HUNT v COMMISSIONER OF POLICE [2021] NZCA 644

HUNT v COMMISSIONER OF POLICE [2021] NZCA 644 [2 December 2021]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA446/2020[2021] NZCA 644BETWEEN LEROY JAMES HUNT, TARA LEE HUNTand CARRINGTON & YOUNGTRUSTEES LIMITED as trustees of theHUNT FAMILY TRUSTAppellantsAND COMMISSIONER OF POLICERespondentCA447/2020BETWEEN DION JAMES HUNT and ADA SHARONPUEAppellantsAND COMMISSIONER OF POLICERespondentANZ BANK NEW ZEALAND LIMITEDFirst Interested PartyLEROY JAMES HUNT, TARA LEEHUNT and CARRINGTON & YOUNGTRUSTEES LIMITED as trustees of theHUNT FAMILY TRUSTSecond, Third and Fourth Interested PartiesADA DIONNE PUEFifth Interested PartyDAVID CHARLES ROSS HUNTSixth Interested PartyHearing: 1 July 2021Court: Brown, Clifford and Gilbert JJCounsel: N P Bourke for Appellants in CA446/2020R A A Weir and S L Abdale for Appellants in CA447/2020G N Milne for RespondentJudgment: 2 December 2021 at 10.30 amJUDGMENT OF THE COURTA The Commissioner's application to adduce further evidence in both appealsis granted.B The appeal in CA446/2020 is dismissed.C The appeal in CA447/2020 is allowed.D The restraining orders over 31 Leyton Place and the cash are discharged.E We make no order for costs in CA446/2020.F The respondent must pay the appellants in CA447/2020 costs for a standardappeal on a band A basis with usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Clifford J)[1] Dion Hunt and Ada Pue (the appellants in CA447/2020) face charges ofproducing, possessing, supplying and conspiring to supply methamphetamine.Their trial is due to start on 8 February 2022.[2] On 21 September 2017 the Commissioner of Police was granted without noticerestraining orders under the Criminal Proceeds (Recovery) Act 2009 (the Act) overreal property comprising 31 Leyton Place, Nawton, 134 and 180 Foreman Road,Waitara and over $4,825.40 in cash.[3] 31 Leyton Place is registered in Mr Hunt's name, as is 134 Foreman Road.180 Foreman Road is registered in the names of the appellants in CA446/2020 astrustees (the Trustees) of Mr Hunt's family trust (the Trust). The $4,825.40 in cashwas found at 180 Foreman Road, a property suspected to have been used by Mr Huntand Ms Pue in the course of their alleged offending.[4] In July 2020, Clark J in the High Court at New Plymouth declined separateapplications by the Trustees and Mr Hunt and Ms Pue to discharge or vary thoserestraining orders as they apply to 180 Foreman Road, 31 Leyton Place and the$4,825.40 cash respectively.1 These are appeals against those decisions: CA446/2020by the Trustees, CA447/2020 by Mr Hunt and Ms Pue.[5] Also before the Court is an opposed application by the Commissioner for leaveto adduce further evidence in both appeals in the form of an affidavit from aMs Anna Marie Swaine. We deal with that application before we address thesubstantive issues this appeal raises.Background[6] Mr Hunt and Ms Pue have been in a de facto relationship since 2003.Both have considerable criminal histories. Those histories include methamphetamineoffending. Following conviction and imprisonment in 2004, property with a value inexcess of $710,000 was recovered from them under the Act.[7] Mr Hunt was released from prison in October 2008, Ms Pue inNovember 2007.[8] In June 2012 Mr Hunt had subdivided the property he then owned onForeman Road into two lots: 134 and 180 Foreman Road. 134 Foreman is bare land,slightly less than one hectare in area: 180 Foreman is described as a "dwelling andpastoral property" comprising some 20 hectares in all. Mr Hunt settled the Trust inJune 2012 on the Trustees. The final beneficiaries of the Trust are Mr Hunt's children,Leroy, David and Tara Lee and their children.[9] In the first half of 2014 the Trust purchased 180 Foreman Road from Mr Huntfor $316,390. The Trust refinanced that purchase in June 2016, with funds from1 Commissioner of Police v Hunt [2020] NZHC 1692 [Judgment under appeal].ANZ Bank New Zealand Ltd (ANZ). Those loans are secured by mortgages over180 Foreman.[10] In December 2016 the New Plymouth Organised Crime Group commenced aninvestigation into the alleged manufacture, sale and supply of methamphetamine byMr Hunt and Ms Pue. As a result of the investigation they were charged in July 2017.In September 2017, the properties were restrained.[11] On 30 September 2019, dissatisfied with the time being taken to resolvethe criminal charges and the restraining orders, the Trustees applied for the release of180 Foreman from restraint. On 3 October Mr Hunt and Ms Pue applied for 31 Leytonand the cash to be released as well.