RAE v COMMISSIONER OF POLICE 2023 NZCA 4

RAE v COMMISSIONER OF POLICE 2023 NZCA 4 [3 February 2023]NOTE: HIGH COURT ORDER PROHIBITING PUBLICATION OF ANYIDENTIFYING PARTICULARS OF R LTD AND S LTD REMAINS IN FORCE.IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA750/2020[2023] NZCA 4BETWEEN DAVID CHARLES RAEAppellantAND COMMISSIONER OF POLICERespondentHearing: 24 November 2022Court: Katz, Mander and Downs JJCounsel: Appellant in personG H Allan as counsel assistingAWM Britton and S B McCusker for RespondentJudgment: 3 February 2023 at 10:00 amJUDGMENT OF THE COURTA The respondent's application to adduce further evidence is granted.B The appellant's application to adduce further evidence is declined.C The appeal is dismissed.D The appellant must pay costs to the respondent for a standard appeal on aBand A basis and usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Downs J)The issue[1] The High Court made a without notice restraining order overfunds in the control of David Rae following alleged money laundering in theUnited States of America and here. The Commissioner of Police1 failed to inform theHigh Court of all relevant information when seeking the order. The Court later variedthe order, but otherwise declined to rescind it. Mr Rae appeals. He contends theHigh Court should have rescinded the order once the Commissioner's failings becameknown. The case raises what should happen when without notice restraint is marredby non-disclosure on the part of the Commissioner.Background[2] We confine this part of the judgment to a brief overview. We provide detail, asneeded, later.[3] On 11 February 2020 the Commissioner applied, without notice, for arestraining order over more than $6.5 million in two bank accounts, which concernedR Ltd and S Ltd.2 The Commissioner alleged the funds were tainted propertyand Mr Rae had unlawfully benefitted from significant criminal activity.More particularly, the Commissioner alleged Mr Rae committed the crime of moneylaundering by transferring to New Zealand the proceeds of fraudulent schemescommitted in the United States of America in relation to that country's Medicarescheme.[4] The Commissioner adduced evidence: (a) United States authorities hadinvestigated the fraudulent schemes; (b) on 19 December 2019 Mr Rae pleaded guiltyin the United States District Court for the District of New Jersey to one charge ofconspiracy to commit international money laundering; and (c) on 7 February 20201 The Commissioner.2 Doogue J made suppression orders in relation to the accounts: Commissioner of Police v RaeHC Wellington CIV-2020-485-43, 21 February 2020 (Minute).Mr Rae was sentenced to 10 months' imprisonment for this offence but released giventhe time he had served.3[5] On 13 February 2020 Cooke J granted the restraining order. As required,the Commissioner then promptly filed and served an application for on noticerestraint.[6] On 12 March 2020, Mr Rae filed and served an affidavit in which he saidthe Commissioner had not made full disclosure to the High Court when seekingwithout notice restraint.[7] On 23 June 2020, Cooke J discharged the restraining order in relation to R Ltd.The Judge also scheduled a hearing to determine the Commissioner's on noticeapplication, which Mr Rae opposed on the basis of non-disclosure.4[8] On 20 and 21 October 2020, the Judge conducted that hearing. The partiesadduced what the Judge described as "[v]oluminous material",5 much of which had"little relevance".6High Court decision[9] Cooke J concluded the grounds for a restraining order were established as thefunds in S Ltd appeared to be tainted property and Mr Rae appeared to have unlawfullybenefited from significant criminal activity. This aspect of the decision is notchallenged, and we say no more about it.[10] The Judge then turned to non-disclosure. He recorded there was "no dispute"that "certain key information" was not put before the Court when the Commissionersought without notice restraint.7 Because of the importance of this aspect of thedecision, we capture it in the Judge's own words:3 The list of evidence is not exhaustive.4 Successful opposition to the on notice application would have resulted in the restraining orderbeing discharged, so, in substance, Mr Rae sought to rescind the order. For convenience, weexpress the position this way.5 Commissioner of Police v Rae [2020] NZHC 3132 at [4].6 At [5].7 At [50].[50] There is no dispute that there was certain key information that was notput before the Court on the without notice application. In particular:(a) The Court was not advised that a formal agreement had beenreached between Mr Rae and the United States authorities, whichled to the guilty pleas, and that forfeiture would be orderedlimited to a particular sum (US$1,775,000).(b) That the forfeiture so agreed, and then ordered, did not includeany funds in the R Ltd accounts.(c) That these limitations were agreed as a consequence of Mr Raeproviding assistance to the United States authorities, including byproviding detailed information at interviews.