Commissioner of Police v Noble
[2025] NZHC 967
•24 April 2025
IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY
I TE KŌTI MATUA O AOTEAROA TAURANGA MOANA ROHE
CIV-2018-470-58
[2025] NZHC 967
UNDER the Criminal Proceeds (Recovery) Act 2009 BETWEEN
COMMISSIONER OF POLICE
Applicant
AND
HIRA CYRIL NOBLE
First Respondent
LUANA MAREE NOBLE
Second RespondentTOM HIRA HENARE NOBLE
Third RespondentFIRST CREDIT UNION
Interested PartyGOLD BAND FINANCE LIMITED
Interested PartySLP EVENT MANAGEMENT
Interested Party
Hearing: 26 March 2025 (Further submissions received on 28 March, 3, 4
and 10 April 2025)
Appearances:
R W Jenson and L Clay for Applicant First Respondent in person
W T Nabney for Second Respondent
Judgment:
24 April 2025
JUDGMENT OF LANG J
[on applications for profit and Type 1 assets forfeiture orders]
This judgment was delivered by me on 24 April 2025 at 2.30 pm, pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date……………
COMMISSIONER OF POLICE v NOBLE [2025] NZHC 967 [24 April 2025]
[1] In this proceeding, the Commissioner of Police (the Commissioner) seeks profit and Type 1 assets forfeiture orders against the respondents, Mr and Mrs Noble, under the Criminal Proceeds (Recovery) Act 2009 (the Act).
Background
[2] In 2017, the police undertook an investigation into the manufacture and distribution of non-approved psychoactive products, also known as synthetic cannabis, and money laundering in the Bay of Plenty region. The investigation was undertaken by the Waikato/Bay of Plenty branch of the Asset Recovery Unit (ARU).
[3] The investigation revealed that the first respondent, Mr Hira Noble, was overseeing a large operation that involved the treatment of plant material known as damiana. Mr Noble arranged for this to be sprayed with a non-approved psychoactive substance. Mr Noble also supplied the finished product to others, who sold it to consumers as synthetic cannabis.
[4] The second respondent, Ms Luana Noble, is Mr Noble’s wife. During the period covered by the investigation, she was running a business known as D.Lish Ltd. This operated a hangi shop. The investigation discovered that a significant amount of cash generated from the sale of synthetic cannabis was laundered through the bank accounts of the D.Lish hangi business. Cash from the sale of synthetic cannabis was also laundered through a Credit Union mortgage account and personal bank accounts operated by Mr and Ms Noble.
[5] Mr and Ms Noble were subsequently prosecuted. Mr Noble pleaded guilty to charges of possessing and selling synthetic cannabis, whilst Ms Noble pleaded guilty to a charge of money laundering. Mr Noble received a sentence of imprisonment, and Ms Noble one of home detention.
[6] The Commissioner contends that Mr and Ms Noble unlawfully benefited from significant criminal activity which produced at least $1,251,210.96.
[7] The Commissioner seeks Type 1 assets forfeiture orders (formerly known as assets forfeiture orders) in relation to assets owned by Mr and Ms Noble. These
comprise the sale proceeds of a Hummer motor vehicle, an Ultima motorcycle and a Seadoo jet ski and trailer. Those items were seized at the end of the police investigation and were subsequently sold. The Official Assignee holds the proceeds of sale in their trust account.
[8] The Commissioner also seeks a Type 1 assets forfeiture order in respect of a property situated at 59 Bongard Street, Tauranga. Mr and Ms Noble have owned this property as tenants-in-common in equal shares since 2004. It is their family home.
[9] Finally, the Commissioner seeks a profit forfeiture order representing the amount of the unlawful benefit Mr and Ms Noble derived from their offending, less the value of the items forfeited to the Crown under the Type 1 assets forfeiture orders.
[10] Ms Noble does not oppose a profit forfeiture order being made against her. Nor does she oppose an assets forfeiture order being made in relation to the funds held by the Official Assignee and the interest held by her husband in the Bongard Street property. However, she contends the Court should exclude her interest in the Bongard Street property from any order it may make.
[11] Mr Noble did not file a notice of opposition to the Commissioner’s application. However, after successfully seeking several adjournments, he appeared in person at the hearing on 26 March 2025 to oppose the making of any profit or assets forfeiture orders. He also subsequently filed written submissions opposing the application. This was accompanied by a brief of evidence from Ms Sian Heppleston, an accountant whom he had engaged for the criminal proceedings in the District Court.