[12] Those applications were heard by Clark J in the High Court at New Plymouthon 2 March 2020.2 On 14 July 2020 the Judge released her decision, declining allthree applications.The Commissioner's fresh evidence application[13] The additional evidence the Commissioner seeks to adduce comprises anaffidavit of Ms Swaine. Ms Swaine records the result of the police's ongoinginvestigations into the affairs of Mr Hunt and Ms Pue, including the source of fundsfor the acquisition of the properties and, more recently, the source of funds used bythe Trust to meet its ANZ funding costs. The point of the evidence is to establishthe Trust has relied on funds received from external parties, including Mr Hunt,to finance the purchase of 180 Foreman.[14] The Trustees, Mr Hunt and Ms Pue object to the admission of that evidence,essentially on the basis that it was not before the Court when the original restrainingorders were made. The Commissioner sought to adduce the evidence inthe High Court, but the Judge felt able to resolve matters without reference to thatevidence and, hence, did not rule on its admissibility.32 Judgment under appeal, above n 1.3 At [53]–[55].[15] We are satisfied the evidence is admissible. The Act clearly provides anongoing process whereby following the grant of initial orders issues of restraint andforfeiture are further investigated by the police. Further orders may be sought by thepolice and, indeed, by respondents and interested persons. Where that occurs, as isthe case here, an update of the state of the police investigation is likely to be relevant,and not unfairly prejudicial. Given that ongoing investigative process, whichculminates at the substantive hearing of the Commissioner's forfeiture applications,we do not consider a respondent or interested person can oppose the adducing of thatevidence just because it was not available at an earlier stage in the process. If thetiming of disclosure is an issue, that can be dealt with in other ways.[16] We therefore grant the Commissioner's application.4Legal context[17] Before turning to the challenged High Court decision, it is necessary tosummarise the position as it was between the appellants and the police, and as regardsthe property, at the time of the High Court hearing. To do so, a little legal contextis helpful.[18] The Act provides a regime for the making of orders for the restraint andforfeiture of property derived as a result of significant criminal activity. The regimeapplies without the need for criminal proceedings or a conviction.5 Property may berestrained, and subsequently forfeited, or simply forfeited without prior restraint.6[19] As relevant here, the Act provides for two types of forfeiture orders:assets forfeiture orders and profit forfeiture orders.7[20] Section 50 provides the High Court must make an assets forfeiture order asregards specific property if it is satisfied on the balance of probabilities that specificproperty is tainted property. Tainted property is property acquired or derived wholly4 Court of Appeal (Civil) Rules 2005, r 45.5 Criminal Proceeds (Recovery) Act 2009, ss 15 and 16.6 Section 11.7 Sections 50 and 55.or in part from significant criminal activity.8 The owner of the property need not beresponsible for or even be aware of the taint.[21] Section 55 provides the High Court must make a profit forfeiture order asregards property in which a person has an interest where the Court is satisfied on thebalance of probabilities that person has unlawfully benefitted from significant criminalactivity within a certain period.[22] Likewise, there are two types of restraining order:(a) Section 24 provides that a court may make a restraining order relatingto specific property where satisfied it has reasonable grounds to believethat any property is tainted property.(b) Section 25 provides that a court may make a restraining order relatingto all or part of a respondent's property if satisfied it has reasonablegrounds to believe that the respondent has unlawfully benefitted fromsignificant criminal activity.[23] Importantly, there is no requirement for orders under ss 25 and 55, which dealwith unlawful benefits, for the restrained and/or forfeited property to be tainted.[24] Section 6(1) defines significant criminal activity as follows:(1) In this Act, unless the context otherwise requires, significantcriminal activity means an activity engaged in by a person that ifproceeded against as a criminal offence would amount to offending—(a) that consists of, or includes, 1 or more offences punishable bya maximum term of imprisonment of 5 years or more; or(b) from which property, proceeds, or benefits of a value of$30,000 or more have, directly or indirectly, been acquired orderived.8 Section 5(1).The Commissioner's applications[25] On 11 September 2017 the Commissioner made two applications underthe Act:(a) The first of these was a without notice application under s 25 of the Actfor the restraint of the real property and the cash. The Commissionerwas asserting Mr Hunt and Ms Pue had an interest in that property andthat they had unlawfully benefited from significant criminal activity.(b) The second was an on-notice application under s 45 for forfeiture ofthree vehicles. Hence the Commissioner was asserting those vehicleswere tainted property.