Commissioner of Police v Burgess HC Auckland Civ-2010-404-002893

[2011] NZHC 2119

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DIGEST PERMITTED.

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2010-404-002893

UNDER  the Criminal Proceeds (Recovery) Act 2009

BETWEEN  COMMISSIONER OF POLICE

Applicant

AND  ROBIN ADRIAN BURGESS

First Respondent

AND  LLANNYS GWEN BURGESS

Second Respondent

Hearing:         16 March 2011

Counsel:         D Johnstone and F Culliney for the Applicant

A Speed for the Respondents

Judgment:      10 May 2011

JUDGMENT OF ASHER J

This judgment was delivered by me on Tuesday, 10 May 2011 at 3pm
pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:

Meredith Connell, DX CP24063, Auckland 1140. Email: [email protected] A G Speed, PO Box 941, Shortland Street, Auckland 1140. Email: [email protected]

Table of Contents

Para No
Introduction	[1]
Respective positions of the parties	[6]
The questions	[8]
The legislative framework	[12]
The right to silence	[23]
The relevant provisions of the NZBORA	[31]
Would the orders sought limit the NZBORA rights?
Subsection (a) and (c) of s 25	[35]
Section 25(d)	[44]
Section 23(4)	[46]
Conclusion on whether the orders limit the Burgesses' NZBORA rights	[47]
The s 5 balancing exercise
Approach	[49]
Australian authorities	[52]
This balancing exercise	[58]
Result	[65]
Costs	[66]
Introduction

1. The Commissioner of Police ("the Commissioner") has applied for an
   examination order under the Criminal Proceeds (Recovery) Act 2009 ("the Act") against the respondents, Robin and Llannys Burgess. The Burgesses oppose the application.

2. The Burgesses are facing receiving charges which are to be heard in a trial in
   the District Court on 22 August 2011. The Crown contends that they have been involved in an extensive commercial operation receiving large quantities of stolen gold jewellery, which they then melt down and on-sell as gold.

3. Section 106 of the Act provides that the Commissioner may apply to a High
   Court Judge for an examination order under s 107. This is a new procedure created when the Act came into force on 1 December 2009. Under s 107 a Judge may, if satisfied that the Commissioner has reasonable grounds to apply for the examination order, make an order requiring a person to attend before the Commissioner and answer questions with respect to any matter that the Commissioner has reason to believe may be relevant to the investigation or to any proceedings under the Act, to

supply any information specified in the notice and to produce for inspection any documents specified in the notice.

1. It appears that the Crown case against the respondents for forfeiture will be largely based on inferences arising from the finding of large quantities of gold, and proof of the movement of large sums of money and the acquisition of assets without there being any apparent legitimate commercial source or justification. The Burgesses jointly face nine receiving counts and the total sums allegedly involved are considerable.

2. There is no provision in the Act for notice to be given to respondents of an application for an examination order. However, on this occasion with the trial pending Mr Andrew Speed had been briefed as counsel by the respondents and had been in contact with the Crown Solicitor. As a courtesy the Crown wrote to him, advising him of the intention to apply for examination orders. This was good practice on the part of the Crown. Mr Speed responded with a letter objecting to the order sought, asserting that the application infringed the Burgesses' right to silence in a criminal proceeding. He sought an opportunity to be heard on the application. Counsel for the Commissioner properly drew this letter to the attention of the Court when the application was made. At that point I directed that there should be a hearing. The hearing has now taken place and both counsel for the Commissioner and the Burgesses have made submissions and, at my request, further written submissions.

Respective positions of the parties

1. Mr Speed asserted that there is a right to silence, and that to make orders in the present circumstances would be to effectively take away the Burgesses' fair trial rights. He pointed to the need for equality of arms and fairness in the criminal processes. He submitted that the disclosures that will follow a compulsory examination process may well result in the Crown shaping its case in response to what it learns in the investigation, and briefing or calling witnesses to deal with the lines of defence that the Crown will as a consequence of the answers received know will be pursued. He submitted that an order would result in a host of "other tactical

steps" which the Crown would be able to pursue with its very considerable resources.

1. In response Mr Johnstone for the Commissioner submitted that the Burgesses do not have any express right to silence. He pointed to the fact that there was an express restriction on the ability to use evidence obtained in the examination process in criminal proceedings at ss 164-166 of the Act. He submitted that confiscation proceedings under the Act are not criminal proceedings or a part of criminal proceedings, and that a criminal conviction is not a necessary precondition for forfeiture. The success or even existence of any criminal proceedings is therefore irrelevant. He relied in particular on s 165 which states that any self-incriminating statement may be used in evidence against that person only in a prosecution for perjury, or in relation to any evidence given by the person that is inconsistent with the statement. Mr Johnstone submitted that there is effectively no right of an accused not to disclose a defence and that disclosure can only assist the discovery of truth. He submitted that the implications of any right to silence were considered by Parliament and met by the protection of s 165, and that no relevant rights were compromised by the order sought.