The law
[12]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.
[13] Section 6 of the Act relevantly defines “significant criminal activity” as follows:
6 Meaning of significant criminal activity
(1)In this Act, unless the context otherwise requires, significant criminal activity means an activity engaged in by a person that if proceeded against as a criminal offence would amount to offending—
(a)that consists of, or includes, 1 or more offences punishable by a maximum term of imprisonment of 5 years or more; or
(b)from which property, proceeds, or benefits of a value of the threshold amount or more have, directly or indirectly, been acquired or derived.
…
[14] The power to make a Type 1 assets forfeiture order is contained s 50 of the Act, which relevantly provides:
50 Making type 1 assets forfeiture order
(1)If, on an application for a type 1 assets forfeiture order, the High Court is satisfied on the balance of probabilities that specific property is tainted property, the Court must make a type 1 assets forfeiture order in respect of that specific property.
(2)Subsection (1) is subject to section 51.
(2A) The specific property is presumed to be tainted property if the Commissioner shows, on the balance of probabilities, that the respondent was served with a disclosure of source order in relation to that property and that the respondent—
(a)failed to comply with the order; or
(b)in purported compliance with the order, made a statement that is false or misleading in a material particular.
(2B)The presumption may be rebutted if the respondent shows, on the balance of probabilities, that—
(a)the respondent had a reasonable excuse for failing to comply with the order or for making the false or misleading statement (as the case may be); or
(b)the specific property is not tainted property.
(2C)The presumption applies (so long as it is not rebutted) whether or not the respondent has been convicted of an offence against section 152.
(2D)The presumption does not apply if the Court is satisfied that it would not be in the interests of justice for the presumption to apply.
(3)The Court must specify in a type 1 assets forfeiture order the property to which the order applies and that the property—
(a)vests in the Crown absolutely; and
(b)is in the custody and control of the Official Assignee.
…
[15]Section 5 defines “property” as follows:
property—
(a)means real or personal property of any kind—
(i)whether situated in New Zealand or a foreign country; and
(ii)whether tangible or intangible; and
(iii)whether movable or immovable; and
(b)includes an interest in real or personal property.
[16]The term “tainted property” is also defined in s 5:
tainted property—
(a)means any property that has, wholly or in part, been—
(i)acquired as a result of significant criminal activity; or
(ii)directly or indirectly derived from significant criminal activity; and
(b)includes any property that has been acquired as a result of, or directly or indirectly derived from, more than 1 activity if at least 1 of those activities is a significant criminal activity.
[17] The power to make a profit forfeiture order is contained in s 55 of the Act, which relevantly provides:
55 Making profit forfeiture order
(1)The High Court must make a profit forfeiture order if it is satisfied on the balance of probabilities that—
(a)the respondent has unlawfully benefited from significant criminal activity within the relevant period of criminal activity; and
(b)the respondent has interests in property.
(2)The order must specify—
(a)the value of the benefit determined in accordance with section
53; and
(b)the maximum recoverable amount determined in accordance with section 54; and
(c)the property that is to be disposed of in accordance with section 83(1), being property in which the respondent has, or is treated as having, interests.
(3)Subsections (1) and (2) are subject to section 56.
[18] Section 53 of the Act creates a rebuttable presumption as to the value of any unlawful benefit received by a person from significant criminal activity:
53Value of benefit presumed to be value in application
(1)If the Commissioner proves, on the balance of probabilities, that the respondent has, in the relevant period of criminal activity, unlawfully benefited from significant criminal activity, the value of that benefit is presumed to be the value stated in—
(a)the application under section 52(c); or
(b)if the case requires, the amended application.
(2)The presumption stated in subsection (1) may be rebutted by the respondent on the balance of probabilities.
[19] Before the Court may make a profit forfeiture order, s 54 requires it to determine the maximum recoverable amount:
54High Court must determine maximum recoverable amount
(1)Before the High Court makes a profit forfeiture order, the Court must determine the maximum recoverable amount by—
(a)taking the value of the benefit determined in accordance with section 53; and
(b)deducting from that the value of any property forfeited to the Crown as a result of a type 1 assets forfeiture order made in relation to the same significant criminal activity to which the profit forfeiture order relates.
(2)In determining the value of any property under subsection (1) (b), the Court may, at its own discretion or at the request of either party to the proceedings, seek an independent valuation as to the value of the property.
