Commissioner of Police v Jin
[2015] NZHC 3088
•7 December 2015
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2015-404-002723 [2015] NZHC 3088
UNDER the Criminal Proceeds (Recovery) Act
2009
BETWEEN
COMMISSIONER OF POLICE Applicant
AND
WEIKUN JIN First Respondent
HAO YANG Second Respondent
NAN QI
Third RespondentXIAO-ZHANG CHEN Fourth Respondent
Hearing: 30 November 2015 Counsel:
G E Hughes for the Applicant
No Appearance of, or for the RespondentsJudgment:
7 December 2015
JUDGMENT OF EDWARDS J
This judgment was delivered by Justice Edwards on 7 December 2015 at 4.00 pm, pursuant to
r 11.5 of the High Court Rules
Registrar/Deputy Registrar
Date:
Solicitors: Meredith Connell, Auckland
COMMISSIONER OF POLICE v JIN [2015] NZHC 3088 [7 December 2015]
[1] The Commissioner of Police seeks orders:
(a) dispensing with service of an application for restraint and forfeiture of property; and
(b) restraining cash in the sum of $165,694.45 pursuant to s 24 Criminal
Proceeds (Recovery) Act 2009 (Act).1
Background
[2] The substantive application for restraining and civil forfeiture orders relates to cash seized in 2004 in the course of investigations relating to the possession and supply of packets of Telfast tablets. In 2004 these tablets were a pharmacy medicine containing pseudoephedrine, an ingredient used in the manufacture of the class A drug methamphetamine.
[3] Both Mr Jin and Mr Yang were charged with conspiracy to supply a precursor substance, possession of precursor substances, and possession for supply of a class C controlled drug. They were both granted bail but failed to appear in Court on the allocated dates in 2004 and 2005. They have not been located since and warrants are outstanding for their arrest.
[4] Mr Qi pleaded guilty and was convicted of possession of a precursor substance on 31 January 2006.
[5] Dr Chen was charged with offences relating to the supply of a class B substance to Mr Yang and Mr Jin. He was acquitted on all charges following a trial on 2 February 2006.
[6] The seized funds have been held in a police trust account pending the
determination of the Commissioner’s applications.
1 The affidavit of Constable Davenport refers to the sum of $165,536.25. However, the sums of cash seized and itemised in his affidavit, and in the application, total $165,694.45.
[7] The Court has the power to dispense with service pursuant to reg 12 of the Criminal Proceeds (Recovery) Regulations 2009, and r 6.8(c) of the High Court Rules. The Court must be satisfied that reasonable efforts have been made to effect service by any of the modes permitted by the rules of Court.
[8] Constable Davenport deposes to the last known addresses of each of the respondents. It is believed that Mr Jin and Mr Yang are either in New Zealand unlawfully, or they have both left New Zealand. Mr Qi was deported from New Zealand on 18 February 2015 and returned to China. Immigration records indicate that Dr Chen departed Wellington for Sydney on 30 August 2006 and it is believed that he has not returned to New Zealand since.
[9] Constable Davenport deposes to the efforts made to locate Messrs Yang and Jin, including visiting their last known addresses, investigating the possible registration of vehicles in their names, and making enquiries with tertiary bodies where they may have been enrolled as students. Possible cellphone and email address contacts for both Mr Jin and Mr Yang were obtained from Immigration New Zealand, but attempts to contact both men using those contact details have been unsuccessful. Further enquiries have been made in an effort to locate the parents of both men and to ascertain their whereabouts through possible bank account records.
[10] Efforts made to find an address for Mr Qi in China have gone unrewarded.
[11] Investigations in relation to Dr Chen’s next of kin have established that he is most likely residing in Australia. It appears funds have been wired from Dr Chen to his next of kin but this possible avenue of enquiry has not yet yielded an address for Dr Chen.
[12] I am persuaded that all reasonable efforts have been made to locate the respondents. I therefore intend to make orders dispensing with service of the application as sought by the applicant.
[13] On the basis that the application dispensing with service is granted, the Commissioner seeks restraining orders to be made in terms of paragraphs 1(b)(i)(A) to (B) of the application dated 13 November 2015.
[14] Section 50(4) requires a restraining order to be in place over the property for one year before an assets forfeiture order may be made on the basis that no interest is claimed. Section 50(4) of the Act provides:
50 Making assets forfeiture order
…
(4) Despite subsection (1), the Court may not make an assets forfeiture order in relation to property that no person has claimed an interest in, unless the Court is satisfied, on the balance of probabilities, of the following additional matters:
(a) that a restraining order was earlier made in relation to the same property; and
(b) that the restraining order has been in place for a period of at least 1 year; and
(c) that the Commissioner has contacted or made all reasonable efforts to contact any person the Commissioner believes may have an interest in the property.
…
[15] In Commissioner of Police v Afakasi, Brewer J said:2
[12] On a plain reading of the section, I do not see any ambiguity. The section is designed, as the applicant submits correctly, to give potential claimants an opportunity to express an interest in the property before any asset forfeiture order is made. That does not mean or imply that the section is invoked only where there is no identifiable owner of the property. There is nothing in Hansard, nor in the report by the Law and Order Select Committee, to suggest that interpretation was intended.