The questions

1. it is first necessary to say something more about the orders sought. The application for examination orders is filed by a constable to whom the Commissioner has delegated powers under s 96 of the Act. The application seeks orders that Mr and Mrs Burgess:

   (a)explain and provide any documents relating to the purchase of, obtaining of or disposing of jewellery or gold;

   (b)explain and provide any documents relating to interactions with Regal Castings Limited;

   (c)explain transactions in bank accounts in the name of Burgess Estate Trust, Robin Burgess, Llannys Burgess and Robin and Llannys Burgess specifically the origin of cash deposits made into these accounts;

   (d)explain and provide documents related to Mr and Ms Burgess' household expenditure from 2006 to 2010 and specifically how the household expenses were paid;

(e)explain and provide documents relating to Dessen Investments Limited trading as Rob's Trading Post and Dessen Investments Limited trading as Lovers of Yesteryear, specifically, the annual turnover and profitability;

(f)explain and provide documentation relating to assets purchased during the period between 2006 and 2010;

(g)explain and provide documents relating to any building work and renovations at 32 Henwood Road including sub-buildings;

(h)explain and provide documents relating to the use of Trade Me specifically auctions run or won in the name of bizo3, kyllou and blasphemous;

(0 explain and provide documents with respect to payments made to or received from Louise Brinsden, Kevin Brinsden or Karl Burgess.

(j)provide information regarding the properties at 32 Henwood Road, Taupaki, 28 Felgrove Street, Glendene, 28a Felgrove Street, Glendene and 1/3 Tawa Road, Te Atatu Peninsula, specifically how the properties were purchased and how they have been subsequently financed; and

(k)answer questions, supply information and produce any documents for inspection, with respect to any matter that the Commissioner has reason to believe may be relevant to the investigation or to any proceedings under the Act;

(Emphasis added.)

1. Paragraph 4 of the Commissioner's application states:

   The grounds on which the orders are sought are that the Commissioner has reason to believe that the information sought is relevant to the proceedings in that it is likely to influence the extent to which it can be shown that Mr and Mrs Burgess have unlawfully benefited from significant criminal activity, namely the receiving of stolen property.

   (Emphasis added.)

2. I asked the Crown whether there could be any further refinement of the questions. The response was that the questions would be confined to documents and information relating to the period from 12 May 2003 to the date of the examination. No further limitation was proposed.

3. I assume that the purpose of asking these questions will be to establish that there can be no innocent explanation for the property, money and precious metal

transactions, and to show by inference that there has been significant criminal activity.

The legislative framework

[12] The Act establishes a new regime for the forfeiture of the proceeds of crime in New Zealand. It replaces the Proceeds of Crime Act 1991 under which a criminal conviction was a precondition to forfeiture. Under the new Act criminal activity on which a civil forfeiture order is based does not need to be, or to have been, the subject of any criminal proceedings.' It is unnecessary for there to be any previous convictions.

[13] The purpose of the Act is stated at s 3 to be: 3 Purpose

(1) The primary purpose of this Act is to establish a regime for the forfeiture of property—

(a)   that has been derived directly or indirectly from significant criminal activity; or

(b)   that represents the value of a person's unlawfully derived income.

(2) The criminal proceeds and instruments forfeiture regime established under this Act proposes to

(a)   eliminate the chance for persons to profit from undertaking or being associated with significant criminal activity; and

(b)   deter significant criminal activity; and

(c)   reduce the ability of criminals and persons associated with crime or significant criminal activity to continue or expand criminal enterprise; and

(d)   deal with matters associated with foreign restraining orders and foreign forfeiture orders that arise in New Zealand.

[14] Under the old Act the Court could, ancillary to a restraining order, make an order for the examination of any person whose property was subject to the restraining order, or any other person, concerning the nature and location of that

Criminal Proceeds (Recovery) Act 2009, s 15.

property.^2. Under subpart 7 of Part 2 of the new Act there are significantly greater investigatory powers than before. These include provision for the Commissioner to apply for a warrant to search for and seize evidence and property and to apply for production and examination orders. The Commissioner may also obtain information from the Department of Inland Revenue. There is no limit on the questions that can be asked in an investigation, except that the Commissioner must have reason to believe that they are relevant to the investigation or to any proceedings under the Act.³

1. Under the Act the property must be derived from "significant criminal activity". Section 6 defines significant criminal activity as activity engaged in by a person that if proceeded against as a criminal offence would amount to offending punishable by a maximum term of imprisonment of five years or from which property, proceeds, or benefits of the value of $30,000 or more have directly or indirectly been acquired or derived.

[16] Section 107 governs the making of examination orders. It provides:

107 Power to require attendance before Commissioner, production of documents, etc

(¹) If an application is made under section 106, the Judge may, if satisfied that the Commissioner has reasonable grounds to apply for the examination order, make an order that the person do 1 or more of the things specified in subsection (3) at the time and place specified in the order.