[51] Not only was the Court not informed of these matters, butMr VanZetta's affidavit stated that the United States was asking forrepatriation of the New Zealand funds for the purpose of compensatingMedicare which had suffered more than $212 million in losses as a result ofthe criminal activity he described. The New Zealand funds describedspecifically included the R Ltd account. Those statements were madenotwithstanding the agreement between Mr Rae and the United Statesauthorities that forfeiture would be limited to US$1,775,000, and that the RLtd account was not part of the agreed forfeiture.[52] I am satisfied the matters not disclosed, and misrepresented, werematerial to the decisions the Court made. In particular these facts and matterswould have been relevant to the consideration of whether restraint should existover the full amount of the balances in the New Zealand bank accounts,whether it should include the R Ltd account, whether the underlying offendinghad already been resolved, and whether there was genuinely a risk ofdissipation given the cooperation Mr Rae had provided. It may well be thatwithout notice orders would still have been made, but it was incumbent uponthe Commissioner to squarely place those matters before the Court asinformation that could support Mr Rae's position.[11] The Judge then considered what should happen in light of these failings.[12] Cooke J found the Commissioner "did not act in bad faith"8 because he was"unaware of the matters that were not properly disclosed, and misdescribed".9In particular, the Commissioner was "unaware that there had been a formal agreementbetween Mr Rae and the United States authorities which resulted in more limitedforfeiture orders not including the R Ltd account".108 At [59].9 At [60].10 At [60].[13] The Judge also found there was no bad faith on the part of the United Statesauthorities:[61] I also accept that the misleading information set out in Mr VanZetta'saffidavit, and its material non-disclosures, were not the consequence of badfaith on behalf of either Mr VanZetta or the other United States officials. Iheard evidence from Mr VanZetta, and also from Ms Barbara Anne Ward, anAssistant United States Attorney for the district of New Jersey. Ms Ward wasengaged in the relevant events for the United States Attorney's office. I acceptthat there was no intention to mislead the New Zealand Court, or misdescribethe factual position in the evidence. Mr VanZetta was unaware of the plea andforfeiture agreement at the time he swore his affidavit in support of the withoutnotice application. That is so notwithstanding that the affidavit was swornafter that agreement was entered. The fact that the affidavit was not reviewedmore carefully and updated for completeness before it was sworn by thosewho were aware can be criticised. But at least part of the reason why that didnot happen was that there was a lack of appreciation by those dealing with itin the United States that there was a need to ensure the affidavit complied witha duty to provide complete information.[62] In short, the United States authorities were not advised by those actingfor the Commissioner that there was any duty to provide full disclosure of allmatters, including matters that might be said to support Mr Rae's position.The Commissioner's personnel were then not told of those matters whenMr VanZetta's affidavit was finalised and the Commissioner completed hispreparations for making the without notice application.[14] The Judge concluded "the case did not involve egregious behaviour by theCommissioner, even though there was a significant failure to meet the requirementsfor a without notice application".11[15] The Judge declined to rescind the restraining order because "the missinginformation does not alter the decision that would have been made in relation torestraint"12 and, as observed, the Commissioner's failings were not "egregious".13A précis of the competing cases[16] Mr Rae, who is unrepresented, highlights the shortcomings identified byCooke J in relation to disclosure when the Commissioner sought without noticerestraint. Mr Rae argues once these are taken together, this is a case involvingegregious behaviour, hence the restraining order should have been rescinded even11 At [63].12 At [56].13 At [63].though grounds for it were otherwise established. Mr Rae emphasises theCommissioner is no ordinary litigant, and high standards are expected of the Crownin litigation irrespective of its persona.14[17] Mr Allan, who appeared as counsel assisting the Court, contends the Judge'sanalysis "is vulnerable to appeal" on the basis the Judge wrongly elevatedegregiousness as a standard or test for non-disclosure in this context. Mr Allan stressesthe importance of the obligation of candour when a litigant seeks without notice relief,particularly when that litigant is the Commissioner.[18] On behalf of the Commissioner, Mr Britton contends Cooke J did not err.Mr Britton emphasises the desirability of egregious behaviour as a touchstone forrescinding an otherwise proper restraining order following material non-disclosure bythe Commissioner.Analysis[19] We begin with the uncontroversial.