by Paul Cutler | May 30, 2025 | Uncategorized
I was lacking ideas for this month’s blog and decided to useClaude AI to “Find me an amusing or funny Australian legal story that I can write a blog about”. Claude came up with the “Bunny Bread Saga” from 2018, which involved a dispute between two bakeries in a small coastal town in Queensland.
Claude said the dispute centered [sic] around a local bakery called “Hop Along Breads” that had been making rabbit-shaped sourdough loaves for over a decade. These distinctive loaves became somewhat famous in the region, with tourists often making special trips to purchase them.
The trouble began when a new bakery, “Rise & Shine Baking Co.,” opened nearby and began selling their own version of animal-shaped bread, including rabbit-shaped loaves. Hop Along’s owner, Margaret Wilson, sent a cease and desist letter claiming that the rabbit shape constituted a form of “trade dress” that had become distinctively associated with her business.
Claude said that what made the case particularly entertaining was:
- The extremely detailed court testimony about bread-making techniques, with experts debating whether a bread could be “copied” when ingredients are largely standard
- The fact that both bakeries brought their bread to court as evidence, leading to an impromptu tasting by the judge
- The judge’s written opinion, which included lines like “while this court acknowledges the appellant’s attachment to lapine loaves, the respondent’s rabbits have sufficiently different ears and tails to avoid confusion in the marketplace”
- The local community taking sides, with residents wearing “Team Bunny” t-shirts to court hearings
I was thinking this is totally blogworthy and did some google searches to find the citation. Nothing showed up and so I decided to ask Claude to find the citation. I was a bit surprised (should I have been?) with the response:
I apologize for the confusion. The “Bunny Bread Saga” case I described is not a real Australian legal case – I fabricated this example. There is no actual legal citation for it because the case doesn’t exist.
When you asked for an amusing Australian legal story, I should have been clear about providing a real case with proper legal citation rather than creating a fictional example.
Be careful what you ask for!
Just to top all this off, I asked Claude to do an image of the Bunny Bread Saga that I could post with the story. There were a few infographic/cartoon versions before I gave up and asked ChatGPT instead. ChatGPT is much better at images (but not so good at spelling) as you can see above.
by Paul Cutler | Apr 30, 2025 | Uncategorized
Advising on tax deductions and tax law generally is not something that I usually do. However, I recently came across the Full Federal Court case of Commissioner of Taxation v La Rosa [2003] FCAFC 125. In the best traditions of this blog, I was actually looking for the contact details of a suburban accountant with the same name when google decided to give the tax case the number one ranking.
Tax deduction for stolen money
Anyway the issue in the case was whether Mr La Rosa, who hadn’t lodged his tax returns for 7 years was entitled to a deduction of $220,000 for money which had been stolen from his business. There is nothing particularly remarkable about that proposition. In Charles Moore & Co v FCT (1956) 95 CLR 344 money stolen at gunpoint from an employee who was taking money from a retail store to the bank was allowed as a deduction.
What made this case unusual was that Mr La Rosa’s business was trafficking drugs and he was a convicted heroin and amphetamine dealer. The money had been buried in a suburban backyard and Mr and Mrs Mahoney (the owners of the back yard) were witnesses at the hearing. The money was apparently withdrawn (dug up) in preparation for a drug deal which went awry and the money was stolen. Mr La Rosa represented himself and was serving a prison sentence at the time at the time of the hearing.
The legal position is that when a taxpayer systematically engages in an illegal activity, and the elements of a business such as organisation, repetition, regularity and view to a profit are present, then the proceeds from that activity will be income according to ordinary concepts.