(2) An order under subsection (1) must contain the following particulars:

(a)   the provision under which the order is made:

(b)   a description of the information that is sought:

(c)   a description of the document or documents production of which is sought:

(d)   a description of the property or other thing or type of property or other thing to which the document or documents are believed to relate.

(3) The things referred to in subsection (1) are‑

(a)   to attend before the Commissioner:

(b)   to answer questions with respect to any matter that the Commissioner has reason to believe may be relevant to the investigation or to any proceedings under this Act:

(c)   to supply any information specified in the notice with respect to any matter that the Commissioner has reason to believe may be relevant to the investigation or to any proceedings under this Act:

(d)   to produce for inspection any documents that are specified in the notice and that the Commissioner has reason to believe are in the person's possession or control and may be relevant to the investigation or to any proceedings under this Act.

1. It was originally proposed that the Commissioner would have this power of examination exercisable by giving notice, without the need to apply for a Court order. However, this was evidently changed on consideration by the select committee. It was noted on the third reading of the Bill in respect of Police powers: ⁴

   The legislation empowers police to carry out the new civil forfeiture functions. Police can draw on their existing knowledge, expertise and a national operational infrastructure to enforce the new regime cost-effectively. Police will have access to examination and production powers necessary for effective enforcement, but these investigative powers are available only by court order, which ensures that there are appropriate checks and balances in place.

   (Emphasis added.)

2. It can be seen then that a Judge is given a discretion as to whether to make an examination order, turning on whether the Judge is satisfied that the Commissioner has "reasonable grounds" to apply for the order. "Reasonable grounds" on the part of the Commissioner presumably constitutes a reasonable belief that questions may be relevant to the investigation or to any proceedings under the Act.⁵ However, the Judge is not bound to make an order if satisfied that the Commissioner has reasonable grounds to apply. In such a situation the Judge "may" make the order. take the view that the Judge has a general discretion as to whether to make an order, even if the Commissioner has a reasonable belief that the questions are relevant.

3. (9 April 2009) 653 NZPD 2603.

4. Criminal Proceeds (Recovery) Act, s 106(3)(a).

This is consistent with the reference in the Parliamentary debates that the need for a Court order ensures that there are appropriate checks and balances in place.

[19] Section 152(1) of the Act makes it an offence to fail to comply with an examination order. A respondent therefore can be compelled to answer any questions authorised by an examination order. A person who commits such an offence is liable on indictment in the case of an individual to imprisonment for a term not exceeding one year or a fine not exceeding $15,000.⁶

[20] Section 165 provides:

165 Admissibility of self-incriminating statements

(1)A self-incriminating statement made orally by a person (whether or not the statement is recorded in writing) in the course of answering any question, or supplying any information, or producing any document, or providing any explanation, as required under section 105 or 107, may be used in evidence against that person only in a prosecution for an offence under section 108 of the Crimes Act 1961 (which relates to perjury) or under this Act in relation to any evidence given by the person that is inconsistent with the statement.

(2)Despite subsection (1), any statement made in relation to—

(a)   a refusal or failure to answer any question, supply any information, produce any document, provide any explanation, or comply with any other requirement may be used in evidence against that person in any prosecution for any offence under section 152 arising from that refusal or failure:

(b)   the answering of any question in a way that is false or misleading in a material particular, or the supply of any information, or the production of any document, or the providing of any explanation that is false or misleading in a material particular, may be used in evidence against that person in any prosecution for any offence under section 152 arising from that act.

[21] The Act therefore gives the Commissioner the ability to obtain an examination order if a Judge is satisfied that the Commissioner has reasonable grounds to apply for it and the Judge exercises the discretion in favour of the application. There is no prohibition in s 107 on the Commissioner in an examination asking questions that might give rise to incriminating answers, and indeed no basis upon which a person could refuse to answer such questions on the basis that the

1. Criminal Proceeds (Recovery) Act 2009, s 152(3)(a).

answer was self-incriminating or might otherwise assist the Police in their investigation. Rather, s 65 provides that such self-incriminating statements as may be given are not admissible in a prosecution against that person (other than if the defendant gives inconsistent evidence, or for perjury),

1. I have not been referred to recent decisions making or declining a s 107 order since the enactment of the Act. This is presumably because most applications by the Commissioner are made without notice and dealt with on the papers.

The right to silence

1. The rights of a litigant who is charged in criminal proceedings to be compelled to answer questions that may be relevant to those criminal proceedings in other proceedings have given rise to a considerable amount of overseas authority. Any consideration of the issues must be carried out against the backdrop of the New Zealand Bill of Rights Act 1990 ("NZBORA").

