THE COMMISSIONER OF NEW ZEALAND POLICE V PAMELA ANN GREEN HC WN CIV-2010-485-964

THE COMMISSIONER OF NEW ZEALAND POLICE V PAMELA ANN GREEN HC WN CIV-2010-485-964 1 August 2011IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYCIV-2010-485-964BETWEEN THE COMMISSIONER OF NEWZEALAND POLICEApplicantAND PAMELA ANN GREENRespondentHearing: 28 June 2011Counsel: D La Hood for ApplicantN Levy for RespondentJudgment: 1 August 2011JUDGMENT OF WILLIAMS JIn accordance with r 11.5, I direct the Registrar to endorse this judgment with the delivery time of 2:30pm on the 1st August 2011.Solicitors:Crown Solicitors, WellingtonN Levy, Barrister, PO Box 10909, Wellington, email: n.levy@axtra.co.nzBackground and issues[1] The respondent Pamela Anne Green (or Ranga) was convicted on drugrelated offences on 8 October 2010 and sentenced to six years' imprisonment. A restraining order was granted by consent on 13 August 2010. The order froze therespondent's assets including two residential properties, cash, bank accounts, a carand jewellery.[2] The Commissioner applied for an examination order against the respondent on 3 June 2011. The order sought by the Commissioner required the respondent to:(a) answer questions as to the source and application of the funds of the respondent and her associates between 2003 and 2010;(b) answer questions with respect to the purchase and sale of properties at Peka Peka and Raumati Beach;(c) answer questions relating to the source of funding for lifestyleexpenses, vehicle purchases, and "asset accretion".[3] I granted the order on the same day and on an ex parte basis. In accordance with s 107(7) of the Criminal Proceeds (Recovery) Act 2009, the Commissioner advised Ms Nicolette Levy, Barrister, of the proposed date of the examination and Ms Levy subsequently received service of the order.[4] Ms Levy immediately requested a copy of the application from the High Court registry. Registry staff duly provided it to Ms Levy assuming that she was entitled to it under r 3.8 of the High Court Rules. Controversy arose between counsel for the Commissioner and Ms Levy as to whether she was entitled to receive and retain the application. Counsel for the Commissioner sought directions on the question.[5] These matters came before me for consideration on 28 June 2011. Although the narrow question was whether Ms Levy was entitled to retain the application andshow it to her client, in fact the answer to that question turned in part on whether the High Court Rules applied to the application at all. The answer to that question then depended on understanding what the procedure for s 107 applications was intended to be.[6] It was therefore agreed that I should address the matter afresh and on a first principles basis. Accordingly, I have posed and answered three questions as follows:(a) Does a proposed examinee have a right to notice of the application for examination? I conclude that there is no such right nor any right to be heard before the Judge considers whether orders should be made.(b) Is there judicial discretion to require notice in appropriate cases? I conclude that there is such discretion and there will be cases where notice should be given and an opportunity afforded to the examinee to be heard.(c) Should I have required that the Commissioner to give notice of the application in this case? I conclude that the examinee should not have received notice in this case, and that the application was appropriately dealt with on an ex parte basis.Is the examinee entitled to notice?[7] In Chanwai v Commissioner of Police, I briefly reviewed the scheme of the Act.1 I found that there was a distinction between the procedures for restraining and forfeiture orders and the procedures for examination orders. Forfeiture applications are always made on notice; restraining orders can either be on notice or ex parte;2 but examination orders contain no specific notice procedure at all. I found that sinceexamination orders are grouped under the heading "Investigative Powers", alongsideproduction orders and search warrants, it was not intended that such applications should be dealt with on notice or involve a hearing as to the terms of any order.1 Chanwai v Commissioner of Police HC Rotorua CIV-2010-463-544, 31 March 2011.2 Sections 21 and 22.[8] In Chanwai, I found also that although s 10 of the Act specifically declared certain proceedings to be civil proceedings, examination orders are not included in the list. I said that the effect of this is that the review provisions in respect of interlocutory applications contained in r 7.49 of the High Court Rules have no application either. For the same reasons the interlocutory notice requirements in r 7.22 could have no application.[9] In this case Ms Levy accepted that there is no express notice or hearing requirement in relation to examination orders in the Act. She pointed however to s 10(1) which provides as follows:Proceedings relating to any of the following are civil proceedings:(a) a restraining order:(c) an assets forfeiture order:(d) a profit forfeiture order.[10] Ms Levy argued that the Commissioner had obtained a restraining order by consent and ultimately intended to secure a forfeiture order both of assets and profit. It followed, she argued, that the application for examination order was a proceeding"relating to" all of (a), (c), and (d). It was, she said, ultimately designed to assist in obtaining forfeiture orders, so it must relate to them.[11] On that basis, she argued that r 3.8 of the High Court Rules applied giving her access to the court file unless a Judge directs otherwise under r 3.8(3).