[26] The Commissioner's without notice application for a restraining order wasgranted as noted, on 21 September 2017. The Commissioner's on notice applicationfor a forfeiture order has, as yet, not been heard.[27] Without notice restraining orders expire after seven days unless within thatperiod the Commissioner applies on notice.9 On 27 September 2017, theCommissioner filed on notice applications under ss 24 and 25 of the Act for restraintof the three properties and the cash. Hence the Commissioner was at that pointasserting that property was both tainted property and/or was property in which theTrustees and Mr Hunt and Ms Pue had an interest and that they had unlawfullybenefited from significant criminal activity.[28] Those on notice applications have never been heard. However, because theapplications have been filed, the without notice restraining orders have remained inforce ever since.[29] The Trustees and Mr Hunt and Ms Pue all initially sought early resolutionof matters. It was subsequently agreed that, in the interests of their avoidingincrimination, the resolution of forfeiture and restraint issues should occur after9 Section 39(1) and (2).the finalisation of the criminal matters. In time the vehicles which were the subject ofthe original on notice forfeiture application, which had been seized but not restrained,were returned.[30] In September 2019, and as the trial date kept slipping, the Trustees andMr Hunt and Ms Pue indicated an intention to apply to strike-out the forfeiture andrestraint proceedings, or for the release of all the property involved. Matters were thenbrought to a head by the filing of the applications at issue here for releasefrom restraint.[31] Accordingly, and when considering the Trustees' release application, it will beimportant to bear in mind the Commissioner asserts that 134 Foreman istainted property. It was thus liable to be forfeit against the Trustees irrespective ofthe fact the Commissioner does not allege they were involved in Mr Hunt's andMs Pue's significant criminal activity.[32] The High Court was satisfied it had reasonable grounds to believe Mr Huntand Ms Pue had benefited from significant criminal activity. At the same time, it ismaterial that when the Court made the original without notice restraining order overthe real property and the cash, it did not conclude under s 24 it had reasonable groundsto believe the restrained property was tainted property. Moreover, it has not done sosubsequently.The challenged High Court decision[33] We summarise Clark J's decision declining to discharge or vary the restrainingorders by reference to the three items of property involved and in the order the Judgeadopted. No application for the variation or discharge of 134 Foreman was made.180 Foreman[34] The Trustees' application pursuant to s 30 of the Act, that their interest in180 Foreman should be severed and that property released, was based onthree propositions:(a) They had an interest in 180 Foreman, being its owners at law(s 30(2)(a)).(b) They had not unlawfully benefitted from any significant criminalactivity of Mr Hunt and Mr Pue comprising their alleged offending(s 30(2)(b)).(c) Their interest in 180 Foreman was severable from Mr Hunt's interestsin the balance of the restrained property, that is 31 Leyton, 134 Foremanand the cash (s 30(1)).[35] Clark J declined that application.10 It was accepted the Trustees had an interestin 180 Foreman.11 But, the Judge reasoned, the Trustees were, jointly, the sole ownersof 180 Foreman: that is they owned the whole property. There was, therefore, no otherinterest in that property from which their interest could be severed. So severance wasnot possible.12[36] Even if that were not the case, the Judge would still not have grantedthe application. The Trustees had not, in her assessment, established on the balanceof probabilities they had not unlawfully benefitted from significant criminal activity.13Rather, given what the Judge termed Mr Hunt's "effective control" of 180 Foreman,and the police evidence as to Mr Hunt's involvement in the 2016 refinancing of thepurchase of both 134 and 180 Foreman,14 the Judge was satisfied that their ownership,albeit as trustees, of 180 Foreman represented an unlawful benefit for them.1531 Leyton[37] Mr Hunt argued that restraint of 31 Leyton was disproportionate andconstituted "undue hardship",16 given the extent of the alleged offending as acceptedby the police. To explain:10 Judgment under appeal, above n 1, at [31].11 At [22] and [34].12 At [31].13 At [36].14 At [37].15 At [38].16 See Criminal Proceeds (Recovery) Act, s 56.(a) The restrained property is said by Mr Hunt to have a total value of$874,218 of which $166,000 is attributable to the equity in134 Foreman.(b) The police estimate of the unlawful benefit from the alleged offendingis (at its highest) $59,000.