R v Harris - [2018] NZHC 273

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

I TE KŌTI MATUA O AOTEAROA WHANGĀREI TERENGA PARĀOA ROHE

CRI-2014-029-000961

[2018] NZHC 273

BETWEEN
THE QUEEN

Plaintiff

AND

MICHAEL HARRIS

First Defendant

MAINSTREET LODGE HOLDINGS LIMITED
Second Defendant

MAINSTREET LODGE KAITAIA LIMITED

Third Defendant

Hearing: 8 February 2018

Appearances:

B M O’Connor for Plaintiff N E Town for Defendants

Judgment:

28 February 2018

JUDGMENT OF WYLIE J

This judgment was delivered by Justice Wylie On 28 February 2018 at 3.00pm
Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar

Date:…………………………

Solicitors/counsel:
Marsden Woods Inskip Smith, Whangarei
Webb Ross McNab Kilpatrick Ltd, Whangarei

R v HARRIS [2018] NZHC 273 [28 February 2018]

Introduction

[1] The Crown seeks forfeiture of the net proceeds of sale of a property in Kaitaia known as the Mainstreet Lodge (the Lodge). The property formerly belonged to the second defendant – Mainstreet Lodge Holdings Limited. The third defendant, Mainstreet Lodge Kaitaia Limited, ran a lodge/backpacker’s business from the property. The first defendant, Mr Harris, was at all material times, and still is, the sole director of and shareholder in both companies.

[2] In late 2014, Mr Harris was charged with a large number of offences, namely disabling (x 12),1 attempting to disable,2 indecent assault (x 15),3 making intimate visual recordings (x 7)4 and possession of those recordings (x 7).5 In late July 2016, Mr Harris pleaded guilty to a number of the charges. He pleaded guilty to the balance in September 2016.

[3] The offences of indecent assault and disabling are punishable by a maximum term of imprisonment of five years or more.6 They are qualifying instrument forfeiture offences.7

[4] Prior to the pleas being entered, the Commissioner of Police applied, both without notice and on notice, for a restraining order under the provisions of the Criminal Proceeds (Recovery) Act 2009 over the Lodge, situated at 235 Commerce Street, Kaitaia. The without notice application was granted by Judge McDonald in the District Court at Whangarei in July 2015.8 The on notice application was opposed – primarily on the ground that the accommodation business operated from the property by Mainstreet Lodge Kaitaia Limited should be able to continue. Mr Harris was concerned that the business would be adversely affected if the Lodge was placed under the control of the Official Assignee. The opposition recorded that the restraining order would not be opposed if the Official Assignee did not interfere with the day-to-day

1      Crimes Act 1961, s 197(1).
2      Sections 72, 197(1) and 311(1).
3      Section 135.
4      Section 216H.
5      Section 216I(1).
6      Sections 135 and 197(1).
7      Sentencing Act 2002, s 4(1).
8      New Zealand Police v Harris [2015] NZDC 13655.

operation of the accommodation business. This was accepted by the Commissioner and orders were made accordingly.

[5] At much the same time, the Commissioner made an on notice application for further orders. He sought to restrain other assets of Mainstreet Lodge Holdings Limited and Mainstreet Lodge Kaitaia Limited. This further application was opposed…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading R v Harris

Details

AGLC: R v Harris [2018] NZHC 273
Case: [2018] NZHC 273
Decision Date: 28 February 2018

CaseChat Overview and Summary

In this case, the Crown seeks to have the net proceeds of sale of the Mainstreet Lodge in Kaitaia forfeited. The Lodge, previously owned by Mainstreet Lodge Holdings Limited, was operated by Mainstreet Lodge Kaitaia Limited, with Michael Harris as the sole director and shareholder of both entities. Harris was charged with and pleaded guilty to multiple offences including indecent assault and disabling, which are qualifying instrument forfeiture offences. The Crown applied for and obtained restraining orders over the Lodge and other assets of the two companies. The Lodge and another property were sold, and the net proceeds of sale were paid into Court. The Crown filed an application for an instrument forfeiture order under the Sentencing Act 2002, which was opposed by Harris, Mainstreet Lodge Holdings Limited, Mainstreet Lodge Kaitaia Limited, and the ASB Bank. The ASB Bank has since been paid out, and it is acknowledged that Harris is the only party with any interest in the net proceeds of sale.

The court had to decide whether the Lodge was an "instrument of crime" as defined in the Sentencing Act 2002, and if so, whether it was appropriate to order forfeiture of the net proceeds of sale. The court found that the Lodge was used by Harris to facilitate the offending, as he relied on the Lodge to draw in potential victims, and the offending resumed almost immediately after the purchase of the Lodge. The court also found that Harris had effective control of the Lodge property as the sole director and shareholder of the two companies. In considering whether or not to order forfeiture, the court took into account the gravity of the offending, the significant sentence of imprisonment already received by Harris, his age, and the fact that he will have limited means upon his release from custody. The court ordered that 25% of the net proceeds of sale of the property at 235 Commerce Street, Kaitaia, be forfeited to the Crown, and the balance be available to Harris.

The final orders of the court were that 25% of the net proceeds of sale of the property at 235 Commerce Street, Kaitaia, in the sum of $17,716.38, be forfeited to the Crown. The balance of the net proceeds of sale will be available to Harris, along with the net proceeds of sale attributable to the sale of 237A Commerce Street, Kaitaia.

Orders