Commissioner of Police v Doyle

[2024] NZHC 3574

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-002149

[2024] NZHC 3574

BETWEEN

COMMISSIONER OF POLICE

Applicant

AND

WAYNE STEPHEN DOYLE

First Respondent

HARATA RAEWYN PAPUNI

Second Respondent

Hearing:

On the papers

Counsel:

M R Harborow and C R Purdon for Applicant

R M Mansfield KC and S L Colgan for Respondents

Judgment:

27 November 2024

JUDGMENT OF ANDREW J

[Costs]

This judgment was delivered by Justice Andrew on 27 November 2024 at 3.00 pm

pursuant to r 11.5 of the High Court Rules 2016 Registrar / Deputy Registrar

Date ……………………………….

COMMISSIONER OF POLICE v DOYLE [2024] NZHC 3574 [27 November 2024]

Introduction

[1]    In my substantive judgment of 26 August 2024,1 I granted the Commissioner’s application for civil forfeiture orders and dismissed the respondents’ application for a variation of the restraining orders. My orders comprised a profit forfeiture order against Mr Doyle in the sum of $11,911,161 and a joint and several profit forfeiture order against Mr Doyle and Ms Papuni in the sum of $2,906,944.60.

[2]    The Commissioner now seeks costs against Mr Doyle on a mixed 2B/3C basis for the steps taken from the filing of the civil forfeiture application until this judgment. The total sum sought is $206,232.50.

[3]    The judgment followed seven years  of  litigation  commencing  in  September 2017. The trial took place over 15 days in October and November 2023.

[4]    The respondents are opposed to any award of costs. They say that costs should be refused on the basis that they are an unnecessary, disproportionately severe punishment in breach of s 9 of the New Zealand Bill of Rights Act 1990 and are inconsistent with the underlying principles of the costs regime in the High Court Rules 2016 (the Rules).

[5]The position of the respondents is as follows:

(a)Costs should be deferred pending determination of the appeal to the Court of Appeal and the associated cross-appeal.

(b)If not deferred, an oral hearing and timetable for detailed submissions on the issues (including the alleged breach of s 9 of the New Zealand Bill of Rights Act) should be ordered.

(c)If the Court is nevertheless minded to determine costs now:

1      Commissioner of Police v Doyle [2024] NZHC 2392.

(i)costs to the Commissioner should be refused; or in the alternative:

(ii)the appropriate costs categorisation is category 2 and the time allocation for all steps is band B. That means the costs calculation in the Commissioner’s memorandum needs to be re-calculated.

Relevant legal principles

[6]    Section 10(1)(d) of the Criminal Proceeds (Recovery) Act 2009 (the Act) provides that a proceeding relating to a profit forfeiture order is a “civil proceeding”.

The costs regime in Part 14 of the Rules applies.2

[7]    Principles as to the award of costs are well-established. The party who fails with respect to a proceeding or interlocutory application should pay costs to the party who succeeds.3

[8]    Ultimately, costs are at the discretion of the Court,4 and the Court must endeavour to do justice, bearing in mind all material features of the case.5

Analysis and decision

Issue – Should costs be awarded?

[9]    In support of their contention that there should be no award of costs, counsel for the respondents emphasised the penal and draconian nature of the legislation. They refer to the significant hurdles to a respondent being able to fund an effective opposition to a forfeiture application and the significant advantages conferred on the Commissioner by the Act. They submit that the severe financial disadvantages that

2      Commissioner of Police v Lau [2020] NZHC 1448; Commissioner of Police v Vincent [2012] NZHC 926; Commissioner of Police v Reed [2013] NZHC 1063; Commissioner of Police v Stepping Stone Finance Ltd [2013] NZHC 1537; Commissioner of Police v Veevers [2015] NZHC 1126; Commissioner of Police v Antolik [2017] NZHC 86.

3      High Court Rules 2016, r 14.2(a).

4      High Court Rules 2016, r 14.1.

5      Packing In (in liq) v Chilcott (2003) 16 PRNZ 869 (CA) at [5].

forfeiture orders can give rise to leaves individuals significantly worse off and often prone to the risk of yet further offending.

[10]They further contend:

To order costs creates economic harm, increases the risk of offending for the community, and further deters an individual from seeking to defend such proceedings, even when they are forced to do so without any access to their own resources, or any reasonable resources so as to guarantee any form of reasonable representation. The sad reality is that there is no equality of arms as lawyers simply seek to avoid any involvement for fear of being tarnished by such involvement and/or left unrewarded for their work in trying to ensure at least some semblance of equality of arms in litigation where this is desperately needed given the draconian, and increasingly inevitable, of confiscation of private property by the state.

[11]   I agree with the respondents that access to justice, particularly when having to defend potentially draconian proceedings of this kind, is very important. Equally, in deciding whether to award costs and determining the quantum of such costs, the Court must endeavour to do justice, taking into account the material features of the case.

