Ministry for Primary Industries v Sajo Oyang Corp

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA167/2013
[2014] NZCA 46

BETWEEN

THE MINISTRY FOR PRIMARY INDUSTRIES

First Appellant

THE DIRECTOR-GENERAL OF THE MINISTRY FOR PRIMARY INDUSTRIES

Second Appellant

AND

SAJO OYANG CORPORATION

First Respondent

SOUTHERN STORM FISHING (2007) LIMITED

Second Respondent

THE DISTRICT COURT AT CHRISTCHURCH

Third Respondent

Hearing:	13 February 2014
Court:	Randerson, Stevens and Wild JJ
Counsel:	M J Lillico and K E Martley for Appellants R B Squire QC and J L Inns for First and Second Respondents H M Carrad for Third Respondent (abiding the Court’s decision)
Judgment:	3 March 2014 at 3:00 pm

JUDGMENT OF THE COURT

AWe set aside the High Court declarations (a) and (b) and substitute the following:
(a)The District Court was correct to deny the first and second applicants standing to be heard on the issue of special reasons for non-forfeiture under s 255C of the Fisheries Act 1996.
(b)Consideration of special reasons under s 255C should ordinarily occur prior to entry of convictions against the defendants.

B We confirm (c) of the relief given in the High Court.

CThe costs order made in favour of the respondents in the High Court is set aside.
D The respondents, jointly and severally, must pay costs to the appellant as for a standard appeal on a Band A basis together with usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Randerson J)

Introduction

Fisheries legislation in New Zealand has long provided for the forfeiture of fishing vessels and other items of property following conviction for fisheries offences. Under s 255C of the most recent legislation, the Fisheries Act 1996, any property used in the commission of specified offences is forfeit to the Crown “unless the court for special reasons relating to the offence orders otherwise”.[1] If forfeiture orders are made, interested parties may seek relief against forfeiture under s 256.
[1]Section 255C(2)(c).
The essential question arising in this appeal is whether third parties not charged with the offence in question may appear and make submissions to the court under the special reasons exception.

Background

The then Ministry of Fisheries charged the master of a Korean fishing vessel and four other officers employed by the first respondent variously with aiding and abetting the charterer of the vessel (the second respondent) to abandon fish subject to the quota management system, making false and misleading statements about species caught and hindering a Ministry observer. The defendants returned to Korea and did not defend the charges. They were found guilty upon formal proof.
Neither the second respondent as charterer nor the first respondent as the vessel’s owner were charged. However, both sought to be heard in the District Court with a view to persuading the Judge that special reasons relating to the offences existed such that the Court ought not to make an order for the forfeiture of the vessel.
Judge Saunders declined leave for solicitors for the first and second respondent to appear at the penalty phase of the case. He said that forfeiture issues could be addressed at a subsequent hearing.[2]
[2]Ministry of Fisheries v Yun DC Christchurch CRI-2011-009-11296, 19 September 2012 (Minute) at [9].
Ultimately convictions in respect of four of the defendants were entered but the sentencing of one of them (Mr Jo) was adjourned without entering convictions. That was because solicitors for the first and second respondents had informed the Court that they had instructions on Mr Jo’s behalf to make an application under the special reasons provision.
Before Mr Jo’s application was heard, the first and second respondents sought judicial review, contending they were entitled to be heard at the time the Court was considering the special reasons exception under s 255C(2). They argued that they would be disadvantaged if their only remedy was to apply for relief under s 256 after forfeiture had occurred.
Matters have not proceeded further in the District Court because interim orders were made in the High Court prohibiting any further steps until the completion of the judicial review application.
On 11 February 2013, Dobson J allowed the application for judicial review and made a series of declarations and orders.[3] The principal declaration was that the District Court had erred in denying the first and second respondents standing to be heard on the issue of special reasons for non‑forfeiture.
[3]Sajo Oyang Corporation v The Ministry for Primary Industries [2013] NZHC 161.
The Director-General of the Ministry for Primary Industries[4] appeals against that finding, contending that the Fisheries Act 1996 (the 1996 Act) does not permit any party other than the defendant to a prosecution to appear and make submissions directed towards the special reasons provision of s 255C(2).

The scheme of the 1996 Act in relation to offences, penalties and forfeiture

[4]As the successor of the Ministry of Fisheries.