[20] An application for a restraining order under the Criminal Proceeds (Recovery)Act 2009 (the Act) is civil in nature.15 Such an application may be made without noticeprovided the Court is satisfied "there is a risk of the proposed restrained property beingdestroyed, disposed of, altered, or concealed if notice were given".16[21] Form 2 of the Criminal Proceeds (Recovery) Regulations 2009 applies towithout notice applications. The form requires the applicant to certify the applicationcomplies with r 19.10 of the High Court Rules 2016. Under r 19.10, an applicationwithout notice must comply with r 7.23 therein, which reads:7.23 Application without notice(1) A person who wants to make an application to the court and have theapplication determined without any other party having been served (inthese rules referred to as an application without notice) must useform G 32.14 Crown Law Attorney-General's Values for Crown Civil Litigation (30 August 2013).15 Criminal Proceeds (Recovery) Act 2009, s 10(1); and High Court Rules 2016, r 19.2(r).16 Criminal Proceeds (Recovery) Act, s 22(1).(2) An application without notice may be made only—(a) on 1 or more of the following grounds:(i) that requiring the applicant to proceed on noticewould cause undue delay or prejudice to theapplicant:(ii) that the application affects only the applicant:(iii) that the application relates to a routine matter:(iv) that an enactment expressly permits the application tobe made without serving notice of the application:(v) that the interests of justice require the application tobe determined without serving notice of theapplication; and(b) if the applicant has made all reasonable inquiries and taken allreasonable steps to ensure that the application and supportingdocuments contain all material that is relevant to theapplication, including any defence that might be relied on byany other party and any facts that would support the positionof any other party.(3) An applicant who makes an application without notice must, if theapplication is of a kind that is likely to be contested if it were made onnotice, file a memorandum with the application that sets out—(a) the background to the proceeding (including the material factsthat relate to the proceeding); and(b) the grounds on which each order is sought; and(c) an explanation of the grounds on which each order is soughtwithout notice; and(d) all information known to the applicant that is relevant to theapplication, including any known grounds of opposition ordefence that any other party might rely on, or any facts thatwould support opposition to the application or defence of theproceeding by any other party.(4) Failure to disclose all relevant matters to the court or to comply withsubclause (3) may result in the court—(a) dismissing the application; or(b) if 1 or more orders have been made by the court in reliance onthe application, rescinding those orders.[22] Certification of compliance with the Rules is no mere technicality; it is aprerequisite of a without notice application.17[23] As is apparent, r 7.23(2)(b) requires the applicant to have made "all reasonableinquiries" and "taken all reasonable steps to ensure" the application contains "allmaterial relevant to the application, including any defence that might be relied onby any other party and any facts that would support the position of any other party".[24] If the application were likely to be opposed if made on notice, the applicantmust also file a memorandum that complies with r 7.23(3)(d), in turn setting out "allinformation known to the applicant that is relevant to the application, including anyknown grounds of opposition or defence that any other party might rely on, or anyfacts that would support opposition to the application or defence of the proceeding byany other party".[25] As is also apparent from r 7.23(4), a failure to disclose "all relevant matters"or non-compliance with r 7.23(3) may lead to the court dismissing the application orrescinding the order it made earlier. For convenience, we call this the dischargeprinciple.18[26] Rule 7.23 does not identify how the discharge principle is to be applied. Thecommon law is more instructive, so to that we turn.[27] The leading case remains Brink's Mat Ltd v Elcombe.19 In Brink's Mat, theapplicant obtained a without notice freezing order following the robbery of more than£25 million worth of gold bullion. The High Court of England and Wales laterrescinded that order in relation to two respondents on the basis the applicant had notcomplied with its disclosure obligations when obtaining the order. The applicantsuccessfully appealed to the Court of Appeal.17 Robert Osborne (ed) McGechan on Procedure (loose-leaf ed, Thomson Reuters, updated to2 October 2020) at [HR7.23.01].18 This is a label, not more.19 Brink's Mat Ltd v Elcombe [1988] 1 WLR 1350 (CA).[28] Ralph Gibson LJ said if there had been material non-disclosure when the orderwas obtained, the Court would be "astute to ensure [the] plaintiff is deprived of anyadvantage he may have derived by that breach of duty".20 The Judge added:21(6) Whether the fact not disclosed is of sufficient materiality to justify orrequire immediate discharge of the order without examination of the meritsdepends on the importance of the fact to the issues which were to be decidedby the judge on the application. The answer to the question whether the non-disclosure was innocent, in the sense that the fact was not known to theapplicant or that its relevance was not perceived, is an important considerationbut not decisive by reason of the duty on the applicant to make all properinquiries and to give careful consideration to the case being presented.