[12]   The authorities make it clear that financial hardship may be taken into account under the “catch all” provisions of r 14.7(g). That rule recognises the existence of some “other reason” justifying the Court refusing or reducing costs. In doing so the authorities have emphasised that:6

(a)financial hardship is not an answer to a claim for a costs award;7

(b)costs award must be made at a meaningful level, even against an impecunious party, particularly where the case is found to have lacked merit;8 and

(c)there is a preference for evidence of limited financial means to be provided in the form of a sworn affidavit (where this is not already established in the substantive proceedings).9

[13]   In this case, no affidavit of limited financial means has been provided, although I accept that at the hearing, some evidence was given by Mr Doyle as to his financial

6      Foni v Foliaki [2018] NZHC 3126 at [5].

7      Chesterfields Preschools Ltd v Commissioner of Inland Revenue [2011] NZCA 640 at [7].

8      Te Whare o te Kaitiaki Ngahere Incorporated Society v West Coast Regional Council [2014] NZHC 2969 at [16]; Tuck v Keedwall [2016] NZHC 794 at [11].

9      Lowe v Auckland Family Court [2017] NZHC 656 at [5]; Craig v Keith [2017] NZHC 2664, [2017] NZFLR 899 at [22].

means. I note that he is 70 years old and currently in receipt of national superannuation. In his affidavit, he also says that he is a personal trainer for a number of people. However, given the circumstances of this case, a fresh, updating affidavit should have been filed to support a claim for hardship.

[14]   I note also that Mr Doyle did not make an application for relief against forfeiture under s 51 of the Act. That option had been open to him.10

[15]   In this case the respondents place reliance on s 9 of the New Zealand Bill of Rights Act (namely, the right not to be subjected to torture or cruel treatment). That is obviously a high threshold.11 Some probative evidence would be required for the Court to give serious consideration to claims of that kind. Apart from rather generalised allegations, there is little evidence that s 9 (if even applicable)12 is engaged in this case.

[16]   In the circumstances, I find that I should determine and fix the amount of costs at this stage. The respondents have advanced no credible basis for the Court to re-visit the now well-established jurisprudence that the High Court Rules costs regime applies to proceedings under the Act. That includes, of course, the important principle that ultimately costs are at the discretion of the Court. However, I also conclude that the costs order I make below should be stayed pending the determination of the appeal to the Court of Appeal.

[17]   I reject the application for an oral hearing and further submissions on the issues, including s 9.

Issue – Categorisation of costs

[18]The parties have never agreed on the costs categorisation for the proceedings.

10     That section allows a respondent to apply for exclusion of certain assets before a profit forfeiture is made, on the grounds of undue hardship. I note also that none of Mr Doyle’s whānau has made application for relief against forfeiture under s 66 of the Act.

11   Blanchard J held that all forms of conduct proscribed by s 9 are of “great seriousness” in Taunoa v Attorney-General [2007] NZSC 70, [2008] 1 NZLR 429 at [171].

12 The Commissioner challenges the contention that s 9 applies to the costs regime for civil proceedings.

[19]   In his submissions in support of the application for civil forfeiture orders, the Commissioner sought costs on a 2B basis, including for second counsel.

[20]   The Commissioner contends that for the majority of the steps taken in the proceedings, 2B is the appropriate categorisation. He notes that the majority of the steps required counsel of average skill and experience given the complexity of the proceeding, and a normal amount of time is reasonable for those steps.

[21]   However, the Commissioner further contends that for a number of steps, including filing both the original and amended applications for civil forfeiture, preparation for trial, and appearances, the appropriate categorisation of the proceedings is 3C.

[22]   The Commissioner notes the proceedings are the largest, and most complex, ever brought by him under the Act. In contrast to the great majority of other proceedings under the Act, the Commissioner was not relying on proving criminal offending by the respondents to underpin his application. Instead, he was required to file dozens of affidavits, evidencing criminal offending by numerous patched members, prospects and associates of the Head Hunters over several decades. The affidavits also  addressed the funnelling of funds derived from that offending to     Mr Doyle, Ms Papuni, and the Head Hunters.

[23]   The respondents oppose the mixed costs categorisation approach for which the Commissioner contends. They refer to r 14.3(2) which provides that the proceeding can only be re-categorised where there are “special reasons”. It is said that there are none here. They also note that the proceedings were seen by the Commissioner as category 2 proceedings when he filed his submissions.

[24]   It is the nature of the proceeding which determines the appropriate costs categorisation.13 Generally, a proceeding is classified as falling into one category. The re-categorisation of proceedings – while possible, as all costs are at the discretion of the Court14 – is normally only appropriate if special reasons exist, such as a change in

13     Peters v Bennett [2020] NZHC 1734 at [30].

14     High Court Rules 2016, r 14.1.

the nature of the proceedings or the unexpected inclusion of particularly complex issues.15 If certain steps are more complicated or require significantly more time, then this should be recognised by increasing the band for that step rather than changing the costs category.16 This principle is stated by Venning J as follows:17

[33] Put another way, where more than a normal amount of time is considered reasonable then, rather than seeking to recategorise the nature of the proceedings to category 3, it is more appropriate and consistent with the intent of the rules to apply time band C rather than band B to those particular steps that warrant it.