The provisions of the 1996 Act for offences, penalties and forfeiture are contained in Part 13. With some exceptions, the 1996 Act provides for offences of strict liability. The prosecution is not required to prove the defendant intended to commit the offence.[5] In certain circumstances, defences are available if the defendant proves the acts in question were beyond the defendant’s control and that reasonable precautions were taken to avoid the contravention.[6] Penalties under the legislation include a range of fines up to a maximum of $500,000. The maximum fine for the dumping charges at issue here was $250,000.[7] Imprisonment is reserved for more serious cases involving various forms of deliberate or dishonest conduct.[8]
[5]Section 240.
[6]Section 241.
[7]Sections 72(4) and 252(3)(b).
[8]Section 252.
The forfeiture provisions of the 1996 Act are contained in the “Penalties” subpart of Part 13. Relevantly, s 255C provides:
255C   Forfeiture for section 252(2), (3), and (5) offences, offences carrying fine of $100,000, repeat offences, and serious non-commercial offences
(1)       Subsection (2) applies in the following cases:
(a)on conviction for an offence referred to in section 252(2) or (3) or (5):
…
(2)The following are forfeit to the Crown unless the court for special reasons relating to the offence orders otherwise:
(a)       any fish and any proceeds from the sale of such fish; and
(b)any illegal fishing gear in respect of which the offence was committed (whether or not seized under section 207); and
(c)       any property used in the commission of the offence; and
…
(3)On conviction of a person for an offence referred to in section 252(2) or (3), the court may order that—
(a)any quota is forfeit to the Crown; and
(b)any associated quota is forfeit to the Crown, unless the court is satisfied that section 255E(3B) applies to preclude forfeiture.
…
In terms of this provision, forfeiture of the relevant property to the Crown occurs automatically upon conviction for a relevant offence unless the Court for special reasons relating to the offence orders otherwise. Upon forfeiture, the property vests in the Crown absolutely and free of all encumbrances.[9]
[9]Fisheries Act 1996, s 255E(1).
At the time of conviction, the Court is obliged to determine the property which is forfeit. Section 255E relevantly provides:
255E General provisions relating to forfeiture
…
(3)At the time of conviction of any offence against this Act, the court must determine what, if any, of the following is forfeit under any of sections 255A to 255D:
(a)fish and any proceeds from the sale of such fish:
(b)illegal fishing gear:
(c)property used in the commission of the offence:
(d)quota.
(e)associated quota, unless the Court is satisfied that subsection (3B) applies to preclude forfeiture.
(3A)Where the court is considering the forfeiture of any quota alleged to be associated quota, the court must give any person who owns that quota a reasonable opportunity to make submissions and be heard on the questions of whether—
(a)the quota is associated quota; and
(b)if so, whether or not the court should find in favour of the owner under subsection (3B).
(3B)Where the court is satisfied that associated quota exists, forfeiture must be considered in accordance with sections 255C(3) and 255D(2) unless the Court is satisfied that the associated quota is associated quota, rather than quota owned by the offender, for reasons principally other than avoiding the consequences of the application of this Act in respect of that forfeiture.
…
We return in [46] below to the significance of subs (3A) since it is the only provision in the forfeiture provisions in ss 255A to 255E which provides specifically for a third party to be heard, limited to submissions in relation to the defined term “associated quota”.[10]
[10]Section 255(1).
If property is forfeit under ss 255B to 255D and it has an estimated value of $200 or more, the chief executive must publicly notify the details of the forfeit property and the right of any person to apply to the Court for relief from the effects of forfeiture.[11] Any person claiming an interest in the forfeit property may, within stipulated time limits, apply to the Court for relief.[12] Upon receipt of an application for relief, the following provisions of s 256 apply:
[11]Section 256(2).
[12]Section 256 (3).
…
(6)The court shall, in respect of every application made under subsection (3),—
(a)determine the value of the forfeit property, being the amount the property would realise if sold at public auction in New Zealand; and
(b)determine the nature, extent, and, if possible, the value of any applicant's interest in the property; and
(c)[Repealed]
(d)determine the cost to the Ministry of the prosecution of the offence which resulted in the forfeiture, and the seizure, holding, and anticipated cost of disposal of the forfeit property, including the court proceedings in respect of that seizure, holding, and disposal.
(7)Having determined the matters specified in subsection (6), the court may, after having regard to—
(a)the purpose of this Act; and
(b)the effect of the offence from which the forfeiture arose on the aquatic environment from which the fish, aquatic life, or seaweed was taken or in which the vessel was operating; and
(c)the effect of the offence from which the forfeiture arose on other fishers (whether commercial or otherwise) fishing in the area or for the stock in respect of which the offence occurred; and
(d)the effect of offending of the type from which the forfeiture arose on the relevant aquatic environment; and
(e)the effect of offending of the type from which the forfeiture arose on other fishers (whether commercial or otherwise) fishing in the area or for the stock in respect of which the offence occurred; and
(f)the social and economic effects on the person who owned the property or quota, and on persons employed by that person, of non-release of the property or quota; and
(g)the effect of offending of the type from which the forfeiture arose on fisheries management and administration systems (including the keeping of records and the providing of returns); and
(h)the previous offending history (if any) of the person from whose conviction the forfeiture arose; and
(i)the economic benefits that accrued or might have accrued to the owners of the property or quota through the commission of the offence; and
(j)the prevalence of offending of the type from which the forfeiture arose; and
(k)the cost to the Ministry of the prosecution of the offence which resulted in the forfeiture, and the seizure, holding, and anticipated cost of disposal of the property or quota, including the court proceedings in respect of that seizure, holding, and disposal,—
and, subject to subsection (8), make an order or orders providing relief (either in whole or part) from the effect of forfeiture on any of the interests determined under subsection (6).
(8)No order shall be made under subsection (7) unless—
(a)it is necessary to avoid manifest injustice or to satisfy an interest referred to in paragraph (b)(ii) or (iii) of the definition of interest in subsection (1).
…
Section 256(14) states that any forfeiture under this part of the 1996 Act shall be in addition to, and not in substitution for, any other penalty that may be imposed by the court or by the Act. This indicates a statutory intention that the forfeiture provisions of the Act are intended to be part of other penalties imposed for fisheries offences but are to be treated as additional to other penalties.

