COMMISSIONER OF POLICE v NICOL [2021] NZHC 1330

COMMISSIONER OF POLICE v NICOL [2021] NZHC 1330 [8 June 2021]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYI TE KŌTI MATUA O AOTEAROATE WHANGANUI-A-TARA ROHECIV-2016-485-490[2021] NZHC 1330IN THE MATTER OF an application under s 50 and 59(1)(b) of theCriminal Proceeds (Recovery) Act 2009BETWEEN THE COMMISSIONER OF POLICEApplicantAND GRANT GENE JOSEPH NICOLRespondentHearing: 8 June 2021Appearances: A W M Britton for ApplicantNo appearance for RespondentJudgment: 8 June 2021JUDGMENT OF ELLIS J[1] Two matters came before me for determination today:(a) an application for an assets forfeiture order relating to propertypresently restrained under the Criminal Proceeds (Recovery) Act 2009(the Act), namely $18,270.31 in cash found at 6 Tuki Street, Titahi Bayon 24 April 2015; and(b) an application under s 59(1)(b) of the Act for an order ancillary to thatorder and to the asset forfeiture orders made by Clark J on 4 September2020.Asset forfeiture order[2] As just noted, Clark J has already made assets forfeiture orders relating to othersums of cash found in Mr Nicol's possession on other occasions.1 For reasons that donot need to be detailed here, the present application relating to the $18,270.31 foundat Tuki Street remained outstanding.[3] Although the respondent filed a notice of opposition to the application, he hastaken no subsequent steps and has filed no evidence despite directions from the Court.On 15 March 2021, Isac J gave him a further 20 working days to do so, and directedthat if no evidence was filed Mr Nicol could take no further steps in the proceedingswithout leave.[4] No evidence has been filed and there was no appearance for Mr Nicol today.The civil forfeiture application therefore proceeded by way of formal proof.Facts[5] The following relevant facts are established by the evidence filed by theCommissioner.[6] On 24 April 2015 Police went to 6 Tuki Street in relation to an arrest warrantfor Mr Nicol's son. While there, they found cannabis, firearms, drug paraphernaliaand a safe containing $29,890 in cash in Mr Nicol's bedroom. After the $29,890 wasseized by Police, $9,619.69 was deducted by the Commissioner of Inland Revenue forchild support payments, leaving $18,270.31 restrained.[7] In November 2015, the Police stopped a Subaru vehicle on Kenepuru Drive,Porirua. Mr Nicol was the front-seat passenger.2 The vehicle was searched consequentto Mr Nicol's arrest and, in addition to a glass pipe used for methamphetamine, $5,680in cash was found in a belt bag in the front passenger foot well. A search of a property1 A previous order having been made on 4 September 2020: Commissioner of Police v Nicol [2020]NZHC 2302.2 He was later arrested for supplying and offering to supply methamphetamine.where Mr Nicol had been staying located a further $8,030 in cash, which was alsoseized and restrained.[8] In March 2016, Mr Nicol's house was searched. In addition tomethamphetamine, digital scales and a handgun, $9,400 in cash was found in a walletunder a couch and $50,000 in cash in a bag inside a vehicle. A total of $59,400 wasseized from this property.[9] On 2 April 2019, Mr Nicol was convicted of the following charges:3(a) three charges of offering to supply methamphetamine;(b) one charge of supplying methamphetamine; and(c) two charges of possession of utensils for methamphetamine.[10] The charges of offering to supply, and supplying methamphetamine constitute"significant criminal activity" for the purposes of the Act.4[11] As mentioned earlier, on 4 September 2020, Clark J made asset forfeitureorders in relation to the cash referred to in [7] and [8] above.Discussion[12] Under s 50 of the Act, the Court "must" make an asset forfeiture order inrespect of specific property if satisfied on the balance of probabilities that the propertyis "tainted property".