COMMISSIONER OF POLICE v TAIKOKO [2018] NZHC 2373

COMMISSIONER OF POLICE v TAIKOKO [2018] NZHC 2373 [10 September 2018]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2018-404-159[2018] NZHC 2373UNDER the Criminal Proceeds (Recovery) Act 2009BETWEEN COMMISSIONER OF POLICEApplicantAND JOSEPH TAIKOKORespondentHearing: On the papersCounsel: K Hogan for the ApplicantT Clee for the RespondentJudgment: 10 September 2018JUDGMENT OF MUIR JThis judgment was delivered by me on Monday 10 September 2018 at 4.00 pmPursuant to Rule 11.5 of the High Court Rules.Registrar/Deputy RegistrarDate:Counsel/Solicitors:Kayes Fletcher Walker, ManukauT Clee, Barrister, AucklandIntroduction[1] The Commissioner seeks asset forfeiture orders in respect of the followingproperty:2011 Harley Davidson motorbike, registration B3LEU (Harley B3)2010 Harley Davidson motorbike, registration B5MAP (Harley B5)2009 Harley Davidson motorbike, registration B9KRN (Harley B9)Cadillac motor vehicle, registration HKA 9951 (the Cadillac)2007 Chrysler motor vehicle, registration KCS24 (the Chrysler)[2] On 27 August 2018 counsel for Mr Taikoko filed a memorandum recording theCommissioner's abandonment of an application in respect of certain other propertyand the fact that in respect of Harley B3, Harley B5, Harley B9, the Cadillac andChrysler no opposition had been or would be filed.[3] In an earlier memorandum, dated 29 June 2018, counsel advised that the onlyvehicle Mr Taikoko opposed forfeiture orders in respect of was the Chrysler but nosubsequent notice of opposition was filed in that respect.[4] Both counsel for the Commissioner and for Mr Taikoko invite a decision onthe papers.DiscussionTainted property?[5] I am satisfied on the balance of probabilities that each of Harley B3, HarleyB5, Harley B9, the Cadillac and the Chrysler are tainted property; that is they havebeen wholly or in part:1 The application refers to the vehicle as a 1984 model as does its registration. The photographsexhibited to the Commissioner's affidavit in support depict a 1964 model.(a) acquired as a result of significant criminal activity; and/or(b) directly or indirectly derived from significant criminal activity.[6] Mr Taikoko's significant criminal activity is evidenced by the following:(a) The affidavit of Detective Sergeant Anderson deposing to supply ofmethamphetamine of up to one kilogram at a time to Lucky Campbellin Gisborne and Mr Taikoko's management of a drug dealing operationin Auckland.(b) Mr Taikoko's lack of legitimate income, in particular:(i) the fact that his only declared income since 2011 has been aMinsitry of Social Development benefit which stopped on 11November 2016; and(ii) his company, F 1st Limited has declared no income or filed anyGST returns.(c) Cash deposits into Mr Taikoko's bank accounts and his acquisition ofhigh value items in particular:(i) a deposit of $247,752.00 in cash to his personal and companyaccounts since 3 May 2017.(ii) $91,450 spent on vehicles subject to the application; and(iii) $51,633.00 spent at Turners Car Auctions, Manurewa DollarDealers and Otahuhu Dollar Dealers.[7] In several recent decisions, the Courts have emphasised the probative value oflarge cash transactions in establishing criminal activity. In Commissioner of Police vAntolik, Downs J observed that cash is "an atypical 21st Century phenomenon".2Likewise in Commissioner of Police v Dryland the Court of Appeal noted that:3Significant criminal activity, involving a large cash transaction, is the onlylikely option if the money was not lawfully earned.And in Commissioner of Police v de Wys the Court of Appeal similarly observed thatif cash sums cannot be adequately explained this will tend to support an inference thatthe cash has been sourced from illegitimate or criminal activity.4[8] In the present case there is no credible explanation by the respondentidentifying a legitimate source of the monies he used to acquire the relevant assets orwhich resulted in the cash deposits. Indeed, in the absence of any opposition andsupporting affidavit there is no formal explanation at all. At the time of his arrest on8 February 2018 Mr Taikoko did tell Police that he had purchased the motorbikes usingfunds from an insurance pay out. However, inquiries have established that such payout occurred on 19 October 2017, which post-dates acquisition of each of the HarleyB3, B5 and B9 motorcycles.[9] I am therefore satisfied that each of the assets is tainted property.Absence of restraint for one year[10] The Commissioner draws the Court's attention to s 50(4) of the CriminalProceeds (Recovery) Act 2009:(4) Despite subsection (1), the Court may not make an assets forfeitureorder in relation to property that no person has claimed an interest in,unless the Court is satisfied, on the balance of probabilities, of thefollowing additional matters:(a) that a restraining order was earlier made in relation to thesame property; and(b) that the restraining order has been in place for a period of atleast 1 year; and2 Commissioner of Police v Antolik [2016] NZHC 2649 at [30].3 Commissioner of Police v Dryland [2013] NZCA 247 at [34].4 Commissioner of Police v de Wys [2016] NZCA 634 at [71].