Commissioner of Police v Nicol

[2021] NZHC 1330

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2016-485-490

[2021] NZHC 1330

IN THE MATTER OF

an application under s 50 and 59(1)(b) of the Criminal Proceeds (Recovery) Act 2009

BETWEEN

THE COMMISSIONER OF POLICE

Applicant

AND

GRANT GENE JOSEPH NICOL

Respondent

Hearing:	8 June 2021
Appearances:	A W M Britton for Applicant No appearance for Respondent
Judgment:	8 June 2021

JUDGMENT OF ELLIS J

[1]Two matters came before me for determination today:

(a)an application for an assets forfeiture order relating to property presently restrained under the Criminal Proceeds (Recovery) Act 2009 (the Act), namely $18,270.31 in cash found at 6 Tuki Street, Titahi Bay on 24 April 2015; and

(b)an application under s 59(1)(b) of the Act for an order ancillary to that order and to the asset forfeiture orders made by Clark J on 4 September 2020.

COMMISSIONER OF POLICE v NICOL [2021] NZHC 1330 [8 June 2021]

Asset forfeiture order

[2]                 As just noted, Clark J has already made assets forfeiture orders relating to other sums of cash found in Mr Nicol’s possession on other occasions.1 For reasons that do not need to be detailed here, the present application relating to the $18,270.31 found at Tuki Street remained outstanding.

[3]                 Although the respondent filed a notice of opposition to the application, he has taken no subsequent steps and has filed no evidence despite directions from the Court. On 15 March 2021, Isac J gave him a further 20 working days to do so, and directed that if no evidence was filed Mr Nicol could take no further steps in the proceedings without leave.

[4]                 No evidence has been filed and there was no appearance for Mr Nicol today. The civil forfeiture application therefore proceeded by way of formal proof.

Facts

[5]                 The following relevant facts are established by the evidence filed by the Commissioner.

[6]                 On 24 April 2015 Police went to 6 Tuki Street in relation to an arrest warrant for Mr Nicol’s son. While there, they found cannabis, firearms, drug paraphernalia and a safe containing $29,890 in cash in Mr Nicol’s bedroom. After the $29,890 was seized by Police, $9,619.69 was deducted by the Commissioner of Inland Revenue for child support payments, leaving $18,270.31 restrained.

[7]                 In November 2015, the Police stopped a Subaru vehicle on Kenepuru Drive, Porirua. Mr Nicol was the front-seat passenger.2 The vehicle was searched consequent to Mr Nicol’s arrest and, in addition to a glass pipe used for methamphetamine, $5,680 in cash was found in a belt bag in the front passenger foot well. A search of a property

1      A previous order having been made on 4 September 2020: Commissioner of Police v Nicol [2020] NZHC 2302.

2      He was later arrested for supplying and offering to supply methamphetamine.

where Mr Nicol had been staying located a further $8,030 in cash, which was also seized and restrained.

[8]                 In March 2016, Mr Nicol’s house was searched. In addition to methamphetamine, digital scales and a handgun, $9,400 in cash was found in a wallet under a couch and $50,000 in cash in a bag inside a vehicle. A total of $59,400 was seized from this property.

[9]On 2 April 2019, Mr Nicol was convicted of the following charges:3

(a)three charges of offering to supply methamphetamine;

(b)one charge of supplying methamphetamine; and

(c)two charges of possession of utensils for methamphetamine.

[10]              The charges of offering to supply, and supplying methamphetamine constitute “significant criminal activity” for the purposes of the Act.4

[11]              As mentioned earlier, on 4 September 2020, Clark J made asset forfeiture orders in relation to the cash referred to in [7] and [8] above.

Discussion

[12]              Under s 50 of the Act, the Court “must” make an asset forfeiture order in respect of specific property if satisfied on the balance of probabilities that the property is “tainted property”.

