection 141.1(1)) and for the same reasons, subsection 142.1(2) does not require the prosecution to prove that the defendant knew the person being bribed was a Commonwealth public official or that the duties are Commonwealth duties.

Proposed subsection 142.1(3) - Receiving a corrupting benefit

251. Proposed subsection 142.1(3) provides a Commonwealth public official is guilty if the official dishonestly asks for, receives, agrees to receive (etc) a benefit and the receipt, or expectation of receipt, of the benefit would tend to influence a Commonwealth public official in the exercise of duties as Commonwealth public official. The maximum penalty is 5 years imprisonment. The same issues concerning the appropriateness and the replacement of section 4 of the Secret Commissions Act 1905 which are discussed above apply here.

Proposed subsection 142.1(4) - Benefit in the nature of a reward

252. Proposed subsection 142.1(4) addresses a concern that the proposed offences may be misconstrued as not covering benefits in the nature of a reward. While the Model Criminal Code Officers Committee report considered this unnecessary, the proposed subsection has been inserted to clarify this point. A large reward in one instance can have a tendency to influence a particular official and others in relation to dealings with the person making the payment. It is important to cover this as rewards are specifically covered by the Secret Commissions Act 1905 which will be replaced by the proposed Bill.

Proposed section 142.2 - Abuse of public office

253. Proposed subsection 142.2 would bring the Commonwealth standard in this respect up to that of offences found in State legislation and is based on section 20.5 of the Model Criminal Code. It has its origin in the common law misfeasance of office offences which includes everything from nepotism to misuse of planning information.

254. The Gibbs Committee did not favour the Model Criminal Code approach of having a single offence dealing with abuse of office. The Gibbs Committee preferred two specific offences:

(a)

defrauding the Commonwealth or any person in the exercise or in the purported exercise of powers of office; and

(b)

an office-holder exercising in a dishonest way or for an improper motive a power or function invested in him or her by virtue of his or her holding office.

255. The first Gibbs Committee offence is unnecessary as it is covered by the proposed fraud offences which have penalties which provide a sufficient range for offenders to be appropriately sentenced. The second offence is an abuse of public office offence but does not have the qualification that the accused must intend to obtain a benefit for himself, herself or another or cause a detriment to another and is narrower than the proposed offence in that it does not apply to the exercise of influence.

256. Proposed section 142.2(1) provides a Commonwealth public official is guilty if the official exercises any influence that the official has in that capacity or engages in any conduct in the exercise of duties; or uses any information obtained in that capacity and does so with the intention of dishonestly obtaining a benefit or causing a detriment to another. The provision follows section 20.5 of the Model Criminal Code but improves on it by providing at subsections 142.2(2) and (3) an additional offence to cover those who uses information obtained in their capacity as a Commonwealth public official after they cease to be a Commonwealth public official. This improvement will be brought to the attention of the Standing Committee of Attorneys-General when they next consider the Model Criminal Code. The Model Criminal Code is not set in concrete. It is expected it will continue to be improved as jurisdictions work together towards an improved and more consistent criminal law. However, it is important that all improvements are fed back to the Standing Committee.

257. Unlike bribery (proposed section 141.1), the abuse of public office does not require that the office holder act at the instigation of another or seek to influence another, and it differs from unwarranted demands (proposed sections 139.1 and 139.2) in that it does not involve threats. Therefore the proposed maximum penalty is 5 years imprisonment, less than the penalty for unwarranted demands or bribery.

Proposed section 142.3 - Geographical jurisdiction

258. Subsection 142.2 provides for similar reasons to theft that extended geographical jurisdiction category D applies to the corrupting benefits and abuse of public office offences.

Proposed Part 7.7 - Forgery and related offences

259. Forgery is yet another offence that is reproduced throughout a number of Commonwealth Statutes although it could be dealt with much more easily by a central Commonwealth Criminal Code offence. The Gibbs Committee noted that not only are there too many forgery offences, the maximum penalties range from 10 years imprisonment under section 85G of the Crimes Act 1914 for forging postal stamps, to $1000 for forging prescribed liquor stamps. The Gibbs Committee concluded that there should rarely be a need to include forgery offences outside the Commonwealth Criminal Code . The only compelling exceptions are the offences which relate to the counterfeiting of currency. Both the Gibbs Committee and the Model Criminal Code Officers Committee favoured separate offences in relation to the matters dealt with in the Crimes (Currency) Act 1981 which deals with specific problems associated with counterfeiting currency and securities. While the offences in that Act need to be harmonised with the Commonwealth Criminal Code , this will be done separately.

260. The offences in proposed Part 7.7 are forgery (proposed section 144.1), using a forged document (proposed section 145.1), possession of a forged document (proposed section 145.2) and the forging devices offences (proposed section 145.3), which carry a maximum penalty of 10 years imprisonment; and the falsification of documents and giving of information derived from false documents offences (proposed sections 145.4 and 145.5), which carry a maximum penalty of 7 years imprisonment.

Proposed Division 143 - Preliminary

261. The definitions and interpretative clauses are very important to the proper operation of these offences. Forgery and related offences are inherently complex and this is not made easier by developments in document making technologies. The new forgery provisions provide an opportunity to update the existing Crimes Act 1914 offences which are largely a product of the pre-computer era.

Proposed section 143.1 - Definitions

262. The first of these is document. The proposed definition is similar to subsection 19.1(1) of the Model Criminal Code but for reasons of consistency with other legislation is aligned with section 25 of the Acts Interpretation Act 1901 . The definition covers everything from traditional paper based documents with writing on them to coding for computers.

263. Information is defined to cover electronic information. This aligns the terminology with the comprehensive but technology neutral language of the Electronic Transactions Act 1999.

264. Proposed subsection 143.1(2) also makes it clear that document includes cards used for commercial transactions. This is particularly important because card fraud is being increasingly identified as a major problem in Australia and they are used in dealings with the Commonwealth.

Proposed section 143.2 - False documents

265. Proposed section 143.2 contains a detailed definition of what is a false document. The definition is based on section 19.2 of the Model Criminal Code and covers documents which suggest they were made/authorised:

by someone else when they were not;

in particular terms when they were not;

altered when they were not;

by someone who exists when they do not.

266. Proposed subsections 143.2(2) and (3) also makes it clear making can include altering and that document includes purported copies of documents. It is necessary to carefully define all the possible ways of manipulating documents. The false document definition is used in all the more serious forgery and forgery related offences in Part 7.7.

Proposed section 143.3 - False Commonwealth documents

267. Proposed section 143.3 provides a Commonwealth jurisdictional context to the definition of false document. The provision shadows proposed section 143.2 but ties the various components of the definition to Commonwealth entities and Commonwealth public officials. While proposed section 143.3 may appear at first glance to involve unnecessary repetition, it serves to ensure that the offences and the definition of false document are not cluttered with unnecessary jurisdictional references that may obscure the more important function of the offence which is to clearly state the proposed obligations.