District Court decision

In a minute issued on 19 September 2012, Judge Saunders declined the second respondent’s application to be heard at what he described as the “penalty phase” of the prosecution.[13] He noted that the defendants in the prosecutions had been found guilty by formal proof and that they faced financial penalties which the Court was shortly to consider. While appreciating that the charterer (and, we interpolate, the first respondent as owner) had an interest in the outcome of the vessel used for the purpose of permitting the offences, the solicitors for the charterer did not represent the defendants who were for sentence.[14]
[13]Ministry of Fisheries v Yun, above n 2, at [6].
[14]Ministry of Fisheries v Yun, above n 2, at [6]-[7].
While the Judge was unwilling to allow the first and second respondents to address the Court in their own right at the sentencing stage, he was prepared to allow representations to be made on the forfeiture issue upon Mr Jo’s application. When sentencing the defendants and imposing substantial fines on 21 September 2012, the Judge refrained from entering convictions against Mr Jo and fixed a date when the solicitors representing Mr Jo could address the Court on the special reasons exception in s 255C(2).[15] As we later discuss, the application (nominally by Mr Jo) was supported by extensive affidavit evidence relating to steps taken by the first and second respondents to avoid the offending.

The High Court judgment

[15] ` Ministry of Fisheries v Yun DC Christchurch CRI-2011-009-11296, 21 September 2012 (Sentencing Notes) at [33].

The first part of Dobson J’s decision deals with the practical difficulties that can arise if a conviction is entered before there has been an opportunity to consider whether special reasons relating to the offence exist such that forfeiture should not occur.[16] Difficulties could arise because, by virtue of s 255C, forfeiture would follow immediately upon conviction unless special reasons existed. Further difficulties could arise where there are multiple dependants not all of whom rely on the special reasons provision. In such cases, the vessel or other relevant property have been forfeited upon the conviction of those defendants before a special circumstances application had been made by another defendant. If forfeiture were then found to be inappropriate, it might be necessary to allow a re-hearing so that the court could reverse the forfeiture that had already occurred. The Judge therefore declared that consideration of special reasons should normally occur prior to entry of convictions against the defendants.[17] This part of the High Court’s decision is not at issue on this appeal.
[16]Sajo Oyang Corporation v The Ministry for Primary Industries, above n 3, at [15]-[27].
[17]At [28].
In the second part of his judgment, Dobson J concluded that the first and second respondents ought not to have been precluded from addressing the Court on the special reasons exception. He saw a distinction between the “core elements” of the criminal proceedings which he viewed as involving determination of whether the charges were established, and the consideration of the appropriate penalties including forfeiture.[18] It would, the Judge said, be inconsistent with the right to natural justice recognised by s 27 of the New Zealand Bill of Rights Act 1990, and more generally with minimum standards of fairness, to deny standing to non-parties to criminal proceedings who have an interest in preserving property that is vulnerable to forfeiture.[19] He noted the concession made on behalf of the Ministry that the requirement to establish manifest injustice on an application for relief from forfeiture under s 256 is materially more difficult for an owner of property than establishing special reasons for non-forfeiture under s 255C.[20] He concluded that the right to natural justice could not properly be vindicated by the opportunity to be heard on a later application for relief against forfeiture.[21]

The competing submissions

[18]At [49].