[13]              I am satisfied the restrained sum of $18,270.31 was acquired as a result of significant criminal activity and is therefore tainted property within the meaning of the Act. Not only has Mr Nicol been convicted of relevant offences but between 2012 and 2017 he was in receipt of benefits and had no other legitimate sources of income. At an earlier point in these proceedings he deposed that after paying his bills he was

3      Mr Nicol was sentenced to come up for sentence if called upon (12 months).

4      Criminal Proceeds (Recovery) Act 2009, s 50; s 5 definition of “tainted property” and “significant criminal activity”.

left with $80 per week. At the time of the seizures of the restrained cash his bank account was either in arrears or contained only a nominal amount.

[14]              As Mr Nicol was not in a position to accumulate cash assets of $101,000 (which total includes the amount taken by Inland Revenue), the only tenable inference is that the cash was derived from his significant criminal activity, namely the sale of methamphetamine.5

Result

[15] The Commissioner’s application for an assets forfeiture order in relation to the property described at [1](a) above is granted.

Application under s 59(1)(b)

[16]              The forfeiture orders made by Clark J on 4 September 2020 (forfeiting cash totalling $73,110, as sought by the Commissioner) were sealed the same day and served on the parties and the Official Assignee, who has custody of the restrained funds.

[17]              In seeking forfeiture of that amount, the Commissioner had, however, forgotten that $19,837.50 of those funds had, further to an order made by Simon France J on 23 June 2017, already been released by the Official Assignee to meet Mr Nicol’s outstanding legal costs. That meant that the funds restrained were insufficient to realise the forfeiture orders and, so, the Official Assignee was unable to discharge them.

[18]              On 9 February 2021, Clark J declined to use the slip rule (r 11.10) to rectify the matter on the grounds that there was no error in her judgment (the error being in the underlying application). And because her judgment had been sealed, recall under r 11.11 was not an available option either.

5      If large cash sums cannot be adequately explained “this will tend to support an inference that the relevant cash has been sourced from illegitimate or criminal activity”: Commissioner of Police v De Wys [2016] NZCA 634.

[19]              The Commissioner then filed an application under s 59(1)(b) of the Act, seeking a further order in the following terms:

The Official Assignee (including a person delegated his or her functions and powers under the Criminal Proceeds (Recovery) Act 2009, in discharging the estate numbers 884461 pursuant to the assets forfeiture orders determined by the  Court  in  the  proceedings  numbered  CIV-2016-485-490  sealed  on    4 September 2020 and [X date 20216], shall not take into account funds in the amount of $19,837.50 that were released from restraint to Elizabeth Hall pursuant to the determination of the Honourable Simon France J on 23 June 2017.

[20]              On 15 March 2021 the matter was called in the Judge’s Chambers List before Isac J. He expressed some reservations about the availability of s 59 in the circumstances of this case but permitted the Commissioner to make further submissions on the issue at the formal proof hearing relating to the outstanding forfeiture application. It was on the basis that I heard further from Mr Britton today.

[21]Section 59 relevantly provides:

(1)       In making a civil forfeiture order, the High Court may do either or both of the following:

…

(b)give any direction that may be necessary and convenient for giving effect to the civil forfeiture order.

[22]              Isac J’s principal concern was that the order sought would have the effect of materially altering the forfeiture order made by Clark J, which he considered would be beyond the scope of s 59. I tend to agree with him; if that is what the order did, there might be a difficulty.

[23]              But the terms of the order sought do not, I think, have that effect. Rather, they are expressed in a genuinely ancillary way, as a direction to the Official Assignee. They would leave Clark J’s orders intact. So I agree with Mr Britton that the order is one that falls within s 59(1)(b) in that it is “necessary and convenient for giving effect to” both her order and the one I am making today. And the need for it is quite plain, for the reasons I have set out.

6      Being the date the forfeiture order made in this judgment is sealed.

Result

[24]I therefore make an order under s 59 in the terms set out above.

Rebecca Ellis J

Solicitors:

Crown Solicitor, Wellington for Applicant