Proposed section 143.4 - Inducing acceptance of false documents

268. Proposed section 143.4 follows subsection 19.1(3) of the Model Criminal Code by ensuring the prosecution does not have to prove an intent to induce a particular person to accept a false document is genuine. This is needed because forgers will often not be concerned about who they deceive so much as that the deception induces the person to do something that they want.

Proposed section 144.1 of Division 144 - Forgery

269. Proposed subsection 144.1(1) provides the person is guilty if the person does two things. First, the person makes a false document with the intention that he or she or someone else will use it to dishonestly induce a third person in their capacity as a Commonwealth public official to accept it as genuine. Secondly, intends that if the false document is accepted, to dishonestly obtain a gain, dishonestly cause a loss or dishonestly influence the exercise of a public function or duty. Like comparable offences in this Bill, proposed subsection 144.1(2) provides it is not necessary to prove that the defendant knew that the capacity was a capacity as a Commonwealth public official.

270. Proposed subsection 144.1(3) provides for the same offence where the false document is used to cause a computer, machine or electronic device to respond to the document as if the document were genuine and the response is in connection with the operation of a Commonwealth entity; subsection 144.1(5) where it is any third person but the false document is a Commonwealth document; and subsection 144.1(7) where it is a computer, machine or electronic device and the false document is a Commonwealth document. It should be noted that proposed subsection 143.1(2) makes it clear that a document includes credit and debit cards and that where relevant it is not necessary for the prosecution to prove that the defendant knew the public official or document were specifically Commonwealth in nature. The offences follow the substance of section 19.3 of the Model Criminal Code but are considerably longer because of the need to properly attract Commonwealth jurisdiction.

271. The proposed maximum penalty for the forgery offences is 10 years imprisonment. This is higher than that provided for in the Model Criminal Code (7 years and 6 months). The penalty for the Commonwealth forgery offence should not be less than that contained in the existing Commonwealth offences - 10 years imprisonment. This is also the same as the penalty for theft and fraud. While the rationale of the Model Criminal Code Officers Committee for the lower penalty is in recognition that forgery is preparatory to fraud, it causes significant harm in its own right quite apart from fraud. The distinction is hard to justify.

272. The inclusion of the fault element of 'dishonesty' is a change from the existing Commonwealth offences. Like other offences in this chapter, the evaluative element of dishonesty will ensure the offence does not include trivial matters and is appropriate for such a serious offence.

273. Although the UK Theft Act uses dishonesty in relation to other offences, the UK adopted a complex definition of "intent to prejudice" in relation to forgery. Dishonesty is better because:

(a)

it is consistent with theft and fraud as it substitutes 'dishonesty' for the common law concepts of 'fraudulently' and 'intent to fraud';

(b)

it is not complex and it will cover conduct that may not be caught under a definition of 'prejudice'; and

(c)

there was strong support for it in the consultation on the Model Criminal Code.

274. Another difference from the existing offences is that the proposed provisions based on the Model Criminal Code require that the prosecution prove the accused intended that the accused or another would use the document to induce a person to accept it as genuine and either cause a gain or loss, or influence the exercise of a public duty. Intention that the document will induce a person to do something to their prejudice is a feature of the law in the UK, NSW, Victoria and the ACT.

275. Section 63 of the Crimes Act 1914 provides that forgery requires an intent that the counterfeit seals, or other things referred to, may be used, acted on or accepted as genuine to the prejudice of the Commonwealth, any State or person with the intent that it/he/she may, in the belief that it is genuine, be induced to do, or refrain from doing, any act. Section 63 is too vague for a serious offence which has a maximum penalty of 10 years imprisonment. The offence should only catch those who intend to use the document to induce a person to accept it as genuine, or obtain a gain or cause loss, or influence the exercise of a public duty.

276. Under the existing offences it is only necessary to prove that the victim be induced to do, or to refrain from doing, any act. Unlike the requirement of proof in the current offence that accepting the document as genuine must "influence the exercise of a public duty", or the UK approach of linking the act or omission to the performance of a duty. There is no mention of duty in the current Commonwealth provision. The UK Law Commission described the Commonwealth and a similar Canadian provision as creating:

.... a very wide offence which would penalise such practical jokes as making a forged invitation to a social function made with no more wicked intent than raising a laugh at another's expense by inducing him to act upon the invitation. We do not think that such conduct should be within a serious offence such as forgery.

277. Requiring that the document influence the exercise of a public duty prevents the forgery offences from operating too widely. It has been suggested by some that under the Model Criminal Code provision there may be situations where a false document causes the Commonwealth or a Minister to act in a way that brings about enormous expense or causes significant changes in policy and there was no public duty to act. For example, it might be argued that a forged letter which causes the activation of disaster relief efforts might be said to be not to have influenced the exercise of a public duty as there was no duty to provide the relief. While this is probably unlikely to be accepted by a court this Bill defines duty at proposed section 130.1 to make it clear that it covers the full range of government activity.

Proposed Division 145 - Offences relating to forgery

278. These are using a forged document (proposed section 145.1), possessing a forged document (proposed section 145.2), and the forging devices offences (proposed section 145.3); and the falsification of documents and giving of information derived from false documents offences (proposed sections 145.4 and 145.5).

Proposed section 145.1 - Using forged document

279. Proposed section 145.1 follows the same pattern as the forgery offences except the offences here concern use of the false document. The person must know that the document is a false document and uses it with respect to the intended outcomes already detailed above in the forgery offences. The maximum penalty is the same as forgery - 10 years imprisonment. The offences are based on section 19.4 of the Model Criminal Code but are considerably longer because of the need to attract Commonwealth jurisdiction. They replace the outdated Crimes Act 1914 offence of uttering.

280. The requirement that the prosecution prove knowledge of the falsity of the document is important. Section 5.3 of the Criminal Code provides that a person has knowledge of a circumstance or a result if he or she is aware that it exists or will exist in the ordinary course of events.

281. This is consistent with the existing Commonwealth provisions and those of most States and Territories. In the UK the fault element may be knowledge or belief and the Gibbs Committee favoured 'knowledge' which, as defined by them, includes not only awareness that a circumstance exists or will exist but that it is probable that it exists or will exist. The Gibbs Committee definition of knowledge is broader than the Criminal Code definition which is closer to the ordinary meaning of knowledge.

282. Under the Criminal Code definition of knowledge a person who uses a genuine document, which the person believed to be a forgery, will not be guilty of the offence of using a false document but will be guilty of attempting to commit that offence under s11.1 of the Criminal Code . However, if the Gibbs Committee definition of knowledge was used, this conduct would result in a charge of using a false document. That would go too far.