2. Mr Speed relies on the "right to silence". It has been argued that in New Zealand there is no general right to silence, whether or not a person has been arrested or detained, and it has been referred to as the "so-called right to silence"! It has been seen by others as shorthand for the much broader concepts that exist within the context of the accusatorial/adversarial criminal trial⁸ and certain rights reflected in the NZBORA.⁹ The issue is topical in relation to the Criminal Procedure (Reform and Modernisation) Bill¹⁰ presently being considered by Parliament where submissions have focused, amongst other things, on case management provisions at cis 52-57 and cls 64-67 which will require the notification of issues in dispute in advance of trial by defendants, and also at the commencement of trial.

3. As observed by Lord Hoffman in the decision of the House of Lords in R v Hertfordshire County Council:¹¹

   EW Thomas "The so-called right to silence" (1991) 14 NZULR 299.

4. DJ Harvey "The right to silence and presumption of innocence" (1995) NZLJ 181.
   R v Haig (2006) 22 CRNZ 814 (CA) at [120] per Hammond J.

10 Criminal procedure (Reform and Modernisation) Bill 2010 (243-1). R v Hertfordshire County Council [2000] 2 AC 412 (HL) at 419.

As Lord Mustill said in Reg. v Director of Serious Fraud Office, Ex parte Smith [1993] A.C. 1, 30-31, the expression "privilege against self-incrimination" or "right to silence" is used to refer to several loosely linked rules or principles of immunity, differing in scope and rationale. Perhaps the best known example is the rule that a person on trial should not be compelled to undergo inquisition by the prosecution or the court. ... There are also associated principles which confer a right to silence or privilege against self-incrimination during the pre-trial investigation, such as the exclusion of involuntary confessions and the prohibition on the questioning of suspects without caution or after charge. ... There is also a general privilege not to be compelled to answer questions from people in authority; based, as Lord Mustill put it in Reg. v Director of Serious Fraud Office, Ex parte Smith ... upon "the common view that one person should so far as possible be entitled to tell another person to mind his own business."

1. In that case the local waste regulation authority under a power conferred by statute requested particulars of persons who had supplied clinical waste to a company, the persons who carried the waste on its behalf, the staff employed in handling waste and the locations of any sites used. The company sought judicial review to challenge the validity of the notice. The House of Lords noted that the power to obtain the evidence was for the broad public purpose of not only obtaining evidence with a view to a prosecution but to protect public health and the environment. The purpose would have been frustrated if those who had the information could refuse to provide it on the basis that they might incriminate themselves. It was noted that the interrogation was not oral and that the recipient of the request could answer on advice and at leisure. It was also noted in that case that there was no certainty that there would be any prosecution and that none of the actual questions called for any admission of liability. This led the Court to conclude, contrary to the view of the Court of Appeal, that the appellants were not entitled to refuse to provide the information. While this is only one of a number of English cases that have grappled with the issue, it can be seen as reflecting the complexities of the topic.

2. The issue of compelling a prospective defendant to answer questions that might be relevant to criminal proceedings in other proceedings, was considered by the High Court of Australia in Hammond v Commonwealth of Australia.¹² Section 6 of the Royal Commissions Act 1902 (Cth) had made it an offence for a witness before a Commission to refuse to answer any question relevant to the inquiry put to

¹² Hammond v Commonwealth of Australia (1982) 152 CLR 188 (HCA).

him by any of the Commission, Another section provided that any responses would not be admissible in evidence against that person in any civil or criminal proceeding. Despite this provision it was held that continuation of the accused person's examination before the Royal Commission would interfere with the due administration of justice, even though the answers would not be admissible in evidence against that person. The Court, in a number of separate judgments, emphasised that even with there being a prohibition against the answers being used at any criminal trial, the fact that the plaintiff had been examined in detail as to the circumstances of the alleged offence was very likely to prejudice that person in that person's defence. ¹³ It was stated by Brennan J:¹⁴

It is sufficient for present purposes to appreciate that it is a principle deep-rooted in our law and history that the Crown may not subject an accused person to compulsory process to obtain his answers upon the issue of his guilt of an offence with which he has been charged.

1. Deane J stated:¹⁵

   [I]t is fundamental to the administration of criminal justice that a person who is the subject of pending criminal proceedings in a court of law should not be subjected to having his part in the matters involved in those criminal proceedings made the subject of a parallel inquisitorial inquiry by an administrative tribunal with powers to compel the giving of evidence and the production of documents which largely correspond (and, to some extent, exceed) the powers of the criminal court, Such an extra-curial inquisitorial investigation of the involvement of a person who has been committed for trial in the matters which form the basis of the criminal proceedings against him constitutes, in my view, an improper interference with the due administration of justice in the proceedings against him in the criminal court and contempt of court.

2. Hammond v Commonweath of Australia was considered in New Zealand in

D Holdings Ltd v Secretary for Internal Affairs and distinguished on the basis that in the parallel proceedings considered in that case the accused person could not be compelled to answer questions. ¹⁶ That case may in turn be distinguished from the present where the Burgesses will be so compelled.