(7) Finally, it "is not for every omission that the injunction will beautomatically discharged". The court has a discretion, notwithstandingproof of material non-disclosure which justifies or requires the immediatedischarge of the ex parte order, nevertheless to continue the order, or to makea new order on terms:"when the whole of the facts, including that of the original non-disclosure, are before[the court, it] may well grant a secondinjunction if the original non-disclosure was innocent and if aninjunction could properly be granted even had the facts beendisclosed:" [29] Ralph Gibson LJ held the applicant had failed to place all relevant informationbefore the High Court, and it was therefore open to that Court to "set aside" thefreezing order even though grounds for the order had otherwise been established.22Or, in the Judge's words, the applicant was at the "mercy" of the Court.23 However,because the freezing order would have been made if the "additional information" hadbeen placed before the High Court, the Judge held the appeal should be allowed andthe order restored against the two respondents.24[30] Balcombe LJ said the discharge principle deprived an applicant of theirimproperly obtained advantage and served to promote the duty of candour.25 But, theprinciple "cannot be allowed itself to become an instrument of injustice".26 It followedthere was a discretion "to continue the injunction, or to grant a fresh injunction in its20 At 1357.21 At 1357 citing Bank Mellat v Nikpour [1985] FSR 87 (CA).22 At 1357.23 At 1357.24 At 1357.25 At 1358.26 At 1358.place, notwithstanding non-disclosure".27 That discretion should be exercised, andthe appeal allowed, because the applicant's non-disclosure was (a) "innocent" and(b) "immaterial".28[31] Slade LJ considered the discharge principle should not "be carried to extremelengths".29 He too held the appeal should be allowed, for, while the applicant hadfailed to disclose everything of relevance to the High Court, the omission was"innocent" and did not compromise the case for a freezing order; there remained"a good arguable case that the initial deposit represented proceeds of the stolengold".30[32] Brink's Mat was cited by this Court in Allen v Commissioner of InlandRevenue.31 The Commissioner obtained a without notice freezing order againstMr Allen following an allegedly fraudulent investment scheme. Mr Allen argued theCommissioner failed to disclose relevant information when obtaining the order.The argument was rejected on the facts, but the Court observed:32[93] The [freezing order] was obtained ex parte. Consequently there wasa requirement on the part of the Commissioner to make appropriate disclosure:see for instance Brink's – MAT Ltd v Elcombe [1988] 3 All ER 188. No doubta plaintiff who fails to make appropriate disclosure is at risk of adverseconsequences which may, perhaps, extend to the discharge of the orderinappropriately obtained (albeit that if the order was otherwise warranted, afurther order is likely to be made, as in the Brink's - MAT case). But, giventhat there is an entitlement to seek review of orders made ex parte and suchreview proceeds on a de novo basis, the power to discharge an ex parte orderon this ground is likely to be exercised only in egregious cases.[33] In Mudajaya Corporation Berhad v Keng,33 the respondents argued freezingorders should be rescinded "because of what they say was material non-disclosure onthe without notice application".34 Fitzgerald J referred to Allen and said:[24] The alleged material non-disclosure was the focus of the respondents'arguments on their application. I therefore consider these issues first. I accept27 At 1358.28 At 1358.29 At 1359.30 At 1361.31 Allen v Commissioner of Inland Revenue (2004) 21 NZTC 18,718 (CA).32 At [93] (emphasis added).33 Mudajaya Corporation Berhad v Keng [2019] NZHC 1436.34 At [5].that if there was egregious non-disclosure, setting aside the orders would bejustified (i.e. without going on to consider the merits of the case and whether"new" orders should be made). I also accept that if any non-disclosure doesnot reach that threshold, the Court's findings may nevertheless be relevant tomatters such as costs.[34] We pause to observe Allen did not offer egregiousness as a standard or test inrelation to the discharge principle. Rather, it offered egregious non-disclosure as anexample of when the exercise of that principle may be appropriate. As will becomeapparent, the distinction is important.[35] In Green Way Ltd v Mutual Construction Ltd,35 the applicant obtained a suiteof orders without notice to prevent a corporate rival from allegedly exploiting itsconfidential information. In so doing, the applicant did not inform the High Court ofcorrespondence in which the respondents denied possessing or exploiting theinformation and acknowledging they would recognise the applicant's intellectualproperty. Campbell J said executed search orders would be rescinded in "exceptionalcircumstances" only,36 but material non-disclosure may qualify. With reference toBrink's Mat, the Judge said the applicant was at the "mercy" of the Court.37[36] Campbell J discharged all of the without notice orders because it was unlikelythey would have been made had there been full disclosure, and the missing disclosurewent to the very need for without notice relief.