283. The existing Crimes Act 1914 provisions on uttering (use) do not require a person to intend to use a false document for the offence to be made out. The Model Criminal Code and Gibbs Committee approaches both provide that this intent should be required. The Gibbs Committee noted:

However, circumstances are conceivable where use of a forged document, with knowledge as to its falsity, even a document of the limited descriptions dealt with in the Crimes Act , should not be subject to criminal sanctions. For instance, where a Commonwealth record has been altered to a minor extent in circumstances amounting to forgery, a person may wish, for some quite proper purpose, to use the record to the extent that it is a valid record.

Proposed section 145.2 - Possession of forged document

284. Proposed section 145.2 follows the same pattern as the using forgery offences except the offences here concern knowing that the document is a false document and having it in ones possession with respect to the intended outcomes already detailed above in the forgery and use forgery offences. The maximum penalty is the same as forgery - 10 years imprisonment. The offences are based on section 19.5 of the Model Criminal Code but are considerably longer because of the need to attract Commonwealth jurisdiction.

285. Proposed section 145.2 varies from subsection 65(2) of the Crimes Act 1914 which limits the possession offence to prescribed objects and documents. This offence should apply to the full range of documents as it is with similar offences in NSW, Victoria and the ACT and with the other forgery related offences. The Gibbs Committee notes that at present the Commonwealth has had to provide for possession of a false document in specific legislation (eg. section 9A Passports Act 1938 ). When the central offence of possession of false documents is enacted in the Commonwealth Criminal Code these offences can be repealed.

Proposed section 145.3 - Possession, making or adaptation of devices etc for making forgeries

286. Sections 65(2), 68 and 69 of Crimes Act 1914 provide special offences for possessing important seals, dies and stamps. Proposed section 145.3 dispenses with this unnecessary complexity by proposing offences which will cover all such circumstances. Proposed subsection 145.3(1) provides that a person is guilty of the offence if the person knows that a device, material or thing designed or adapted for the making of a false document (everything from a scanner to credit card blanks) and the person has it in their possession with the intention that he or she or another will use it to commit forgery. Proposed subsection 145.3(2) covers making or adapting such things with intention that it will be used for forgery. These offences carry a maximum penalty of 10 years imprisonment. A person who has committed this offence may be more the cause of the forgery problem than the person who is using the forgeries. It is important to have severe sanctions to ensure such people are dealt with appropriately.

287. Proposed subsections 145.3(3) and (4) deal with the same situations but where it cannot be shown the person possessed, made or adapted the device with the intention of committing forgery. With subsection 145.3(3) the person will be guilty if he or she does not have a reasonable excuse. This was modified by a Government Amendment replacing the exception of lawful excuse with the less onerous exception of reasonable excuse. While this will be a departure from the Model Criminal Code equivalent (section 19.6) it is appropriate in relation to possession because a person could possess such an device for innocent reasons but still be without lawful authority (for example, having found the device, the person is in the process of taking it to the authorities). On the other hand the specific lawful excuse exception from the making or adapting devices for making forgeries offence at proposed paragraph 145.3(4)(c) is removed because it is unnecessary. The Bill will include a general lawful authority and excuse defence at proposed section 10.5 (item 7 of the Bill). There is a note to remind readers of the defence.

288. The lower maximum penalty of 2 years imprisonment for these offences is appropriate because it is not necessary to prove the defendant intended to use the device to commit a forgery offence. It is the same as the penalty currently found in subsection 65(2) of the Crimes Act 1914.

Proposed section 145.4 - Falsification of documents

289. Proposed section 145.4 and 145.5 are the equivalent of the Model Criminal Code false accounting offence (section 19.7).

290. Proposed subsection 145.4(1) provides a person is guilty if the person dishonestly damages, destroys, alters, conceals or falsifies a document, and the document is kept for the purposes of a Commonwealth law or made or held by the Commonwealth and the person does all this for gain or loss. Subsection 145.4(2) covers the same situation but covers any document where the intention is to obtain a gain or cause a loss to the Commonwealth.

291. Subsection 145.5(1) provides a person is guilty if the person dishonestly gives information to another person and the information was derived from a document known by that person to be false and misleading in a material particular, and the document is kept for the purposes of a Commonwealth law or made or held by the Commonwealth and the person does all this for gain or loss. Subsection 145.5(2) covers the same situation but covers any document where the intention is to obtain a gain or cause a loss to the Commonwealth.

292. The Model Criminal Code focuses on false accounts because in the State context because of the central importance of accounts in the world of commerce. In the Commonwealth context there are many other documents of importance that are required by law to be kept and can cause losses to the Commonwealth and others (for example, immigration, employment and quarantine records).

293. There are offences of this nature at sections 72 and 74 of the Crimes Act 1914 and section 61 of the Financial Management and Accountability Act 1997. It is appropriate that there be a central offence which will avoid the need for duplication in other legislation. The justification for the offence of false accounting is that forgery is still essentially an offence about altering other people's documents and so does not cover a person who authors a false account. The central importance of accounts justifies the creation of a serious offence and in our view the same applies to any accounts prepared for the Commonwealth. These are just as important as those prepared for the private sector. The maximum penalty should be as recommended - 7 years imprisonment, which is the same as the penalty for contravening section 72 of the Crimes Act 1914 or section 61 of the Financial Management and Accountability Act 1997.

Proposed section 145.6 Geographical jurisdiction

294. Subsection 145.6 provides for similar reasons to theft that extended geographical jurisdiction category D applies to the forgery related offences.

Part 7.8 - Causing harm to, and impersonation and obstruction of, Commonwealth public officials

295. The primary purpose of this Bill was to improve the theft, fraud, corruption and forgery related offences, but an important issue for the Government and Chapter 7 of the Criminal Code is the protection those performing duties for the Commonwealth. The existing offences are inadequate and provide less than satisfactory sanctions where the obstruction involves violence. Rather than rely on State offences, the proposed offences will give the Commonwealth a common set of offences which can be utilised by law enforcement to protect the Commonwealths most important asset - its people. At the same time the proposed amendments will enable the Commonwealth to be the first jurisdiction to implement the basic harm and threaten harm offences of the Offences Against the Person Chapter of the Model Criminal Code (Chapter 5) which was completed in September 1998.

296. The basic forms of the obstruction and impersonation of Commonwealth officer offences are at sections 75 and 76 of the Crimes Act 1914 , but it is proposed that they be replaced by offences that adequately cover similar offences in other legislation. The proposed new offences will enable the repeal of more than 60 offences located throughout the Commonwealth statute book.

297. In 1990 the Gibbs Committee stated that a reduction in the number of these offences will mean that ...the courts, the legal profession and the police would...be able to deal more effectively with a limited number of omnibus offence provisions with which they would become familiar than [with] a much greater number of provisions in particular Acts. and ...some matters are of such significance in the administration of law and justice that it is desirable that they be governed by general provisions carefully thought out in advance rather than provisions drafted ad hoc for the purposes of each particular statute.

Proposed section 146.1 of Division 146 - Definitions

298. A definition of Commonwealth law enforcement officer is needed because there are additional penalties in the harm and threaten harm offences where the victim is a Commonwealth law enforcement officer. It is proposed that this should only cover those whose occupation exposes them to the danger of being harmed by criminals: Australian Federal Police, National Crime Authority and Australian Customs Service personnel.