[38] Mr Hunt said those figures demonstrate the restraining order simply goestoo far. Continuing restraint over 134 Foreman alone would be sufficient to protectthe police's interest in recovering by forfeiture the unlawful benefit from thealleged offending.[39] The Judge did not directly address whether disproportionality hadbeen established. Rather she concluded the possible question of disproportionalitywas not relevant when restraint orders were granted or continued. It only becamerelevant when questions of forfeiture were considered.17 She declined the applicationfor the release of 31 Leyton accordingly.18The cash[40] The $4,825.40 cash was seized from 180 Foreman when Mr Hunt and Ms Puewere arrested. It comprised:(a) $3,000 found in an envelope on the kitchen bench;(b) $498 in notes and coins found in Ms Pue's bag; and(c) $1,160 in notes found in Mr Hunt's wallet.[41] Mr Hunt and Ms Pue based their application for release on disproportionalityconstituting undue hardship and on the cash not being derived from, or tainted by,significant criminal activity. In support of the second of those propositions:17 Judgment under appeal, above n 1, at [59].18 At [62].(a) They relied on an affidavit from a Mr Craig McEldowney that on26 July 2017 he had paid Mr Hunt $3,000 cash in an envelope — whichhe had recently earned in a "large gambling win". That cash wasthe outstanding purchase price of a car, previously belongingto Ms Pue, which Mr McEldowney had purchased through Mr Huntabout a month earlier.(b) They said:(i) the $498 in notes and coins came from Ms Pue's winnings atthe casino at Hamilton; and(ii) the $1,160 in notes was a cash withdrawal from the balance ofan account which had been deposited with credit from a financecompany to renovate 31 Leyton.[42] The Judge declined the application as premature.19 It was more properly to beconsidered, and Mr McEldowney's evidence tested if the Commissionercross-examined him, at the "on-notice" hearing.20Analysis180 Foreman[43] We agree with the Trustees' interpretation of "severable" under s 30 of the Actin this context. Contrary to the view the Judge took, where real property constitutinga number of separate lots is restrained, we consider each lot may be severable fromthe balance of the restrained property, that is, the other lots, notwithstanding that thewhole of the lot to be severed is owned by the same person or persons.[44] But that is not to say we disagree with the Judge's decision to declinethe Trustee's severance application. In our view Mr Hunt's retention under the termsof the Trust of the power to appoint and remove trustees, and even more so to appoint19 At [70].20 At [71].persons, including himself, as beneficiaries is fatal to a claim that 180 Foremanis severable from the rest of the restrained property, as the concept of severability isto be understood in the context of the Act.[45] Section 30 of the Act provides:30 Excluding severable interest from restrained property(1) A person (other than the respondent) who has a severable interest inproposed restrained property or restrained property may apply to thecourt that is to consider, or has considered, the application for arestraining order to have that person's severable interest excludedfrom—(a) a restraining order that the court may make; or(b) a restraining order the court has made.(2) The court must exclude a severable interest from proposed restrainedproperty or restrained property at, or after, the time a restraining orderis made if the applicant proves on the balance of probabilities—(a) that the applicant has an interest in the property to which therestraining order relates; and(b) if the order was or is to be made under section 24 or 25, thatthe applicant has not unlawfully benefited from the significantcriminal activity to which the restraining order relates; and(c) if the order was or is to be made under section 26, that theapplicant was not involved in the qualifying instrumentforfeiture offence to which the restraining order relates.(3) The court may exclude a severable interest from proposed restrainedproperty or restrained property at, or after, the time a restraining orderis made if it considers that it is in the public interest to do so, havingregard to all the circumstances, including, without limitation,—(a) any undue hardship that is reasonably likely to be caused toany person by the severable interest in property being madeor having been made restrained property:(b) the gravity of the significant criminal activity or qualifyinginstrument forfeiture offence with which the property inwhich the person has a severable interest is associated:(c) the likelihood that the interest will become subject to aforfeiture order.[46] For the purposes of s 25 restraining orders, and the question of what constitutesproperty in which a respondent has an interest, s 58 of the Act provides that ifthe High Court is satisfied a respondent has effective control over property the Courtmay order that the property is to be treated as though the respondent had an interestin it.