Commissioner of Police v Owen

[2018] NZHC 626

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

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

CIV-2012-485-1095

[2018] NZHC 626

IN THE MATTER

of an Application pursuant to the Criminal Proceeds (Recovery) Act 2009

BETWEEN

THE COMMISSIONER OF POLICE

Applicant

AND

SHAN EDWARD OWEN

First Respondent

BRYAN TRACY OWEN

Second Respondent

ANTHONY JAMES LEWIS

Fourth Respondent

Hearing:

On the papers

Counsel:

E M Light for Applicant

P Surridge for First and Second Respondents

Judgment:

10 April 2018

JUDGMENT OF CLARK J

Introduction

[1]                 The Commissioner of Police has filed applications for assets and profit forfeiture orders under the Criminal Proceeds (Recovery) Act 2009 (the Act). The applications are in respect of monies totalling, respectively $39,720 and $192,975.49. The monies are currently held in the Official Assignee’s trust accounts.

[2]                 Upon assets and profit forfeiture orders being made, the Commissioner applied also to have other property currently under restraint released from restraint.

THE COMMISSIONER OF POLICE v OWEN [2018] NZHC 626 [10 April 2018]

[3]                 The parties have been in discussion about the possible resolution of this matter and have reached an agreed settlement. Such a settlement is, however, subject to the Court’s approval under s 95 of the Act.

Background

[4]                 On 31 May 2012, restraint and effective control orders were made in respect of three properties and a caravan. On 10 September 2012, an order was made by consent removing one of the properties from the ambit of the effective control and restraint orders made on 31 May 2012.

[5]                 On 6 June 2012, the Commissioner filed an application for a restraining order and an effective control order. The application was granted by consent on 26 August 2013. The following property is currently restrained pursuant to the restraint order:

(a)35 Toia Way, Hikurangi, Northland, identified under title number 355808; with Legal Description Lot 3 Deposited Plan 388940, valued at approximately $285,000.00 and registered in the name of the first respondent with no registered encumbrances;

(b)590 Murray Road, Tangowahine, Northland, identified under title number NA112B/78 with Legal Description Lot 6 Deposited Plan 180893, valued at approximately $325,000.00, registered in the name of the first and second respondents other than the rights, title and interest of the Bank of New Zealand Ltd under the registered mortgage number 7763137.2;

(c)a 1991 Nissan motor caravan, registration DKD359, registered in the name of the fourth respondent, with no registered encumbrances, and currently at an unknown location;

(d)monies totalling $39,720.00 from a total of $39,894.10 cash seized by the Police on 22 November 2010 and held in a New Zealand Police trust account with receipt number 1186 and belonging to the first respondent; and

(e)monies totalling $4,200.00 relating to cash seized by the Police on     2 April 2012 and held in a New Zealand Police trust account with receipt number 533841 and belonging to the first respondent.

[6]                 Applications to extend the duration of the restraining and effective control orders have been subsequently granted by consent.

[7]                 On 29 July 2014, the first respondent was sentenced by Judge DRW Barry in the Wellington District Court to three years’ imprisonment on 11 methamphetamine related charges.

Proposed settlement

[8]                 The proposed settlement is set out in the Joint Memorandum of Counsel in Support  of  Applications  for  Forfeiture  Orders  and  Agreed  Settlement,  dated   31 January 2018, (joint memorandum). For the purposes of settlement the parties accept that:

(a)the cash seized in 2010 is tainted property in terms of s 5 of the Act;1 and

(b)the funds totalling $150,000.00 represent the unlawful benefit the first respondent received from his significant criminal activity.

[9]                 Accordingly, the Commissioner applies for an assets forfeiture in respect of the cash seized in 2010 and a profit forfeiture order in respect of the $150,000.00.

Should the settlement be approved?

