R v Fafeita

[2013] NZHC 1833

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

CRI 2012-070-004238 [2013] NZHC 1833

THE QUEEN

v

WAYNE GARY FAFEITA

Hearing:	19 July 2013
Appearances:	P V Cornegé for the Crown A C Balme for the Defendant P J Morgan QC for A Fafeita
Judgment:	19 July 2013

ORALJUDGMENT OF WYLIE J (Forfeiture order)

R v FAFEITA [2013] NZHC 1833 [19 July 2013]

Forfeiture Order

[1]      Mr Fafeita has pleaded guilty to two charges under the Misuse of Drugs Act

1975.  He has pleaded guilty to cultivating cannabis, contrary to s 9 of that Act, and to being in possession of cannabis for supply, contrary to s 6(1)(f).   Both charges were laid indictably and convictions have been entered.

[2]      Both charges are qualifying instrument forfeiture offences under the relevant provisions in the Criminal Proceeds (Recovery) Act 2009.

[3]      The offending occurred on a property at 17 Sutherlands Road, Brookfield, Tauranga.

[4]      The Crown has sought forfeiture of that property.  It says that the property was used as an instrument of crime, as defined in the Sentencing Act 2002 (“the Act”).

[5]      I directed that a copy of a notice to interested persons, advising that the Court would consider whether to make an instrument forfeiture order in respect of the property, be served on various parties.  An application for relief has been filed by Mr Fafeita’s former wife, Angela Fafeita.

[6]      The property has an agreed value of $276,000, being the rating valuation obtained by the Crown. The property is registered in Mr Fafeita’s name.  It is subject to a mortgage in favour of the ANZ Bank, to a total sum of $84,724.13.  The equity in the property is therefore approximately $191,276.

[7]      Both Mr Cornegé for the Crown, and Mr Balme appearing on Mr Fafeita’s behalf, accept that his former wife would be entitled to a half-share of the net equity in the property if she were to make a relationship property claim.  It follows that, after allowing for the mortgage in favour of the ANZ Bank, Mr Fafeita’s half-share of the property would amount to approximately $95,638.

[8]      In her application for relief, Mrs Fafeita asserted undue hardship.  She sought a hearing under s 142K of the Act and an order determining that an instrument forfeiture order be declined.

[9]      The position which had been agreed between the Crown and Mr Balme on Mr Fafeita’s behalf was relayed to Mrs Fafeita’s legal advisors.  I have heard this morning from Mr Morgan QC on her behalf.   In the event, agreement has been reached which is acceptable to all parties.

[10]     Mr Fafeita for his part has accepted that he is unable to resist an instrument forfeiture application in respect of the property, given the circumstances of the offending.  The Crown and the defence have agreed that a partial forfeiture order would be appropriate, given the nature of the offending, Mr Fafeita’s personal circumstances, and after consideration of all the relevant factors detailed in s 142N of the Act.   They agree that a partial forfeiture order in relation to 50 percent of Mr Fafeita’s interest in the net equity of the property should be made.  Mr Fafeita’s half interest in the net equity equates to $95,638, and a 50 percent interest therefore equates to $47,819.

[11]     Mr Morgan on Mrs Fafeita’s behalf wished to preserve an entitlement for her to  pay out  the  forfeited  sum  to  the  Official Assignee,  and  thus  to  acquire the property, either in her own name, or in combination with Mr Fafeita, so that it can continue to be used as a family home for the benefit of, inter alia, their daughter.  He proposed  that  the  Official  Assignee  should  be  empowered  to  discharge  the instrument forfeiture order on receipt by him of the sum specified to be forfeited by Mr Fafeita.

[12]     In my view, a forfeiture order in the terms proposed is appropriate.  I say this for the following reasons:

(a)      The property was purchased in about 1996.  There is no suggestion that the funds for its purchase came from anything other than legitimate sources.

proprietor of the property.

(c)      It is common ground that Mrs Fafeita is entitled to a half share of the net equity.   She has contributed to mortgage repayments over a prolonged period.   She was not involved in Mr Fafeita’s offending, nor involved in any other way.

(d)      There is a mortgage in favour of the ANZ Bank. (e)     There is no dispute as to the value of the property.

(f)       Given the charges to which Mr Fafeita has entered guilty pleas, it seems that the cultivation operation was one-off offending, which spanned a comparatively short period of four months between April and August 2012.   While the offending was serious, it was not the most serious offending of its type.

(g)      Mr Fafeita has admitted that he uses illicit drugs, including cannabis.

A cannabis smoking utensil was located during the police search of the property.

(h)Mr Fafeita is 51 years of age, and he has only been in casual and seasonal employment.  If an order for full forfeiture were to be made, it would be unlikely that he would be able to raise sufficient capital to purchase another property in the future.

(i)       It is important that Mrs Fafeita’s interest in the home, and the use of

the home for occupation by the daughter, should be preserved.

with the approach taken in other recent cases involving instrument forfeiture orders.1

[14]     Accordingly, I make the following orders:

(a)      This order relates to the property at 17 Sutherland Road, Brookfield, Tauranga, registered in the name of Wayne Gary Fafeita, Certificate of Title reference SA27A/1233, South Auckland Land Registry;

(b)The Court considers the present value of the property to be $276,000 (s 142N(4));

(c)       Angela  Fafeita  has  an  interest  in  the  property  to  the  extent  of

50 percent of its net value, which percentage is valued at $95,638 (s 142N(3)(a));

(d)      The  sum  of  $47,819,  being  50  percent  of  Wayne  Gary  Fafeita’s

interest in the property, is forfeited to the Crown (s 142N(1));

(e)      The property is vested in the Crown absolutely, and is to be in the custody and control of the Official Assignee (s 70(1));

(f)       The Official Assignee is to give Mrs Fafeita a first option in the property.   The Official Assignee is empowered to discharge the instrument forfeiture order on receipt by him of the sum of $47,819, being the amount specified to be forfeited to the Crown by Mr Fafeita.

(g)In  the  event  that  Mrs  Fafeita  is  unable  to  make  payment  to  the Official Assignee of the sum of $47,819 within two months or within such further time as shall be directed by this Court on application, the Official Assignee is  to  sell  the property.   After repayment of  the

money owed  by  virtue  of  the  mortgage  held  by  the ANZ  Bank,

1      R v Elliott HC Gisborne CRI-2010-416-65, 20 October 2011; R v Sheehan HC Hamilton CRI

2011-039-151, 19 December 2011.

lesser sum as shall be available from the balance of the monies paid to it  by  the  Official  Assignee  pursuant  to  s 85(d)  of  the  Criminal Proceeds (Recovery) Act 2009 (s 142N(3)(b)).   The Crown is to account for any additional monies paid to it by the Official Assignee pursuant to s 85(d) as follows:

(i)       One half to Ms Fafeita, and

(ii)      One half to Mr Fafeita.

The Crown is to pay any monies due to Wayne Gary Fafeita to a solicitor to be nominated by him, and notified to the Crown;

[15]     This judgment is stayed until 5.00 pm on Tuesday, 23 July 2013.  Counsel are to advise if there are any difficulties with the order detailed above on or before that

time.

Wylie J