[19]At [56].

[20]At [58].

[21]At [58].

Mr Lillico for the Ministry advanced two key propositions. First, a third party to criminal proceedings does not have standing to appear or address the court unless expressly authorised by statute or recognised at common law. Second, the 1996 Act did not envisage any right for a third party to address the court on the special circumstances exception to automatic forfeiture under s 255C. Rather, the remedy available to a third party was confined to seeking relief against forfeiture under s 256.
To the contrary, Mr Squire QC submitted for the first and second respondents that the High Court decision was correct for the reasons the Judge gave. He emphasised that as s 255C(2) was silent as to who had standing to appear, it was anomalous that a defendant owner or charterer could address the court on special reasons to avoid forfeiture while those not charged would not have a right of audience if the Ministry’s contention were right. There was unfairness and a breach of natural justice in not allowing the owners and charterers of the vessel to address the court on the special circumstances issue when they had a vital interest in endeavouring to avoid the serious consequences of forfeiting the property, and the opportunity to seek relief against forfeiture at a later stage was inadequate to address their concerns in that it set an acknowledged higher threshold of manifest injustice.
In the end, the determination of this issue is a matter of statutory interpretation. We address the statutory history, comparable forfeiture legislation, and the text of the 1996 Act considered in the light of its purpose.

Statutory history

As noted, forfeiture has a long history in New Zealand fisheries legislation. Section 53 of the Fisheries Act 1908 simply provided that ships, boats and other property used in any unlawful fishing were forfeited to the Crown and were to be disposed of as the Minister thought fit. It was not until the Fisheries Amendment Act 1948 that the concept that forfeiture was to take place on the conviction of the offender was introduced. Prior to that, no proceeding by way of condemnation or otherwise was required before forfeiture occurred. As noted by this Court in Fisheries Inspector v Turner,[22] the purpose of the legislature was to require a judicial determination of unlawful activity culminating in conviction before forfeiture occurred.
[22]Fisheries Inspector v Turner [1978] 2 NZLR 233 at 245.
The Fisheries Act 1983 continued to provide that property used in respect of the commission of the offence was to be forfeited to the Crown upon conviction of the relevant offence and gave the Minister of Fisheries a discretion to redeem forfeit property upon application by a third party having an interest in the property. It was not until the Fisheries Amendment Act 1986 that an exception to automatic forfeiture upon conviction was introduced. The court could decide that the property ought not to be forfeit.

It is evident from observations made by the Minister of Fisheries on the second reading of the Bill that this change was considered necessary to improve the administration of the legislation and to give a discretion to the Court to avoid forfeiture. The Minister said:[23]
Under New Zealand fisheries law, offences against the Fisheries Act and its many regulations and notices have always had as part of the penalty the forfeiture of vessels and gear after the commission of and conviction of such offences. That forfeiture has always been automatic following conviction, and it has been up to the Minister to decide whether to retain the forfeited property or to return it to its owner for a fee.
I consider it onerous to be placed in the position of having to decide that matter. Many submissions have been made on that point over the years, and they were again considered by the select committee. The Bill as introduced provided for forfeiture of quota on conviction to be the decision of the courts, and to be automatic unless the court, for special reasons relating to the offence, thought fit to order otherwise. The select committee has inserted the same provision in relation to forfeiture of vessels and gear on conviction, and it will now apply to all forfeiture in the future. The Minister will dispose of forfeited gear or vessels as he thinks fit. They will be kept by the Crown, be returned by way of a redemption fee – which is the present practise – or be sold. That is a significant change in the penalties provided under the Fisheries Act, and it should considerably improve the administration of the Act through the courts.
[23]10 July 1986 472 NZPD 2883-2884.
The Minister’s remarks are directed to the owners of property and suggest that the amendment was designed to improve administration and reduce the burden on the Minister by providing a mechanism by which the courts could decide that property should not become forfeit where special reasons relating to the offence were established. However, the Minister’s speech throws no light on the specific issue of standing raised by this appeal.
The 1996 Act continued the special reasons exception introduced in 1986 to the previous legislation. However, a significant change to the forfeiture regime was made. Any application for relief from forfeiture was to be considered by the courts rather than the Minister. The relevant considerations were specified.