[12] Mr La Hood argued that the phrase "relating to" in s 10 could have two possible and quite distinct meanings: either "affecting" or "about". If it was intended by Parliament to have the former meaning then an examination order does indeed affect, in the sense that it relates to, a restraining or forfeiture order and Ms Levy would be entitled to retain the application. If the latter meaning was intended, it does not. Mr La Hood argued that in the event of a genuine ambiguity such as this, recourse must be had to the scheme and history of the Act.[13] Insofar as the scheme is concerned, Mr La Hood argued that the legislature intentionally put examination orders and search warrants in the same category –"investigative powers" under sub-part 7 – because they were intended to be dealt with ex parte and without any right in the examinee of access or participation. Mr La Hood argued that applications for search warrants or examination orders must necessarily be dealt with confidentially because if the respondent is able to access the relevant information or participate in the process leading up to grant of the warrant or order, the application's purpose would be undermined. Prior warning of a search warrant is likely, he argued, to lead to the relevant items disappearing. Similarly, prior warning of the detailed evidence disclosed by police in their application of financial transactions and purchases will inevitably lead to examinees carefully concocting beforehand their answers to difficult and inconvenient questions.[14] Mr La Hood also referred to the history of the legislation. The Criminal Proceeds (Recovery) Bill 2007 (2007 Bill), as introduced, also included a sub-part 7 relating to investigative powers. The Bill would have established a specialist recovery agency. Under the original sub-part 7, the director of the agency could issue an examination notice without the need for judicial involvement. When the Bill was reported back from the Select Committee, the examination notice procedure had been replaced with a regime which, according to the committee report, made it"necessary to obtain judicial authorisation to require a person to appear before theCommissioner to answer questions, supply information and produce documents forinspection." The Select Committee said:3We consider that replacing the notice power with the power to seek an examination order with judicial oversight would provide better safeguards.[15] Mr La Hood submitted that the amendment was intended to produce judicial oversight not a right in the examinee to notice and a hearing.[16] I agree with Mr La Hood that the term "relating to" in s 10(1) of the Act wasintended to mean "about" not "affecting". I agree that the location of the examination order process in sub-part 7 was intended to indicate that it should be3 Criminal Proceeds (Recovery) Bill 2007 (81-2) (Select Committee report) at 5.treated similarly to search warrants. The fact that these provisions were changed in Select Committee to introduce judicial oversight to what would otherwise have been a police notice procedure is a strong indication in my view that the legislature never intended the notice and access rights or procedures of the High Court Rules to be bolted on the examination order process. Rather, it was considered (as with search warrants) that judicial oversight by means of an ex parte procedure was, generally speaking, a sufficient safeguard for the examinee.[17] I have briefly reviewed the Law Commission Report on search and surveillance powers of June 2007,4 the original Criminal Proceeds and Instruments Bill 2005 (2005 Bill) along with the 2007 Bill both as introduced and as reported back. The themes are consistent.[18] Another investigative power included in sub-part 7 is the power to order production. The 2005 Bill, and the first version of the 2007 Bill, provided for production notices (in respect of a limited range of people), as well as productionorders (a wider range of people) and examination notices. The Select Committee removed production notices from the second version of the 2007 Bill, with a similar explanation as that for the change to examination orders.5 In June 2007, the Law Commission reported extensively on the issue of production powers (they were relatively novel in New Zealand but more widely used elsewhere). While the Commission was supportive of production orders, the Commission said:6There do not appear to be any substantial grounds to justify departing from the warrant principle requiring enforcement officers exercising a coercive power to first obtain authorisation from a neutral person acting judicially. Cases where it is not practical to seek such authority before a production power is exercised are unlikely to arise.[19] The Commission criticised the inclusion of production notices in the 2007 Bill.7 These comments seem to have been important in the Select Committee'sdecision to remove the notice procedures for both production and examination4 Law Commission Search and Surveillance Powers [NZLC R97, 2007].5 At 4.6 At 301.7 At 303.powers and to replace them with orders. The Hon Simon Power in his opening speech on the second reading debate said:8The Bill would also have introduced examination and production notice powers, which would have been issued by the Commissioner of Police, but the notice powers were a concern for some submitters on the Bill, who considered that such powers could be subject to abuse because of the lack of judicial oversight of their use. These matters have been widely canvassed by the Law Commission in its report on search and surveillance powers. The Commission recommended against the provision of notice powers for criminal investigative purposes. Although it is possible to draw a distinction between civil and criminal forfeiture investigations, the committee considered that, on balance, some of the concerns raised in submissions were equally applicable to civil forfeiture investigations, and there was no compelling reason to diverge from the Law Commission's recommendation.Accordingly, the committee has recommended amendments to remove the production notice power and replace the examination notice with an examination order power.