Commissioner, New Zealand Police v McGoldrick-Savaii

[2020] NZHC 133

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2017-485-405

[2020] NZHC 133

UNDER

the Criminal Proceeds (Recovery) Act 2009

IN THE MATTER

of an application pursuant to sections 22, 24 and 25

BETWEEN

THE COMMISSIONER, THE NEW ZEALAND POLICE

Applicant

AND

HAYDEN HARLEY McGOLDRICK- SAVAII

Respondent

AND

ANZ BANK NEW ZEALAND LIMITED

First Interested Party

AND

MARGARET ELLEN NORTH

Second Interested Party

Hearing:	10 February 2020
Counsel:	S B McCusker for Applicant
Judgment:	11 February 2020

JUDGMENT OF ELLIS J

[1]                 On 1 October 2019, the Commissioner filed an application for asset forfeiture orders under the Criminal Proceeds (Recovery) Act 2009 (the Act). More specifically he seeks forfeiture of a 2003 Mercedes-Benz E Avantgard Saloon motor vehicle (the Mercedes) registered in the name of the second interested party, Ms Margaret North. Because Mr McGoldrick-Savaii has given his signed consent to the application and Ms North has been served with the application but taken no steps in response, it is possible to deal with the application relatively briefly.

COMMISSIONER OF POLICE v McGOLDRICK-SAVAII [2020] NZHC 133 [11 February 2020]

Background

[2]                 From 6 March 2017 the Mercedes was registered in the name of Ms North. Ms North is an associate of the Porirua Mongrel Mob gang. The car’s previous registered owner from 17 September 2016 to 5 March 2017 was Mr Laurie Obeda, also an associate of the Mongrel Mob gang.

[3]                 On 5 March 2017 –  the  day  before  the  Mercedes  was  transferred  into  Ms North’s name – Mr McGoldrick-Savaii was observed by Police driving the car. The Mercedes was impounded for 28 days after Mr McGoldrick-Savaii's driver's licence was suspended. Mr McGoldrick-Savaii was later observed driving the Mercedes on 7 April 2017 and the car was seized by Police four days later.

[4]                 On 5 May 2017 the Commissioner applied (without notice) for restraining orders under the Act in relation to the Mercedes and a property at 32 Waiho Terrace, Elsdon. As I have said, the Mercedes was registered in the name of Ms North and the property was registered in the name of Mr McGoldrick-Savaii. This Court made the restraining orders on 8 May 2017.

[5]                 On 23 February 2018, Mr McGoldrick-Savaii was sentenced to a period of imprisonment for three years and six months, after pleading guilty to one representative charge of offering to supply methamphetamine, one representative charge of offering to supply methamphetamine, and one charge of possession of methamphetamine for supply.

[6]                 On 15 August 2018, the Court approved a settlement agreement between the Commissioner and Mr McGoldrick-Savaii over the Waiho Terrace property. The terms of the settlement were that:

(a)Mr McGoldrick-Savaii admitted to receiving an unlawful benefit of

$60,775 from his significant criminal activity for the purposes of the Act.

(b)Funds totalling $50,000 were to be forfeited for the purposes of a profit forfeiture  application.  Upon  forfeiture  of   the   $50,000,   the Waiho Terrace Property was to be released from the restraining order.

(c)The Mercedes (which has been valued at $5,0001) would remain under restraint, as Ms North had indicated that she still intended to apply for relief under s 66 of the Act.

(d)The Commissioner would later file an application for asset forfeiture orders over the Mercedes, which Mr McGoldrick-Savaii would not oppose.

(e)Once the status of the Mercedes had been resolved, the proceedings against Mr McGoldrick-Savaii would be at an end.

[7]                 There was a subsequent hearing of an on notice application restraining order over the Mercedes which was opposed by Ms North on the grounds that the car belonged to her. But on 30 April 2019 Grice J found that, on the balance of probabilities, the Mercedes was under Mr McGoldrick-Savaii’s effective control for the purpose of s 58 of the Act.2 She confirmed the restraining orders over the car.

[8]                 On 1 October 2019 the Commissioner applied for an assets forfeiture order in relation to the Mercedes and a further effective control order.

[9]                 In accordance with the settlement, Mr McGoldrick-Savaii formally confirmed that he did not oppose the orders sought on 16 December 2019. Ms North was served with the application but has taken no steps. There is, accordingly, nothing on the file that suggests the position in relation to effective control has changed since that matter was determined by Grice J. Nor has Ms North applied for any relief under the Act.