(c) that the Commissioner has contacted or made all reasonableefforts to contact any person the Commissioner believes mayhave an interest in the property.[11] Restraining orders were first made in this case by Lang J on 5 February 2018.Therefore the requirements of s 50(4)(b) are not satisfied. Neither does theCommissioner advance his case on the basis of either of s 50(4)(a) or (c). Rather hesays that the assets are not property that "no person has claimed an interest in".[12] I am satisfied that he is correct in that submission. I adopt a purposiveconstruction of the section, namely that it is directed to the situation where therespondent has not claimed an interest in the assets concerned and where therefore itis appropriate to give an adequate opportunity for others to do so before the forfeitureorder is made.[13] In the present case the evidence establishes claims to an interest in each itemof property by the respondent.Harley B3[14] On 14 December 2017 Mr Taikoko was stopped riding Harley B3 by SergeantRobert Cato. Mr Taikoko told Sergeant Cato that he owned the motorbike. He hasalso been issued with seven traffic infringement notices while riding it and was theonly person to have been ticketed in respect of it.[15] During a search of Mr Taikoko's home address on 8 February 2018 a receiptwas located in Mr Taikoko's name for purchase of the motorcycle on 18 July 2017 for$20,800.[16] On 21 February 2018 he told Police that he was in a position to tell them where"the Harleys" were.[17] In contravention of the restraining order made by Lang J Mr Taikoko arrangedon or about 25 July 2018 to transfer the registered ownership of Harley B3 to MsDillion Piungaura Tini. Ms Tini has expressly denied having any interest in themotorcycle. The previous registered owner of the motorcycle (Mr Mataio) has takenno steps in the proceeding and Mr Mataio's father has expressly denied that his sonhad any interest in the motorcycle.Harley B5[18] F 1st Limited, a company of which Mr Taikoko is the sole director andshareholder, became the registered owner of this motorcycle on 21 September 2017.[19] On 10 February 2018 Mr Taikoko arranged to transfer the registered ownershipof the motorcycle to Mr Rahul Nair. On 26 February 2018 Police seized themotorcycle from Mr Nair pursuant to Lang J's restraining order and Mr Nair has takenno steps in this proceeding.[20] I am likewise satisfied that the motorcycle was one in which Mr Taikokoclaimed an interest at the time of the restraining order. Indeed, he claimed to havepurchased this motorcycle (as with the other motorcycles) from an insurance pay-outhe had received.Harley B9[21] This was purchased by F 1st Limited on 21 September 2017 from Cycle Spot.The purchase price was $17,500. Mr Taikoko traded another Harley Davidsonmotorcycle for $10,000 and paid an additional $7,500 in cash. Again, Mr Taikokoclaimed to have purchased the motorcycle from an insurance pay out in his favour.[22] On 18 March 2018 Mr Taikoko purported to transfer the registered ownershipof the motorcycle to William Goodwin. Mr Goodwin disavowed ownership of it andthe certificate of particulars indicates that it has subsequently been transferred to"persons unknown".[23] On 24 April 2018 the motorcycle was located in possession of Mr Lee Waerea,who has likewise disavowed ownership of it. It was at that time seized pursuant toLang J's restraining order.The Cadillac[24] F 1st Limited became the registered owner of the Cadillac on 12 August 2017,the vehicle having been purchased by Mr Taikoko from Mr Craig Holmes for $14,000cash.[25] On 13 September 2017 Mr Taikoko was issued with three traffic infringementnotices while driving in the vehicle.[26] On 23 November 2017 Mr Taikoko uploaded two photographs of the vehicleto his Facebook page.[27] On 8 February 2018 he told Police the Cadillac was with a friend called "Luke"and on 21 February 2018 advised Police that he could tell them where it was located.[28] On 25 July 2018 Mr Taikoko arranged to transfer the registered ownership ofthe vehicle to Ms Tini who has expressly denied having any interests in it.[29] I am again satisfied that Mr Taikoko has claimed an interest in the vehicle forthe purposes of s 50(4).The Chrysler[30] F 1st Limited became the registered owner of the Chrysler on 12 May 2017after purchase by Mr Taikoko from a Mr Vikrant Pathania for between $14,000 or$15,000 cash.[31] On 8 February 2018 Police located the Chrysler at Mr Taikoko's address andseized it. On that date Mr Taikoko said he purchased it "a couple of years ago whenhe was working for a mechanic". That assertion was false as to timing.[32] On 25 July 2018 Mr Taikoko purported to transfer the registered ownership ofthe Chrysler to Ms Tini, again in contravention of the restraining order. Ms Tini hasexpressly denied having any interest in the vehicle.[33] Again, I am satisfied that Mr Taikoko has claimed an interest in it for thepurposes of s 50(4).Result[34] I make asset forfeiture orders under s 50(4) of the Criminal Proceeds(Recovery) Act 2009 in respect of vehicles Harley B3, Harley B5, Harley B9, theCadillac and the Chrysler.__________________________Muir J