[10]              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. A settlement does not bind the parties unless the High Court approves it.2 The High Court must approve a

1 See [5](d) above.

2      Criminal Proceeds (Recovery) Act 2009, s 95.

settlement if it is satisfied the settlement is consistent with the purposes of the Act and the overall interests of justice.3

[11]              The primary purpose of the Act is to establish a regime for the forfeiture of property that has been derived from significant criminal activity, or that represents the value of a person's unlawfully derived income.4

[12]              The value of the benefit to the first respondent from his significant criminal activity is presumed to be the value in the Commissioner’s application. The value of the unlawful benefit claimed in the Commissioner’s application is $192,975.49. This is the benefit the Commissioner would need to prove on the balance of probabilities if the application were to proceed to a hearing.5 For the purpose of settlement, the parties have accepted that $150,000.00 represents the value of the unlawful benefit gained by the first respondent from his significant criminal activity.

[13]              The settlement proposal means the full value of the unlawfully derived income would be forfeited. The maximum amount recoverable is $192,975.49 less the value of the assets forfeited ($39,720.00) plus accrued interest ($3,255.49).6 The settlement would forfeit property that represents the unlawful benefit the first respondent has received from his significant criminal activity. The proposed settlement eliminates the opportunity for the first respondent to profit from his significant criminal activity and thus promotes one of the statutory purposes of the forfeiture regime.7

[14]              The first respondent consents to the application for assets and profit forfeiture orders being granted. This aspect of the settlement means litigation is avoided, certainty is achieved and significant court time and cost is saved. The interests of justice are enhanced by this outcome.8

3      Section 95(3).

4      Section 3(1).

5      Section 53.

6      Section 54(1).

7      Section 3(2)(a).

8      Section 95(3)(b).

[15]              I am satisfied the settlement is consistent with the purposes of the Act and the overall interests of justice. Accordingly, the settlement is approved pursuant to s 95(3) of the Act.

Result

[16]By consent the following orders are made:

(a)The Commissioner's applications for assets and profit forfeiture orders are granted.

(b)The following property vests in the Crown absolutely and is to be in the Official Assignee’s custody and control:

(i)monies totalling NZ$39,720.00 from cash seized by the Police on 22 November 2010 belonging to the first respondent and currently held in the Official Assignee’s trust account plus any accrued interest on those funds of $3,255.49.

(c)The value of the unlawful benefit is recognised as $192,975.49.

(d)The following funds are to be realised:

(i)$150,000.00 deposited by D J Blaikie Lawyer on behalf of the first respondent into the New Zealand Insolvency & Trustee Service Proceeds of Crime Account (Official Assignee’s trust account) on 22 December 2017, and currently being held in the New Zealand Insolvency and Trustee Service Proceeds of Crime Account.

(e)The restraining order, dated 26 August 2013, is varied with the deletion from the ambit of the order the property identified at paragraphs 3(a)-

(c) and (e) of the restraining order, namely:

(i)35 Toia Way, Hikurangi, Northland, identified under title

number 355808; with Legal Description Lot 3 Deposited Plan 388940, valued at approximately $285,000.00, and registered in the name of the first respondent with no registered encumbrances;

(ii)590 Murray Road, Tangowahine, Northland, identified under title number NA112B/78; with Legal Description Lot 6 Deposited Plan 180893, valued at approximately $325,000.00, registered in the name of the first and second respondents, other than the rights, title and interest of the Bank of New Zealand Limited under the registered mortgage number 7763137.2;

(iii)a 1991 Nissan motor caravan, registration DKD359, registered in the name of fourth respondent, with no registered encumbrances, and currently at a location unknown; and

(iv)monies totalling $4,200.00 relating to cash seized by the Police on 2 April 2012 and held in New Zealand Police trust account with receipt number 533841, and belonging to the first respondent.

(f)The Official Assignee is to return to the first respondent the monies referred to in paragraph 3(e) of the restraining order, which were transferred into the Official Assignee’s custody under the restraining order, together with funds totalling $344.24, which represents the amount of interests that has accrued on the monies.

(g)With the making of these orders the proceedings are brought to an end and costs are to lie where they fall.

Karen Clark J

Solicitors:

Crown Solicitor, Wellington for Applicant