COMMISSIONER OF NEW ZEALAND POLICE v LYNDON VAUGHAN RICHARDSON [2022] NZHC 2864

COMMISSIONER OF NEW ZEALAND POLICE v LYNDON VAUGHAN RICHARDSON [2022] NZHC2864 [3 November 2022]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYI TE KŌTI MATUA O AOTEAROAŌTAUTAHI ROHECIV-2021-409-000198[2022] NZHC 2864BETWEEN COMMISSIONER OF NEW ZEALANDPOLICEApplicantAND LYNDON VAUGHAN RICHARDSONFirst RespondentAND TERRENCE AUSTIN MCFARLANDSecond RespondentAND SIMON JOHN TURNERThird RespondentHearing: 31 October 2022, 1, 2 November 2022Appearances: K South and C C White for ApplicantS N B Wimsett and L R Toepfer for Second Respondent andLincoln Property Investments LtdJudgment: 3 November 2022RULING OF DUNNINGHAM JThis judgment was delivered by me on 3 November 2022 at 2.30 pm, pursuant tor 11.5 of the High Court RulesRegistrar/Deputy RegistrarDate:Introduction[1] The Commissioner of Police has applied, under the Criminal Proceeds(Recovery) Act 2009, for civil forfeiture orders in respect of, among other things, ahouse at Vickerys Road, Sockburn, Christchurch, which is the clubhouse of a gangknown as the Head Hunters Motorcycle Club (the Head Hunters).[2] On receiving the briefs of evidence for the Commissioner, Mr Wimsett, for thesecond respondent,1 raised a number of objections to parts of the evidence, primarilyon the grounds the briefs included inadmissible hearsay evidence.[3] Many of those objections were resolved by the Commissioner obtainingwitness summons for the individuals who made the relevant statements and thoseindividuals then appearing and giving evidence. The only remaining objection was tothe admissibility of a red notebook, said by the police to contain records of the takingsof clubhouse pokie machines and its expenditure (the pokies notebook), which wasmost likely created by a former gang member, Darrin Baylis.The disputed evidence[4] The pokies notebook is a small red hardcover notebook with a pen attached bya piece of string to the spine of the book and containing handwritten entries. The firstpage of the book reads "This note Book is for the Pokie machines Only ". Therecords contained in the pokies book span from 9 July through to 26 August 2016.The entries in the book start from the back of the book and move forward. The pagesare generally headed with a date. The total monetary figure from the previous page iseither recorded at the top of the fresh page or, on some pages, is added in further down.There are then amounts entered alongside the narrations #1 – #3, "Changer" and "Tin"which are added to the total from the previous page to reach a new total. There arethen various outgoings listed and described, which are taken off the total amount toreach a new total.1 He also appeared for the company Lincoln Properties Investments Ltd, which is the registeredowner of the property. The three respondents are directors of the company.[5] By way of example, on an unknown date but between 21 July and 27 July, theentry is as follows:#1 –#2 475#3 185Changer 775Tin 20$1455$12382$13,837– 2 200 (concrete)– 750 (carpet)– 500 (Float)$10,387The figure of $12,382 is the total reached on the previous page.[6] Mr White, for the Commissioner, said the pokies notebook was found in thefront console of the car Darrin Baylis was driving, along with three passengers, whenit was stopped by police on 27 August 2016. Mr Baylis was acknowledged by otherwitnesses to have undertaken the role of being the gang's bookkeeper at times and itwas a reasonable inference that he had made the records in the pokies notebook.Attempts by the Commissioner to have Mr Baylis appear as a witness[7] Mr Baylis was served a witness summons to attend the hearing byDetective Alan Newton. Detective Brendan Patten gave evidence to say he messagedMr Baylis on the morning of the trial to remind him to attend Court that day. Mr Baylissent a reply text to say he had tested positive for COVID-19 on Saturday and thereforewas self-isolating for seven days. He said he would provide a photograph of thepositive test. He provided the address of a car yard he was residing at as the addressat which he would be self-isolating.[8] Police officers were tasked to attend the car yard around the middle of the firstday of the hearing to see if arrangements could be made for Mr Baylis to give hisevidence remotely. However, they were advised by the other occupants that Mr Bayliswas well, and had left the address approximately an hour ago. That afternoon I issueda warrant to arrest Mr Baylis. Police were assigned to check on the address to arresthim. On Tuesday morning an occupant at the address advised they had not seenMr Baylis since the previous day.[9] Detective Patten made various attempts to make contact with Mr Baylis,including asking another witness who attended Court and knew Mr Baylis to speak tohim, but to no avail. The last text Detective Patten received from Mr Baylis advisedthat Mr Baylis would be turning his phone off. Detective Patten also advised thatwhen served with the witness summons, Mr Baylis had said something to the effectthat he did "not think that will fly" to the officer effecting service, which wasunderstood to mean that Mr Baylis was unlikely to comply.The Commissioner's application[10] The Commissioner seeks to have the pokies notebook ruled admissible as abusiness record within the exception to the rule against hearsay evidence contained ins 19 of the Evidence Act 2006 (the Act). Section 19 provides:19 Admissibility of hearsay statements contained in business records(1) A hearsay statement contained in a business record is admissible if—(a) the person who supplied the information used for thecomposition of the record is unavailable as a witness; or(b) the Judge considers no useful purpose would be served byrequiring that person to be a witness as that person cannotreasonably be expected (having regard to the time that haselapsed since he or she supplied the information and to all theother circumstances of the case) to recollect the matters dealtwith in the information he or she supplied; or(c) the Judge considers that undue expense or delay would becaused if that person were required to be a witness.