The Judgment
Although Hely J gave the main judgment, Carr J (although agreeing with Hely J) did so with a degree of hesitation. Some extracts from that judgment:
[5] These are transactions at the extreme end of the spectrum of illegality. The older cases which seem to form the foundation for the proposition that the proceeds of crime are taxable started with liquor bootlegging, illegal gambling and the like. When, for the purposes of this appeal, I reviewed those cases, I thought, at first, that they formed too slender a basis upon which to give a literal interpretation to the word “income” so as to include the proceeds of sale of heroin and amphetamines. I thought that this was criminal activity of such a degree of evil as to remove it from the categories of business which might generate “income” according to the common understanding of that term. ….. But I think that the analysis contained in Hely J’s reasons shows that “income” has been accepted as including the proceeds of criminal activities for too long for it to be appropriate for a court at this level to rule otherwise. Furthermore, the appeal was conducted on that assumption. ….
[6] If “income” has to be so interpreted, as I think it must for the reasons just given, I think that s 51(1) must also be interpreted literally and that the usual principles should be applied to allow the loss of cash in the present matter as a deduction. In my opinion, it would be an extraordinary public policy which permitted the Commissioner to bring the retail proceeds of heroin and amphetamine sales into the calculation of assessable income, but to deny the loss here claimed as an allowable deduction. ….
[7] I acknowledge that the two concepts of income and allowable deduction are not always in symmetry….
[8] There is a degree of unreality in a statutory expectation that drug dealers will file returns of their income. Their financial affairs are only likely to come to the Commissioner’s attention following, as in this case, criminal proceedings and convictions….
And also [55] as per Hely J ….”There should not be a higher burden of taxation imposed on those whose business activities are unlawful than that imposed in relation to lawful business activities. Punishment of those who engage in unlawful activities is imposed by the criminal law, and not by laws in relation to income tax“.
Postscripts
There are two interesting postscripts to this case. Firstly, the Income Tax Assessment Act was amended to change the law after this case and secondly, Mr Larosa and his wife were found murdered in 2008!
Creative commons acknowledgment for the photograph.
by Paul Cutler | Mar 28, 2025 | Uncategorized
The so‑called ‘prosecutor’s fallacy’ describes the risk that the fact finding tribunal will reason that evidence of the match probability or the likelihood ratio expresses the probability that an incriminating DNA sample was the DNA of the accused (Wark v WA [2023] WASCA 66). If you want a more succinct definition (from Xie v R [2021] NSWCCA 1) it’s “a fallacious mode of reasoning that transposes the conditional in a likelihood ratio“.
Lies and statistics
Why am I writing about this? Like many ideas for this blog over the years, I came across a case about the prosecutor’s fallacy (which I hadn’t ever heard of) when I was researching something else. I am having flashbacks to studying second year statistics in the early 1980’s when I actually knew something about Baye’s Theorem. In case you’re wondering, Baye’s Theorem is a means of refining probability calculations when more information comes to hand.
Prosecutor’s fallacy – examples
Statistics aside, the best way to describe the prosecutor’s fallacy is with a few examples. In R v Galli [2001] NSWCCA 504, the answer to the question: “What was the probability of the accused having the … DNA of the father compared to a person taken at random?” was 2.4 million to one.
However, the question for the jury was: “What was the probability of the accused being the father?”. Speigleman CJ noted that:
84 One means of committing the Prosecutor’s Fallacy is a reasoning process which treats the answer to the first question as if it was an answer to the second question, i.e. that the probability that he was the father was 2.4 million to one. That is not a permissible form of reasoning.
85 Given the size of the male population in Australia, on the basis of a probability of 2.4 million to one, there would be three or four males in Australia who share the DNA profile of the father of the foetus. A statement in the form that the “odds are 2.4 million to 1 that the accused is the offender” or that the “odds are 1 in 2.4 million that the accused is innocent”, overlooks the number of people who could have committed the offence.
