COMMISSIONER OF POLICE v McGOLDRICK-SAVAII [2020] NZHC 133

COMMISSIONER OF POLICE v McGOLDRICK-SAVAII [2020] NZHC 133 [11 February 2020]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYI TE KŌTI MATUA O AOTEAROATE WHANGANUI-A-TARA ROHECIV-2017-485-405[2020] NZHC 133UNDER the Criminal Proceeds (Recovery) Act 2009IN THE MATTER of an application pursuant to sections 22, 24and 25BETWEEN THE COMMISSIONER, THE NEWZEALAND POLICEApplicantAND HAYDEN HARLEY McGOLDRICK-SAVAIIRespondentAND ANZ BANK NEW ZEALAND LIMITEDFirst Interested PartyAND MARGARET ELLEN NORTHSecond Interested PartyHearing: 10 February 2020Counsel: S B McCusker for ApplicantJudgment: 11 February 2020JUDGMENT OF ELLIS J[1] On 1 October 2019, the Commissioner filed an application for asset forfeitureorders under the Criminal Proceeds (Recovery) Act 2009 (the Act). More specificallyhe seeks forfeiture of a 2003 Mercedes-Benz E Avantgard Saloon motor vehicle (theMercedes) registered in the name of the second interested party, Ms Margaret North.Because Mr McGoldrick-Savaii has given his signed consent to the application andMs North has been served with the application but taken no steps in response, it ispossible to deal with the application relatively briefly.Background[2] From 6 March 2017 the Mercedes was registered in the name of Ms North.Ms North is an associate of the Porirua Mongrel Mob gang. The car's previousregistered owner from 17 September 2016 to 5 March 2017 was Mr Laurie Obeda,also an associate of the Mongrel Mob gang.[3] On 5 March 2017 – the day before the Mercedes was transferred intoMs North's name – Mr McGoldrick-Savaii was observed by Police driving the car.The Mercedes was impounded for 28 days after Mr McGoldrick-Savaii's driver'slicence was suspended. Mr McGoldrick-Savaii was later observed driving theMercedes on 7 April 2017 and the car was seized by Police four days later.[4] On 5 May 2017 the Commissioner applied (without notice) for restrainingorders under the Act in relation to the Mercedes and a property at 32 Waiho Terrace,Elsdon. As I have said, the Mercedes was registered in the name of Ms North and theproperty was registered in the name of Mr McGoldrick-Savaii. This Court made therestraining orders on 8 May 2017.[5] On 23 February 2018, Mr McGoldrick-Savaii was sentenced to a period ofimprisonment for three years and six months, after pleading guilty to onerepresentative charge of offering to supply methamphetamine, one representativecharge of offering to supply methamphetamine, and one charge of possession ofmethamphetamine for supply.[6] On 15 August 2018, the Court approved a settlement agreement between theCommissioner and Mr McGoldrick-Savaii over the Waiho Terrace property. Theterms of the settlement were that:(a) Mr McGoldrick-Savaii admitted to receiving an unlawful benefit of$60,775 from his significant criminal activity for the purposes of theAct.(b) Funds totalling $50,000 were to be forfeited for the purposes of a profitforfeiture application. Upon forfeiture of the $50,000, theWaiho Terrace Property was to be released from the restraining order.(c) The Mercedes (which has been valued at $5,0001) would remain underrestraint, as Ms North had indicated that she still intended to apply forrelief under s 66 of the Act.(d) The Commissioner would later file an application for asset forfeitureorders over the Mercedes, which Mr McGoldrick-Savaii would notoppose.(e) Once the status of the Mercedes had been resolved, the proceedingsagainst Mr McGoldrick-Savaii would be at an end.[7] There was a subsequent hearing of an on notice application restraining orderover the Mercedes which was opposed by Ms North on the grounds that the carbelonged to her. But on 30 April 2019 Grice J found that, on the balance ofprobabilities, the Mercedes was under Mr McGoldrick-Savaii's effective control forthe purpose of s 58 of the Act.2 She confirmed the restraining orders over the car.[8] On 1 October 2019 the Commissioner applied for an assets forfeiture order inrelation to the Mercedes and a further effective control order.[9] In accordance with the settlement, Mr McGoldrick-Savaii formally confirmedthat he did not oppose the orders sought on 16 December 2019. Ms North was servedwith the application but has taken no steps. There is, accordingly, nothing on the filethat suggests the position in relation to effective control has changed since that matterwas determined by Grice J. Nor has Ms North applied for any relief under the Act.1 While initial valuations placed the value of the Mercedes at $16,600, a valuation from the OfficialAssignee indicated that the car was now worth around $5,000.2 Commissioner of Police v McGoldrick-Savaii [2018] NZHC 936 (given the date of the judgment,the date in the neutral citation number appears to be out by a year).Should the forfeiture order be made?