299. Harm is defined because it is used in the harm and threaten harm offences. The definition follows that at section 5.1.1 of the Model Criminal Code. There was extensive nation-wide consultation on the definition. It covers physical and mental harm.

300. Harm to a persons mental health also follows the Model Criminal Code definition. It does not cover ordinary emotional reactions.

301. Physical harm covers a wide range of possibilities including infection with a disease (particularly relevant to attacks and threats carried out with a syringe).

302. Serious harm is carefully defined to ensure that technical arguments about the mathematical changes of infection with certain life-threatening diseases are not too easily used to avoid criminal responsibility when the victim has been deliberately attacked with something that is infected with such a disease. It covers the cumulative effect of harm, the likelihood of endangerment and the likelihood of it being significant and longstanding. Again this follows the Model Criminal Code (section 5.2.2).

Proposed section 146.2 - Causing harm

303. Again, consistent with the objectives behind the serious harm definition, a persons conduct is taken to cause harm if it substantially contributes to harm. This follows section 5.1.3 of the Model Criminal Code.

Proposed Division 147 - Causing harm to Commonwealth public officials

304. This provides for basic cause harm offences. There is no attempt to deal with more serious offences against the person such as sexual penetration, serious assaults or homicide. They are matters where the best approach is to rely on State and Territory law. However many cases of obstruction will involve some harm being caused to Commonwealth public officials. It is not appropriate that all those cases should be dealt with by the lesser obstruction offence. The more serious offence is necessary in some cases. There are four offences: causing harm to a Commonwealth public official (proposed section 147(1)); causing harm to a former Governor-General, Minister or Parliamentary Secretary (proposed section 147(2)); threatening to cause harm or serious harm to a Commonwealth public official (proposed section 147.2); and threatening to cause serious harm to a former Governor-General, Minister or Parliamentary Secretary (proposed section 147.2(3)).

Proposed section 147.1 - Causing harm to a Commonwealth public official etc

305. Proposed subsection 147.1(1) provides a person is guilty if the person causes harm to a Commonwealth public official, intends to do so, does so without the officials consent and because of the officials status as a public official or any conduct engaged in by the official in the officials capacity as a public official. An amendment was made to bring this offence in line with others by making it clear there is no requirement to prove the defendant was aware that the person was specifically a Commonwealth public official. The proposed offence is based on section 5.1.17 of the Model Criminal Code. It does not extend being reckless as to causing the harm. The focus here is one someone who deliberately harms the Commonwealth public official. Recklessly causing harm is more appropriate for the State and Territory offences. Likewise attacks which have nothing to do with the persons status as a public official should be left to the State and Territory law.

306. The proposed maximum penalty of 10 years imprisonment, or 13 years where the official is a Commonwealth judicial or law enforcement officer is the same as proposed for the Model Criminal Code offence.

307. Proposed subsection 147.1(2) provides for a similar offence where the victim is a former Governor-General, former Minister or former Parliamentary Secretary. The shortcomings of the current restriction to acting in the course of duty were identified by the 1995 Review of Security for Commonwealth Holders of High Public Office, a review prepared for the Prime Minister by Deputy Secretary Greg Wood of the Department of the Prime Minister and Cabinet.

The Review recommended that section 76 of the Crimes Act 1914 be broadened so that the offence applies where:

(a)

a Minister or the Governor-General is assaulted or threatened while not performing an official function but the threat or assault is as a result of the office holders official position or activities; and

(b)

a former Minister or former Governor-General is assaulted or threatened as a result of their former duties.

Proposed section 147.2 - Threatening to cause harm to a Commonwealth public official etc

308. Proposed subsection 147.2(1) provides a person is guilty if he or she makes a threat to cause serious harm (either through someone else like a spouse or by aiming the threat at someone else) intending or reckless as to whether the victim will fear that the threat will be carried out. Further it must be shown the threat is made because of the officials status as a public official or because of any conduct engaged in by the official because of his or her status. The maximum penalty is 7 years imprisonment, or 9 years where the official is a Commonwealth judicial or law enforcement officer. This offence is based on section 5.1.21 of the Model Criminal Code.

309. Proposed subsection 147.2(2) covers threats to cause harm , but not serious harm, and includes an offence in the same terms as proposed subsection 147.2(1). The maximum penalty is 2 years imprisonment. The Model Criminal Code Officers Committee recommended that this would be an appropriate penalty for threatening less than serious harm.

310. Proposed subsection 147.2(3) covers threats to cause serious harm to a former Governor-General, former Minister and former Parliamentary Secretary and includes an offence in the same terms as proposed subsections 147.2(1) and 147.2(2). The maximum penalty is 7 years imprisonment.

311. Proposed subsection 147.2(4) makes it clear that threats include those that are express or implied, or conditional or unconditional. Depending on their nature, conditional threats can also be caught by the unwarranted demands offence (proposed section 139.1). This follows subsection 5.1.19(1) of the Model Criminal Code.

312. Proposed subsection 147.2(5) provides that it is not necessary for the prosecution to prove the victim actually feared that the threat would be carried out. It is sufficient that the defendant intended, or was reckless about causing, fear.

Proposed section 147.3 - Geographical jurisdiction

313. Proposed section 147.3 provides that there be extended geographical jurisdiction category C (proposed section 15.3) for these offences.

Division 148 - Impersonation of Commonwealth public officials

314. Section 75 of the Crimes Act 1914 makes it an offence to impersonate or falsely represent oneself to be an officer in particular circumstances. A number of provisions in other Acts make it an offence to pretend to be an officer with particular powers, (eg s. 97 of the Marriage Act prohibits a person from pretending he or she is a person whose consent to the marriage of another person is required). These other offences do not currently require proof of the additional matters provided for in section 75 .

315. The Gibbs Committee concluded there was a need to extend section 75 to cover a person who impersonates or falsely represents himself or herself to be an officer with the intention of obtaining a gain, causing a loss or influencing the exercise of a public duty (as in the general dishonesty offence at proposed section 135.1). The situation where one officer personates another or falsely represents to be another is clarified in the proposed section 148.2). A key aim of these offences is to protect the public against being disadvantaged by a person pretending to be an officer who exercises powers he or she is not empowered to exercise. They are also designed to protect the integrity of the office so the person must be purporting to perform the functions of the office at the relevant time.

Proposed section 148.1 - Impersonation of an official by a non-official

316. Proposed subsection 148.1(1) provides a person other than a Commonwealth public official is guilty if on a particular occasion the person with intent to deceive impersonatesanother person in that persons capacity as a Commonwealth public official and does so knowing it to be in circumstances when the official is likely to be on duty. This is based on the Gibbs Committee recommendations, though it was considered desirable to also require proof of intention to deceive. This was to make it very clear that the offence is not meant to cover satirical presentations which may be performed in jest. Further, an Opposition amendment was passed in the House of Representatives which provides in proposed subsection 148.1(5) that to avoid doubt impersonation and false representation do not include conduct engaged in for satirical purposes only. The maximum penalty is 2 years imprisonment.