[37] This brings us back to United Kingdom authority. In Jennings v CrownProsecution Service,38 the Crown obtained a without notice restraining order in thewake of alleged fraud. In obtaining the order, the Crown did not inform the High Courtof a letter sent to it by Mr Jennings. The letter was relevant because it showedMr Jennings told the Crown of his intentions in relation to the property.39 He arguedthe order should be discharged for this reason.35 Green Way Ltd v Mutual Construction Ltd [2021] NZHC 1704.36 At [77].37 At [77], citing Brink's Mat Ltd v Elcombe, above n 19, at 1357.38 Jennings v Crown Prosecution Service [2005] EWCA Civ 746, [2005] 4 All ER 391.39 At [53].[38] The High Court rejected the argument. Mr Jennings appealed unsuccessfullyto the Court of Appeal. Laws LJ said:[56] It seems to me that there are two factors which might point towards adifferent approach being taken to without notice applications for restraintorders in comparison to applications in ordinary litigation for freezing orders;but they pull in opposite directions. First, the application is necessarilybrought (assuming of course that it is brought in good faith) in the publicinterest. The public interest in question is the efficacy of s 71 of the Act of1988. Here is the first factor: the court should be more concerned to fulfil thispublic interest, if that is what on the facts the restraint order would do, than todiscipline the applicant – the Crown – for delay or failure of disclosure. Butsecondly, precisely because the applicant is the Crown, the court must be alertto see that its jurisdiction is not being conscripted to the service of anyarbitrary or unfair action by the state, and so should particularly insist on strictcompliance with its rules and standards, not least the duty of disclosure.[57] The court needs to have both these considerations in mind. But theydo not, I think, promote some distinct and separate test for the exercise of thes 77 jurisdiction. They are relevant factors which in his [or her] good sensethe judge will consider and weigh as they arise case by case.[39] Longmore LJ said:40The fact that the Crown acts in the public interest does, in my view, militateagainst the sanction of discharging an order if, after consideration of all theevidence, the court thinks that an order is appropriate. That is not to say thatthere could never be a case where the Crown's failure might be so appallingthat the ultimate sanction of discharge would be justified.[40] Lloyd LJ agreed with both Judges.[41] The Court dismissed the appeal because the failure to disclose the letterreflected nothing more sinister than "inadvertence" and the "impact of disclosure ofthe letter would only have been 'to increase the concern of dissipation of assets, ratherthan reduce it'".41[42] Jennings was cited in the more recent High Court decision of Malabu Oil &Gas Ltd v Director of Public Prosecutions.42 Malabu involved a restraining ordersought by an Italian prosecutor using the mutual assistance process. The applicationfailed to disclose, among other things, a long investigation had been inconclusive as40 At [64].41 At [8] and [53].42 Malabu Oil & Gas Ltd v Director of Public Prosecutions [2016] Lloyd's Rep FC 108 (EWHC).to whether money laundering had occurred. This was one of the offences whichunderlay the application.[43] In Malabu, Edis J said the public interest in restraining orders "is likely toweigh more heavily than the need to enforce high standards in those who make theapplication", but whether this is so "in an individual case will depend on a variety offactors including the culpability of the failures in disclosure".43 The Judge noted thepossibility of "other sanctions for non-disclosure apart from discharging an orderwhich should otherwise stand", including costs and professional disciplinaryproceedings.44[44] Edis J concluded non-disclosure was "closer to" the scenario contemplated byLongmore LJ in Jennings, as being "so appalling ... the ultimate sanction of dischargewould be justified". However, Edis J held this sanction was not justified because arestraining order would still have been made had full disclosure been made when theorder was sought.45[45] Before returning to Mr Rae's case, we attempt to summarise the effect of thecommon law in two propositions.[46] First, the discharge principle is potentially engaged whenever an applicant failsto comply with their obligations under r 7.23(4); that is, whenever an applicant failsto disclose "all relevant matters to the court or to comply with subclause (3)".[47] Second, whether the discharge principle is exercised depends on thecircumstances of each case, including:(a) Whether the applicant acted in good faith or otherwise. Unsurprisingly,the common law treats this factor as important. Campbell J dischargedthe orders in Green Way absent a conclusion of bad faith. But, asCampbell J noted, the applicant in that case was unrepentant about itsfailure to provide the Court with all relevant information.43 At [49].44 At [49].45 At [78].(b) The significance of the missing information. This too is an importantconsideration, for reasons that are self-evident. Brink's Mat, Jenningsand Malabu all involved missing information that was relevant butimmaterial. In each case, the Court concluded the order would havebeen made had the information been before the Court.