1. Against this backdrop I consider the provisions of the NZBORA.

¹³ At 198 per Gibbs

1. At 202.

¹⁵ At 206

¹⁶ D Holdings Ltd v Secretary for Internal Affairs HC Wellington CIV-2005-485-967, 28 April 2006 at [42].

The relevant provisions of the NZBORA

[31] There is no specific section in the NZBORA which refers to a right to silence in those terms. However, there are four provisions of possible relevance to this application, the first in s 23 and the other three in s 25.

[32] Section 23(4) provides:

23 Rights of persons arrested or detained

(4) Everyone who is—

(a)   Arrested; or

(b)   Detained under any enactment—

for any offence or suspected offence shall have the right to refrain from making any statement and to be informed of that right.

[33] Subsections (a), (c) and (d) of s 25 provide:

25 Minimum standards of criminal procedure

Everyone who is charged with an offence has, in relation to the determination of the charge, the following minimum rights:

(a) The right to a fair and public hearing by an independent and impartial court:

(c)       The right to be presumed innocent until proved guilty according to law:

(d)      The right not to be compelled to be a witness or to confess guilt:

[34] 1 respectfully adopt Lord Hoffman's analysis of the common law position indicating the amorphous nature of the "right to silence". There is no unitary right to silence. Indeed, there are some statutory provisions such as the obligation to disclose the particulars of an alibi in s 22 of the Criminal Disclosure Act 2008 that require a defendant to disclose defences and evidence. Nonetheless, these four rights articulated in the NZBORA reflect rules or principles of immunity of differing scope and rationale designed amongst other things to protect defendants facing trial from forced disclosure of material that could be used to assist the Crown in the

prosecution. As an amalgam they can be seen as recognising a qualified right to silence. I consider it best to approach the issues raised by this application in the context of the specific relevant sections of the NZBORA. Would there be a breach of ss 23(4) or 25(a), (c) or (d) if the order was made?

Would the orders sought limit the NZBORA rights?

Subsections (a) and (c) of s 25

1. Section 25 sets out "minimum rights" and must be seen in the context of the long title of the Act which states that the Act is to "affirm, protect, and promote human rights and fundamental freedoms in New Zealand".

2. The general consideration of the right to silence can be approached in this application with particular emphasis on the onus of proof provision (s 25(c)) and the right to a fair trial provision (s 25(a)). I bear in mind the observation of the authors of The New Zealand Bill of Rights Act:¹⁷

   The Anglo-New Zealand legal system does not require that individuals respond to criminal allegations made by the state; criminal guilt must be proved beyond reasonable doubt through the evidence of others. As

   Wigmore puts it, the individual is sovereign and            proper rules of battle
   between government and the individual require that the individual ... not be conscripted by his opponent to defeat himself' .¹⁸

I consider that the concept that a defendant facing criminal charges should not be required to assist the Crown to achieve a guilty verdict is a basic feature of the onus of proof (s 25(c)), and the right to a fair trial (s 25(a)).

1. There have been a number of decisions where New Zealand courts have ordered information and documents to be made available in civil litigation which might involve incriminating information relevant to criminal proceedings. In those cases the courts have ensured that there were terms imposed that included the

2. At 647.

¹⁸ J McNaughton Wigmore on Evidence (Little, Brown, Boston, 196I) vol 8 at 318.

information being inadmissible in any criminal proceeding.¹⁹ There have been a number of decisions where courts have grappled with whether there should be a stay of civil proceedings where the evidence in those proceedings could be relevant to criminal proceedings.^20° It is clear from these cases that a plaintiff is entitled to have a civil action tried in the ordinary course of the procedure and business of the Court, but that in certain circumstances a Court may intervene and stay the proceedings or impose conditions if there is perceived to be the possibility of a miscarriage of justice in criminal proceedings.

1. If these orders are made it is likely that the information that will be compelled will cover the widest range of topics. I note that question (k) requires Mr and Mrs Burgess to answer questions, supply information and produce documents with respect to any matter at all that the Commissioner has reason to believe may be relevant to the investigation. While it cannot be stated that as a matter of certainty the answers given by the Burgesses could assist the Crown in proving guilt, there is a distinct possibility that their answers, while not directly admissible, may do so. Their answers may well disclose further details of damaging circumstances which on investigation by the Police could lead into useful lines of enquiry. The answers may provide the names of persons who could be defence witnesses, or indeed helpful Crown witnesses. The answers are likely to disclose any evidence that the Burgesses are likely to give at the criminal trial and enable the Crown to understand and prepare in advance to cross-examine on that evidence and answer it. The answers may disclose any defences and enable the Crown to prepare and respond to those defences.

