Commissioner of Police v Hunt

[2023] NZHC 1773

IN THE HIGH COURT OF NEW ZEALAND NEW PLYMOUTH REGISTRY

I TE KŌTI MATUA O AOTEAROA NGĀMOTU ROHE

CIV-2017-443-62

[2023] NZHC 1773

UNDER

the Criminal Proceeds (Recovery) Act 2009

BETWEEN

THE COMMISSIONER OF POLICE

Applicant

AND

DION JAMES HUNT

First Respondent

ADA SHARON PUE
Second Respondent

AND

ANZ BANK NEW ZEALAND LIMITED

First Interested Party

LEROY JAMES HUNT, TARA LEE HUNT and CARRINGTON & YOUNG

TRUSTEES LIMITED as trustees of the HUNT FAMILY TRUST

Second, Third and Fourth Interested Parties

ANA DIONNE PUE
Fifth Interested Party

DAVID CHARLES ROSS HUNT

Sixth Interested Party

On the Papers

Counsel:

C E Clarke for the Applicant

R Weir for the First Respondent
S Abdale for the Second Respondent

Judgment:

7 July 2023

JUDGMENT GWYN J

(Approving settlement of proceeding)

THE COMMISSIONER OF POLICE v HUNT [2023] NZHC 1773 [7 July 2023]

Introduction

[1]    By joint memorandum filed on 3 July 2023, the Commissioner of Police and Dion Hunt and Ada Pue, the first and second respondents, seek an order pursuant to  s 95 of the Criminal Proceeds (Recovery) Act 2009 (Act) approving the proposed settlement of the Commissioner’s claim against Mr Hunt and Ms Pue.

Background

[2]    The proceeding has its genesis in an investigation known as Operation Homes, targeting the manufacture, sale and supply of the Class A controlled drug methamphetamine. The operation was primarily focussed on the first and second respondents, as well as the second respondent’s son, Tony Pue, and Mr Pue’s associate Mawena Bidois.

[3]    The operation terminated on 27 July 2017 when search warrants were executed at a number of properties, including a lifestyle and property at 134 Foreman Road, Waitara (First Foreman property) and a dwelling and pastoral property at 180 Foreman Road, Waitara (Second Foreman property).

[4]    On 21 September 2017 an application without notice for a restraining order was granted by this Court in respect of the First Foreman property, the Second Foreman property, and other properties.1

[5]    On 1 June 2022 the first and second respondents were convicted after a jury trial in the New Plymouth District Court on one charge of supplying Tony Pue with methamphetamine on 6 July 2017 and one charge of possession of methamphetamine for supply relating to the search warrant executed at one of the properties on 27 July 2017. The respondents were discharged under s 147 of the Criminal Procedure Act 2011 in respect of a third charge where the Crown offered no evidence.

1      Commissioner of Police v Hunt HC New Plymouth, CIV-2017-443-62, 21 September 2017. The restraining order describes the First Foreman property as being at 180 Foreman Road, Waitara, but a subsequent judgment of Clark J records that the parties accepted that address was incorrect and should be 134 Foreman Road, Waitara: Commissioner of Police v Hunt [2020] NZHC 1692, at [5].

[6]    On 22 July 2022 the first  and  second  respondents  were  sentenced  by Judge Greig to imprisonment of five years and five months.

[7]    The first and second respondents have appealed against conviction and sentence. The appeals were set down to be heard on 29 March 2023 but were adjourned for the first respondent to obtain a psychological report.

The proposed settlement

[8]    The parties have been in settlement discussions. The first respondent asked the applicant to consider whether the settlement sum could be sourced through a loan to the first respondent from Clive Jury, with Mr Jury securing the loan by way of a mortgage over the title of one of the Foreman properties.

[9]    The Official Assignee has advised the Commissioner that the most appropriate course to adopt is by a variation of the existing Without Notice Restraining Order dated 21 September 2017 (Restraining Order) that was subject to the On Notice Restraining Order application dated 27 September 2017.

[10]   The variation to the Restraining Order would allow the first respondent to use one of the Foreman properties as security for a loan from Mr Jury (if such security is required by Mr Jury) and order the Official Assignee to consent to one of the Foreman properties being used as security.

[11]   The variation to the Restraining Order would also order the Official Assignee to remove the Restraining Order from the title of the Foreman properties on receipt of the Settlement Sum from Mr Jury, transferred to the Official Assignee’s Trust Account in cleared funds.

[12]   The Commissioner and Mr Hunt and Ms Pue therefore propose the following settlement terms (Settlement Proposal):

(a)The first and second respondents are to pay the sum of $200,000 (Settlement Sum).

(b)The Settlement Sum is to be sourced through a loan to the first respondent from Clive Jury, with Mr Jury securing the loan by way of a mortgage or other such charge over the title of one of the Foreman properties.

(c)The Settlement Sum will be held by the Official Assignee as restrained funds.