[25]   I adopt that approach here. I accept that for the following steps, where a comparatively large amount of time was expended, category 2, band C should apply. Those steps are:

(a)Preparation of the application;

(b)Preparation of the amended application;

(c)Filing of evidence in reply;

(d)Drafting of opening submissions in support of the application;

(e)Preparation of the common bundle;

(f)Drafting of closing submissions in support of the application; and

(g)Attendance at the hearing of principal and second counsel.

[26]   On that basis, the costs schedule attached to the Commissioner’s submission will, of course, need to be re-calculated.

15     For example, see Body Corporate 207624 v Grimshaw & Co [2023] NZHC 3381 at [10], citing Heslop v Cousins HC Christchurch CIV 2005-409-2833, 6 August 2007 at [7]. In Heslop, the Court considered there were special reasons to re-categorise the proceeding because, when the hearing began, counsel on both sides appeared to have seriously underestimated its complexity. Also see Hojsgaard v Chief Executive of Land Information New Zealand [2019] NZCA 84, [2019] 2 NZLR 864 at [127]. The Court of Appeal upheld the re-categorisation by the trial Judge as one claim (for judicial review) was relatively straightforward compared to the claim for declaratory relief.

16     Peters v Bennett, above n 14, at [32].

17     Peters v Bennett, above n 14.

[27]   The following factors support my finding that a large amount of time was required to carry out those steps:

(a)The Commissioner’s application for civil forfeiture orders, filed in May 2020, was accompanied by 23 affidavits, with numerous affidavits having already been filed in support of restraint and which were also relied on in support of forfeiture.

(b)The Commissioner’s amended application preceded the receipt of the respondents’ evidence in opposition, and was filed together with 11 further affidavits relating to the wide-scale laundering of funds by multiple persons on behalf of Mr Doyle, including across jurisdictions.

(c)The Commissioner’s evidence in reply comprised eight further affidavits in response to the 10 affidavits filed in opposition by the respondents.

(d)The Commissioner’s opening submissions in support of the application totalled 79 pages. Those submissions drew together the threads of the Commissioner’s largely circumstantial case. As noted, this spanned several decades and involved numerous patched members, prospects and associates of the Head Hunters.

(e)Together with the submissions, the Commissioner prepared and filed the common bundle in electronic form. That comprises over 20,000 pages of evidence.

(f)The Commissioner’s closing submissions in support of the application totalled 55 pages. They were filed together with a further 25 pages of schedules. Some of those were annexed to my judgment.

(g)As noted above, the hearing itself spanned five weeks, with 15 sitting days.

[28]   In an alternative submission that the calculation of costs should be on a 2B basis only (and for all steps), the respondents contend:

(a)the Commissioner’s case was that it could be inferred that Mr Doyle knowingly benefitted from criminal activity of third parties by virtue of having been the president of the Head Hunters;

(b)the evidence of criminal activity by third parties was predominantly from witnesses who were Police officers and based in operations that had long since terminated and resulted in convictions. Much of the work was already done for the Commissioner by the Police in the course of the relevant operations and prosecutions;

(c)the evidence of alleged criminal activity by Mr Doyle was in large part sourced from Crown departments that had already carried out their own investigations. This includes, for example, the Ministry of Social Development and/or the Department of Internal Affairs; and

(d)the Commissioner’s lead witnesses were Mr Peat and Ms Cairns, both of whom are employed by the Asset Recovery Unit.

[29]   Those contentions are not without merit. However, I have no doubt that substantial and additional legal resources were applied by the Commissioner in prosecuting these proceedings. The High Court costs regime is, of course, intended to reflect the contribution to the out-of-pocket legal expenses and disbursements actually incurred by the successful party. As I see it, the application made here by the Commissioner is entirely consistent with that regime; the real and actual legal costs incurred would have been significant.

[30] On the issue of calculation/quantum of costs, I conclude that costs are to be paid by the respondents to the Commissioner on a 2B basis for each step in the proceeding (as identified in the Commissioner’s memorandum), except for the specific steps identified at [25] above. In relation to those particular steps, band 2C is to apply.

Result

[31]   I order that the respondents are to pay costs to the Commissioner on a 2B and 2C basis in accordance with the determinations in this judgment.

[32]   The order for costs is stayed pending the determination of the appeal (and cross-appeal) to the Court of Appeal. That is the just outcome in this case at this stage. The proceedings are obviously of huge significance to Mr Doyle. The events at issue traverse most of his life; he is now 70 years old. It is, of course, his contention and an issue on appeal, that the assets at issue represent his life’s work. In the circumstances, it would be wrong for any costs order to be enforced against him prior to the appeal being determined.

Andrew J