(c) The identity of the applicant, at least when it is the Crown. As observedby Laws LJ in Jennings, the court "must be alert to see that itsjurisdiction is not being conscripted to the service of any arbitrary orunfair action by the state not least [in relation to] the duty ofdisclosure".46(d) The interests protected and promoted by the duty of candour. Thisfactor is largely implicit to the common law, but the concept is clearenough. Without notice applications trench upon natural justice. It istherefore important applicants in this context make full disclosure. It isequally important courts are not misused.(e) The public interest. This factor has obvious importance when the caseinvolves restrained property believed to be tainted property; arespondent who appears to have unlawfully benefited from significantcriminal activity; or both. In each situation, the Commissioner seeksrestraint acting "in the public interest".47 Jennings and Malabu provideexamples.[48] We return to this case. The parties' submissions presuppose Cooke J adoptedegregiousness as a standard, test or touchstone, rather than applying the approach justsummarised. We do not read the decision that way. Indeed, as will be apparent fromthe extracts below, the Judge explicitly refrained from attempting to circumscribe thedischarge principle:48[54] In advancing submissions for Mr Rae, Ms Wang referred to theanalogous situation where the Court grants freezing notice orders on a without46 Jennings v Crown Prosecution Service, above n 38, at [56].47 At [56].48 Commissioner of Police v Rae, above n 5 (footnotes omitted).notice application. Ms Wang accepted that the Court would discharge suchorders in what has been described as "egregious cases". But she argued thatthe Court would also do so when the non-disclosure was sufficiently materialto impact on the original decision to grant the order. She emphasised thehigher standards that are expected of the Crown in litigation before the Courts,and argued that the Crown must be an exemplar of high standards. A relatedconcept was that the Commissioner was exercising the powers of the statesuch that the Court "should particularly insist on strict compliance with itsrules and standards, not least the duty of disclosure".[54] I accept it is relevant that the Commissioner is exercising powers ofthe state, and that there are particular expectations that the Court has in relationto his conduct of litigation. But as Mr Britton argued, there are additionalconsiderations of significance. In Yan v Commissioner of Police the Court ofAppeal stated, in respect of the potential requirement for the Commissioner togive an undertaking as to damages or costs under s 29 for a restraining order:[34] While proceedings under the Act are civil proceedings,they are, because of these public policy factors,distinguishable from ordinary interlocutory measures incivil proceedings such as interim injunction and freezingorder applications.[39] There is a strong public interest in preventing criminalsfrom benefiting as a result of significant criminal activityand, accordingly, a strong public interest in preservingtainted property prior to forfeiture being reasonablyobtainable and preventing dissipation of those assets. Onthe other hand, a restraining order represents a significantinfringement of property rights and has the potential tocause considerable injustice should it transpire the orderwas not justified. Section 29 provides a potentialsafeguard against the latter injustice.[56] In Jennings v Crown Prosecution Service, the English and WelshCourt of Appeal referred to the competing policy considerations of the kind Ihave referred to and indicated that, while important considerations, they didnot promote a distinct or separate test on the question of discharge. Irespectfully agree. The Commissioner is making the application in thefurtherance of the public interest and is exercising the power of the stateagainst the individual. There are expectations that he will be exercise highstandards in the conduct of litigation. The consequences of the failure todisclose are to be assessed against that background, but the same principlesapply. I also consider that, if the Court is persuaded that the missinginformation does not alter the decision that would have been made in relationto restraint, then the order should only be discharged in what has beendescribed as "egregious" cases. That is also consistent with the scheme of theAct, as the question of discharge will likely arise at the same time as theconsideration of the on-notice application. So if the requirements of an on-notice order are met, there would need to be compelling reasons why it shouldnot be made.[57] As to what is regarded as an "egregious" case, and without seeking tocircumscribe future cases, it seems to me that such a case would most likelyarise when the non-disclosure, or misrepresentation, is deliberate. That is, thatthere is an element of bad faith in the pursuit of the application. It is perhapsonly then that the Court would be able to say that the integrity of theadministration of justice is a more significant consideration than the publicinterest in offenders not being able to enjoy the fruits of their significantoffending. A failure to act in accordance with the requirements, evenaccompanied by a certification, would not in itself be sufficient in itself towarrant such an outcome. Mere negligence is not enough. Such a failure maybe addressed by other means, such as a costs awards.