Commissioner of Police v Moody

[2015] NZHC 1208

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

CIV-2012-419-309 [2015] NZHC 1208

BETWEEN

THE COMMISSIONER OF POLICE

Applicant

AND

GEORGE EDWARD MOODY Respondent

Hearing:	On the papers
Counsel:	M Robb for Applicant PM Hardie for Respondent
Judgment:	2 June 2015

JUDGMENT OF DUFFY J

This judgment was delivered by me on 2 June 2015 at 4.30 p.m., pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Solicitors:           Almao Douch, Hamilton

Jones Howden, Matamata

POLICE v MOODY [2015] NZHC 1208 [2 June 2015]

[1]      The parties seek this Court’s approval of a settlement proposal on which they

are agreed.

[2]      The background to the agreement is as follows.   On 13 March 2012, the respondent, George Moody, was arrested and charged with cultivating cannabis.  On his arrest, the Commissioner seized a Ducati motorcycle, registration number A9JWM; and a black KTM motorcross motorcycle from Mr Moody.

[3]      On 14 March 2012, the Commissioner made a without notice application to this  Court  seeking a restraining order in  relation  to  a property of Mr  Moody’s situated at Te Rerenga-Kuaotuna Road, Coromandel, Certificate of Title SA72B/868, identifier 501077, South Auckland Land Registry, being 13.8104 hectares, Lot 1

Deposited Plan 422800 (“the Kuaotuna property”).   Then, on 22 March 2012, the Commissioner filed an on notice application seeking a restraining order over the land.

[4]      Later,  on  17 April  2012,  the  Commissioner  filed  an  application  seeking forfeiture of the motorcycles.

[5]      Initially Mr Moody opposed the Commissioner’s applications.  By consent, restraining orders were issued by this Court and subsequently renewed from time to time.

[6]       On 27 October 2012, this Court permitted the sale of the motorcycles on the condition that the proceeds of any such sales would be held by the office of the Official Assignee  pending  determination  of  the  application  for  forfeiture.    The motorcycles were sold and realised the total sum of $17,685.00.

[7]      On 11 August 2014, Mr Moody pleaded guilty to two counts of cultivation of cannabis in the indictment that had been filed in the District Court at Hamilton.  Mr Moody is yet to be sentenced on those counts.

[8]      The  Kuaotuna  property  has  a  registered  valuation,  including  chattels,  of

$610,000.  Since the making of the restraining order, Mr Moody has entered into a

conditional contract for the sale of this property for the sum of $665,000.  The sale is conditional upon the restraining order being discharged to enable the transfer of this property to the purchaser.

[9]      The  Commissioner  and  Mr  Moody have  now  reached  agreement  on  the disposal of the restrained property.  Section 95 of the Criminal Proceeds (Recovery) Act 2009 (“the Act”) requires the High Court to approve the settlement between the Commissioner and another party.  Section 95(3) provides that the High Court must approve the settlement if it is satisfied that it is consistent with:

(a)       The purposes of the Act; and

(b)      The overall interests of justice. [10]     The purpose of the Act is set out in s 3:

3        Purpose

(1)      The primary purpose of this Act is to establish a regime for  the forfeiture of property—

(a)       that has been derived directly or indirectly from significant criminal activity; or

(b)       that represents the value of a person's unlawfully derived income.

(2)      The criminal proceeds and instruments forfeiture regime established under this Act proposes to—

(a)       eliminate the chance for persons to profit from undertaking or being associated with significant criminal activity; and

(b)      deter significant criminal activity; and

(c)       reduce the ability of criminals and persons associated with crime or significant criminal activity to continue or expand criminal enterprise; and

(d)       deal with matters associated with foreign restraining orders and foreign forfeiture orders that arise in New Zealand.

[11]     It follows that my approval of the proposed settlement is conditional on me being satisfied that the settlement proposal is consistent with the purposes of the Act and the overall interests of justice.

[12]     The parties submit that the proposed settlement is desirable and is in the overall  interests  of  justice.    The  Commissioner  contends  that  the  activities  of Mr Moody  render  the  restrained  properties  subject  to  forfeiture  in  the  sum  of

$50,000 under s 142N of the Sentencing Act 2002 and, secondly, that Mr Moody has unlawfully  benefitted  from  significant  criminal  activity  to  an  agreed  sum  of

$150,000.  Thus, proceeds of the sale of the motorcycles and the Kuaotuna property should be applied to satisfy a profit forfeiture order made pursuant to s 55 of the Act.