317. Proposed subsection 148.1(2) provides a person other than a Commonwealth public official is guilty if on a particular occasion the person by falsely representing himself or herself to be another person in that persons capacity as a Commonwealth public official and does so in the assumed character of the official. There was also a Government amendment inserting proposed subsection 148.1(2A) to make it clear that the offences cover the situation where someone is falsely representing himself or herself to be an official who does not exist. The maximum penalty is 2 years imprisonment.

318. Proposed subsection 148.1(3) provides that should a person other than a Commonwealth public official impersonate or falsely represent themself in another persons capacity as a Commonwealth public official and does so with the intention of obtaining a gain, causing a loss, or influencing the exercise of a public duty or function, the person will be guilty of an offence punishable with a penalty of 5 years imprisonment. There was also a Government amendment inserting proposed subsection 148.1(3A) to make it clear that the offences cover the situation where someone is falsely representing himself or herself to be an official who does not exist.

Proposed section 148.2 - Impersonation of an official by another official

319. The offences in proposed section 148.2 cover the same situations where the Commonwealth public official is being impersonated or falsely represented by another Commonwealth public official. There was a similar Opposition amendment at proposed subsection 148.2(5) as provided for in 148.1(5) to exclude conduct engaged in for satirical purposes only, and Government amendments at proposed subsections 148.2(2A) and (3A) to the equivalent subsections in 148.1. The maximum penalties are the same.

Proposed section 148.2 - Geographical jurisdiction

320. Proposed section 147.3 provides that there be extended geographical jurisdiction category C (proposed section 15.3) for these offences.

Proposed Division 149 - Obstruction of Commonwealth public officials

321. Section 76 of the Crimes Act 1914 makes it an offence to obstruct, resist, hinder, use violence against, threaten or intimidate a officer carrying out a function or duty or a person exercising a power, function or duty under a law of the Commonwealth or on behalf of the Commonwealth.

322. In spite of section 76, many other Acts create offences, using varying terminology, of obstructing or hindering persons engaged in duties under those Acts. Sometimes the protection goes beyond officers and sometimes it applies to the statutory authority rather than an individual officer. The Gibbs Committee considered that there should be a new, central offence prohibiting obstruction, resistance, interference, hindering and the use or threatened use of violence, threats or intimidation.

323. The meaning of wilfully (or knowingly) obstruct has been considered in a number of cases relating to obstruction of police in the performance of their duties. Lying to an officer who asks questions in the performance of a duty to investigate was held in Tankey v Smith (1981)
36 ACTR 19 to amount to wilful obstruction. However, mere failure to answer questions does not amount to wilful obstruction ( Rice v Connolly [1966] 2 All ER 649). The distinction is that a citizen has a right to refuse to answer questions but no right to deliberately deceive. There may, however, be exceptional cases where the manner of a person together with his or her silence amounts to wilful obstruction, (eg an innocent person deliberately seeking to attract suspicion to protect the guilty person).

324. There are over 50 offences which can be replaced by a general offence of obstructing an officer. The Gibbs Committee recommended that the legislation prohibit obstruction, resistance, interference, hindering and the use of violence, threats or intimidation without reasonable excuse. It also recommended that the offence cover all Commonwealth public officials while engaged in the discharge or attempted discharge of any duty or function as such an official.

Proposed section 149.1 - Obstruction of Commonwealth public official

325. Proposed subsection 149.1(1) provides a person is guilty if the person knows the other person is a Commonwealth public official and obstructs the official in the performance of the officials functions. Proposed subsection 149.1(2) provides it is not necessary to prove the person knew the official was a Commonwealth public official of that the functions were functions as a Commonwealth public official. Proposed subsection 149.1(6) provides for a broad definition of functions. Further proposed subsection 149.1(3) provides it is not necessary to show the person was aware that the official was performing those functions. This reflects the fact many in the community are often not aware of what are Commonwealth functions.

326. The proposed maximum penalty is 2 years imprisonment. The Geographical jurisdiction - Category C (section 15.3).

Proposed Part 7.20, Division 261 - Miscellaneous

327. Division 261 provides for some general provisions which apply to the whole of Chapter 7. Readers will note that the numbering of this Part suggests that in the future there will be a large number of provisions to be inserted into Chapter 7. This is correct. It is proposed that Chapter 7 will eventually include damage offences, computer offences and offences concerning Commonwealth land. It is important that the Criminal Code also has room to grow without disrupting its structure and numbering.

Proposed section 261.1 - Saving of other laws

328. Proposed section 261.1 makes it clear that other Commonwealth, State and Territory laws are not limited or excluded by proposed Chapter 7. There is an overlapwith State and Territory offences. This provision is designed to ensure that when State police wish to lay a series of charges which may involve one offence against a Commonwealth entity, then they have the option of charging under the State or Territory law.

Proposed section 261.2 - Contempt of court

329. Proposed section 261.2 is included to ensure that the court will always have the option of punishing contempts of court rather than using the offences in this Chapter (for example, obstruction).

Proposed section 261.3 - Ancillary offences

330. Proposed section 261.3 is included to ensure an unintended consequence of referring specifically to another offence (like theft) in another offence (such as receiving) does not mean that under subsection 11.6(2) of the Criminal Code the reference is to the ancillary offences as well.

Item 16 of Schedule 1 - Chapter 10 - National Infrastructure

331. Item 16 inserts two new chapters. Chapter 10 which is concerned with the national infrastructure and Chapter 11 which deals with interpretative provisions. Chapter 10 will deal with the protection of any part of the national infrastructure about which the Commonwealth has power and believes it is in the national interest to protect regardless of ownership arrangements. While the ultimate content and size of this chapter is not certain, the Crimes Act 1914 already provides for protection of the post and telecommunications (Parts VIIA and VIIB). Some of these offences are theft and fraud related, so it is proposed that they be updated and transferred from the Crimes Act 1914 to the Criminal Code . Other offences which protect the postal and telecommunications services in Parts VIIA and VIIB are likely to be moved to Chapter 10 when the Government moves to develop other parts of the Criminal Code . For example, the send narcotic substances by post offence (section 85W of the Crimes Act 1914 ) might be appropriate to move to the Criminal Code when steps are taken to enact new serious drug offences.

Part 10.5 - Postal services

332. Part 10.5 concerns the postal services offences. These include theft and receiving of mail bags, etc (proposed sections 471.1 and 471.2) and taking or concealing them (proposed section 471.3). These replace most of section 85K of the Crimes Act 1914. The offences are drafted in the same terms as the equivalent offences used in the Protect the proper administration of government chapter (Chapter 7) but provides protection for the core of Australias postal service. This approach continues the policy which existed in 1989 when the equivalent offences were first included in Part VIIA of the Crimes Act 1914. Part 10.5 merely continues the longstanding policy on these issues. The overall object is to review and move all Crimes Act 1914 offences into the Criminal Code. In some cases, like these, the policy behind the offences will remain unchanged. However, also like these, the offences will need to be adjusted to make them consistent with related Criminal Code offences.