2. There has been no demur by the Crown to Mr Speed's suggestion that such information so obtained by the Police in the course of their investigation under the Act will be accessible to Police involved in the criminal proceeding. Indeed, there is nothing to indicate that the same Police personnel are not involved. There is no suggestion that there could be any protocols or Chinese walls set up that might

19 Busby v Thorn EMI Video Programmes Ltd [I984] I NZLR 461 (CA) at 474 and Natural Gas Corp Holdings Ltd v Grant [1994] 2 NZLR 252 (HC). In the latter decision, decided after the enactment of the NZBORA, there was no analysis of whether with these safeguards there was nonetheless an actual breach of a right, or a justification for that breach in NZBORA terms.

20 See B v B (1998) I7 FRNZ 448 (FC), Rudman v Way [2008] 3 NZLR 404 (HC) and the statements made by Wootten J in McMahon v Gould (1982) 1 ACLC 98 (NSWSC) at 103-104.

ensure that such information could not be used in the criminal trial (and I express no view on whether such protocols could be effective). The answers, therefore, may well provide information which helps the Crown win at the trial. Therefore, the process of asking the questions and obtaining the answers will have the effect of derogating from the "golden thread" of the common law that it is the duty of the prosecution to prove guilt.²¹ The answers are likely to help the Crown prove guilt.

1. There are occasions when a defendant does face having to provide information in proceedings which may assist a prosecution in different criminal proceedings. For instance, the Official Assignee has power to summons certain persons as to the property and transactions of a bankrupt.²² There is nothing to preclude questions which may lead to incriminating evidence, although it was suggested in Official Assignee v Murphy that a person receiving such a witness summons might be entitled to refuse to answer questions if that person is being examined in respect of facts relevant to a suspected offence.²³

2. Under s 9 of the Serious Fraud Office Act 1990 the Director of the Serious Fraud Office may, by notice in writing, require a person whose affairs are being investigated to attend before the Director and to answer questions with respect to any matter that the Director has reason to believe may be relevant to the investigation. There is also an obligation to supply information and to produce documents for inspection. Any person who is required to attend before the Director under the section must be given a reasonable opportunity to arrange for a barrister or solicitor to accompany him or her (subs (5)). Section 28(1) provides that a self-incriminating statement made orally in response to such s 9 questioning may be used in evidence against that person only in a prosecution for an offence where the person gives evidence inconsistent with the statement. The section therefore has real similarities to s 165.

3. The significant difference between the two provisions is that in relation to the Criminal Proceeds (Recovery) Act procedure, leave of the Court is required. None is required under the Serious Fraud Office Act procedure, which is initiated by notice.

21

Woolmington v Director of Public Prosecutions [I935] AC 462 (HL) at 481.

1. Insolvency Act 2006, s 165.

²³ Official Assignee v Murphy [1993] 3 NZLR 62 (HC) at 71-72.

There is in that procedure a direct statutory limit on the NZBORA. There is no such direct limit in s 107 as the answers can only be compelled if the Court orders that the questions be asked.

1. In terms of s 25(a) the concept of a fair trial precludes a defendant being compelled in advance to give information that might help the prosecution. I conclude that an order under s 107 would affect and limit the minimum right of a defendant to be presumed innocent until proved guilty according to law.

Section 25(d)

1. Section 25(d) gives a person charged the minimum right "not to be compelled to be a witness or to confess guilt". I do not regard the right not to be compelled to confess guilt to be limited to confessions in court. The requirement not to confess guilt is not to be read with the right not to be compelled to be a witness, but rather disjunctively as a stand-alone right. I do not consider that the phrase "confess guilt" should be given the implied qualification of confessing guilt in the course only of the actual criminal proceedings. It is a confession whatever the context of its making. It seems to me that the Burgesses are charged with an offence, and that they now through this procedure, if it is permitted, may be compelled to confess their guilt if they are guilty. While such a confession could not be used in Court (absent inconsistent evidence or a perjury prosecution) it would be a confession nonetheless. I consider there to be, therefore, a significant limitation placed on the Burgesses' rights under s 25(d).

2. The Burgesses' position is very different from that of defendants in civil proceedings or other proceedings in which they cannot be compelled to answer questions. Here, if the Burgesses refuse to answer questions they commit an offence and face potential penalties including imprisonment or a significant fine.

Section 23(4)

providing a right to refrain from making a statement and to be informed of that right in relation to an offence for which that person is specifically arrested or detained, and that the required making of the statement must arise in the course of the relevant arrest or detention. Here, the questioning is not related to the arrest or detention of the Burgesses. It arises in entirely separate proceedings and they are not arrested or detained in those proceedings. However, it is arguable that if they are being examined under s 23(4) they are being detained by that process.²⁴ I have not had submissions on these issues and I do not need to determine them.