(footnote omitted)
[16] The Commissioner accordingly seeks an order restraining the property so that, after a year, if no interest has been claimed, a forfeiture order may be made.
2 Commissioner of Police v Afakasi [2013] NZHC 3054.
[13] There seem to be two obvious reasons why a restraining order might be applied for and made:
(a) to protect property from potential dissipation pending the making of an either an assets forfeiture order or an instrument forfeiture order; or
(b) to safeguard the potential interests of third parties in the property concerned.
[14] Support for the latter point can be derived from s 50(4) of the Act which provides that the Commissioner may only apply for an assets forfeiture order in relation to property in which no one has claimed an interest, if there has first been a restraining order in relation to that property in place for one year. Thus one purpose of a restraining order is to ensure that there is sufficient time provided within which a third party may be made aware that his property is in jeopardy and to take appropriate steps before a final forfeiture order is made.
[18] Making a restraining order in this case would allow further time for a third party to claim an interest to the funds before a final forfeiture order is made. I am satisfied that making the restraining order in these circumstances is consistent with one of the underlying legislative purpose of such orders.
[19] The application is made under s 24 of the Act. That section allows a court to make a restraining order if satisfied that there are reasonable grounds to believe that any property is tainted property. Tainted property is property which has been acquired as a result of, or directly or indirectly derived from “significant criminal activity”.4
[20] Constable Davenport deposes to the circumstances in which the funds to be restrained were originally seized.
[21] The bulk of the funds (NZ$157,020 and US$2,400) were located in a locked black suitcase on premises rented to Mr Jin. Nine cartons of Telfast tablets and approximately 60 grams of the class C controlled drug, cannabis, were found on the
premises at the same time.
3 Commissioner of Police v Briggs [2012] NZHC 2324 at [13] and [14].
4 Criminal Proceeds (Recovery) Act 2009, s 5 (1).
[22] Both Mr Yang and Mr Jin were observed entering the premises where the tablets, drugs and the cash were found. Further sums of cash were located on both Mr Yang ($2,250) and Mr Jin ($805) during a search of them at that time.
[23] Constable Davenport also deposes to evidence of Dr Chen purchasing Telfast tablets in bulk from Anspec NZ Ltd. The tablets were originally sourced from Healthcare Logistics. Dr Chen was seen uplifting 2,000 packets of Telfast tablets on
30 August 2004 and driving to a meeting with Mr Yang. He subsequently left that meeting on foot. Mr Yang took the car containing the tablets and picked up Mr Jin. Both men, assisted by Mr Qi, transferred the tablets to premises where members of the Auckland police drug squad executed a search warrant.
[24] When approached by police at this time, Mr Yang, Mr Jin and Mr Qi all left the address by jumping out a bedroom window. They were subsequently apprehended. Mr Jin was found to be in possession of $746.66, which was seized by police. The same Telfast tablets that Dr Chen had uplifted earlier in the evening were located in a bedroom on the premises.
[25] In video-recorded evidence with Dr Chen, he is alleged to have stated that he had purchased Telfast tablets on a number of occasions, that Mr Yang had approached him on behalf of a Chinese medicine company to re-export them back overseas, and that he had been given $50,000 cash by Mr Yang to purchase the tablets as a fee. Dr Chen stated that he had been paid approximately $250,000 in fees in total as a result of this activity.
[26] Later enquiries established that Dr Chen had paid $24,000 cash for the tablets. That money was seized by consent. Following Dr Chen’s acquittal, $22,455 of this sum was repaid to Healthcare Logistics (the original supplier of the tablets), with a residual amount ($1,545) identified as not being their property retained by police.
[27] I am satisfied that this evidence establishes reasonable grounds to believe that the cash, the subject of the application for the restraining order, was obtained as a
result of the supply of precursor substances. There are reasonable grounds to believe
therefore that the cash is “tainted property” within the meaning of s 24 of the Act.
Result
[28] I make the following orders:
(a) Dispensing with service on the respondents of the following documents:
(i)The on notice application for restraining and civil forfeiture orders dated 13 November 2015; and
(ii) The affidavit of Nicholas Perry Davenport sworn
11 November 2015.
(b)The following property is not to be disposed of or dealt with other than as provided for in these orders and is to be under the Official Assignee’s custody and control:
(i) NZ$157,020 cash seized from Apartment 4H,
32 Eden Crescent, Auckland (Apartment 4H) on 8 June 2004;
(ii) US$2,400 cash (since converted to NZ$3,327.79) seized from
Apartment 4H on 8 June 2004;
(iii) NZ$805 seized from the first respondent (Mr Jin) on 9 June
2004 following his arrest;
(iv) NZ$2,250 seized from the second respondent (Mr Yang) on
9 June 2004 following his arrest;
(v)NZ$746.66 seized from Mr Jin on 30 August 2004 following his arrest; and
(vi) NZ$1,545 being the balance of NZ$24,000 seized from
Anspec New Zealand Ltd on 30 August 2004, less NZ$22,455 returned to Healthcare Logistics on 16 October 2006;
Edwards J
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