333. Other Part 10.5 offences include dishonest removal of stamps or postmarks (proposed section 471.4); dishonest use of stamps (proposed section 471.5); damaging or destroying mail bags, etc (proposed section 471.6 - this replaces part of section 85K of the Crimes Act 1914 ); tampering with mail bags, etc (proposed section 471.7); and dishonestly obtaining delivery articles in the course of the post (proposed section 471.8).

Proposed section 470.1 of Division 470 - Definitions

334. The proposed definitions closely follows those in section 85E of the Crimes Act 1914. The terms article in the course of post, carry by post, mail receptacle, postage stamp, postal message and unwritten communication follow terminology used in the postal industry and the Australian Postal Corporation Act 1989. Property has been defined with reference to the Chapter 7 theft and fraud offences (see section 130.1).

Proposed section 470.2 - Dishonesty

335. Proposed section 470.2 uses the same definition as that found in proposed section 130.3 of Chapter 7 and is repeated here for the convenience of readers. A detailed explanation of the term is found in the notes on proposed section 130.3.

Proposed section 470.3 - Determination of dishonesty to be a matter for the trier of fact

336. Proposed section 470.3 is the same as proposed section 130.4 and is explained in the notes on that section.

Proposed Division 471 - Postal offences

337. All the postal offences are in this Division.

Proposed section 471.1 - Theft of mail receptacles, articles or postal messages

338. Proposed subsection 471.1(1) provides a person is guilty if the person dishonestly appropriates a mail receptacle, an article in the course of post or a postal message and does so with the intention of permanently depriving the other person of the mail receptacle, article or postal message. This offence contains the same elements as the theft offence at proposed section 131.1 and penalty (a maximum of 10 years imprisonment). Subsections 471.1(2), (3) and (4) mirror the relevant theft offence interpretative provisions.

339. The postal theft offence replaces part of section 85K of the Crimes Act 1914 which refers to fraudulent taking, stealing and misappropriating and relies on the common law meaning of these terms. The new offence will simplify the terminology and harmonise it with the general Criminal Code theft offence. The offence at section 85K has a maximum penalty of 5 years imprisonment. Proposed section 471.1 will justifiably increase that penalty. Items that are in the post can often be valuable and there is no reason having a lower penalty just because they were stolen from the post.

Receiving stolen mail receptacles, articles or postal messages

340. Proposed subsection 471.2(1) provides a person is guilty if the person dishonestly receives a stolen mail receptacle, an article in the course of post or a postal message knowing or believing it to be stolen. This offence contains the same elements as the receiving offence at proposed section 132.1 and penalty (a maximum of 10 years imprisonment). Subsections 471.2(2), (3) and (4) mirror the relevant receiving offence interpretative provisions.

341. The postal receiving offence replaces subsection 85K(2) of the Crimes Act 1914 which refers to receiving stolen fraudulently taken or misappropriated articles and relies on the common law meaning of these terms. The new offence will simplify the terminology and harmonise it with the general Criminal Code receiving offence. The offence at section 85K has a maximum penalty of 5 years imprisonment. Proposed section 471.2 will justifiably increase that penalty significantly. Items that are in the post can often be valuable and there is no reason having a lower penalty just because they were received from the post.

Proposed section 471.3 - Taking or concealing of mail-receptacles, articles or postal messages

342. Proposed subsection 471.3(1) provides a person is guilty if the person dishonestly takes or conceals a mail receptacle, an article in the course of the post or postal message. The proposed maximum penalty is 5 years imprisonment. This deals with less serious conduct covered by section 85K of the Crimes Act 1914 which referred to fraudulently taking and fraudulently concealing . Dishonestly means much the same thing as fraudulently. The existing maximum penalty of 5 years imprisonment is appropriate.

Proposed section 471.4 - Dishonest removal of postage stamps or postmarks

343. Proposed section 471.4 provides a person is guilty if the person dishonestly removes any postage stamp or removes a post mark from a previously used stamp. It is appropriate to only have a minor offence for this type of conduct. The maximum penalty is 12 months imprisonment. This is the same as provided for in the offence which it partly replaces (section 85J of the Crimes Act 1914 ).

Proposed section 471.5 - Dishonest use of previously used, defaced or obliterated stamps

344. Proposed subsection 471.5(1) provides a person is guilty if the person dishonestly uses for postal services a previously used, obliterated or defaced postage stamp. Proposed subsection 471.5(2) provides for a presumption as to usage where the stamp is affixed to an article. Consistent with Criminal Code principles, the burden of proof in respect of contrary evidence (see subsection 13.3(1) of the Criminal Code ). The evidential burden is defined at subsection 13.3(6) which provides it means, in relation to a matter, the burden of adducing or pointing to evidence that suggests a reasonable possibility that the matter in question exists or does not exist. If the person satisfies that standard, then it is for the prosecution to prove the matter in dispute beyond a reasonable doubt. In view of the fact the defendant is more likely to be able to point to such evidence and the less serious nature of the offence (maximum penalty of 12 months imprisonment), it is appropriate to have a presumption in this instance. The offence replaces part of section 85J of the Crimes Act 1914 which also contains a similar presumption.

Proposed section 471.6 - Damaging or destroying mail receptacles, articles or postal messages

345. Proposed section 471.6 provides a person is guilty if the person engages in conduct that causes damage to or the destruction of a mail receptacle, article in the course of post or postal message and the person intends his or her conduct will cause that damage or is reckless as to whether his or her conduct will cause the damage. The maximum penalty is 10 years imprisonment. This offence is based on a soon to be released Model Criminal Code damage offence and replaces the remaining component of section 85K of the Crimes Act 1914. Damage can of course produce the same level of deprivation of property as theft. The penalty should therefore be the same as that for the postal theft offence (proposed subsection 471.1(1)). The maximum penalty should be 10 years imprisonment. This is consistent with State and Territory penalties in relation to damage offences. While damage offences are generally outside the subject matter of this Bill, it was more efficient to include them here now rather than placing a redrafted offence into the Crimes Act 1914.

Proposed section 471.7 - Tampering with mail receptacles

346. Proposed subsection 471.7(1) provides a person is guilty if the person dishonestly opens a mail receptacle or tampers with a mail receptacle. A mail receptacle can of course have many articles of monetary and personal value. Tampering with a large mail receptacle, like a mail bag, has the potential to disrupt the lives of hundreds of Australians as a result of one incident. It is therefore appropriate that the maximum penalty should be 5 years imprisonment. The proposed offence replaces section 85L of the Crimes Act 1914.