Conclusion on whether the orders limit the Burgesses ' NZBORA rights

1. I consider my interpretation of s 25 as consistent with the long title of the Act, which states that it is to "affirm, protect, and promote human rights and fundamental freedoms in New Zealand". The right to be presumed innocent until proven guilty, and not to be compelled to confess guilt, should not be limited by an implied proviso that the rights only pertain where the answers are admissible in the criminal proceedings. The compelled making of incriminating statements and disclosure of information about prospective defences in those circumstances with the criminal trial pending erode the traditional concept of the roles of Crown and defence, and can have the effect of changing the balance of power in a prosecution. A party facing criminal proceedings may be compelled to confess to facts that show that person to be guilty of the charge. By a side wind s 107 could be used to change the established dynamics of the criminal trial and the procedural features ensuring equality of arms that have been worked out over the centuries. It may affect the fairness of the trial by giving the Crown an advantage it did not previously have.

2. I conclude that there will be a breach of the NZBORA if the Burgesses are compelled to answer the questions. I must now consider how this affects the exercise of my discretion under s 5 of the NZBORA.

²⁴ See Police v Smith & Herewini [1994] 2 NZLR 306 (CA) at 316.

The s 5 balancing exercise

Approach

1. Section 5 of the NZBORA provides: 5 Justified limitations

   Subject to section 4 of this Bill of Rights, the rights and freedoms contained in this Bill of Rights may be subject only to such reasonable limits prescribed by law as can be demonstrably justified in a free and democratic society.

2. The Supreme Court considered the correct approach to the s 5 exercise in R v Hansen.²⁵ In applying Hansen it must be remembered that the primary issue was how the reverse onus for possession of drugs under s 6(6) of the Misuse of Drugs Act 1975 should be approached under s 6 of the NZBORA. It was necessary to determine the standard against which consistency with the Bill of Rights was to be measured. The application of s 5 was therefore a secondary issue. It was observed in that case that the NZBORA does not mandate any one method or sequence of application for applying and reconciling the NZBORA provisions.²⁶

3. In Hansen the majority of the Judges approached the s 5 exercise by applying the decision of the Supreme Court of Canada in R v Oakes and the cases that followed it.²⁷ Tipping J in Hansen provided this adapted summary of the Oakes approach:²⁸

   This approach can be said to raise the following issues:

   (a)does the limiting measure serve a purpose sufficiently important to justify curtailment of the right or freedom?

   (b)(i) is the limiting measure rationally connected with its purpose?

   (ii) does the limiting measure impair the right or freedom no more than is reasonably necessary for sufficient achievement of its purpose?

²⁵ R v Hansen [2007] NZSC 7, [2007] 3 NZLR 1.

1. At [61].

²⁷ R v Oakes [I986] 1 SCR 103. See [120]—[124] per Tipping J, [2031—[205] per McGrath J and [272] per Anderson J following R v Chaulk [1993] 3 SCR 1303 which essentially summarised the Oakes approach.

1. At [104].

(iii) is the limit in due proportion to the importance of the objective? Here the limiting measure at issue will be the examination orders if granted.

Australian authorities

1. There have been some Australian decisions where the merits of the compulsory answering of questions in proceedings that were different from criminal proceedings have been considered.

2. In Australian Crime Commission v OK the appeal concerned whether an examiner conducting an examination under the Australian Crime Commission Act 2002 (Cth) could compel a witness to answer questions that related directly to matters that were the subject of criminal charges.²⁹ The majority held that this was permissible on the basis that there were statutory safeguards in place in relation to the dissemination of the material obtained by compulsion and this was sufficient to avoid the risk of prejudice to a fair trial. It was held that there was no interference with the course of justice merely because a party availed itself of the statutory power to obtain evidence during the course of pending litigation.³⁰ For the Court to intervene the party must exercise the power in a way that interferes with the course of justice. It was noted in that case that the commission of enquiry that was investigating would be required to stop its investigation for an indeterminate period if there were orders made, a most unsatisfactory consequence. Spender J, who considered that Hammond applied, strongly dissented. He held following Hammond that the compulsory interrogation by the executive of a person facing criminal charges about those charges was inconsistent with that person's right to trial by jury and an improper interference with the due administration of justice.³¹ This was so despite prohibitions on the dissemination of evidence.

1. In DAS v Victorian Human Rights and Equal Opportunity Commission Warren CJ of the Victorian Supreme Court applied Oakes in carrying out a balancing test in relation to coercive powers under the Major Crime (Investigative Powers) Act

29 Australian Crime Commission v OK [2010] FCAFC 61, (2010) 268 ALR 281.

30 At [103] per Emmett and Jacobson

1. At [64].

2004 (Vic) and an application to vary a coercive powers order made by a Judge of the Trial Division.³² He distinguished between "direct use immunity" which protects a person from his or her compelled incriminating testimony being used directly against him or her in a subsequent proceeding, and "derivative use immunity" which insulates a person from having compelled incriminating testimony used to obtain other evidence against that person. Following Canadian law he found that derivative use immunity is recognised in the event of a statutory abdication of the privilege against self-incrimination. Having carried out an Oakes-type balancing exercise he concluded that the Charter of Human Rights and Responsibilities Act 2006 (Vic) required that derivative use immunity had to be recognised at an early stage. He concluded that if suitable conditions were imposed the limitation on the common law privilege against providing incriminating testimony could be justified, given the importance of its purpose which was the prevention and prosecution of organised crime.