[10] As I have said, there is no reason disclosed on the file to doubt the correctnessearlier effective control order and, indeed, I doubt there is the ability for this Court todo so. So I proceed on the basis that the Mercedes did, effectively, belong toMr McGoldrick-Savaii.[11] Under s 50 of the Act, the Court can make an asset forfeiture order in respectof specific property if it is satisfied that on the balance of probabilities that thatproperty is tainted property. "Tainted property" is defined as follows:tainted property –(a) means any property that has, wholly or in part, been –(i) acquired as a result of significant criminal activity; or(ii) directly or indirectly derived from significant criminalactivity; and(b) includes property that has been acquired as a result of, or directly orindirectly derived from, more than 1 activity, if at least 1 of thoseactivities is a significant criminal activity[12] The Commissioner says that Mr McGoldrick-Savaii purchased the Mercedeswith proceeds from the sale and supply of methamphetamine and that it is accordingly"tainted property" for the purposes of the Act.[13] On the evidence before the Court I agree with the Commissioner that the onlylogically available inference from the following evidence is that the Mercedes was"wholly or in part" acquired as a result of his significant criminal activity. I note inparticular the evidence that:(a) Mr McGoldrick-Savaii was unemployed and received a benefit from 6September 2015;(b) his declared income for the year ending 31 March 2017 (the financialyear in which the Mercedes was acquired) was only $13,236.82, and inthe previous year ending 31 March 2016 was $29,287.43;(c) during this same period, the evidence establishes that Mr McGoldrick-Savaii incurred the following expenses:(i) purchasing approximately 119 grams of methamphetamine forthe purposes of on-selling;(ii) conducting improvements and earthworks to the Waiho TerraceProperty, including renovations to the kitchen and bathroom,and the laying of a concrete driveway;(iii) servicing the mortgage on the Waiho Terrace Property at a rateof $250 per week; and(iv) acquiring a 2001 Mercedes-Benz C240 Saloon car.[14] Mr McGoldrick-Savaii's declared income was not at a sufficient level to fundany of the activities identified above (let alone all of them), as well as support his day-to-day living expenses (which included supporting a young child). As he told Policefollowing his arrest, $250 per week from his weekly $350 benefit payment went toservicing the mortgage over the Waiho Terrace property. It is not plausible for MrMcGoldrick-Savaii to have funded the purchase of the Mercedes entirely from whatremained of his legitimate earnings.[15] It follows that Mr McGoldrick-Savaii could only have the means to acquire theMercedes if he used money he acquired from undertaking significant criminal activity,namely methamphetamine dealing. As I have noted, he has admitted to receiving anunlawful benefit of $60,775 in relation to this activity between 20 February and11 April 2017. As Mr McCusker submitted, it is reasonable to assume thatMr McGoldrick-Savaii's drug dealing activity was not limited to that period.[16] As well, there is the fact that Mr McGoldrick-Savaii sought to obscure hisownership of the Mercedes by placing it in Ms North's name. There is no obviousreason why Mr McGoldrick-Savaii would have registered the car in Ms North's nameunless he was trying to launder the proceeds of sale from methamphetamine.[17] The evidence therefore satisfies me that the Mercedes was acquired byMr McGoldrick-Savaii either as a result of significant criminal activity or directly orindirectly derived from significant criminal activity and is tainted, accordingly.Result[18] For the reasons I have given, under s 50 of the Act I make an assets forfeitureorder in relation to the 2003 Mercedes-Benz E Avantgard Saloon motor vehicleincluding ignition keys, registration CYU213, registered in the name of Margaret EllenNorth. The Mercedes is therefore to vest in the Crown absolutely and is to be in thecustody and control of the Official Assignee.____________________Rebecca Ellis JSolicitors:Crown Solicitor, Wellington for Applicant