THE COMMISSIONER OF POLICE AND KAI XIONG ZHUOJUN LAI YINGSHENG XIONG CAIQIN AL FUQUAN LAI MEIRONG LIANG Sixth ANZ BANK OF NEW ZEALAND LIMITED Interested Party BANK OF NEW ZEALND LIMITED Interested Party THE TRUSTEE...

[2024] NZHC 3020

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

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

CIV-2019-485-000189

[2024] NZHC 3020

UNDER

the Criminal Proceeds (Recovery) Act 2009

IN THE MATTER OF

an application under ss 49, 50 and 51

BETWEEN

THE COMMISSIONER OF POLICE

Applicant

AND

KAI XIONG

First Respondent

ZHUOJUN LAI
Second Respondent

YINGSHENG XIONG

Third Respondent

CAIQIN AL
Fourth Respondent

FUQUAN LAI
Fifth Respondent

MEIRONG LIANG
Sixth Respondent

ANZ BANK OF NEW ZEALAND LIMITED

First Interested Party

BANK OF NEW ZEALND LIMITED
Second Interested Party

THE TRUSTEE OF XIONG’S FAMILY TRUST

Third Interested Party

THE COMMISSIONER OF POLICE v XIONG [2024] NZHC 3020 [16 October 2024]

On the papers:

Counsel:

B M Finn for Applicant

S Campbell for Third and Fourth Respondents and Third Interested Party

Judgment:

16 October 2024

JUDGMENT OF GRAU J

A proposal to settle criminal proceeds proceedings

[1]                 The Court has previously made a restraining order under the Criminal Proceeds (Recovery) Act 2009 (the Act) affecting property of the third interested party and the third and fourth respondents.

[2]                 Most recently, on 19 August 2024, Cull J extended the duration of the restraining order which applies to this (and other) property.1 A hearing is set down to begin on 11 November 2024 to determine the Commissioner’s applications for asset and profit forfeiture. The third interested party and the third and fourth respondents have filed applications for relief from forfeiture.

[3]                 The third interested party is the trustee of a trust. His parents, the third and fourth respondents, are discretionary beneficiaries. As trustee, the third interested party owns 4 Grenville Street, Waiwhetu, Lower Hutt (the Grenville Street property), which is subject to the forfeiture application, and subject to the current restraining order.

[4]                 The Commissioner, the third interested party, and the third and fourth respondents, have agreed to settle the proceedings as they relate to the Grenville Street property.

[5]                 The parties request that the Court, under s 95 of the Act, approve the settlement.

1      Commissioner of Police v Xiong HC Wellington CIV-2019-485-189, 19 August 2024.

The jurisdiction

[6]Section 95 of the Act provides:

95High Court must approve settlement between Commissioner and other party

(1)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.

(2)A settlement does not bind the parties unless the High Court approves it.

(3)The High Court must approve the settlement if it is satisfied that it is consistent with—

(a)the purposes of this Act; and

(b)the overall interests of justice.

[7]                 It is recognised that the Court may consider approval of the settlement reached following the making of a restraining order without requiring a formal forfeiture application. This Court has confirmed that a joint memorandum from the parties or counsel may sufficiently engage s 95 of the Act.2

Discussion

[8]The parties have set out the basis for settlement as follows:

(a)While the funds used to purchase the Grenville Street property were sometimes in the same account as allegedly tainted funds (from other parties) the subject of this proceeding, the applicant is prepared to settle the matter on the basis that it cannot be proved that any tainted funds were used to purchase the Grenville Street property.

(b)The applicant has considered advancing arguments regarding the use of tainted monies to fund the payment of rates on the property. However, the amounts involved in funding the rates are limited.

2      Commissioner of Police v Saunders [2012] NZHC 3479 at [2]; Commissioner of Police v Jones

[2022] NZHC 79 at [5].

(c)There is therefore a reasonable prospect that the applications for relief from forfeiture in respect of the Grenville Street property would succeed.

(d)To the extent the application for forfeiture orders continues against the first and second respondents, the applicant considers that there remain sufficient other assets subject to restraint potentially available to meet forfeiture orders that may be made.3

[9]                 The Commissioner proposes to discontinue the asset forfeiture application for the Grenville Street property, and the proceedings against the third and fourth respondents. The interested third party wishes to withdraw his notice of interest.

[10]             On the basis set out in the joint memorandum of counsel dated 10 October 2024, I am satisfied that the proposed settlement is consistent with the purposes of the Act and the overall interests of justice.

Orders

[11]I approve the following settlement and I make the following orders:

(a)the Grenville Street property (described in the record of title unique identifier 615518, legal description Lot 2 DP 464032) is released from the current restraining order;

(b)the applicant is to discontinue the current asset forfeiture application in respect of the Grenville Street property;

(c)the third and fourth respondents and third interested party may then be removed from the proceedings; and

3      These are listed in the applicant’s application for forfeiture dated 3 December 2021, at [2.2]–[2.8].

(d)costs are to lie where they fall.

Grau J

Solicitors:

Crown Solicitor, Wellington

Ord Legal, Wellington for First and Second Respondents