[13] I am satisfied the restrained sum of $18,270.31 was acquired as a result ofsignificant criminal activity and is therefore tainted property within the meaning of theAct. Not only has Mr Nicol been convicted of relevant offences but between 2012and 2017 he was in receipt of benefits and had no other legitimate sources of income.At an earlier point in these proceedings he deposed that after paying his bills he was3 Mr Nicol was sentenced to come up for sentence if called upon (12 months).4 Criminal Proceeds (Recovery) Act 2009, s 50; s 5 definition of "tainted property" and "significantcriminal activity".left with $80 per week. At the time of the seizures of the restrained cash his bankaccount was either in arrears or contained only a nominal amount.[14] As Mr Nicol was not in a position to accumulate cash assets of $101,000(which total includes the amount taken by Inland Revenue), the only tenable inferenceis that the cash was derived from his significant criminal activity, namely the sale ofmethamphetamine.5Result[15] The Commissioner's application for an assets forfeiture order in relation to theproperty described at [1](a) above is granted.Application under s 59(1)(b)[16] The forfeiture orders made by Clark J on 4 September 2020 (forfeiting cashtotalling $73,110, as sought by the Commissioner) were sealed the same day andserved on the parties and the Official Assignee, who has custody of the restrainedfunds.[17] In seeking forfeiture of that amount, the Commissioner had, however, forgottenthat $19,837.50 of those funds had, further to an order made by Simon France J on23 June 2017, already been released by the Official Assignee to meet Mr Nicol'soutstanding legal costs. That meant that the funds restrained were insufficient torealise the forfeiture orders and, so, the Official Assignee was unable to dischargethem.[18] On 9 February 2021, Clark J declined to use the slip rule (r 11.10) to rectifythe matter on the grounds that there was no error in her judgment (the error being inthe underlying application). And because her judgment had been sealed, recall underr 11.11 was not an available option either.5 If large cash sums cannot be adequately explained "this will tend to support an inference that therelevant cash has been sourced from illegitimate or criminal activity": Commissioner of Police vDe Wys [2016] NZCA 634.[19] The Commissioner then filed an application under s 59(1)(b) of the Act,seeking a further order in the following terms:The Official Assignee (including a person delegated his or her functions andpowers under the Criminal Proceeds (Recovery) Act 2009, in discharging theestate numbers 884461 pursuant to the assets forfeiture orders determined bythe Court in the proceedings numbered CIV-2016-485-490 sealed on4 September 2020 and [X date 20216], shall not take into account funds in theamount of $19,837.50 that were released from restraint to Elizabeth Hallpursuant to the determination of the Honourable Simon France J on 23 June2017.[20] On 15 March 2021 the matter was called in the Judge's Chambers List beforeIsac J. He expressed some reservations about the availability of s 59 in thecircumstances of this case but permitted the Commissioner to make furthersubmissions on the issue at the formal proof hearing relating to the outstandingforfeiture application. It was on the basis that I heard further from Mr Britton today.[21] Section 59 relevantly provides:(1) In making a civil forfeiture order, the High Court may do either orboth of the following:(b) give any direction that may be necessary and convenient forgiving effect to the civil forfeiture order.[22] Isac J's principal concern was that the order sought would have the effect ofmaterially altering the forfeiture order made by Clark J, which he considered wouldbe beyond the scope of s 59. I tend to agree with him; if that is what the order did,there might be a difficulty.[23] But the terms of the order sought do not, I think, have that effect. Rather, theyare expressed in a genuinely ancillary way, as a direction to the Official Assignee.They would leave Clark J's orders intact. So I agree with Mr Britton that the order isone that falls within s 59(1)(b) in that it is "necessary and convenient for giving effectto" both her order and the one I am making today. And the need for it is quite plain,for the reasons I have set out.6 Being the date the forfeiture order made in this judgment is sealed.Result[24] I therefore make an order under s 59 in the terms set out above._______________________Rebecca Ellis JSolicitors:Crown Solicitor, Wellington for Applicant