1. In Chapman v DPP for• Western Australian Pullan JA of the Court of Appeal of the Supreme Court of Western Australia granted an interim stay of examination orders made under the Criminal Property Confiscation Act 2000 (WA), orders which have similarities to those sought here. He held that it did not appear that there was a statutory immunity against the use of the material in criminal proceedings.³³ It seems that in that case the information obtained in response to the questions may have been able to be used in Court. It was observed at [29]:

   [I]f the appellants are obliged to state the source of moneys in the accounts referred to in the charges, then the answers may provide direct evidence of the flow of funds the prosecution will seek to prove in the criminal charges. Answers to questions about whether the appellants own or control the accounts or assets referred to in the charges may provide direct evidence of what the prosecution will seek to prove in the prosecutions.

2. Although the case is distinguishable, these observations can be equally made about the questions that it is proposed to ask in this case.

³² DAS v Victorian Human Rights and Equal Opportunity Commission [2009] VSC 381, (2009) 24 VR 415.

33

Chapman v DPP for Western Australian [2009] WASCA 66, (2009) 194 A Crim R 323.

1. In these decisions the courts emphasised the need to protect a defendant if that defendant is going to be questioned in ancillary proceedings on matters that are relevant and could help the prosecution in a criminal trial.

This balancing exercise

1. Here the Crown has proposed no safeguards, save for the existing privilege against self-incrimination at s 165. This is relevant in considering whether the limiting measure impairs the right no more than is reasonably necessary. Safeguards can help justify a limiting measure. In considering whether the limit is proportionate to the importance of the objective it is necessary to consider the specific circumstances of this application.

2. The power to examine in relation to the proceeds of crime is undoubtedly a significant and important objective. In relation to these facts, it is relatively easy for a party using cash to hide the source of funds or indeed the source of precious metals. Generally, it may be observed that criminals are adept at hiding the proceeds of crime, and the forced disclosure of those sources is a significant and important objective. The power to compel answers to questions designed to find those sources is a power rationally connected to that objective. I conclude that the first two requirements under s 5 can be answered in favour of the position of the Commissioner.

3. However, it must also be shown that the limiting measure impairs the right or freedom no more than is reasonably necessary, and that the limit is proportionate to the importance of the objective (the third and fourth issues in the Oakes test).

4. Under the Act there is the ability to restrain the disposition of assets, pending the determination of proceedings under the Act.³⁴ Restraint orders have been made. The Burgesses' trial should be completed within four months. At that point, subject to any appeals, the criminal proceedings will be at an end. The actual items in question will have been restrained to that point. There is nothing to indicate that there is any urgency, or that assets can be dissipated if there is such a delay. The

³⁴ Criminal Proceeds (Recovery) Act 2009, ss 18-42.

objects of the Act of preventing profits being made from crime, deterrence, and preventing profits from crime being used to finance more crime, should not be defeated by a delay, given the Burgesses' inability to deal with the assets. To limit the s 25 rights just to obtain what is likely to be a four-month time advantage is unnecessary. It should be possible for the Police to achieve their objective in seeking the examination procedure at a later time. There is unlikely to be significant interference with the Police objective. To put it in the language used in the last of the four Hansen considerations, the proposed interference with the NZBORA rights is disproportionate to the importance of the objective.

1. The Crown has suggested the central object must be the ascertainment of truth and that the examination is warranted to ensure that the truth comes out. There is no doubt that the pursuit of truth is of fundamental importance, but many of the checks developed by the common law and contained in the NZBORA are designed to control or restrain the actions of the Crown in the pursuit of truth to ensure that those actions do not operate unfairly against the citizen. These checks protect against the conviction of innocent persons, a result inimical to the pursuit of truth.

2. I conclude that if I exercise my discretion to direct the Burgesses to answer the questions and supply the information and produce the documents I would be imposing a limit on their rights which cannot be demonstrably justified in a free and democratic society. I conclude that I should decline to exercise my discretion at this point. I emphasise that this decision is made on the particular facts and timeframes of this application.

3. 1 will not dismiss the application because the pending criminal trial may be over within five months. I am satisfied that the Commissioner had reasonable grounds to apply for the examination order in the sense that the proposed questions are relevant to the investigation. It is likely that an order can be made once the criminal proceedings are concluded. I am therefore inclined to adjourn the application. However, the Crown may wish to have a more determinative decision should it wish to appeal, so I adjourn the question of remedy for further submissions if necessary.

Result

1. Unless I receive submissions to the contrary, the application will be adjourned until the conclusion of the criminal trial R v Burgess scheduled to begin on 22 August 2011 in the Auckland District Court.³⁵ Any submissions seeking a different order should be filed within 14 days.

Costs

1. Costs are reserved. If there is any issue as to costs submissions should be filed within 14 days.

Asher J