Comparable forfeiture legislation

A number of New Zealand statutes provide for forfeiture of property in defined circumstances. However, none of these has a special reasons exception that operates to avoid forfeiture that would otherwise be automatic upon conviction. For example, forfeiture under the Customs and Excise Act 1996 is governed by Part 14. Goods are forfeited not upon conviction but upon the commission of the offence. As such, a customs officer may seize any goods that are forfeit or that he or she has reasonable cause to suspect are forfeit. An application may be made to the Chief Executive for relief from seizure with a right of appeal.[24] Unless the goods have, before a conviction, been sold or restored to the person from whom they were seized or otherwise disposed of by the Chief Executive, the conviction of any person for the relevant offence has effect as a condemnation of the goods.[25] However, where the court imposes a sentence on any person following conviction, it may, if it thinks fit, order the restoration of the goods forfeited to the person from whom the goods were seized, subject to such conditions as the court thinks fit.[26] The Customs and Excise Act does not specify who may appear at the time of sentencing other than the defendant or his or her representative.
[24]Customs and Excise Act 1996, ss 231–235B.
[25]Customs and Excise Act 1996, s 236(1).
[26]Section236(2) and (3).
The former Proceeds of Crime Act 1991 gave a discretionary power for the Court to make a forfeiture order following a person’s conviction of a serious offence.[27] This regime operated as a separate but parallel process to the trial and sentencing of convicted offenders. Section 17 of the Act makes it clear that persons interested in the property at issue have the right to apply for relief before or after a forfeiture order is made.
[27]Section 15(1).
The recently enacted Criminal Proceeds (Recovery) Act 2009 further removes the forfeiture of property regime from the criminal process. The Commissioner of Police may apply for a civil forfeiture order in relation to assets or profit thought to derive from criminal activity.[28] The Act is specific in identifying the persons entitled to appear and to adduce evidence at the hearing of an application for a civil forfeiture order. They are the applicant, the person on whom the application is served (including, if applicable, the respondent) and any other person who claims an interest in the property to which the application relates.[29] The making of an assets forfeiture order does not depend on conviction. Rather, the High Court may make such an order if satisfied on the balance of probabilities that specific property is tainted.[30] The making of such an order is discretionary and the court may exclude property from the order if it considers that undue hardship is reasonably likely to be caused to the respondent.[31]
[28]Criminal Proceeds (Recovery) Act 2009, subpt 3 pt 2.
[29]Section 46.
[30]Section 50.
[31]Section 51.
Similar provisions apply in relation to profit forfeiture orders.[32] The court must grant relief to the extent it considers appropriate if the applicant proves on the balance of probabilities that the applicant has an interest in the property to which the application relates and has not unlawfully benefitted from the significant criminal activity to which the application relates.[33] The court may also grant discretionary relief if it considers it is reasonably likely that the applicant will suffer undue hardship.[34] Third parties have a right of appeal from the making of an instrument forfeiture order.[35]
[32]Criminal Proceeds (Recovery) Act 2009, ss 53–56.
[33]Sections 61–65.
[34]Section 67.
[35]Section 78.
Of more direct relevance for present purposes are the instrument forfeiture provisions contained in ss 142A to 142Q of the Sentencing Act 2002 introduced in 2009.[36] Property may be made the subject of an instrument forfeiture order under these provisions at the discretion of the court. A person (other than the offender) may apply for relief against any such order.[37] Of interest is s 142K which makes express provision for those who may appear before the court when the making of an instrument forfeiture order is being considered or where relief is to be sought. Those who may appear are the prosecutor, the offender, any person making an application for relief and any other person who claims to have an interest in the property. Under s 10B of the Sentencing Act, in dealing with an offender convicted of a qualifying instrument forfeiture offence, the court must take into account, amongst other things, any forfeiture order made, or to be made. The court also has the power to adjourn sentencing until matters to do with forfeiture have been concluded.[38]
[36]By s 10 of the Sentencing Amendment Act 2009.
[37]Section 142J.
[38]Section 10B(3).
These provisions of the Sentencing Act show that, while the existence of a forfeiture order may be a relevant factor at sentencing, the making of forfeiture orders is treated as a separate and parallel process.
Viewed overall, the trend in forfeiture legislation in New Zealand is to deal with such issues separately from the associated processes of criminal conviction and sentence. The Fisheries Act 1996 is the only legislation that provides for automatic forfeiture of relevant property upon conviction and allows a limited opportunity at that point to avoid forfeiture where specified reasons relating to the offence exist.