(3)If a type 1 assets forfeiture order relating to a determination under this section is discharged on appeal, the Court may, on application by the Commissioner, vary the maximum recoverable amount in the profit forfeiture order to reflect that there is no longer a deduction to be made on account of the type 1 assets forfeiture order.
Did Mr and Ms Noble unlawfully benefit from significant criminal activity?
[20] As set out above, s 53(1) of the Act requires the Commissioner to establish, on the balance of probabilities, that Mr and Ms Noble have unlawfully benefited from significant criminal activity.
The argument for the Commissioner
[21] Between 1 April 2013 and 31 March 2019, Mr and Ms Noble returned the following taxable income to the Commissioner of Inland Revenue.
Mr Noble
Year Ending
Employer
Gross earnings
PAYE deductions
31/3/2019
MSD – Benefit
6,812.22
715.15
31/3/2018
No income returned
31/3/2017
D.Lish Limited
47,360.00
0.00
31/3/2016
D.Lish Limited
5,084.00
831.81
31/3/2015
D.Lish Limited
16,405.33
2,608.20
31/3/2015
MSD – Benefit
2,277.15
239.12
31/3/2014
MSD – Benefit
6,853.91
719.73
TOTAL
$84,792.61
$5,114.01
Mrs Noble
31/3/2019
MSD – Student Allowance
5,660.80
802.20
31/3/2019
MSD – Benefit
6,812.22
715.15
31/3/2018
No Income returned
31/3/2017
D.Lish Limited
963.00
114.53
31/3/2017
D.Lish Limited
47,360.00
0.00
31/3/2016
D.Lish Limited
24,149.00
4,818.21
31/3/2016
D.Lish Limited
139.40
0.00
31/3/2015
D.Lish Limited
37,979.00
7,935.72
31/3/2015
MSD – Benefit
2,277.15
239.12
31/03/2014
MSD – Benefit
6,853.91
719.73
31/03/2014
Restaurant Brands Limited
12,973.00
2,321.93
31/3/2014
Ubiquitous Ltd
1,102.00
145.08
31/03/2014
Budz Galore Ltd
3,866.10
0.00
Total
$147,135.58
$17,811.67
[22] A significant part of the police investigation comprised a forensic analysis of the financial affairs of Mr Noble, Ms Noble and the D.Lish business. This was designed to ascertain whether Mr and Mrs Noble had derived income from sources other than those disclosed for taxation purposes. The analysis covered the period between 1 October 2013 and 23 April 2018. During this period, Mr and Ms Noble operated numerous bank accounts in their own names and on behalf of the business. The analysis disclosed that cash deposits were made regularly to several of these accounts and, in particular, the D.Lish bank accounts.
[23] The results of the analysis undertaken by the police are set out in a comprehensive affidavit filed by Mr Dean Baker, a forensic accountant attached to the Waikato/Bay of Plenty ARU. It is not necessary for present purposes to describe the analysis undertaken by Mr Baker in any detail because neither of the respondents have
challenged the methodology he used. I note, however, that whilst Mr Baker was carrying out his investigation, Mr and Ms Noble engaged accounting experts. They made submissions to him querying aspects of the methodology he was using. He completed his investigation after taking these submissions into account.
[24] The resulting analysis showed that Mr and Ms Noble had cash available to them from unidentified sources amounting to at least $1,251,210.96. This sum reflects the amount of cash that they can be shown to have spent or deposited, and which could not have come from known sources such as sales of product through the D.Lish business. This is best explained by the following summary:
(a)Known sources of Cash
(i)Cash Withdrawals from bank accounts $162,537.29
(ii)Known cash income $647,019.80
(iii)Total known sources of Cash $809,557.09
(b)Less cash used
(i) Cash deposits $1,347,766.44 (ii) Cash payments
$713,001.61
(iii) Total cash used
$2,060,768.05
(c)Cumulative Total / Unidentified Cash Source $1,251,210.96.
[25] The Crown says the fact that Mr Noble was making and selling synthetic cannabis during this period renders it highly likely that the unexplained cash income came from that operation. It was then laundered through the various bank accounts.
Mr Noble’s opposition
[26] Mr Noble opposes the application on two bases. First, he says that he has filed an appeal against his conviction and, if this succeeds, the argument for the Commissioner will be significantly undermined. Secondly, he says that the brief of evidence from his accountant, Ms Heppleston, shows that Mr Baker’s analysis has overstated the shortfall in cash by between $284,611 and $565,071.