(4)Upon notice from the Official Assignee that the Settlement Sum has been received by the Official Assignee as cleared funds and is being held as restrained funds the applicant will file an Application for Profit Forfeiture Order for the Settlement Sum so the funds are forfeited. The respondents consent to that forfeiture.

(5)If the Settlement Sum is not transferred to the Official Assignee on or before 5.00 pm on 14 July 2023 the Foreman Road properties are to remain under restraint and the Restraining Order is to remain registered on the titles of the Foreman properties.

(6)Costs lie where they fall as between the Commissioner, respondents and interested parties.

(7)The settlement is in full and final settlement of all matters in this proceeding as between the applicant, respondents and interested parties.

[13]   On 14 April 2023 counsel for the first respondent confirmed that the first and second respondents and Mr Jury wish to proceed in the manner proposed by the Official Assignee.

[14]The interested parties consent to the settlement proposal.

[15]   Counsel for the Commissioner confirms that the Settlement Proposal is consistent with the purposes of the Act, taking account of the particular facts of this case, in that:

(a)property derived from significant criminal activity will be forfeited. Evidence filed on behalf of the Commissioner estimates that the first and second respondents have unlawfully benefited from significant criminal activity in an amount of at least $264,000;

(2) the profit gained by Mr Hunt and Ms Pue from criminal activity is diminished; and

(b)such forfeiture potentially deters future significant criminal activity.

[16]   Overall, counsel submitted that the approval of the Settlement Proposal settlement is in the interests of justice since it avoids delay and potential litigation risk.

Legal principles

[17]Section 95 of the Act provides:

95High Court must approve settlement between Commissioner and other party

(1)The Commissioner may enter into a settlement with any person as to the property or any sum of money to be forfeited to the Crown.

(2)A settlement does not bind the parties unless the High Court approves it.

(3)The High Court must approve the settlement if it is satisfied that it is consistent with—

(a)the purposes of this Act; and

(b)the overall interests of justice.

[18]   Pursuant to s 3, the purpose of the Act is to establish a regime for the forfeiture of property derived directly or indirectly from significant criminal activity or which represents the value of a person’s unlawfully derived income.2 A further purpose of the regime is to eliminate the opportunity for persons to profit from undertaking or being associated with significant criminal activity and to deter significant criminal activity.3

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

3      Section 3(2)(a)–(b).

[19]   It is well settled that the Court’s approval is not a “rubber stamping” exercise.4 The Court’s supervisory jurisdiction and function under s 95 requires a broad inquiry.5 An assessment of s 95(3)(a) and (b) compliance will require the Court to consider the strength of both the Commissioner’s case and the respondent’s defence.6 In addition, the value of assets to be forfeited and the relativity of such sum to the total value of assets restrained as tainted property are relevant considerations.7 Further, there is also the litigation risk of a hearing to the Commissioner and the respondent.8 Finally, the Court may consider such other matters, including economic and pragmatic grounds, as inform a sensible compromise to litigation that serves the Act’s purposes.9 There is a strong public interest in such litigation being resolved promptly, especially where a settlement reflects the likely costs and risks inherent in adjudicating a contested application.10

Discussion

[20]   I note that the first and second respondents do not accept the applicant’s summary of evidence as set out in counsel’s joint memorandum. They dispute their guilt and, as noted above have appealed their conviction and sentence to the Court of Appeal. However, the respondents acknowledge that if the Settlement Proposal is not approved, the Commissioner will present evidence consistent with the summary in the joint memorandum at a forfeiture hearing. Each of the respondents is represented by counsel, who have signed the joint memorandum on their behalf.

[21]   I am satisfied that the proposed terms of settlement are consistent with the objectives and principles of the Act and are in the interests of justice. The finality of the settlement on these terms and the certainty it brings to the parties will avoid further costs, delay and litigation risk. I also accept that this proposal is a sensible and pragmatic basis on which to settle proceedings.

4      The Commissioner of Police v Know-All Group Ltd HC Auckland CIV-2010-404-403, 7 November 2011 at [11].

5      Commissioner of Police v Zhang [2016] NZHC 930 at [8].

6      The Commissioner of Police v Kree [2013] NZHC 2972 at [11].

7      Commissioner of Police v Venn [2014] NZHC 361 at [5]–[6].

8      Kree, above n 5, at [11].

9      The Commissioner of Police v Douglas [2015] NZHC 1293 at [6].

10     Commissioner of Police v Cotton [2017] NZHC 0021 at [7].

Decision

[22]   The Settlement Proposal is approved, pursuant to s 95 of the Criminal Proceeds (Recovery) Act 2009.

[23]   The Commissioner has indicated that, in accordance with the Settlement Proposal, the application for variation of the existing Without Notice Restraining Order dated 21 September 2017 (Restraining Order) that was subject to the On Notice Restraining Order application dated 27 September 2017, will now be made.

Gwyn J

Solicitors:

Crown Solicitor, New Plymouth Beattie Rickman Legal, Hamilton

Legal Solutions and Carrington Ussher, New Plymouth