Relevant authorities

Prior to the present case, it appears that the issue for determination has not been the subject of detailed consideration by the higher courts. The probable reason is that, until recently, the Ministry has not objected to third parties making representations to the Court under the special circumstances exception. Mr Lillico informed us that the Ministry has changed its stance on this issue out of concern about delays in the criminal process, particularly where there are multiple defendants being prosecuted arising from the same set of circumstances.
The purpose of the forfeiture provisions is clearly intended to act as a strong deterrent against fisheries offending. The epithet “draconian” has long been applied to fisheries legislation. In Jones and Haldane v Ministry of Agriculture and Fisheries, Casey J observed: [39]
[the seriousness of a breach of these regulations] has been amply demonstrated by the difficulties that have surrounded this case, and which make it quite clear that the Court must by its approach on penalty impress upon others the gravity of the matter, it may be unfortunate in individual cases that offenders have to suffer drastically if they are caught but it is well known that in Regulations of this type, the penalties imposed by Parliament are purposely made Draconian because policing can be so difficult. The Court must pay regard to that in sentencing.
[39]Jones v Ministry of Agriculture and Fisheries HC Whangarei M103-81, 3 May 1983 at 7.
This Court has echoed Casey J’s observation on at least two subsequent occasions. In Basile v Atwill it was noted that: [40]
The consequences for innocent co-owners were determined not by the attitude of the courts but by the requirements of the legislation itself. The parties affected had the right to apply to the Minister, who was obligated to take into consideration the factors set out in s 107C(3) of the Act, and the Minister’s decision was capable of review by the court. But the draconian consequences of the forfeiture provisions were those imposed by the Act itself not by the decision of the courts.
[40]Basile v Atwill [1995] 2 NZLR 537 (CA) at 539.
Similarly, in Equal Enterprise Limited v Attorney-General this Court reiterated that the forfeiture provision of the legislation reflected the historical approach under earlier fisheries legislation, noting that drastic confiscation provisions were necessary as a deterrent to ensure the strict observation of the legislation given the notorious difficulties in its enforcement.[41]
[41]Equal Enterprise Limited v Attorney-General [1995] 3 NZLR 293 at 295.
The insertion in 1986 of the special reasons exception to automatic forfeiture may be viewed as an attempt by Parliament to provide some opportunity to avoid the forfeiture of property while still permitting third parties to seek relief from forfeiture under s 256 of the Fisheries Act. But, we emphasise that the opportunity under s 255C(2) is limited. As this Court observed in Basile v Atwill, the special reasons must relate to the facts and circumstances of the offending and be sufficiently unusual or out of the ordinary to qualify as “special”.[42]
[42]Basile v Atwill, above n 40, at 539.
We consider the scheme of the 1996 Act is clear. The forfeiture of property arises automatically upon conviction unless the special circumstances exception applies. Forfeiture is therefore closely linked to the ordinary criminal process of determining the defendant’s guilt and the appropriate sentence if the charge is proved. It is not suggested that a third party could have any part in that process.
Contrary to the view adopted in the High Court, we do not consider the special reasons exception can sensibly be separated from the criminal processes of determining guilt and any subsequent sentence. The fact that the special reasons exception is limited to matters relating to the offence supports the proposition that the opportunity to address the court at that stage should be limited to the prosecutor and the defendant. A third party could not, for example, be permitted to address the Court on matters of hardship or the economic consequences of forfeiture. Indeed, the ability of an “innocent” third party to give evidence that truly relates to the circumstances of the offending is likely to be limited.
Where a defendant is also the owner or charterer of a vessel or the equipment associated with the offence, no difficulty arises. Similarly, if the defendant is willing to permit a third party such as an owner or mortgagee to provide evidence in support of the defendant’s own application under the special circumstances exception. But absent such circumstances, the legislation provides a process of public notification of the forfeiture and an opportunity for any person to apply for relief under s 256. We are satisfied that the proper course is for the third party to apply for relief under that section and, if necessary, to exercise the rights of appeal then available.[43] We note in passing that if a third party were dissatisfied after an unsuccessful attempt to persuade the court to exercise its discretion under the special reasons exception, the third party would have no right of appeal under the Criminal Procedure Act which provides for rights of appeal only by defendants in criminal proceedings or by the prosecutor.[44] This tends to support the Ministry’s proposition that the third party does not have standing to appear in the District Court under s 255C of the Fisheries Act.
[43]Prima facie, an application for relief against forfeiture would be treated as a civil matter appealable under s 72 of the District Courts Act 1947: see Mafart v Television New Zealand Ltd [2006] 2 NZLR 18 (SC) at [29].
[44]See, for example, ss 229 and 296 of the Criminal Procedure Act 2011. Arguably, there may have been a right of appeal by a third party under s 115 of the Summary Proceedings Act 1957.