[20] It is clear in my mind that both the Commission's and the Select Committee'spreference for orders over notices was intended to ensure that examination and production powers were properly and neutrally authorised. The concern was not as to whether the respondent was given an opportunity to be heard in a more adversarial process.[21] That is not to say that either the Law Commission or the Select Committee completely ruled that possibility out in all cases. Rather, it is to say that neither proposed a regime positively providing for it.Is there discretion to require notice?[22] Having concluded that an examinee has no right to participate in the process whereby examination orders are made, I am equally satisfied that the discretion available to the Judge under s 107 is wide enough to permit such participation if that is necessary in the interests of justice.[23] Section 107(1) of the Act requires the Judge to be satisfied that the Commissioner has reasonable grounds to apply for an examination order before any order is made. Upon being satisfied, there is still a broad discretion vested in the8 (17 February 2009) 652 NZPD 1372.Judge who "may" make the order. In some circumstances such orders may impinge upon a defendant's right not to be compelled to be a witness or to confess guilt as protected by s 25(d) of the New Zealand Bill of Rights Act. In addition, an order will always involve some measure of detention in terms of s 23(4)(b) of NZBORAand so will impinge upon the right while detained to "refrain from making any statement". There is no doubt but that the Act was intended to impinge upon these rights. Section 165 gives the examinee derivative immunities in recognition of that fact. But that does not necessarily mean that the Act requires the complete abrogation of those rights in every case. It will always be necessary to consider the application in light of these rights.[24] In Commissioner of Police v Burgess, Asher J considered an application by the Commissioner for an examination order.9 Crown counsel advised the respondents' solicitor of the intention to apply for examination orders. Asher J described this as good practice on the part of the Crown.10 The respondents objected and were heard. Asher J found that, because the examination order was being soughtbefore final disposal of the substantive criminal charges against the respondents, the rights I have mentioned were engaged. He found that the inconsistency between the rights engaged and the application, could be resolved by adjourning the application until after the conclusion of the collateral criminal proceedings.[25] Clearly there will be circumstances where the orders sought should be refused or modified. As Burgess shows it will sometimes be necessary to hear from the respondent before reaching any conclusion. It will be the responsibility of the Judge to be alive to the possibilities and, where appropriate, to require that the application be served, or that the respondent be given an opportunity to makesubmissions. The point is, as was implicit in Asher J's reasoning, Judges have inherent power to consider whether respondents should be brought into the process in order to address possible impacts that can be mitigated within the four corners of the statute. This will need to be determined on a case by case basis depending on whether there are collateral interests that the respondent might be entitled to protect, overly broad incursions into NZBORA rights or other particular considerations9 Commissioner of Police v Burgess HC Auckland CIV-2010-404-2893, 10 May 2011.10 At [5].unique to individual cases. Such cases will, I apprehend, be the exception rather than the rule, but they must be provided for when they arise.Should the respondent have had notice of the examination order application in this case?[26] The orders sought by the Commissioner essentially ask the respondent to explain where she got her money from between 2003 and 2010, and how she spent it; how she purchased the properties at Peka Peka and Raumati Beach; and how she funded her (implicitly extravagant) lifestyle.[27] Ms Levy says it would be helpful to the process of examination to allow the examinee to see the application beforehand because it will give Ms Green an early opportunity to recall relevant detail. Mr La Hood on the other hand says disclosure of the application will give Ms Green an opportunity to concoct false explanations.[28] I have reviewed the application and the evidence upon which it is based. I am satisfied that there is no particular reason to give notice of the application to the respondent beyond that set out in s 107(7) in which the respondent must be given a reasonable opportunity to arrange for a lawyer to accompany her to the policestation. The questions are constrained to the respondent's own personal financialaffairs and transaction. There are no pending charges that might invoke a collateral right to silence requiring further consideration.[29] In short, this is an orthodox application under s 107 with no special characteristics such that I ought to require proper notice to the respondent in exercise of my inherent jurisdiction.Conclusion and order[30] It follows therefore that, since the High Court Rules have no application to examination orders, and since I do not consider that there are any special circumstances that might require that the respondent be given notice of theapplication, counsel must return the application and any other court documents held in relation to this application to the High Court registry.___________________________Williams J