(2) This section is subject to sections 20 and 22.[11] A business record is defined in s 16 of the Act as follows:business record—(a) means a document—(i) that is made—(A) to comply with a duty; or(B) in the course of a business, and as a record orpart of a record of that business; and(ii) that is made from information supplied directly orindirectly by a person who had, or may reasonably besupposed by the court to have had, personalknowledge of the matters dealt with in theinformation he or she supplied; but(b) does not include a Police record that contains any statementor interview by or with an eyewitness, or a complainant, orany other person who purports to have knowledge orinformation about the circumstances of alleged offending orthe issues in dispute in a civil proceeding.[12] "Business" is in turn defined in s 16 as follows:business—(a) means any business, profession, trade, manufacture,occupation, or calling of any kind; and(b) includes the activities of any department of State, localauthority, public body, body corporate, organisation, orsociety[13] Section 16 also specifies the following:(2) For the purposes of this subpart, a person is unavailable as awitness in a proceeding if the person—(a) is dead; or(b) is outside New Zealand and it is not reasonably practicablefor him or her to be a witness; or(c) is unfit to be a witness because of age or physical or mentalcondition; or(d) cannot with reasonable diligence be identified or found; or(e) is not compellable to give evidence.(3) Subsection (2) does not apply to a person whose statement is soughtto be offered in evidence by a party who has caused the person to beunavailable in order to prevent the person from attending or givingevidence.[14] Mr White's submission was that, similar to the gang's accounting notebookproduced in evidence, this was a business record which related to the operation of thethree functional pokie machines located in the gang clubhouse and which was intendedto be a reliable record of the relevant financial transactions.[15] In emphasising that the gang kept relatively accurate records of financialtransactions at Vickerys Road, Mr White pointed to entries in the separate accountingnotebook where outgoings recorded as rates could be cross-referenced to paymentsreceived by the Council around the same date and outgoings which were recorded aspower bill payments were similarly recorded in Contact Energy's records as cashpayments received. Given the importance of keeping accurate records, so that therewas accountability to other gang members, Mr White submitted that, just as theaccounting notebook was accepted as a business record, the pokies notebook fitswithin the definition of business records.[16] Although much of the business being carried out by the gang was illicitbusiness, including sale of controlled drugs and other criminal ventures, Mr Whitesubmitted there is nothing within the Act which suggests that an illicit business or tradeis excluded from the definition of "business". The Act defines "business" broadly andnon-exhaustively. Here, he submitted that the Head Hunters can be considered a"society" and their business activities, illicit or not, involve either a "trade","occupation" or "calling of any kind".[17] This is supported by the High Court's decision in Commissioner of Police vVincent, where a spreadsheet recording the distribution and sales of controlled drugswas held to be admissible as a business record, despite the fact the business in questionwas a criminal venture.2[18] Mr White accepted that the Commissioner has not definitively identified theauthor of the pokies notebook, although it was found in Mr Baylis' possession, and hewas acknowledged in evidence to have regularly carried out the function of treasurerfor the local gang members. If it is Mr Baylis, the circumstances described in [7]–[9]above demonstrate that Mr Baylis is either unavailable as a witness, or the delay that2 Commissioner of Police v Vincent [2016] NZHC 892 at [26]–[27].would be caused in endeavouring to secure his appearance as a witness would beundue in the circumstances of the case, thus satisfying either s 19(1)(a) or (c).[19] In any event, Mr White submitted that the identity of the author does not haveto be conclusively demonstrated as a pre-requisite to admitting a business record. Asthe Court of Appeal said in Keshvara v Blanchett:3[33] With respect to the requirements in s 19(1), even if we had consideredthat Mr Antoo was unlikely to be the person who supplied the informationused in composing the documents, the judge's conclusions on admissibilityare still valid. Nothing in s 19 requires the judge to make an explicit findingas to the identity of the person who supplied the information relevant to thedocuments in question. We are satisfied that a judge may rely on s 19(1)(b) ifsatisfied that, given that sufficient time has passed, whoever the precise personor persons might be, no useful purpose would be served by requiring thatindividual (or individuals) to be a witness.[20] Here, Mr White argued that whether or not Mr Baylis created the accountingrecords, any supplier of the information which was used to compile those records,even if they could be identified and located, could no longer reasonably be expectedto recollect the matters dealt with in the information they supplied given the time thathas elapsed. There could be no useful purpose in requiring every individual who wasresponsible for each transaction recorded in the notebook to be called and giveevidence. For these reasons, the pokies notebook is admissible under s 19(1)(b).[21] Finally, Mr White noted that, given the association of the three respondents tothe suppliers of the information used to compile the pokies notebook, they are morelikely to be able to obtain the information that they require to interpret and certify itscontents than the Commissioner.Submissions for the defendant[22] Mr Wimsett maintained his objection as to the admissibility of the pokiesnotebook. Whether or not it was admissible under s 19 of the Act, he emphasised thatthe Court must still consider the s 8 test and whether the admission of the evidencewould have an unfairly prejudicial effect on the proceeding.3 Keshvara v Blanchett [2012] NZCA 553, (2012) 21 PRNZ 475.