COMMISSIONER OF POLICE v FARRELL [2022] NZHC 310

COMMISSIONER OF POLICE v FARRELL [2022] NZHC 310 [28 February 2022]IN THE HIGH COURT OF NEW ZEALANDWHANGAREI REGISTRYI TE KŌTI MATUA O AOTEAROAWHANGĀREI-TERENGA-PARĀOA ROHECIV 2021-488-58[2022] NZHC 310UNDER The Criminal Proceeds (Recovery) Act 2009BETWEEN COMMISSIONER OF POLICEApplicantAND LEONIE MARIE FARRELLRespondentHearing: 28 February 2022 (by VMR)Appearances: S Earl and J Barclay for the applicantM Taylor-Cyphers for the respondentJudgment: 28 February 2022JUDGMENT OF CAMPBELL JThis judgment was delivered by me on 28 February 2022 at 4:00 pm pursuant to Rule 11.5of the High Court RulesRegistrar/Deputy Registrar[1] The Commissioner of Police applied, on notice, for restraining and furtherorders under the Criminal Proceeds (Recovery) Act 2009 (the Act) in relation to twoitems of real property and three vehicles (the application).[2] The respondent, Ms Farrell, initially opposed all the orders sought in theapplication. On 25 February 2022, the parties agreed to a resolution of the application,except for one order sought by the Commissioner.[3] In accordance with that agreed resolution, I have made restraining orders overall the property that is the subject of the application. Under the restraining orders theOfficial Assignee has, in accordance with ss 24 and 25 of the Act, custody and controlof the restrained property. I have also made a further order under s 35 of the Actdirecting the Official Assignee to sell one of the restrained vehicles in order to preservethe value of the restrained property.[4] The only order sought by the Commissioner to which Ms Farrell did not agreewas an order under s 35 directing the Official Assignee to sell another of the restrainedvehicles, a 2012 BMW M5 Sedan 7A 4 Saloon, registration MQN791 (the BMW).1[5] The only matter that I have to determine on the application is whether I shouldmake a sale order to preserve the value of the BMW. It is therefore unnecessary forme to outline the alleged offending that underlies the application.[6] Ms Earl, for the Commissioner, submitted that sale orders under s 35 are oftenmade in respect of vehicles, because of the rate at which they depreciate and theongoing costs of insurance, storage and maintenance. She referred me to a statementof Gordon J, in Commissioner of Police v Milosevic, that the "starting point is thatmotor vehicles have a clear tendency to depreciate in value and cost money to store,maintain and insure".2 She submitted that the BMW has no special characteristics thatwould reduce the risk of depreciation.1 There is a third vehicle (a 2016 Ford Ranger) over which the Commissioner sought, and has beengranted, a restraining order. The Commissioner has not yet sought a sale order under s 35 inrespect of the 2016 Ford Ranger but may do so in the future.2 Commissioner of Police v Milosevic [2019] NZHC 202 at [96](a).[7] Ms Taylor-Cyphers, for Ms Farrell, made two submissions. The first was thatthe BMW was already ten years old and so the time for significant depreciation hadpassed. She submitted, by reference to recent online advertisements for the sale ofBMWs, that this particular model and year of BMW had retained its value over timemore than models manufactured since. The second submission was that Ms Farrell isa single mother with two school-aged children without a car. If the BMW were notrestrained, it would be available to Ms Farrell for her use.[8] I put the second submission to one side. As Ms Earl said in response, thatsubmission is irrelevant to the question whether property already the subject of arestraining order should be sold. The submission might be relevant to an applicationunder s 28 of the Act, but Ms Farrell has not made any such application.[9] The issue is whether an order for the immediate sale of the BMW is necessaryto preserve the value of that property.3 In that respect it is important to consider thetime until any forfeiture application will be resolved. Ms Farrell is next appearing onher charges in the Whangārei District Court at callover on 31 March 2022. She hasyet to enter pleas on some charges. It is unlikely the criminal trial will be held until2023. The forfeiture application will follow the criminal trial. It is a reasonableassumption that at least 18 months will pass before the forfeiture application will beresolved.[10] In my view, it is probable that the BMW will depreciate over that time. I agreewith Gordon J that motor vehicles have a clear tendency to depreciate. I acknowledgethat some motor vehicles do not have that tendency. That usually occurs because theyhave some special or unique characteristics or they are of an older vintage. There isno evidence before me that the BMW is such a vehicle. The online advertisementsthat Ms Taylor-Cyphers provided with her submissions merely show asking prices forthree different BMW vehicles. They do not show that the BMW in question hasspecial characteristics or that it will hold its value over time.3 Commissioner of Police v Milosevic [2019] NZHC 202 at [95].[11] In addition, if the BMW is not sold there will be ongoing storage, maintenanceand insurance costs. In themselves they will not be insignificant given the time beforeany forfeiture application is resolved.[12] For these reasons I am satisfied I should make an order under s 35 for the saleof the BMW.Result[13] I order that the Official Assignee shall sell the 2012 BMW M5 Sedan 7A 4Saloon, registration MQN791, at its fair market value and hold the proceeds of thatsale, after paying all associated costs, in accordance with the restraining orders alreadymade on the Commissioner's application.______________________Campbell J