[27] The Commissioner’s response to the documents filed by Mr Noble shows that his argument based on the proposed appeal does not withstand scrutiny. It is true that Mr Noble lodged an appeal against his conviction in 2022. However, he subsequently abandoned the appeal by written notice to the Court of Appeal dated 30 July 2023. He has not lodged any further appeal since that date and has not sought to withdraw his abandonment. He would face significant difficulties if he tried to do so at this late stage.
[28] The brief of evidence by the accountant is also problematic because it has not been provided by way of affidavit in the present proceeding. Mr Noble did not produce it until the final date given for the filing of written submissions.
[29] Counsel for the Commissioner helpfully points out that Mr Baker and Ms Heppleston conferred prior to sentencing in the District Court and reached agreement that for sentencing purposes, the amount of cash that Mr and Ms Noble received from unknown sources was $940,000. The Commissioner contends that the Court should proceed on the basis of the higher figure originally reached by Mr Baker because the standard of proof in the present proceeding is lower than that required for the criminal proceeding.
[30] I accept that submission as far as it goes, but the fact that Mr Baker was prepared to reach a compromise with Ms Heppleston in the District Court suggests that he accepted aspects of his analysis were open to challenge. I consider that I should take the same approach in the present proceeding notwithstanding the difference in the onus of proof.
[31] I am therefore satisfied that Mr and Ms Noble unlawfully benefited from significant criminal activity in the sum of at least $940,000. However, before making a profit forfeiture order it is necessary to determine the maximum recoverable amount. As can be seen, s 54(1) of the Act requires this to be done by deducting from the amount of the unlawful benefit the value of any property forfeited to the Crown through an assets forfeiture order made in relation to the same significant criminal activity to which the profit forfeiture order relates. It is therefore necessary to
determine whether assets forfeiture orders should be made in relation to property owned by Mr and Ms Noble.
Should Type 1 assets forfeiture orders be made?
The proceeds of sale of the 2008 Hummer motor vehicle with the registration plate “HANG1”
[32] The Commissioner alleges Mr and Ms Noble purchased this vehicle in May 2015 for cash. They have driven it since that time and the previous owner of the vehicle says he sold it to persons fitting their descriptions. He sold it to them after advertising on the Trademe website.
[33] Mr Noble claims in his written submissions that he acquired the vehicle using an inheritance from his mother and the sale of property. However, he has not provided any evidence to support this claim despite having had ample opportunity to do so. He acquired the vehicle during the period he was deriving unlawful benefits from significant criminal activity. I therefore accept the submission for the Commissioner that it is highly likely the cash that was used to purchase the vehicle came from that activity. In the absence of evidence to the contrary I am satisfied that the vehicle falls within the definition of “tainted property” under the Act.
[34] The vehicle was sold some time ago for the sum of $24,815.28. I make a Type 1 assets forfeiture order in respect of the sale proceeds.
The proceeds of sale of the Ultima motorcycle
[35] On 27 October 2017 Mr Noble became the registered owner of a 2009 LWTA Ultima motorcycle registered number A2GAK. The previous owner was a member of Mr Noble’s family. The police have not been able to discover how (or if) Mr Noble paid for the motorcycle. The motorcycle has now been sold and the proceeds of sale amounted to $8,956.91.
[36] Mr Noble acquired the motorcycle during the period when he was engaged in significant criminal activity. In the absence of any opposition by him I conclude on the balance of probabilities that he acquired the motorcycle using funds derived from
significant criminal activity. I make a Type 1 assets forfeiture order in relation to the sale proceeds of the motorcycle.
The proceeds of sale of the Seadoo jet ski and trailer
[37] On 10 November 2015, Mr and Ms Noble’s son became the registered owner of a Seadoo GTI jet ski that was stored on a trailer having the registered number 1S394. During their investigation the police used their powers under s 107 of the Act to conduct an examination of Mr Noble’s son regarding the jet ski and trailer. He told the police that the jet ski belonged to his father. He said Ms Noble had registered the trailer in his name online. He said he had a reached an arrangement with his father under which he and his father would share the sale proceeds if the items were ever sold because he had carried out repairs on it after Mr Noble had damaged it.
[38] The jet ski and trailer were seized at the termination of the investigation and have been sold for the sum of $6,482.05.
