Commissioner of Police v James

[2024] NZHC 1036

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-001563

[2024] NZHC 1036

UNDER

Criminal Proceeds (Recovery) Act 2009

BETWEEN

COMMISSIONER OF POLICE

Applicant

AND

ANDRE FRANCIS JAMES

First Respondent

RICARDO REX YOUNG

Second Respondent

Hearing:	On the papers
Counsel:	A Mackenzie and J Lowyim for Applicant J Rhodes for Second Respondent
Judgment:	1 May 2024

JUDGMENT OF ANDREW J

This judgment was delivered by Justice Andrew on 1 May 2024 at 4.00 pm

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

Date ……………………….

COMMISSIONER OF POLICE v JAMES [2024] NZHC 1036 [1 May 2024]

Introduction

[1]    By joint memorandum dated 18 April 2024, the parties seek the Court’s approval of a proposed settlement between the Commissioner and Mr Ricardo Rex Young under s 95 of the Criminal Proceeds (Recovery) Act 2009 (the Act).

[2]    The property subject to the proposed settlement (and currently restrained by orders of this Court) includes the sale proceeds, plus any interest accrued, of motor vehicles and cash. The approximate total value of the property, which the parties agree should be forfeited, is $348,293.35 (excluding interest).

[3]    The Commissioner’s case is that Mr Young unlawfully benefited from significant criminal activity, namely his laundering of money for an organised criminal group involved in the distribution of methamphetamine. Mr Young has pleaded guilty to and was sentenced for various charges, including a representative charge of money laundering and possessing methamphetamine for supply. Mr Young was one of the principal money launderers for the syndicate.

Factual background

[4]    The date range for the representative charge of money laundering, to whichd Mr Young pleaded guilty, was between 11 December 2018 and 7 August 2019. The agreed summary of facts to which he pleaded guilty record the following:

(a)On several occasions during the period of offending, Mr Young would collect large quantities of cash for sending overseas to drug suppliers;

(b)These  quantities,  often  in  suitcases,  ranged  between  $200,000  to

$300,000 for smaller suitcases, while larger ones could take up to

$500,000;

(c)During search warrants executed at Mr Young’s home in May and August 2019, the Police located cash with which Mr Young intended to engage in the money laundering transactions. In May 2019, Police also located approximately 42.5 grams of methamphetamine.

[5]    Mr Young was sentenced to nine months’ home detention.1 In the sentencing notes, Judge Thomas noted that the total amount laundered was “going to be at least half a million dollars’ worth of cash” and that Mr Young “would have known where that cash would have come from”.2

[6]Between the 2012 and 2019 tax years, Mr Young declared a net income of

$32,803.55, the majority of which was derived from Ministry of Social Development benefits.

[7]    Between February and June 2019, Mr Young acquired the restrained motor vehicles, which have a combined value of at least $132,852. He was also found in possession of the restrained cash totalling $278,990.

[8]    The Commissioner considers Mr Young’s possession of this property to be plainly inconsistent with his legitimate declared income.

[9]    The parties have agreed to settle this proceeding on the basis that all of the restrained property is to be forfeited to the Crown as tainted property.

[10]   The parties agree that Mr Young has interests in the restrained property and that it is all tainted property.

The statutory scheme of the 2009 Act

[11]Section 95 of the Act governs settlements and provides:

High 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.

1      R v Young [2023] NZDC 29367.

2      R v Young, above n 1, at [8].

[12]   In enacting s 95, Parliament expressly empowered the Commissioner to enter into settlement discussions with respondents (and interested parties) regarding the forfeiture of assets. In doing so, Parliament no doubt had in mind the significant costs associated with civil litigation, and the benefits to all parties if such proceedings can be resolved by consent.

[13]   Parliament has entrusted the Court with the supervisory jurisdiction, aimed at ensuring that any settlements reached are consistent with its intent in enacting the Act, and with the overall interests of justice.3 The approval of a proposed settlement by the Court is not a rubber-stamping exercise.4

[14]The primary purpose of the Act is contained in s 3(1):

The establishment of a regime for forfeiture of property that has been derived directly or indirectly from significant criminal activity, or that represents the value of a person’s unlawfully derived income.

[15]   The statutory language “overall interests of justice” indicates a broad enquiry is required.

[16]   If the Court is satisfied of the two matters set out in s 95(3), the settlement reached between the parties must be approved (i.e. the purposes of the Act and the overall interests of justice).

Analysis and decision

[17]   For the reasons submitted by the parties, I find that the proposed settlement is consistent with the purposes of the Act and the overall interests of justice:

(a)There will be a saving of time and cost if the matter can be resolved by consent without the need for a hearing;

(b)An agreed settlement will allow the parties to have certainty and control as to outcome;

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

4      Commissioner of Police v Bradley [2012] NZHC 1594, at [9]; Commissioner of New Zealand Police v Veevers (aka Williams) [2017] NZHC 80 at [10].

(c)All the restrained property will be realised for the benefit of the Crown, totalling approximately $348,293.25. That is appropriate given the scale of Mr Young’s laundering activity, and that the Commissioner considers the entirety of the restrained property to be tainted;

(d)The Commissioner has a strong case to show that Mr Young unlawfully benefited from significant criminal activity and that the restrained property is tainted;

(e)As regards a profit forfeiture order, the Commissioner acknowledges the practical difficulties of pursuing a civil debt under ss 55(4) and 83(4) of the Act; and

(f)For his part, Mr Young acknowledges that forfeiture of at least the majority of the restrained property is inevitable.

[18]   I accordingly make an order approving the settlement, pursuant to s 95 of the Act.

Result

[19]I make the following orders, so as to give effect to the settlement:

(a)Type 1 assets forfeiture orders under s 50(1) of the Act: the following property vests in the Crown absolutely and is in the Official Assignee’s custody and control:

(i)$9,121.06 (plus any interest accrued), being the sale proceeds of a 2009 Harley-Davidson Rocker Roadbike motorcycle, registration B4FLT, registered person 3 Base Projects Limited (3 Base);

(ii)$6,387.81 (plus any interest accrued), being the sale proceeds of a 2013 Yamaha  YZF  R1A motorcycle,  registered  person 3 Base;

(iii)$8,294.48 (plus any interest accrued), being the sale proceeds of a 2009 Harley-Davidson Softail motorcycle, registration B2UGQ, registered person Jason Hoeflich;

(iv)$45,500 (plus any interest accrued), being the sale proceeds of a 2014 Porsche Macan Turbo, registration MEU421, registered person 3 Base;

(v)$3,210 cash located at 3 Rabone Street, Henderson on 6 May 2019, plus any interest accrued;

(vi)$165,020 cash located in the boot of a BMW motor vehicle, registration LTU959, on 15 May 2019, plus any interest accrued; and

(vii)$110,760 cash  located  at  231B  Hill  Road,  Manurewa,  on  7 August 2019, plus any interest accrued.

[20]I further record and note the following terms of the agreed settlement:

(a)Mr Young abandons all claims he may have, under the Act or otherwise, to any of the property to be forfeited under this settlement;

(b)The Commissioner will not bring an application for a profit forfeiture order against Mr Young seeking forfeiture of the restrained property on the basis of significant criminal activity evidenced in the affidavits filed by the Commissioner to date; and

(c)The agreement is in full and final settlement of the question of civil forfeiture of the restrained property as between the Commissioner and Mr Young on the basis of the significant criminal activity evidenced in the affidavits filed in this proceeding to date.

Andrew J