347. Proposed subsection 471.7(2) provides the person is guilty if the person intentionally opens a mail receptacle, does so without authorisation and knows that he or she is not authorised. This is a lesser preparatory offence with a maximum of 2 years imprisonment. It is appropriate to have this in the event that the person is caught before they have an opportunity to start tampering with the mail. The offence replaces subsection 85L(2) of the Crimes Act 1914.

Proposed section 471.8 - Dishonestly obtaining delivery of articles

348. Proposed section 471.8 provides a person is guilty if the person dishonestly obtains delivery of, or receipt of, an article in the course of the post that is not directed to the person. This of course would not cover inadvertently keeping something that has been misdirected. The focus is on someone who does something dishonest to obtain the delivery or receipt of the article. It is therefore appropriate that the same penalty as the general dishonesty offence (proposed section 135.1) should apply. This is also consistent with the penalty for the offence that it replaces, section 85 M of the Crimes Act 1914.

Proposed section 471.9 - Geographical jurisdiction

349. Proposed section 471.9 provides that the appropriate Geographical jurisdiction should be Category C (section 15.3).

Proposed Division 472 - Miscellaneous

350. Proposed section 472.1 provides the usual savings provision for other laws of the Commonwealth, the States and Territories. There is some overlapping. In some cases it will be more convenient to charge under another offence. The same approach is taken with the theft, fraud, bribery and related offences in Chapter 7.

351. Proposed section 472.2 preserves the meaning of expressions in the Australian Postal Corporation Act 1989 andin what is to remain of Part VIIA of the Crimes Act 1914.

Proposed Part 10.6 - Telecommunications

352. This is comprised of the offence of general dishonesty with respect to a carriage service provider (proposed section 474.1) which would replace section 85ZF of the Crimes Act 1914. As with the offences in Part 10.5, the new offence brings the wording of this offence into line with the general dishonesty offence at proposed section 135.1 of Chapter 7. The rationale for having this offence in chapter 10 is much the same as that for the postal offences and reflects the policy that was in place in 1989 when section 85ZF was first inserted into the Crimes Act 1914.

Proposed Division 473 - Preliminary

353. Proposed Division 473 contains definitions and a procedural provision.

Proposed section 473.1 - Definitions

354. These include loss, obtaining and property which are the same as those used for the general dishonesty offence in Chapter 7. Carriage service and carriage service provider are the same as those in Part VII B of the Crimes Act 1914.

Proposed section 473.2 - Dishonesty

355. Proposed section 473.2 uses the same definition as that found in proposed section 130.3 of Chapter 7 and is repeated here for the convenience of readers. A detailed explanation of the term is found in the notes on proposed section 130.3.

Proposed section 473.3 - Determination of dishonesty to be a matter for the trier of fact

356. Proposed section 473.3 is the same as proposed section 130.4 and is explained in the notes on that section.

Proposed Division 474 - Telecommunications offences

357. Proposed Division 474 is designed to include a range of telecommunications offences currently found in Part VIIB of the Crimes Act 1914. However, only one of those offences concerns something that comes within the general subject matter of this Bill - the defrauding a carrier offence at section 85ZF.

Proposed section 474.1 - General dishonesty with respect to a carriage service provider

358. Proposed section 474.1 provides a person is guilty if the person does anything with the intention of dishonestly obtaining a gain or causing a loss to a carriage service provider in connection with the supply of a carriage service. It also covers knowingly risking such a loss. This offence contains the key elements of the general dishonesty offence at proposed section 135.1 and has the same penalty (a maximum of 5 years imprisonment). It does not include the influencing a Commonwealth public official component because that aspect is not relevant to this context.

359. The telecommunications dishonesty offence replaces part of section 85ZF of the Crimes Act 1914 which refers to defrauding and relies on the common law meaning of the term. The new offence will simplify the terminology and harmonise it with the Criminal Code general dishonesty offence which like section 85ZF also has a maximum penalty of 5 years imprisonment.

Proposed section 475.1 of Division 475 - Saving of other laws

360. Proposed section 475.1 provides the usual savings provision for other laws of the Commonwealth, the States and Territories. There is some overlapping. In some cases it will be more convenient to charge under another offence. The same approach is taken with the theft, fraud, bribery and related offences in Chapter 7.

Item 17 of Schedule 1 - Dictionary - aggravated burglary

361. This simply refers to the offence of the same name at proposed section 132.5 and is included for cross-referencing purposes

Item 18 of Schedule 1 - Dictionary - aggravated robbery

362. This simply refers to the offence of the same name at proposed section 132.3 and is included for cross-referencing purposes

Item 19 of Schedule 1 - Dictionary - ancillary offence

363. This is a short-hand term for provisions in Part 2.4 of the Criminal Code which extend criminal responsibility. They concern attempt (section 11.1), complicity and common purposes (section 11.2), innocent agency (section 11.3), incitement (section 11.4) and conspiracy (section 11.5). Often special rules need to apply to these provisions collectively (for example, the rules in relation to geographical jurisdiction in Part 2.7 of the Criminal Code ).

Item 20 of Schedule 1 - Dictionary - Australian aircraft

364. This broad definition ensures there is sufficient jurisdiction to cover Australian aircraft. It is the same definition which was contained in the Criminal Code Amendment (Bribery of Foreign Public Officers) Act 1999 .

Item 21 of Schedule 1 - Dictionary - Australian ship

365. This broad definition ensures there is sufficient jurisdiction to cover Australian ships. It is the same definition which was contained in the Criminal Code Amendment (Bribery of Foreign Public Officers) Act 1999 .

Item 22 of Schedule 1 - Dictionary - burglary.

366. This simply refers to the offence of the same name at proposed section 132.4 and is included for cross-referencing purposes

Item 23 of Schedule 1 - Dictionary - Commonwealth authority.

367. This is one of the more important definitions for Chapter 7 and will also be relevant to future Chapters. The proposed definition sets the scope of the protection of the theft, fraud, bribery and related offences which are to assist with the proper administration of government. It is necessary to cover statutory bodies created by the Commonwealth to perform government functions. In most cases a reference to a body established by or under a law of the Commonwealth will be appropriate. It is therefore proposed that all those bodies be captured under the definition of Commonwealth authority. However there are some exceptions which are clearly separate from the Commonwealth government that should be excluded. These are aboriginal councils and associations; the ACT, NT and Norfolk Island Governments; corporations and bodies such as registered unions and employer associations. The current definition in section 3 of the Crimes Act 1914 , which defines public authority under the Commonwealth as meaning any authority or body constituted by or under a law of the Commonwealth or of a Territory lacks sufficient discrimination. The definition will also enable the exclusion of other bodies by regulation when appropriate.

Item 24 of Schedule 1 - Dictionary - Commonwealth contract

368. This is relevant to the definition of Commonwealth service provider which it is proposed should be inserted by item 28.