[39] Mr Noble acquired these items during the period when he was involved in significant criminal activity. In the absence of any opposition or explanation by him I also conclude on the balance of probabilities that he acquired them using funds derived from that activity. I therefore make a Type 1 assets forfeiture order in respect of the proceeds of sale of the jet ski and trailer.
The Bongard Street property
[40] Mr and Ms Noble own the Bongard Street property as tenants in common in equal shares. They purchased it in 2004 for the sum of $125,000. They completed the purchase using a loan they obtained from a credit union in the sum of $100,000. The loan is secured by a first mortgage registered against the title to the property.
[41] The Bongard Street property as at 11 May 2023 was $575,000. As at 9 May 2023, the sum of $67,258.86 remained owing under the mortgage.
[42] Mr and Ms Noble were living at the Bongard Street property at the time the offending occurred. They derived the sum of $160,000 in cash from unexplained sources during that period.
[43] When the address was searched at the termination of the investigation, the police located self-sealing bags of plant material. The police also found two barrels buried on public land adjoining the address. One of these contained a shotgun, ammunition and multiple snaplock bags containing psychoactive plant material. The second barrel contained further plant material. In total, the two barrels held ten kilograms of psychoactive plant material. This included 801 bags of material that had been packaged in preparation for sale.
[44] During the period covered by the police investigation, Mr and Ms Noble also made cash deposits to their credit union account that reduced the amount owing under the mortgage by the sum of $55,505. In addition, they transferred funds totalling
$36,879.36 to their credit union account from other accounts. These were funded by cash deposits to the accounts from which they came. The amount owing to the credit union has therefore been reduced by the sum of $92,384.36 through cash derived from the sale of synthetic cannabis.
[45] The Court of Appeal has held that the acquisition of equity in a property by paying down a mortgage using unlawfully acquired funds is sufficient to render the property “tainted property” under the Act.1 This means the Bongard Street property is “tainted property” as that term is defined in s 5(1) of the Act.
[46] I am satisfied that Mr Noble’s share of the property should be subject to a Type 1 assets forfeiture order for this reason and because he has filed no documents in opposition to the Commissioner’s application.
1 Duncan v Commissioner of Police [2013] NZCA 477, (2013) 26 CRNZ 796 at [27] and [28].
Should Mrs Noble’s interest in the property be excluded from the Type 1 assets forfeiture order?
The law
[47] The power to make an assets forfeiture order under s 50 of the Act is subject to s 51, which enables the Court to exclude a respondent’s interest from a Type 1 assets forfeiture order because of undue hardship. Section 51 provides:
51 Exclusion of respondent’s property from assets forfeiture order because of undue hardship
(1)The High Court may, on an application made by the respondent before an assets forfeiture order is made, exclude certain property from an assets forfeiture order if it considers that, having regard to all of the circumstances, undue hardship is reasonably likely to be caused to the respondent if the property is included in the assets forfeiture order.
(2)The circumstances the Court may have regard to under subsection (1) include, without limitation,—
(a)the use that is ordinarily made, or was intended to be made, of the property that is, or is proposed to be, the subject of the assets forfeiture order; and
(b)the nature and extent of the respondent’s interest in the property; and
(c)in the case of a type 1 assets forfeiture order, the circumstances of the significant criminal activity to which the order relates.
[48] The Act does not define the term “undue hardship”. However, in determining whether it has been established, the Court may obviously take into account the circumstances set out in s 51(2). The courts have held that undue hardship amounts to hardship that is “gross or disproportionate between the gravity of the offending and the value of the property sought to be forfeited coupled with the other punishment inflicted on the offender”.2
[49] The relevance of the likely effect of an assets forfeiture order on children living at the property in respect of which orders are sought was discussed by the Court of Appeal in Duncan v Commissioner of Police:3
2 Lyall v Solicitor-General [1997] 2 NZLR 641 (CA) at 647.
3 Duncan v Commissioner of Police, above n 1, (footnotes omitted).
[55] Mr Hollister-Jones [Counsel for the Commissioner] noted that the drafting of s 51(1) of the Act showed that the legislature contemplated that hardship would be a result of an assets forfeiture order, and relief was only to be provided where the hardship was “undue”. He referred to this Court’s decision in Lyall v Solicitor-General in which it was held that the expression “undue hardship”, used in s 15(2)(b) of the Proceeds of Crime Act 1991, required consideration of whether forfeiture would result in a “gross or severe disproportion between the gravity of offending and the value of the property sought to be forfeited”. Mr Hollister-Jones submitted that Andrews J had properly considered the relevant considerations set out in s 51(2) of the Act.