[47] The Commissioner, referencing the terms of the Trust and s 58, arguedMr Hunt had effective control over 180 Foreman, and had an interest in that property.The Judge did not adopt that analysis. Rather she reasoned effective control,constituting an interest, was not relevant to determining whether another person, witha legal or beneficial interest in the property, had a severable interest.21 We donot agree.[48] If, pursuant to an application made under s 58, the High Court is satisfied thata respondent does have effective control of a property (and hence does have an interestfor the purposes of the Act) the interest of separate legal or beneficial owners of thatproperty should not be "severed" from the respondent's interest. To do so would defeatthe purpose of s 58: a grant of severance in those circumstances would allow the legalowners to deal with the property without regard to the Commissioner's restrainingorder based on the respondent's interest.[49] In our view the terms of the Trust do establish effective control, and henceMr Hunt's interest. Moreover, there is a more direct route for concluding Mr Huntis interested in 180 Foreman and that the Trustees cannot sever their interest from that.That is the interest in 180 Foreman, a contingent equitable interest, that Mr Hunt hasby virtue of his power to appoint himself a beneficiary of the Trust. Nor canthe Trustees sever their interest from that of Mr Hunt, given that interest also derivesfrom the Trust.[50] The possibility that, if 180 Foreman was released from restraint on the basisthe Trustees were entitled to severance, Mr Hunt could thereafter appoint himselfbeneficiary and benefit from the Trust's ownership of that property establishes theinconsistency of that outcome with the scheme and purpose of the Act.[51] The Trustees argued before us that the Commissioner could not, however, relyon the effective control route to establish Mr Hunt had an interest in 180 Foreman, ashe had not initially relied on, or separately applied to the High Court to establish,Mr Hunt's effective control. In making that argument, the Trustees were relying onthe terms of s 58(1) which provide:21 At [24].(1) If the High Court is satisfied that a respondent has effective controlover property, the Court may, on an application made by theCommissioner, order that the property is to be treated as though therespondent had an interest in the property specified by the Court.(Emphasis added.)[52] Whilst the Commissioner, when obtaining these restraining orders withoutnotice, did not explicitly rely on s 58, it is clear he was doing so when opposingthe application for the release of 180 Foreman before Clark J.[53] The Act establishes an ongoing process for determining matters of restraint andforfeiture. That process includes subsequent on-notice applications by theCommissioner and the provisions for respondents and others to challenge, at variouspoints, restraint and forfeiture. In that context, the reference to "an application madeby the Commissioner" in s 58(1) is to be read to include reliance on effective controlin response to such a challenge, as the Commissioner does here.22[54] Accordingly, in declining the Trustees' application for severance in respect of180 Foreman the Judge reached the correct decision, and we dismiss the Trustees'appeal against that decision accordingly.31 Leyton[55] On the face of things, the restraint of property worth approximately $874,000to protect the Commissioner's interest in a subsequent profit forfeiture order for anunlawful benefit of $59,000 from alleged significant criminal activity appearsdisproportionate.[56] In those circumstances it is useful to consider first the Judge's conclusion thatissues of disproportionality are not relevant at the restraint stage, but only atthe forfeiture stage.23 Again, we do not agree.22 We have not overlooked the requirement for the Commissioner to give notice of the s 58application using form 27 of the Criminal Proceeds (Recovery) Regulations 2009. On our readingof s 58, the form will not be necessary where the Commissioner is relying on effective control inresponse to a challenge. In such circumstances the relevant interest holders will be made awareof the Commissioner's argument.23 Judgment under appeal, above n 1, at [59].[57] Our reason is found in the differences between the way the two types offorfeiture orders provided by the Act, asset and property forfeiture orders, workon enforcement.[58] Once found to be tainted, specific property — assets acquired from significantcriminal activity — must be forfeited under an assets forfeiture order. As taintedproperty is property acquired or derived "wholly or in part" from significant criminalactivity at the point of forfeiture, no question of proportionality arises. Neither doesit at the restraint phase. The cases the Commissioner and the Judge relied on all relatedto assets restraining orders pending an application for assets forfeiture orders.