Authorities and Widow Fight Over $433,000 Found in Suitcase: Who Wins?

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Margaret Elizabeth Flack, a 55-year-old widow living in Glebe, Sydney was astonished when police searched her home and found a briefcase containing almost half a million dollars in cash.

She wasn’t aware of its existence, and police couldn’t find the true owner.

Both the authorities and Mrs Flack believed it was theirs!

But who got to keep it?

This was the central issue in the case of the Chairman of the National Crime Authority v Flack.

It was 1994, and Mrs Flack lived alone after her husband died in their rented premises in Glebe.

Her son and daughter both had house keys and came to visit her, but neither lived there.

On 12 April 1994, police obtained a warrant to search her property, as they believed her son Glen was involved in drug importation.

When they searched the home, a suitcase containing $433,000 was found hidden in a cupboard that Mrs Flack had not used for twelve or thirteen years.

When the detective showed her the bag, Mrs Flack said: “I have never seen it before. I don’t know whose it is.”

The money was examined by the reserve bank, and it was determined that one of the banknotes had been published fairly recently, in 1994, so it must have been placed in the suitcase – or the entire suitcase must have been placed in the cupboard – fairly recently.

Of course, since the briefcase (and cash) was part of an investigation, police took it.

But no prosecution followed, no charges or any other action was taken by the Chairman of the National Crime Authority.

Mrs Flack asked for the suitcase back, but the Authority said she didn’t have sufficient title to sue for it.

Who got to keep the money?

Mrs Flack took the issue to court.

At first it may seem like a strange case; after all how, could she claim possession of something she didn’t even know existed?

She was successful at the first hearing, but the Authority appealed the decision.

In the Federal Court, Mrs Flack scored a narrow victory: two of the three judges agreed with her.

Under common law, a person is taken to exercise control over any property inside their home, whether they know about it or not.

The court found that until the suitcase was discovered, Mrs Flack would have intended to exercise control over the things in her house – and the mere fact that her son and daughter had keys did not remove that intention.

Many cases both in Australia and England have confirmed that a person intends to manifest control over the things in their house, whether or not they are aware of their existence.

Of course, if the true owner came forward, they would have title to the money, but until and unless this happened, she had better title to the money than anyone else.

Under common law in 1994, anything seized by police under warrant had to be returned if the reason for its seizure no longer existed, or if it was decided that it would no longer be used in evidence, unless the thing is forfeited by the person with the best title to the Commonwealth or is the subject of an ownership dispute.

There was no general power, at that time, for the Commonwealth to seize and claims goods simply because they appeared suspicious.

Mrs Flack was therefore held to have the better title to the money – unless and until the true owner came forward.

What is the law today?

A person is still presumed to manifest an intention to control all property within their home – but new and far tougher laws are now in place in relation to “suspicious” goods.

Proceeds of crime laws at both state and federal levels mean that authorities may confiscate goods without even having to prove that the owner was involved in criminal activity.

In many cases, they need only establish that they have a ‘reasonable suspicion’ that the goods were either stolen or derived from another unlawful means, which is not difficult to do if a large stash of unexplained cash turns up hidden in a house during an investigation into illegal drug activity.

Indeed, Mrs Flack’s case would likely have had the opposite outcome if decided today.

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About Ugur Nedim

Ugur Nedim is an Accredited Specialist Criminal Lawyer and Principal at Sydney Criminal Lawyers®, Sydney’s Leading Firm of Criminal & Traffic Defence Lawyers.

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