[56] Noting that Ye was a case decided under the Immigration Act 1987 he submitted that it was of little direct assistance in the context of s 51. He conceded, however, that s 51 itself invites the Court to have regard to “all of the circumstances”, and the matters specifically listed in s 51(2) are to be considered “without limitation”. He accepted that, given this statutory context, where there were special or extenuating circumstances connected to the interests of a child which militate against the making of an order for the forfeiture of property, they could be considered under s 51.
[57] We accept that is so, and there may be cases where the forfeiture of the family home, or even an interest in it, could cause undue hardship for a child which ought to be influential in the disposition of an application under s 51 of the Act. As was observed in Lyall where forfeiture of a family home used for drug dealing purposes was ordered, “special hardship might be suffered by innocent members of the family”. Whether or not undue hardship arises however must be a matter of fact and degree, and an argument that forfeiture of the family home will always result in undue hardship cannot be sustained in the face of the relevant provisions of the Act.
[58] These include, pre-eminently, the statutory purpose set out in s 3, discussed above, and s 51 itself, under which the use ordinarily made of the property is but one of the relevant considerations. This means that the fact that undue hardship is “reasonably likely” as a result of a forfeiture order must be addressed by evidence squarely addressing that point.
The grounds for exclusion advanced by Ms Noble
[50] Ms Noble contends that her half-share of the Bongard Street property should be excluded from any assets forfeiture orders on the basis that she and others would suffer undue hardship if such orders were made. She has filed an affidavit in which she deposes that several members of her immediate and extended family, including children, live at the address. Some of these are vulnerable and/or suffer from health- related issues.
[51] When Ms Noble was cross-examined in June 2024, she said that twelve members of her family were living at the address. That number was shortly to increase to 13. She said that some of these persons were living in cabins that have been moved
onto the property. She agreed that this had occurred since 2018, when the Commissioner first obtained a restraining order against the property. Ms Noble said that some of the persons living at the address pay rent. She said that in total they paid between $400 and $500 per week to live at the property.
[52] Ms Noble said she is currently not working and is in receipt of a benefit. If the property is sold, she and the other persons living at the address will be forced to move out and live elsewhere. She said that this would cause them all great difficulty because it is both difficult and expensive to obtain rental accommodation in the area in which they live.
Analysis
[53] The circumstances of a party who seeks exclusion of an interest in assets to be forfeited are obviously important. In the present case Ms Noble cannot claim to be an innocent party who has been rendered subject to unfortunate consequences by her husband’s wrongdoing. She was convicted of criminal activity that was closely associated with the significant criminal activity in which her husband was engaged.
[54] The Crown never alleged that Ms Noble was physically involved in the manufacture of illegal psychoactive material. She pleaded guilty only to a charge of money laundering. as Mr Nabney points out on her behalf, she pleaded guilty to that charge on the basis that she was reckless as to the source of the funds she allowed to be laundered through the bank accounts. Recklessness in this sense requires knowing there was a real possibility that the funds came from an unlawful activity and unreasonably running that risk anyway by undertaking the laundering activities.4
[55] Ms Noble therefore accepted through her guilty plea that she knew there was a real possibility her husband was generating very substantial sums of cash from an unlawful activity. The activity continued for a very lengthy period. Notwithstanding this knowledge, she was prepared to allow the cash to be deposited into her business accounts as well as other bank accounts. It is arguable that her business was a major
4 Cameron v R [2017] NZSC 89, [2018] 1 NZLR 161 at [73].
and direct beneficiary of the criminal activity because it was the recipient of much of the cash that it generated.
[56] Ms Noble also benefited through the overseas travel she undertook with her family that was paid for in cash. In addition, she had the benefit of vehicles such as the Hummer. Further, her equity in the Bongard Street property was increased through the reduction of the mortgage using cash payments derived by the offending.
[57] These factors all confirm that, although Ms Noble was not directly involved in the significant criminal activity undertaken by her husband, she had a very close association with it.
[58] The strongest argument in Ms Noble’s favour is that fact that she and her husband acquired the property legally and it has always been used as the family home. However, this is commonly the case when an assets forfeiture order is made in relation to a residential property. Of itself, this factor does not amount to undue hardship even though some of the younger members of Ms Noble’s family may be described as vulnerable.