[59] The position is different when a respondent's property is forfeited pursuant toa profit forfeiture order.[60] When applying for a profit forfeiture order the Commissioner is required,amongst other things, to state the value of the unlawful benefit of the alleged criminalactivity.24 That stated value is presumptively correct, but a respondent may rebut thatpresumption on the balance of probabilities.25 When making a profit forfeiture orderthe High Court must also determine what is known as the maximum recoverableamount.26 That is the value of that benefit less the value of any property alreadyforfeited to the Crown under assets forfeiture orders made in respect to the samesignificant criminal activity. That maximum recoverable amount is enforceable as adebt due to the Crown.27[61] Following compulsory recovery by the Official Assignee of the forfeitedproperty, the maximum recoverable amount caps the amount the Crown may recoveras regards the relevant criminal benefit. That there is a cap at the point of forfeitureshows the Commissioner's relief is limited and bears a direct relationship tothe maximum recoverable amount. That mechanism ensures the seizure of theperson's property constituted by the forfeiture is, in terms of s 27 of the New ZealandBill of Rights Act 1990, a reasonable one.24 Criminal Proceeds (Recovery) Act, s 52(c).25 Section 53(2).26 Section 54.27 Section 55(4).[62] We therefore agree with Brewer J's observation in Commissioner of Policev C:28[38] The Act sets out the grounds which must be established bythe applicant on the balance of probabilities before restraining orders willbe made. Where, as here, the applicant seeks to restrain all of a respondent'sproperty, some of which is identified, he runs the risk of the Court exemptingsome assets from restraint, or imposing ameliorating conditions to restraint,if he cannot satisfy the Court that there is a degree of benefit alleged that isroughly proportional to the value of the assets sought to be restrained.[63] At the restraint stage, no estimate of the unlawful benefit is required. Nor, onmany occasions, would making such an estimate be practicable. In that situation therewill be less scope for a complaint of disproportionality. But where the significantcriminal activity and/or the estimated unlawful benefit alleged is towards the lowerend of seriousness and scale, and a respondent's property considerable, such anargument could well be made.[64] For those reasons, we disagree with the Judge's finding that proportionality asregards a profit forfeiture order is not relevant during the restraint phase.[65] In our view, an assertion that continuing restraint of 31 Leyton and the cash isdisproportionate in terms of the alleged benefit so that property should be releasedfrom restraint is, in principle, available to Mr Hunt and Ms Pue.[66] The Commissioner, as we understand is the usual practice, at the time of hiswithout notice application provided an estimate of unlawful benefit. The supportingaffidavit explained:9.2 At this current, early stage of the investigation, we can identify anunlawful benefit to the Respondents of $32,000 to $43,000 from thesale of methamphetamine. The value of the unlawful benefit could becovered in forfeiture by the seizure of the vehicles described above,the Navara, the Hyundai and the Tractor.9.3 However, it is probable that following further investigation by boththe criminal team and Asset Recovery team, further offending andunlawful benefit will be uncovered. It is on this basis that we areseeking to restrain the properties.28 Commissioner of Police v C [2012] NZHC 435.[67] Subsequently, the Commissioner has estimated the criminal benefit as beingapproximately $59,000. That estimation can be contrasted against the Commissioner'sestimate of total net value of approximately $874,000, including the following values:(a) 31 Leyton's purchase price in January 2015 of $390,000 (with$304,233.47 owing to ANZ as at March 2017);(b) 134 Foreman's equity of $166,000 (including a mortgage of $27,940.99as at June 2017);(c) 180 Foreman's rateable value in September 2013 of $720,000 (witha mortgage of $294,437.58 as at June 2017); and(d) the cash of $4825.40.[68] On that basis, we are satisfied that continued restraint of 31 Leyton and thecash is disproportionate in the context of a s 25 restraining order to theCommissioner's legitimate interest in a subsequent profit forfeiture order in thevicinity of $59,000.[69] One issue remains.[70] Throughout these proceedings, the police in supporting affidavits have justifiedthe restraining of the property, including 31 Leyton and the cash, on the basis theyconstitute tainted property.