[58] I approach the present case on that basis.[49] Our view of the Judge's approach is buttressed by his approval of Jennings,which, as will be apparent from our earlier discussion, does not refer to egregiousness,and instead eschews "some distinct and separate test".49 It follows most of thesubmissions are directed at a premise that does not arise. Furthermore, we do notconsider the role or involvement of the Commissioner warrants a distinct approach forthe reasons identified in Jennings, especially those of Laws LJ.[50] In any event, we consider Cooke J was correct not to rescind therestraining order given the considerations we have summarised, even if the Judge didadopt egregiousness as is suggested. In view of the considerations set out at [46]–[47], we note:(a) The Commissioner acted in good faith. He did not know there had beena formal agreement between Mr Rae and the United States authorities,and therefore did not know those authorities had excluded the R Ltdbank account. Relatedly, the misleading information provided by theUnited States authorities was "not the consequence of bad faith" for thereasons explained by the Judge.50 We add that unlike the applicant inGreen Way, the Commissioner accepted these shortcomings once theywere identified.(b) The missing (and misdescribed) information was important. However,that information would not have changed the outcome had it been49 Jennings v Crown Prosecution Service, above n 38, at [57].50 Commissioner of Police v Rae, above n 5, at [61].known, save in relation to the bank account of R Ltd. The exclusion ofthat account by United States authorities would presumably have led tothat aspect of the restraining order application being declined. ButCooke J rescinded the order in relation to R Ltd long before thecontested hearing on 20 and 21 October 2020. So, this aspect hadalready been remedied by the time the Judge was asked to rescind theorder in its entirety. And, as observed, the balance of the order wouldhave been made had the missing information been before the Court.(c) The Commissioner was the applicant. Unlike the earlier factors, thisfavoured the restraining order being rescinded.(d) The same is true of the interests protected and promoted by the duty ofcandour.(e) The public interest favoured ongoing restraint. Money laundering is aserious crime and one, we consider, that can be difficult to detect.Mr Rae allegedly derived significant benefit from that crime inNew Zealand and through similar offending abroad.[51] We dismiss Mr Rae's invitation to assess the combination of circumstancesdifferently. We consider the balance of interests told against the exercise of thedischarge principle. To borrow language from another area of the law, we considerrescinding the restraining orders would have been disproportionate to theimpropriety.51[52] This conclusion is consistent with the outcomes in the cases we have referredto.Other matters[53] This leaves other matters. Mr Rae contends the Commissioner's applicationto restrain the property constitutes an abuse of process because he will "be made to51 Evidence Act 2006, s 30.comply with two [separate] forfeiture orders in relation to the same funds". Mr Raealso raises contentions about the Judge's factual determinations. We can address thesearguments reasonably swiftly.Abuse of process[54] Mr Rae contended in the High Court that continuation of the restraining orderwould amount to an abuse of process. Cooke J rejected the contention for two reasons.First, Mr Rae's formal agreement with the United States authorities52 did not bind theNew Zealand government. Indeed, the Judge noted the agreement was expresslyconfined "to the United States Attorney's Office for the District of New Jersey andcannot bind other federal, state, or local authorities".53 Second, the Commissioner wasacting independently in seeking restraint under New Zealand law, rather than as anagent of the United States authorities. The Judge then added this:[79] There is one complication, however. As I understand it the forfeitureorder made by the District Court for the State of New Jersey has not beensatisfied. Mr Rae should not be placed in the position where he is obliged tocomply with two forfeiture orders in relation to the same funds. I am notpresently clear the appropriate procedural pathway for ensuring that that doesnot happen. Perhaps the United States Government/Mr Rae should apply forrelief against forfeiture, or even relief against restraint, to allow the UnitedStates order to be satisfied. This issue will need to be addressed.[80] Nevertheless for the above reasons I do not accept that the applicationon notice for restraint is an abuse of process for the reasons advanced byMr Rae. Given that I have concluded that the ground to make a restraint orderon notice has been established, and that neither of the grounds of oppositionadvanced by Mr Rae are accepted, then the foundation to make the ordersought has been made out.[55] Mr Rae raises the potential complication identified by the Judge as the basisfor a fresh argument that restraint constitutes an abuse of process. However, Mr Raedid not elaborate on this in his written or oral submissions. Counsel assisting did notpursue the point either.