[59] Further, when Mr and Ms Noble were arrested, there were just five people living at the Bongard Street property. These comprised Mr and Ms Noble, their son, his partner and their son’s infant child. Most of the persons who now live in cabins on the property began doing so after the Commissioner obtained restraining orders against it. Both they and Ms Noble must have known that there was a risk that they would be asked to leave the property if the Commissioner ultimately succeeded in obtaining an assets forfeiture order in relation to it.
[60] In any event, the focus in the present context is on whether Ms Noble will suffer undue hardship if an assets forfeiture order is made. The effect of such an order on her children may be relevant but the effect on third parties such as tenants is not.
[61] Another factor relevant to my decision is that Ms Noble acknowledged in evidence that she and her husband have not paid rates on the property for approximately four years even though they have received rental income from their
tenants. The sum of more than $6,000 is owed by way of rates arrears. When I asked Ms Noble about how she proposed to pay these, she did not seem to have any plan. The position may well be that she and Mr Noble have deliberately not paid rates on the property because it is at risk of forfeiture to the Crown.
[62] Taking these factors into account, I do not consider the likely effect of forfeiture on Ms Noble amounts to undue hardship as the Act requires.
[63] It follows that I make a Type 1 assets forfeiture order in relation to the Bongard Street property. I decline Ms Noble’s application for an order excluding her interest in the property from that order.
[64] In terms of s 50(3) of the Act I specify that the property to which these orders apply are:
(a)the proceeds of sale of the Hummer motor vehicle with the registration plate “HANG1”, the Ultima motorcycle having the registered number A2GAK and the Seadoo jet ski and trailer having the registered number 1S394; and
(b)the property situated at 59 Bongard Street, Gate Pa, Tauranga being the land described in Identifier SA 21C/479 South Auckland Land Registry.
[65] In terms of s 50(3) of the Act, I direct that the property is to vest in the Crown absolutely and is in the custody and control of the Official Assignee.
What is the maximum recoverable amount under the profit forfeiture order?
[66] Before the Court may make a profit forfeiture order, s 54(1) requires it to determine the maximum amount recoverable. This is done by deducting the value of assets forfeited from the unlawful benefit derived through the significant criminal activity.
[67] As I have already noted, the Hummer motor vehicle and the Ultima motorcycle realised the sums of $24,815.28 and $8,956.91 respectively. The Seadoo jet ski and trailer realised the total sum of $6,482.05. These sums total $40,254.24.
[68] The value of the Bongard Street property for rating purposes was $575,000 as at 11 May 2023. As at 9 May 2023, Mr and Ms Noble still owed the sum of $67,258.86 to the credit union. When she gave evidence, Ms Noble said she has been paying the mortgage by deduction from her benefit. The amount currently owing is therefore likely to be less than was the case in May 2023. However, this is an issue the parties can resolve without difficulty. For present purposes I take the equity in the property to be the sum of $507,741.14.
[69] It follows that the total value of the property forfeited under the Type 1 assets forfeiture order is $547,995.38. Deducting that sum from the unlawful benefit of
$940,000 leaves the sum of $392,004.62.
[70] I therefore make a profit forfeiture order in the sum of $392,004.62 against Mr and Ms Noble on a joint and several basis. In terms of s 55(2) of the Act I specify that:
(a)The value of the benefit determined in accordance with s 53 of the Act is $940,000.00.
(b)The maximum recoverable amount determined in accordance with s 54 of the Act is $392,004.62.
(c)The property to be disposed of in accordance with s 83(1) of the Act comprises:
(i)The property situated at 59 Bongard Street, Gate Pa, Tauranga being the land described in identifier SA 21C/479 South Auckland Land Registry.
(ii)The sale proceeds of the 2008 Hummer motor vehicle “HANG1”, the Seadoo jet ski and trailer and the 2009 Ultima motorcycle registration number A2GAK.
Costs
[71] The Commissioner is the successful party in this proceeding and is entitled to costs on a category 2B basis together with disbursements as fixed by the Registrar.
Leave reserved
[72] Leave is reserved to both parties should any further directions or orders need to be made.
Lang J
Solicitors/counsel:
Pollett Legal Ltd, Tauranga
W T Nabney, Barrister, Tauranga M S King, Barrister, Tauranga
Copy to: H C Noble
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