[71] In considering the application to lift the restraint on 31 Leyton and the cash,the Judge reasoned, in broad terms, as follows:29[61] Section 3 is the purpose provision. It provides that the primarypurpose of the Act is to establish a regime for forfeiture of property that hasbeen derived from significant criminal activity or "that represents the value ofa person's unlawfully derived income". This broad statement of the primarypurpose of the legislation is not to be confused with the specific provisionspursuant to which restraining orders are sought and made. Those specificprovisions are ss 24 and 25. I have set out the principles that govern theirapplication. There is no requirement for "proportionality" at the "restraint"29 Judgment under appeal, above n 1 (footnotes omitted).stage. The application for a restraining order is made at a very preliminarystage in the police investigations and on the basis of "reasonable grounds" tobelieve the property is tainted property rather than on the basis of proof ofeither the "significant criminal activity" or the extent of the "tainted property".[62] [Mr Hunt] has not established that the discretion the Courtundoubtedly has to vary or discharge a restraining order should be exercisedin this case.[72] There has, however, been no finding by the High Court of a reasonable beliefthe restrained property is tainted property. Nor did the High Court reach such aconclusion when considering the applications for discharge. In our view, inthe absence of such a finding the Commissioner cannot rely on the allegedly taintedstatus of the property to, here, resist Mr Hunt and Ms Pue's applications for thedischarge of the s 25 restraining orders over 31 Leyton and the cash on the basis thatrestraint is disproportionate.[73] The appeals by Mr Hunt and Ms Pue in CA447/2020 against the decision ofthe High Court declining their application for the discharge of the restraining ordersover 31 Leyton and the cash are allowed, and discharge orders are made accordingly.[74] We make a final observation. This matter has dragged on for far too long.It would appear that, for a time at least, all involved agreed that the resolution ofrestraint and forfeiture matters should await the outcome of the criminal trial. But asthe Judge observed, an indefinite "holding position" was not justified on the basis ofthis Court's decision in Commissioner of Police v Burgess.30 In that case, having foundthe Court below did have grounds to exercise its discretion to adjourn an examinationorder until after the trial, this Court said:[42] That does not mean that the Commissioner should not make anapplication for an examination order until after a criminal trial in every case.Nor does it mean that a Judge to whom an application for examination is madeshould defer the consideration of it until after the criminal trial has occurred.What is required is a careful analysis of the matters about which theCommissioner wishes to examine the potential examinee and the likely impactof answering those matters on the subsequent criminal trial. If the impact islikely to be a tactical advantage to the police or disadvantage to the examineeaffecting his or her fair trial rights, then the Judge should consider whether theexamination order should be deferred, having regard to the potential prejudice30 At [77], referring to Commissioner of Police v Burgess [2012] NZCA 436.to the Commissioner if such a deferral occurs. In the present case nosignificant prejudice was identified.(Footnote omitted.)[75] The difference in delay between that case and the present is stark, however. Inthat case, the delay was 15 months; here, the proceedings have been going on for overfour years. That delay falls within the assessment of potential prejudice to anexaminee in balancing the factors identified in Burgess. Moreover, there areprovisions in the Act to limit the extent that may be made in a criminal proceeding ofevidence from the civil restraint proceedings.31 To the extent the Commissioner relieson his untested assertion as to the tainted status of the restrained property, aproportionality challenge may be available to the Trustees in respect of 180 Foreman.In any event, it would also seem appropriate for steps now to be taken so that theunheard on notice applications are considered.Result[76] The Commissioner's application to adduce further evidence in both appealsis granted.[77] The appeal in CA446/2020 is dismissed.[78] The appeal in CA447/2020 is allowed.[79] The restraining orders over 31 Leyton Place and the cash are discharged.[80] In the circumstances, we make no order for costs in CA446/2020.[81] The respondent must pay the appellants in CA447/2020 costs for a standardappeal on a band A basis with usual disbursements.Solicitors:Young Carrington + Ussher Lawyers, New Plymouth for Appellants in CA446/2020 andCA447/2020.Crown Solicitor, New Plymouth for Respondents31 Criminal Proceeds (Recovery) Act, ss 165 and 166.