Commissioner of Police v Harding

[2019] NZHC 2470

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

I TE KŌTI MATUA O AOTEAROA WHANGĀREI-TERENGA-PARĀOA ROHE

CIV-2015-488-110

[2019] NZHC 2470

BETWEEN

COMMISSIONER OF POLICE

Applicant

AND

BROWNIE JOSEPH HARDING

First Respondent

JOSEPH HARDING
Second Respondent

CASEY REWHA
Third Respondent

AMY LEIGH HARDING

Interested Party

TE PAREKURA ELLIOT

Interested Party

Hearing:

27 September 2019

Appearances:

D M A Wiseman and R S Ching for Applicant No appearance for First Respondent

M N Pecotic for Second and Third Respondents and Interested Parties

Judgment:

30 September 2019

JUDGMENT OF LANG J

[on application for approval of settlement under s 95 of the Criminal Proceeds (Recovery) Act 2009]

This judgment was delivered by me on 30 September 2019 at 3.30 pm,

pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date……………

COMMISSIONER OF POLICE v HARDING [2019] NZHC 2470 [30 September 2019]

[1]                 In this proceeding the Commissioner of Police (the Commissioner) seeks civil forfeiture orders against the respondents under the Criminal Proceeds (Recovery) Act 2009 (the Act).

[2]                 The applicant has now reached a proposed settlement with all parties other than the first respondent, Mr Brownie Harding. The terms of the settlement are set out in two joint memoranda of counsel dated 17 and 26 September 2019 respectively. The parties now seek an order under s 95 of the Act approving the proposed settlement.

Background

[3]                 The proceeding was filed as a result of an investigation by the Organised and Financial Crime Agency of New Zealand into a methamphetamine manufacturing and distribution network organised and headed by Mr Brownie Harding. This resulted in the arrest and prosecution of a large number of persons for their alleged participation in the network.

[4]                 Mr Brownie Harding was ultimately convicted and sentenced to a lengthy term of imprisonment on 7 April 2017 for his role in the operation.1 Mr Joseph Harding faced two charges of being a party to the manufacture of methamphetamine and a charge of participating in an organised criminal group. The charges against him were ultimately stayed because he was found to be unfit to stand trial by virtue of mental impairment.2 The third respondent, Ms Rewha, was found guilty by a jury on a charge of participating in an organised criminal group and was sentenced to 12 months home detention on 25 November 2016.3

[5]                 The interested parties, Ms Amy Harding and Mr Te Parekura Elliott, are the registered owners of a property situated at 278 Taipuha Road in Northland. This was a remote rural property that Mr Brownie Harding and other members of his network used as a clandestine laboratory to manufacture large quantities of methamphetamine between September and November 2014.

1      R v Harding [2017] NZHC 675.

2      Harding v R [2017] NZHC 1747.

3      R v Rewha [2016] NZHC 2825.

The Commissioner’s application

[6]                 In this proceeding the Commissioner sought civil forfeiture orders against the three respondents. He sought a profit forfeiture order against Mr Brownie Harding in the sum of $9,323,493. This represents the sum the Commissioner believes Mr Harding would have received from the sale of methamphetamine manufactured under his direction. The Commissioner applied for an order that the Taipuha Road property be disposed of under s 83(1) of the Act and the proceeds of sale applied in reduction of the amount owing under the profit forfeiture order. The interested parties, Ms Amy Harding and Mr Te Parekura Elliott, are the registered proprietors of this property.

[7]The Commissioner sought the same order in relation to cash in the sum of

$9,900 found at Ms Rewha’s property.

[8]Finally, the Commissioner sought profit forfeiture orders in the sums of

$61,610 and $58,678 respectively against Mr Joseph Harding and Ms Rewha.

The proposed settlement

Ms Rewha

[9]                 On 16 December 2014 the police searched Ms Rewha’s address at 1 Raumanga Valley Road in Northland when they terminated the operation into Mr Brownie Harding’s activities. At the address they found $9,900 in cash. That sum has been subject to restraining orders obtained by the Commissioner since September 2016.

[10]             The proposed settlement with Ms Rewha involves the sum of $2,000 being paid to Ms Rewha and the balance of the cash being forfeit to the Commissioner. The Commissioner would not seek any further order against Ms Rewha.

Mr Joseph Harding

[11]             Mr Joseph Harding has no known assets. The Commissioner therefore accepts the application for a profit forfeiture order against him must be dismissed.