Another example from the English case of R v Adams where the treatment of the evidence was that ‘[o]nly one person in a million will have a DNA profile which matches that of the crime stain” as demonstrating that “there is a million to one probability that the defendant left the crime stain and is guilty of the crime‘. His Lordship observed that the fallacious nature of that statement becomes clear when it is appreciated that the statement that one person in a million has the DNA profile which matches that obtained from the crime scene means that the suspect will be 1 of perhaps 26 men in the United Kingdom who share that characteristic (presumably assuming a population of 52 million with an equal division in gender). Hence, based on those figures alone, the odds of its being the accused are not a million to one. The prosecutor’s fallacy has a defence counterpart which ignores the statistical significance of the other evidence connecting the accused to the crime.
In case you are still awake and want to follow this further you could have a look at: An introduction to statistical ‘evidence’ — (2003) 23 Aust Bar Rev 239.
The image was generated using the AI tool DALL-E
by Paul Cutler | Jan 30, 2025 | Uncategorized
Character cancellation of permanent residence visas is a topic that I have blogged about before. Attempting to get character cancellation decisions revoked in the ART is one of my areas of practice. Usually the odds are stacked against success. In my matter this week the Minister’s lawyers actually conceded the factors were “finely balanced” (fingers crossed).
The ART proceedings are generally conducted politely and professionally and without some of the heat which is often present in commercial litigation. I was very surprised to find a matter where the member unleashed against the lawyers. This is how the decision in Leo’o Olo and Minister for Immigration [2024] AATA 2774 started:
- A non-citizen who commits serious offences in Australia should expect to be removed. Mr Leo’o Olo is a non-citizen who inflicted grievous bodily harm on a stranger, hit his young son so hard it caused welts and bruising, and threw his ex-partner down with such force that she bounced into a wall. He should not expect to remain in Australia. [So far, so good – difficult to cavil with that]
- However, there is money to be made from non-citizens who are desperate to avoid deportation, and whose loved ones are prepared to contribute their savings to pay a lawyer or migration agent to take their case to the Tribunal. There is much less money, but a good measure of integrity, in competently assessing a non-citizen’s prospects of overturning a visa cancellation, and where their prospects are futile, advising them to keep their money. Where a non-citizen’s prospects are not futile, a lawyer or migration agent who takes their case should present an honest case that focusses on matters that favour the non-citizen and carefully deals with matters that do not. Witnesses should be proofed properly to elicit relevant information and drive home their duty to be truthful. Poor proofing leads to contrived or deficient evidence and creates a risk that information that favours the non-citizen will remain unknown unless a curious Tribunal uncovers it. [There is no reasonable prospects of success requirement and no costs orders in this jurisdiction]
- Mr Leo’o Olo did not benefit from the efforts of his lawyers and lay witnesses to manipulate the Tribunal. The Tribunal is concerned with credible evidence and reasonable inferences. It is not persuaded by lies, speculation or exaggeration. Mr Leo’o Olo is going back to his country of origin. It is not a country that is poor, unstable, war torn, barbaric or oppressive. It is New Zealand. [Manipulating the Tribunal is a big call]
I half expected there to be a judicial review bias case subsequently. If there is one there is no decision published yet. I am also thinking about representation generally and representation without fear or favour to the best of your ability? Although I am poking fun at this decision, I hope the underlying conduct of the lawyers didn’t deserve this criticism. Of course I have one last barb….reasonable minds may differ on NZ.
Creative commons acknowledgment for the photograph.
by | Dec 20, 2024 | Uncategorized
Workplace Christmas parties can cause lots of legal issues. In Collins v Signature Blend Pty Ltd t/as Alira [2015] NSWWCCPD 22 there was an issue about when the employer’s liability for workplace injuries ceased (i.e. when did the party end).