1      While initial valuations placed the value of the Mercedes at $16,600, a valuation from the Official Assignee indicated that the car was now worth around $5,000.

2      Commissioner of Police v McGoldrick-Savaii [2018] NZHC 936 (given the date of the judgment, the date in the neutral citation number appears to be out by a year).

Should the forfeiture order be made?

[10]              As I have said, there is no reason disclosed on the file to doubt the correctness earlier effective control order and, indeed, I doubt there is the ability for this Court to do so. So I proceed  on  the  basis  that  the  Mercedes  did,  effectively,  belong  to Mr McGoldrick-Savaii.

[11]              Under s 50 of the Act, the Court can make an asset forfeiture order in respect of specific property if it is satisfied that on the balance of probabilities that that property is tainted property. “Tainted property” is defined as follows:

tainted property –

(a)means any property that has, wholly or in part, been –

(i)acquired as a result of significant criminal activity; or

(ii)directly or indirectly derived from significant criminal activity; and

(b)includes property that has been acquired as a result of, or directly or indirectly derived from, more than 1 activity, if at least 1 of those activities is a significant criminal activity

[12]              The Commissioner says that Mr McGoldrick-Savaii purchased the Mercedes with proceeds from the sale and supply of methamphetamine and that it is accordingly “tainted property” for the purposes of the Act.

[13]              On the evidence before the Court I agree with the Commissioner that the only logically available inference from the following evidence is that the Mercedes was “wholly or in part” acquired as a result of his significant criminal activity. I note in particular the evidence that:

(a)Mr McGoldrick-Savaii was unemployed and received a benefit from 6 September 2015;

(b)his declared income for the year ending 31 March 2017 (the financial year in which the Mercedes was acquired) was only $13,236.82, and in the previous year ending 31 March 2016 was $29,287.43;

(c)during this same period, the evidence establishes that Mr McGoldrick- Savaii incurred the following expenses:

(i)purchasing approximately 119 grams of methamphetamine for the purposes of on-selling;

(ii)conducting improvements and earthworks to the Waiho Terrace Property, including renovations to the kitchen and bathroom, and the laying of a concrete driveway;

(iii)servicing the mortgage on the Waiho Terrace Property at a rate of $250 per week; and

(iv)acquiring a 2001 Mercedes-Benz C240 Saloon car.

[14]              Mr McGoldrick-Savaii's declared income was not at a sufficient level to fund any of the activities identified above (let alone all of them), as well as support his day- to-day living expenses (which included supporting a young child). As he told Police following his arrest, $250 per week from his weekly $350 benefit payment went to servicing the mortgage over the Waiho Terrace property. It is not plausible for Mr McGoldrick-Savaii to have funded the purchase of the Mercedes entirely from what remained of his legitimate earnings.

[15]              It follows that Mr McGoldrick-Savaii could only have the means to acquire the Mercedes if he used money he acquired from undertaking significant criminal activity, namely methamphetamine dealing. As I have noted, he has admitted to receiving an unlawful benefit of $60,775 in  relation to this activity between 20 February and     11 April  2017.  As  Mr  McCusker  submitted,  it  is  reasonable  to  assume  that  Mr McGoldrick-Savaii’s drug dealing activity was not limited to that period.

[16]              As well, there is the fact that Mr McGoldrick-Savaii sought to obscure his ownership of the Mercedes by placing it in Ms North’s name. There is no obvious reason why Mr McGoldrick-Savaii would have registered the car in Ms North’s name unless he was trying to launder the proceeds of sale from methamphetamine.

[17]              The evidence therefore satisfies me  that  the  Mercedes  was  acquired  by  Mr McGoldrick-Savaii either as a result of significant criminal activity or directly or indirectly derived from significant criminal activity and is tainted, accordingly.

Result

[18]              For the reasons I have given, under s 50 of the Act I make an assets forfeiture order in relation to the 2003 Mercedes-Benz E Avantgard Saloon motor vehicle including ignition keys, registration CYU213, registered in the name of Margaret Ellen North. The Mercedes is therefore to vest in the Crown absolutely and is to be in the custody and control of the Official Assignee.

Rebecca Ellis J

Solicitors:

Crown Solicitor, Wellington for Applicant