The interested parties - Amy Leigh Harding and Te Parekura Elliott

[12]             The owners of the property at 178 Taipuha Road are to pay the Commissioner the sum of $21,900 within six months and this is to be forfeited by way of an assets forfeiture order. The restraining order will be discharged once the Official Assignee confirms receipt of this sum.

[13]             In default the Commissioner shall have the right to sell the property and the proceeds of sale shall be used to satisfy the assets forfeiture order. To facilitate this process the existing restraining order will remain in place for a further 12 months but will be varied to enable Ms Harding and Mr Elliott to borrow using the property as security should that be necessary.

[14]             The sum of $21,900 reflects the total cash deposits made into bank accounts that funded mortgage payments relating to the Taipuha Road property between 2012 and 2014. During this period Ms Harding and Mr Elliott were living in Australia and the property was not deriving any rental income. For that reason the Commissioner contends the funds used to make the deposits must have been provided by Mr Brownie Harding and represent the proceeds of his network’s criminal activities. Given their agreement to the proposed settlement Ms Harding and Mr Elliott must be taken to accept this was the case.

Decision

Mr Brownie Harding

[15]             Mr Brownie Harding has not taken any steps to defend the Commissioner’s claim but he has no known assets and will be in prison for the foreseeable future.

[16]             Section 55(1)(b) of the Act only permits the Court to make a profit forfeiture order where the respondent has interests in property. Given the fact that Mr Brownie Harding has no identifiable property the Commissioner accepts the claim against him must be dismissed.

Mr Joseph Harding

[17]               For the same reason the claim against Mr Joseph Harding must also be dismissed.

Ms Rewha

[18]             Ms Rewha defended the application on the basis that she had acquired the cash that was found at her address by legitimate means. She said it represented funds paid to her whilst she was on a benefit in Australia together with the sale proceeds of a vehicle. She also refers to funds derived when she surrendered some bonus bonds. She has not, however, produced any documents to support her claim on these issues. None of these explanations are particularly credible given the fact that she was found in possession of such a large amount of cash.

[19]             I consider the proposed settlement reflects a realistic assessment of the likelihood of Ms Rewha being able to persuade the Court that the cash came from legitimate sources. The amount in question also makes it relatively uneconomic for this aspect of the claim to proceed to trial from the perspective of both parties. I approve the proposed settlement of the claim against Ms Rewha on that basis.

Ms Harding and Mr Elliott

[20]             Ms Harding  and  Mr  Elliott  acquired  the  Taipuha  Road  property  from  Mr Elliott’s father in 2006. Although it is registered in the names of Ms Harding and Mr Elliott, the property is in reality owned by Mr Elliott and his wife Emmarina. Emmarina is Ms Harding’s daughter. The purchase of the property was funded by a loan from a bank secured by registered mortgage.

[21]             As I have already recorded, Ms Harding and Mr Elliott were both residing in Australia during the period when Mr Brownie Harding used the Taipuha Road property as a clandestine laboratory. They had been in Australia for several years by that stage and only returned to New Zealand sporadically. The Commissioner accepts they were not involved in the manufacture or distribution of methamphetamine and that they had no knowledge Mr Brownie Harding had taken possession of their

property for his own purposes. He has never had any legal interest in the property and undoubtedly used it for his own purposes without bothering to consult the owners.

[22]             For these reasons there is no proper basis upon which the Commissioner could contend the property ought to be forfeited or used to meet any profit forfeiture order made against Mr Brownie Harding. The fact remains, however, that cash payments were used to meet the mortgage payments on the property. In the absence of any other credible explanation it is likely that these were funded by Mr Brownie Harding.

[23]I am therefore satisfied the proposed settlement reflects that fact.

Result

[24]             I approve the proposed settlement under s 95 of the Act. I make orders as sought in paragraph 6.1 of the joint memorandum of counsel dated 17 September 2019 and record the further terms of the settlement with Ms Rewha set out in paragraph 6.2 of that memorandum.

[25]             I also make orders as sought in paragraph 6.1 of the joint memorandum dated 26 September 2019 and record the further terms of the settlement with Ms Harding and Mr Elliott set out in paragraph 6.2 of that memorandum.

Lang J

Solicitors:

Crown Solicitor, Auckland Counsel:

M N Pecotic, Barrister, Auckland