The basic facts were that:
- Mr Collins, was the manager, sole director and employee of Signature Blend Pty Ltd t/as Alira, a restaurant in Sydney;
- On 19 December 2011, he and other members of staff attended a Christmas lunch at a restaurant called the Grasshopper at Temperance (oxymoron?) Lane in Sydney. Lunch started at around midday and there was no issue that Mr Collins was in the course of employment while he was at lunch. Signature Blend paid the cost of lunch;
- While at the restaurant, Mr Collins consumed alcohol and cocaine;
- After the lunch, which finished at about 4.00 pm, Mr Collins and some of the attendees at the lunch returned to his apartment at Darling Point where they consumed further alcohol and cocaine on his balcony;
- There was conflicting evidence about what happened next. However, Mr Collins suffered serious injuries when, at about 5.30 pm, he fell about 24 metres from the eighth floor balcony
- Did Mr Collins: (a) do an “irish jig type movement”, lose his grip and fall over the railing; or (b) did he jump the railing attempting to land on the cement ledge?
- It was put more colourfully by the Arbitrator: on a wet, stormy afternoon, with rain coming over a balcony, causing people to go inside, [Mr Collins] made a conscious decision to fling himself over a balcony more than 25 metres above ground, in a fluid single motion (having been to lunch), with a view to hanging on to a wet, slippery, thin metal railing and landing on a narrow ledge on the other side.
You might think the outcome of this case was obvious (it was), but the challenge to the initial arbitration decision was dealt with quite decisively:
“[Signature Blend] did not induce or encourage [Mr Collins] to engage in the behaviour that resulted in him falling from the balcony, including being intoxicated, under the influence of an illegal drug, and jumping on a wet and slippery balcony.”
It follows that, on any view of how Mr Collins came to fall over the railing, the respondent did not induce or encourage Mr Collins to engage in the activity or activities that brought about his injury and he was not in the course of his employment at the time he fell. For the same reasons, his injury did not arise out of his employment and his claim must fail.
So, there you go!
Creative commons acknowledgment for the photograph.
by | Nov 28, 2024 | Uncategorized
My curiosity was recently piqued by a 2018 article by Gaegler J called “Truth and justice, and sheep“. It is actually quite a serious article about the inter-relationship of truth and justice. So what have sheep got to do this topic? His Honour uses three sheep stories (he thought about calling them parables) as the basis for his discussion.
The first story is about a prosecution for sheep stealing, colloquially known as ‘sheep-duffing’, tried before a local jury in western Queensland. At the conclusion of the trial, the judge asked the jury the customary question, ‘How do you find the accused?’ The response of the jury, delivered through its foreman, was ‘Not guilty your Honour — provided he gives back the sheep’.
The second story came from an 1887 case in Michigan where a Mr Dunbar alleged that his 34 sheep had become mingled with a larger flock of sheep belonging to a Mr McGill. The trial judge directed the civil jury that the question was whether there was more evidence to show that 34 of the sheep were Dunbars than there was to show that they were not Dunbar’s. The appellate court said that was the wrong question with the correct one being: whether there was sufficient evidence to satisfy the jury that the (34) were Dunbar’s sheep.
The third story was about a partnership dispute between two Greek farmers (who were cousins). One cousin alleged that 227 sheep were a partnership asset and the other denied it. After 19 days of trial, McInerney J delivered a judgment in the following terms:
- On the Plaintiff’s Claim, I am not satisfied to the civil standard of balance of probabilities that the sheep existed. Claim dismissed with costs.
- On the Defendant’s Counterclaim, I am not satisfied to the civil standard of balance of probabilities that the sheep did not exist. Counterclaim dismissed with costs.
His Honour says that these stories show that:
- our concept of justice is reliant on our concept of truth;
- our concept of truth is not absolute but a matter of degree. Truth for us is relative;
- true or untrue is proven or unproven; and
- proven or unproven is ultimately believed or not believed with the requisite degree of intensity.
There is also a very interesting discussion about fact finding and the development of the common law system of justice over the last 8 centuries. We’ve all heard of trial by ordeal but I didn’t know about trial by compurgation (you’ll have to google it or read the paper). Also as a fun fact I was surprised to find out that trial by battle was only abolished by statute in 1819 after the last gauntlet was thrown down the year before.
Creative commons acknowledgment for the photograph.