Although s 255C(2) is silent as to who may address the court under that provision, the conclusion we have reached is consistent with the general proposition advanced by the appellant that non-parties are not permitted to intervene in criminal processes unless authorised to do so by statute or at common law. This principle is reflected in the Summary Proceedings Act 1957[45] and in the Criminal Procedure Act 2011,[46] both of which envisage that the right of audience is limited to the prosecutor and the defendant or their authorised representatives. The Supreme Court in de Bruin v R confirmed this when refusing leave to appeal from a decision of this Court which held that, as a third party, the appellant had no right to participate in a preliminary hearing under the Summary Proceedings Act.[47] Even the victims of crime have only the limited rights accorded to them by the Victims Rights Act 2002.
[45]Summary Proceedings Act 1957, ss 37(2) and 67.
[46]Criminal Procedure Act 2011, ss 10 and 105.
[47]de Bruin v R [2008] NZSC 32, [2008] NZFLR 825 at [3].
The conclusion we have reached finds further support in ss 255E(3A) and (3B), introduced by the Fisheries Amendment Act 2001 in respect of the forfeiture of associated quota. Parliament clearly considered it necessary to provide expressly for an opportunity for the owners of associated quota to address the court in order to avoid forfeiture but has not considered it appropriate to widen that opportunity where other property is involved. Mr Squire’s submission that participation by the owner of associated quota is necessary to explain the reasons for ownership of the associated quota does not answer this point.
It is argued that to deny third parties the right to address the court on the special circumstances exception is to breach their right to natural justice and is unfair. However, the right of an owner to be heard before being deprived of property as a matter of natural justice or fairness must be considered in context. Here, the third party has a clear statutory right to apply for relief against forfeiture should the court not find special reasons. While we accept that there is a higher threshold for relief under s 256, that is a consequence of the statutory scheme and is consistent with the purpose of the legislation, namely to provide an effective deterrent against breaches of the Act. That has particular resonance here where the defendants have left the jurisdiction and do not own the vessel.
We note in passing that we are satisfied the circumstances relating to the offending may be raised and considered under s 256 even though not specifically referred to in s 256(7) as a factor to which the court is to have regard when exercising its discretion on an application for relief against forfeiture. We do not regard the list of factors specified in subs (7) as an exhaustive list and, in any event, such factors may be taken into account in the overall assessment of whether the applicant has established manifest injustice.[48]
[48]Contrary to the view expressed by Andrews J in Daleszak v Ministry for Primary Industries [2013] NZHC 2602 at [25].
Another important contextual factor relevant to the contention of fairness is that the third party’s rights ought not to trump or conflict with those of the defendant in criminal proceedings. We have concerns that the defendant’s rights to a fair trial under s 25 of the New Zealand Bill of Rights Act could be compromised by the intervention of a third party at the stage the court is considering the special circumstances exception.
The existence of a conflict with the defendant’s interests is well illustrated by the present case. Mr Jo’s sentencing was deferred until his special reasons application could be heard. As a consequence of the judicial review application and this appeal it has still not taken place. A substantial body of affidavit evidence was produced in support of the application from the second respondent (through its general manager) and through others contracted to the company. The evidence covers a range of topics designed to demonstrate that the second respondent had done all it could to avoid the offending taking place. Any prior knowledge of the offending is denied. Evidence is given of compliance processes employed on the company’s behalf, the experience of the defendants, their knowledge of the requirements of New Zealand fisheries law, and the nature and extent of briefings given to the defendants before the vessel sailed on the two voyages at issue in the prosecution.
The evidence even extends to specific warnings against the dumping of quota species. The deponents assert that as a result of briefings given to the defendants, they were well aware that “under no circumstances was there to be any discarding of [quota] species” and that the captain was warned that any directives of the Ministry observer on board were to be complied with. The general manager deposes that “the offending was in clear contravention of the instructions they [the defendants] received … in breach of the terms of his [the captain’s] employment and was not known or authorised by me”.
Some of the evidence goes so far as to cast doubt on the credibility of a Ministry observer on the vessel by suggesting that she had said there were no issues when questioned by a contractor employed by the second respondent after one of the voyages.
It may be debateable whether evidence of this kind “relates to the offences” in terms of s 255C(2). The evidence here is directed to showing what steps the respondents took to avoid the offending and, more generally, to present themselves as an “innocent” third party. However, what is clear is that none of the material could conceivably have assisted the defendants. Indeed, the evidence adduced is plainly inimical to their interests. If accepted, it demonstrates that the defendants acted deliberately in breach of legal requirements after specific warnings not to do so. Although the application was brought nominally in the name of Mr Jo, it is hard to accept that he would have authorised such material to be provided had he been in the country and been properly advised. The significance of this material for Mr Jo as an aggravating factor at sentencing is obvious.

