Commissioner of Police v Swarbrick
[2023] NZHC 430
•9 March 2023
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2022-409-439
[2023] NZHC 430
BETWEEN COMMISSIONER OF POLICE
Applicant
AND
SCOTT ANDREW SWARBRICK
Respondent
AND
SARAH JANE ECKHOLD
Interested Party
Hearing: On the papers Judgment:
9 March 2023
JUDGMENT OF HARLAND J
Introduction
[1] It is in the interests of justice that those who undertake or are associated with criminal activity do not profit from such activity. The Criminal Proceeds (Recovery) Act 2009 (the Act) sets out provisions for the confiscation of the proceeds of crime and property used to commit serious offences. The purpose of the Act is to establish a regime for the forfeiture of property that has been derived directly or indirectly from significant criminal activity or represents the value of a person’s unlawfully derived income.1
[2]The Commissioner initially applied for two orders against the respondent:
1 Criminal Proceeds (Recovery) Act 2009, s 3(1).
COMMISSIONER OF POLICE v SWARBRICK [2023] NZHC 430 [9 March 2023]
(a) a profit forfeiture order to the value of $93,338.29 in relation to two amounts of cash totalling $25,305 and unexplained income deposited into the respondent’s bank account of $68,033.29; and
(b) an assets forfeiture order in relation to two amounts of cash totalling
$25,305.
[3] The Commissioner has since advised that the application for a profit forfeiture order is not pursued. The only application now pursued is the assets forfeiture order. I proceed on this basis.
[4] An application for an assets forfeiture order can be determined by way of formal proof.2 The respondent, Mr Swarbrick, and the interested party, Ms Eckhold, have been served. Neither party appeared at the first call of this matter, nor have they indicated they wish to contest the Commissioner’s application. Both Mr Swarbrick and Ms Eckhold have been served with the Minute of Nation J dated 31 October 2022 which outlined that the application would proceed by way of formal proof in the absence of any steps being taken by them to defend it.
[5] Given that no further steps have been taken, I determine the application by way of formal proof, based on the affidavit of Reon Deane Blake, affirmed 15 September 2022 and filed in support of the application.
[6] I have decided to grant the assets forfeiture order. This judgment sets out the reasons for my decision.
Factual Background
[7] On 25 May 2021 at 7:20 am, the Police executed a search warrant at […], which was the home address of the respondent, Mr Swarbrick, and his associate […]. Mr Swarbrick’s partner, Ms Eckhold, lived at a separate property, but she would visit this address and stay there with Mr Swarbrick from time to time.
2 Commissioner of Police v Mauga [2015] NZHC 1071.
[8] During the search, two substantial cannabis growing operations, a large amount of drug paraphernalia and ammunition (a mixture of .44 Magnum, .22 calibre, and shotgun rounds) were found. The drug paraphernalia included digital scales, dried cannabis leaf and hypophosphorous acid, a chemical commonly used for converting ephedrine/pseudoephedrine to methamphetamine.
[9] On the same morning, Police executed a surveillance device warrant to intercept Mr Swarbrick’s personal phone calls.
[10] At approximately 8:48 pm, Mr Swarbrick called an unknown person and organised to meet at Mairehau High School to sell that person one gram of methamphetamine for $500.
[11] On 26 May 2021 at approximately 3:00 pm, the Police stopped Mr Swarbrick in his car. Ms Eckhold was also in the vehicle.
[12] On Mr Swarbrick’s seat was a jacket with two sunglass cases inside, one containing cash amounting to $13,000 and the other containing cash amounting to
$10,000. A further $2,000 in cash was found in Mr Swarbrick’s pocket and $305 cash was found in his wallet. Scales, a methamphetamine pipe, cell phones, a taser, and
182.37 grams of cannabis in zip lock bags were found on the backseat of the vehicle.
[13] Mr Swarbrick was charged and later pleaded guilty to charges of unlawfully carrying/possession of explosives,3 failing to carry out obligations in relation to a computer search,4 offering to supply methamphetamine,5 and possession of cannabis plant for the purposes of supply.6 He was convicted and sentenced to nine months’ home detention.
[14] Ms Eckhold was charged and convicted for unlawfully carrying a restricted weapon.7 She was sentenced to 80 hours’ community work and nine months’ supervision.
3 Arms Act 1983, s 45(1); maximum penalty 4 years’ imprisonment or $5,000 fine or both.
4 Search and Surviellance Act 2012, s 178; maximum penalty 3 months’ imprisonment.
5 Misuse of Drugs Act 1975, s 6(1)(c) and (2)(a); maximum penalty life imprisonment.
6 Sections 6(1)(f) and 2(c); maximum penalty 8 years’ imprisonment.
7 Above n 3.
Legal considerations
[15]Section 50 of the Act provides:8
50 Making assets forfeiture order
(1) If, on an application for an assets forfeiture order, the High Court is satisfied on the balance of probabilities that specific property is tainted property, the Court must make an assets forfeiture order in respect of that specific property.
(2) Subsection (1) is subject to section 51.
(3) The Court must specify in an 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.
(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.
(5) If any property that is land is vested in the Crown absolutely as a consequence of an assets forfeiture order made under subsection (3), an interest recorded on the title to the land that is not affected by the assets forfeiture order is not extinguished.