[23] In this regard, he submitted that hearsay statements in business records areadmissible under s 19 because, by their very nature, they speak for themselves.However, the pokies notebook did not have the same "on its face" readability as, say,bank records, which are clear and readily understood. In his submission, one cannotread the entries in the pokies notebook and know exactly what the figures represent.It would therefore be prejudicial to the respondents for the Commissioner to take theseentries which have been prepared by an unknown author and introduced as evidencewithout explanation and then calculate the "benefit" said to have been generatedthrough the gang's pokie machines. Without being confident as to what this notebookrecords, the Court would be engaging in guesswork in interpreting its contents.Discussion[24] I am satisfied that the pokies notebook falls within the definition of being abusiness record for the purpose of the Act. The evidence I did hear from witnesseswho were associated with the gang at the time these documents were created satisfiedme that the gang required accountability when money was being handled byindividuals on the gang's behalf. Mr Tonihi, who kept the accounting notebook for aperiod of five months, emphasised that it was important to keep records because "themoney was never personally mine so it was really there to keep me safe to make surethat people did not think I ripped them off". Mr Tonihi's role in running the accountingnotebook ended when he handed it over to Darrin Baylis.[25] Similarly, Mr Murphy, who was an associate of the gang, explained howcareful records were kept of money taken from the pokie machines, the drinks machineand the snack machine which were in the clubrooms. He pointed out that all thosemachines took coins so there was also a coin changer machine which people could useto change notes for coins. He would be entrusted with taking the excess notes out ofthe coin changer and take it away as float. He observed that he would "write downwhich machine done what for myself then I would count it up, I would get someoneelse to count it up so there is no discrepancies and then most of the money I wouldtake to pay for whatever was needed, to keep it safe". I thus have some evidence ofthe care with which tallies of cash from the pokie machines were undertaken and thelikely reliability of the records in the pokies notebook.[26] That then leads to whether any of the circumstances in s 19 of the Act apply.While much has been made about Mr Baylis being the likely author of the pokiesnotebook and, being "unavailable as a witness" because he has been unable, withreasonable diligence, to be found,4 that only addresses part of s 19(1)(a). It is unclearwhether, even if Mr Baylis authored the notebook, that he supplied each financialrecord which is recorded there. The evidence I have heard demonstrates differentmembers and associates of the gang paid money in, or oversaw the checking of thepokie machine takings, or made payments out. Whoever created the pokies notebookrecorded these transactions for the record.[27] To the extent that Mr Baylis may have been the author of the pokies notebook,or may have had first hand knowledge of some of the transactions, I am satisfied he isunavailable as a witness because of his deliberate steps to avoid coming to Court andthen to evade police attempts to locate him. I also consider that there would be unduedelay if I required the hearing to be adjourned until and unless the police were able tolocate Mr Baylis.[28] However, more importantly, I consider the pokies notebook falls withins 19(1)(b). Whoever recorded the transactions, the person who supplied theinformation to the bookkeeper cannot, in each case, be identified and nor could theyreasonably be expected, having regard to the six years that have elapsed since theyprovided the information, to recollect the matters dealt with in the information he orshe supplied. Indeed, to the extent witnesses were questioned on particulartransactions associated with the separate accounting notebook, they could not recallthe details of the transaction and I would not expect the individuals who supplied theinformation to whoever kept the pokies notebook to be able to recall the details ofindividual payments in or out.[29] That leads to Mr Wimsett's main objection, which is that, without explanation,the pokies notebook is simply not comprehensible on its face and cannot be relied on,without explanation, to estimate the throughput of the pokie machines.4 Evidence Act 2006, s 16(2)(d).[30] I do not accept that submission. While the records are not particularly formal,they are not as opaque as Mr Wimsett suggests. In the context of the evidence I haveheard, it is a logical inference that the numbers #1 – #3 refer, respectively, to the threepokie machines and the reference to the "Changer" is to the machine which dispensescoins in exchange for bank notes. In each case it is clear that the total from theprevious page in the notebook is transferred onto the fresh page, the income from thepokie machines added in to reach a new total and then the payments out are recordedto reach a new total.[31] On its face, there is no other logical way to read the records in the pokiesnotebook and no obvious ambiguity arises. Furthermore, as Mr White submitted, therespondents who were connected to the Head Hunters at the time could be expected toprovide a credible alternate explanation of what the pokies notebook recorded if infact there was one.[32] Accordingly, at the conclusion of the admissibility hearing, I ruled the pokiesnotebook admissible in evidence, and advised that closing submissions could proceedon the basis that it was in evidence.Solicitors:Raymond Donnelly & Co., ChristchurchCopy To:S N B Wimsett, Barrister, Auckland