Mr Squire suggested that any differences between the defendant’s account and that of the third party could be dealt with by a disputed facts hearing under s 24 of the Sentencing Act. We do not accept that submission since s 24 applies only to resolve facts disputed as between the prosecutor and the defendant. It does not apply to the resolution of facts disputed between a defendant and a third party.
We are satisfied that to allow a third party to appear and make submissions on the special circumstances issue in a criminal prosecution could not have been intended by the legislature and is inconsistent with the well established principle that involvement in the criminal process is limited to the prosecutor and the defendant. To allow a right of audience at this stage is also inconsistent with the statutory scheme of the 1996 Act.

Conclusion

For the reasons given, we find that the respondents as third parties do not have any right of audience before the court in relation to the special circumstances exception to automatic forfeiture of property under s 255C of the Fisheries Act 1996. A special reasons application under that section may be made only by the defendant to the relevant prosecution. It follows that the appeal must be allowed, at least in part.
The declarations made in the High Court were:
(a)A declaration that the minute in the criminal proceedings dated 19 September 2012, and the indication as to the further steps intended to occur on 21 September 2012, was wrong in law in denying the first and second applicants standing to be heard on the issue of special reasons for non-forfeiture, and that such consideration should occur prior to entry of convictions against the defendant crew members. The procedure contemplated by the District Court failed to recognise the distinction between special reasons relating to the offence as affording grounds for an order for non-forfeiture, from the considerations that apply to an application for relief from forfeiture under s 256 of the Act.
(b)An order directing the District Court at Christchurch to hear an application by the applicants for special reasons for non-forfeiture of the vessel prior to, or at the time of, any convictions being entered against Mr Jo for offences found to be proven against him.
(c)A declaration that in the circumstances of this case, if:
•special reasons are made out on the special reasons application pursued by the applicants in connection with Mr Jo’s sentencing; and
•the Court is satisfied that such special reasons also apply to justify non-forfeiture in respect of the convictions entered against other crew members;
then the Court would have the power to set aside the convictions of the other crew members in order to reverse the forfeiture of the vessel that had occurred by operation of the provisions of the Act.
We set aside declarations (a) and (b) and substitute the following:
(a)The District Court was correct to deny the first and second applicants standing to be heard on the issue of special reasons for non-forfeiture under s 255C of the Fisheries Act 1996.
(b)Consideration of special reasons under s 255C should ordinarily occur prior to entry of convictions against the defendants.
We confirm (c) of the relief given in the High Court.
We add that, before considering the material filed in support of Mr Jo’s special reasons application, the District Court will need to be satisfied that Mr Jo understands and has authorised that material to be placed before the court. It will be a matter for the District Court to determine whether the material “relates to the offence” in terms of s 255C(2) and, if so, what consequences should follow from that.
We set aside the costs order made in favour of the respondents in the High Court.
The respondents, jointly and severally, must pay costs to the appellant as for a standard appeal on a Band A basis together with usual disbursements.

Solicitors:
Crown Law Office, Wellington for Appellant and Third Respondent
M Sullivan Oceanlaw, Nelson for First and Second Respondents

[2014] NZCA 46

3 March 2014 at 3:00 pm