(emphasis added)
[16]Section 5 defines “tainted property” as:
tainted property—
(a) means any property that has, wholly or in part, been—
(i)acquired as a result of significant criminal activity; or
8 Above n 1. This section is subject to the exclusionary rule in s 51. On an application made by the respondent, the Court may consider whether undue hardship is likely to be caused to the respondent. No such application has been received and this issue is therefore not engaged in the current proceeding.
(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
(emphasis added)
[17]Section 6 defines “significant criminal activity” as:
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 $30,000 or more have, directly or indirectly, been acquired or derived.
(2) A person is undertaking an activity of the kind described in subsection
(1) whether or not—
(a)the person has been charged with or convicted of an offence in connection with the activity; or
(b)the person has been acquitted of an offence in connection with the activity; or
(c)the person’s conviction for an offence in connection with the activity has been quashed or set aside.
(3) Any expenses or outgoings used in connection with an activity of the kind described in subsection (1) must be disregarded for the purposes of calculating the value of any property, proceeds, or benefits under subsection (1)(b).
Analysis
[18] As the Act provides, if I am satisfied that it is more probable than not that the cash sums totalling $25,305 are tainted property, I am required to make an assets forfeiture order in relation to them.
[19] Both drug offences, to which Mr Swarbrick pleaded guilty, come within the meaning of “significant criminal activity” in s 6(1)(a) of the Act. The first part of the definition of “tainted property” is met. I must next determine whether the $25,305 is derived or acquired from that significant criminal activity.
[20] The affidavit filed by the Commissioner outlines the extent of Mr Swarbrick’s drug dealing. The sequence of events is instructive. I have already referred to what was located during the search of Mr Swarbrick’s property on 25 May 2021. In relation to two cannabis operations, 16 plants, heat lamps and extraction fans were found, as well as various ammunition. On the same day as the search, the Police intercepted Mr Swarbrick’s phone calls and heard of his plan to sell one gram of methamphetamine to an unknown person for $500. The next day, scales, cell phones, a taser, zip lock bags containing cannabis, and the $25,305 in cash were found in Mr Swarbrick’s vehicle. The cash was in various denominations of $100, $50, $20, $10, and $5 notes.
[21] All the items located in Mr Swarbrick’s home and vehicle, and the intercepted phone call, are indicative of his involvement in the sale of methamphetamine and cannabis.
[22] The affidavit filed by the Police records that, in the 23 months prior to his arrest:
(a) Mr Swarbrick’s bank account included 206 unexplained cash deposits, ranging from $10 to $4,650, totalling $68,033.29. The transactions were made by 50 different people, 29 of whom it is deposed are known drug users, partners of drug users or drug suppliers; and
(b) an analysis of Mr Swarbrick’s bank account showed there were few individual day-to-day purchases such as groceries, clothing, phone and electronic purchases, suggesting he used cash to pay for his living expenses.
[23] The cash deposits and use of cash for living expenses are reflective of Mr Swarbrick’s involvement in a cash generating activity. The market for methamphetamine and other drugs primarily involves the use of cash.
[24] Although an assets forfeiture order is not dependent on the outcome of criminal proceedings, Mr Swarbrick’s guilty plea to charges of offering to supply
methamphetamine and possession of cannabis plant for the purpose of supply is an additional factor in favour of finding the cash is tainted.9
[25] However, the question here is not simply whether Mr Swarbrick was supplying methamphetamine and cannabis. Rather, it is whether, on the balance of probabilities, I can find that the $25,305 is derived from that activity. Although people who deal in drugs largely transact their business in cash and can therefore amass large amounts, it is important to recognise that there can also be reasons why a person may have legitimately accumulated or obtained a large amount of cash.
[26] This evidence reveals that, between 1 July 2019 and 26 May 2021, the 23 months prior to his arrest, Mr Swarbrick received $9,236.15 in benefit payments from the Ministry of Social Development and $38,439.17 for work he undertook for a painter decorator and timber merchant.
[27] The interested party, Ms Eckhold, has a similarly low income. In the same 23- month period, her total declared income was $43,789.32, derived from benefit payments from the Ministry of Social Development. She also stated that the money (I infer the $25,305) did not belong to her.
[28] Mr Swarbrick has provided no alternative explanation as to where the extra cash came from or how it was accumulated and has not come forward to claim it.
[29] Considering these matters in combination, I conclude it is more probable than not that the $25,305 found in Mr Swarbrick’s car and on his person was derived from him supplying methamphetamine and/or cannabis.
Conclusion
[30] I am satisfied that the cash sum of $25,305 is likely to have been derived from significant criminal activity undertaken by Mr Swarbrick, being the supply of methamphetamine and/or cannabis. It is therefore tainted property for the purposes of
9 Above n 1, s 15.
s 50(1) of the Act. As it is mandatory for the Court to make the assets forfeiture order in these circumstances, I grant the Commissioner’s application.
Result
[31] I order that the following property is to vest in the Crown absolutely and is to be in the Official Assignee’s custody and control:
(a) The sum of $23,000.00 (plus any interest accrued) located on the front passenger’s side of a Suzuki Swift motor vehicle registration HPJ325 on 26 May 2021 where the respondent, Mr Swarbrick, had been sitting; and
(b) The sum of $2,305.00 (plus any interest accrued) located on the respondent, Mr Swarbrick, when searched by Police after getting out of the Suzuki Swift motor vehicle registration HPJ325 on 26 May 2021.
Harland J
Solicitors:
Raymond Donnelly & Co., Christchurch.
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