[56] Mr Britton observes the formal agreement required Mr Rae to payUS$1,775,000 and forfeit any interests he might have had in an identifiedUnited States bank account. However, that agreement did not prevent action by the52 The formal agreement.53 Commissioner of Police v Rae, above n 5, at [71].New Zealand government or govern the restrained property. Mr Britton soughtpermission to adduce, as fresh evidence, United States of America v Rae, a decision ofJudge McNulty of the United States District Court for the District of New Jersey, dated9 February 2022.54 The decision implies the funds in the United States bank accountare not Mr Rae's and may not be used by him to satisfy payment of US$1,775,000.On this basis, Mr Britton contends Mr Rae's abuse of process submission has nogrounding in fact.[57] We consider it undesirable to express a view on these contentions. The shortpoint remains restraint cannot constitute an abuse of process for the reasons identifiedby Cooke J. Moreover, the Act contains machinery by which the potential problemidentified by Cooke J may be addressed if it comes to pass, most obviously, prospectof relief for undue hardship.55Factual determinations[58] Mr Rae contends Cooke J failed to make a discrete factual determination inrelation to the evidence of Detective Sergeant Macdonald. A little more backgroundis required.[59] Detective Sergeant Macdonald filed an affidavit in support of thewithout notice application for the restraining order. Mr Rae contendedDetective Sergeant Macdonald was untruthful in asserting he was unaware of theformal agreement as a Google search at the time the application was filed would haverevealed a news article referring to the formal agreement and Mr Rae's sentencing.The Commissioner asked an IT technician to review the hard drive onDetective Sergeant Macdonald's computer. That review yielded nothing to supportthe proposition the officer had conducted a Google search at or about the relevant time.Despite this, Mr Rae put to Detective Sergeant Macdonald in cross-examination hedeleted the history of such a search. The officer denied the allegation (in strong terms).Mr Rae contends the Judge did not specifically address this point in his decision.54 United States of America v Rae US Dist (NJ) no 19-cr-895 (KM), 9 February 2022. Mr Raeoffered no objection to the decision being received as fresh evidence. He described it as "helpfulbackground". We receive it in the interests of justice, but as will be apparent, do not act upon it.55 Criminal Proceeds (Recovery) Act, s 56(1).[60] We accept as much. However, a court is not required to deal with every factualcontroversy in a case. Were it otherwise, courts would be overwhelmed. Furthermore,the Judge's factual determinations leave no room for ambiguity or misapprehension.Again, the Judge found the Commissioner was "unaware that there had been a formalagreement between Mr Rae and the United States authorities which resulted in morelimited forfeiture orders not including the R Ltd account".56 The Judge could not havereached this conclusion if he considered Detective Sergeant Macdonald had beenaware of the formal agreement, whether by a Google search or otherwise. All of whichis to say we have no doubt the Judge did not overlook the point.[61] Mr Rae filed an additional written submission the day before the appealhearing. By it, Mr Rae invites the Court to take a different view of the facts thanCooke J. Mr Rae says this is justified because on 31 May 2022 he sent an email to thelawyers "representing the US Government in these proceedings" requesting what isdescribed as "non-party discovery". Mr Rae invites us to receive the email andconclude that because United States authorities have not provided the informationsought, they and the Commissioner have acted egregiously.[62] We decline to approach things this way for three reasons. First, the contentionis speculative. Second, it is far from obvious how "discovery" of the informationcould materially affect the Judge's conclusion which, we note, was made with thebenefit of (extensive) live testimony. Third, we consider this another instance in whichmaterial of little relevance is being offered as if it were otherwise. We decline toreceive the email as fresh evidence for the same reasons.57Result[63] The respondent's application to adduce further evidence is granted.56 Commissioner of Police v Rae, above n 5, at [60].57 Mr Rae also offered as fresh evidence (a) email correspondence between the Commissioner andthe United States authorities prior to the without notice application and (b) a decision of theNew Zealand Lawyers and Conveyancers Disciplinary Tribunal: National Standards Committee 1v Reed [2021] NZLCDT 23. Item (a) was before the High Court and so no ruling is required.No ruling is required in relation to item (b) either; the (legal) decision concerns the dischargeprinciple and is not evidence. For completeness, we note the decision does not add anything ofprinciple to the cases we have discussed.[64] The appellant's application to adduce further evidence is declined.[65] The appeal is dismissed.[66] The appellant must pay costs to the respondent for a standard appeal on aBand A basis and usual disbursements.Solicitors:Crown Solicitor, Wellington.