Item 25 of Schedule 1 - Dictionary - Commonwealth entity

369. This is the collective term for the Commonwealth bodies to be protected by the Chapter 7 theft, fraud, bribery and related offences. It includes Commonwealth authorities which are described at item 23 and the Commonwealth itself (covering its departments and other non-statutory bodies established by the executive).

Item 26 of Schedule 1 - Dictionary - Commonwealth judicial officer

370. This definition links with the definition of Commonwealth public official which is relevant to the scope of the Chapter 7 offences which concern the duties of Commonwealth public official (for example, the bribery offence). Certain judicial officers are covered by the Crimes Act 1914 definition of Commonwealth officer (subsection 3(1)) which covers any person holding office under the Commonwealth. This would include judges of federal courts but there is less certainty about the status of judicial registrars, and State and Territory judges and officials performing judicial functions. It is important that there should be no doubt about the coverage and that the protection afforded to the administration of government should extend to judicial officers. The definition is very comprehensive.

Item 27 of Schedule 1 - Dictionary - Commonwealth public official

371. The definition of Commonwealth officer in subsection 3(1) of the Crimes Act 1914 is very unsatisfactory. This is because there have even been doubts expressed in the past that it covers Ministers and it does not even cover the Governor-General. It is critical that all people who perform duties and functions for the Commonwealth are covered. This is not only relevant to corruption offences, but the whole range of Chapter 7 offences. It also includes Commonwealth service providers - those who provide services by contract rather than as an office holder or employee (see the proposed definition at item 28). Often these people have responsibilities that are indistinguishable from departmental officers. While they are covered by the Crimes Act 1914 definition of Commonwealth officerfor some offences (non-disclosure, theft, falsification or records, corruption, impersonation and obstruction - sections 75 to 76), there is no reason why they should not be subject to the full range of Chapter 7 offences (including the fraud related offences).

Item 28 of Schedule 1 - Dictionary - contracted service provider

372. The definition of contracted service provider covers parties to a contract with a Commonwealth entity but also subcontractors. Often it is the subcontractors who provide the services.

Item 29 of Schedule 1 - Dictionary - defence aircraft

373. This broad definition ensures there is sufficient jurisdiction to cover Australian aircraft. It is the same definition which was contained in the Criminal Code Amendment (Bribery of Foreign Public Officers) Act 1999.

Item 30 of Schedule 1 - Dictionary - defence ship

374. This broad definition ensures there is sufficient jurisdiction to cover Australian aircraft. It is the same definition which was contained in the Criminal Code Amendment (Bribery of Foreign Public Officers) Act 1999.

Item 31 of Schedule 1 - Dictionary - electronic communication

375. This is an important definition for the Criminal Code to ensure that where there are references to communications there adequate coverage for a whole range of options now technically possible. The definition is consistent with the terminology of the Electronic Transactions Act 1999.

Item 32 of Schedule 1 - Dictionary - engage in conduct

376. This simply refers to the interpretation provision at proposed for subsection 4.1(2) by item 4.

Item 33 of Schedule 1 - Dictionary - foreign country

377. This is important for the purposes of the geographical jurisdiction provisions in proposed Part 2.7. It covers the full range of countries and territories that are outside Australia.

Item 34 of Schedule 1 - Dictionary - person

378. This has been inserted because to simplify the drafting, a most of Chapter 7 offences refer to person. While paragraph 22(1)(a) of the Acts Interpretation Act 1901 includes the body politic or corporate as well as the individual, it needs be made clear that for the purposes of the Criminal Code it includes a Commonwealth authority that is not a body corporate and that another has a corresponding meaning.

Item 35 of Schedule 1 - Dictionary - primary offence

379. This is a useful description which simplifies the drafting of some provisions (note proposed Part 2.7). It simply distinguishes most offences from what is defined as ancillary offences by item 19.

Item 36 of Schedule 1 - Dictionary - public official

380. A generic definition of public official is necessary to make a number of offences to work in the way they are intended. In some cases it should only be necessary that the defendant knew he or she was dealing with a public official, not necessarily a Commonwealth public official (for example, see the bribery offence at proposed section 141.1).

Item 37 of Schedule 1 - Dictionary - receiving

381. This simply refers to the offence of the same name at proposed section 132.1 and is included for cross-referencing purposes

Item 38 of Schedule 1 - Dictionary - robbery

382. This simply refers to the offence of the same name at proposed section 132.2 and is included for cross-referencing purposes

Item 39 of Schedule 1 - Dictionary - services provided to a Commonwealth entity

383. This is necessary to make the definition of Commonwealth service provider at item 28 to work properly. The services must be in connection with the performance of the Commonwealth entitys functions.

Item 39A of Schedule 1 - Dictionary - special liability provision

384. Prior to the Government Amendments in the House of Representatives, proposed section 600.1 in Chapter 11 (item 16 of the Bill as originally introduced) was for the purpose of ensuring that where there is a special liability provision (such as one applying absolute liability to the Commonwealth element in the offence of theft of Commonwealth property at proposed subsections 131.1(1) and (3)) then that rule should carry through to ancillary offences, such as an attempt (section 11.1). On reflection, proposed section 600 was an obscure way of achieving that result. Indeed, consistent with the approach taken with the Criminal Code in relation to other matters, it was concluded that rules of this nature need to be much clearer. Items 7A and 7B were inserted by the Government Amendments to include proposed subsections 11.1(3A) and (6A) which specifically provide as part of the ancillary offence of attempt that special liability provisions apply. The same provisions are also provided for in relation to other relevant ancillary offences: complicity (proposed subsections 11.2(3A) and (6)); incitement (proposed subsections 11.4(2A) and (4A)); and conspiracy (proposed subsections 11.5(2A) and (7A)). It is proposed that a definition of special liability provision be inserted into the Criminal Code dictionary by Item 39A. It provides a special liability provision is where absolute liability applies to one or more (but not all) of the physical elements of an offence. This will mean that while the rules which require proof of fault with respect to ancillary offences (such as subsection 11.2(3) in attempt) will continue to apply to every offence (including the extremely rare occasion where absolute liability might apply to all elements of an offence), it will not be necessary where it concerns a subsidiary element such as the example given in relation to theft of Commonwealth property.

385. It is also proposed that the definition of special liability provision include those special provisions which provide that it is not necessary to prove the defendant knew or believed a particular thing. An example of this is proposed subsection 141.1(2) which concerns bribery. It provides it is not necessary to prove that the defendant knew the official bribed was a Commonwealth public official. The amendments will mean it will not be necessary to prove knowledge about the Commonwealth characteristic of the public official providing the defendant was attempting to bribe a public official of some kind.

Item 40 of Schedule 1 - Dictionary - subcontractor

386. This is necessary to make the definition of Commonwealth service provider at item 28 to work properly. It ensures the subcontractor is providing services in connection with the performance of the Commonwealth entitys functions.

Item 41 of Schedule 1 - Dictionary - theft

387. This simply refers to the offence of the same name at proposed section 131.1 and is included for cross-referencing purposes.