[13]     Mr Moody acknowledges the strength of the Commissioner’s position but asserts that the level of his culpability and other factors to be taken into account under the legislation mean that a ceiling of $200,000 should be placed upon the total extent of forfeiture as any higher amount would not be consistent with the intent of the legislation.

[14]     The Commissioner accepts that in Mr Moody’s case the object of the Act does not require complete forfeiture, and that the settlement proposal is appropriate, taking into account the objects of the Act, the length of time this matter has been proceeding, and the cost of any further proceedings.

[15]     The parties propose a settlement which recognises that a portion of the value of the restrained property should be subject to  an “instrument forfeiture order”, pursuant to the provisions of the Sentencing Act, and that a further portion of the value of this property should be applied to satisfy a profit forfeiture order, given Mr Moody’s acknowledgement that he has unlawfully benefitted from significant criminal activity.

[16]     The proposed settlement is:

(a)      The sum of $17,685, currently held by the Official Assignee following the sale of the motorcycles, is forfeited to the Crown pursuant to the provisions of s 50 of the Act.

(b)The restraining orders over the Kuaotuna property be discharged immediately upon approval of the settlement and an order to that effect be issued by the Court.1

(c)      The Kuaotuna property may then be sold in accordance with the terms and conditions of the agreement for sale and purchase currently in force and, from the proceeds of that sale, the sum of $132,315 is forfeited to the Crown pursuant to s 58 of the Act.  That sum will be paid by Mr Moody’s solicitors to the Crown within seven days of the settlement of the conveyance of the property.  Mr Moody’s solicitors have provided the Commissioner with an undertaking in writing agreeing to such payment.

(d)The parties agree that in respect of an application for instrument forfeiture, pursuant to the provisions of the Sentencing Act, the sentencing court will be invited to find, pursuant to s 142N of the Sentencing Act,  that  the  property  is  an  instrument  of  crime,  and specify that part of the property to the value of $50,000 is to be forfeited to the Crown.

(e)      To  facilitate  the  payment  of  an  order  for  instrument  forfeiture, Mr Moody’s solicitors have undertaken in writing to retain the sum of

$50,000  from  the  settlement  proceeds  for  the  purposes  of  an immediate settlement of such an order.

(f)      If  at  sentencing  in  the  District  Court  the  sum  specified  for  the purposes of any order for instrument forfeiture is less than $50,000, then the sum of $132,315 is to be increased by the amount of the reduction in the District Court below $50,000 and, further, if the sum so specified exceeds $50,000 in the sum, then the sum of $132,315 is

to be reduced by the amount in excess of $50,000.

1      A draft order for the discharging of the restraining orders is attached to the parties’ joint

memorandum.

[17]     The effect of the settlement is that the Commissioner and Mr Moody agree that the return to him from his significant criminal activity, through his use of private assets to facilitate that significant criminal activity, should be assessed as totalling

$200,000.  The parties assert there are no known circumstances that would suggest that figure is inappropriate.  Of the sum of $200,000, $150,000 is forfeited as tainted property pursuant to the civil forfeiture regime created by the Act and $50,000 is forfeited as an instrument forfeiture pursuant to the regime created by the Sentencing Act.  As a consequence of the latter, Mr Moody will be able to seek a deduction in the sentence imposed him in the District Court for his cannabis offending pursuant to s 10B of the Sentencing Act.  The parties contend that the settlement avoids the need for the examination in future proceedings in the High Court of the financial affairs of Mr Moody and the relationship between his asset base and criminal offending and thus avoids the need to examine in the District Court the issues surrounding instrument forfeiture of assets on the basis of the Sentencing Act 2002.

[18]     Having read and considered the joint memorandum of counsel for each party and the attached material, I am satisfied that in all the circumstances the settlement is consistent with the purposes of the Act and the overall interests of justice.  In those circumstances, I am required to approve the settlement and thereby I do so.

[19]     I make the orders in terms of the draft order discharging restraining orders attached to the joint memorandum.

[20]     Leave is reserved to the parties to apply for further orders, variations or amendments to the orders made herein, for the purpose of better giving effect to the

settlement should the need to do so arise.

Duffy J