Commissioner of Police v McQuillan

[2024] NZHC 1821

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2024-419-0170

[2024] NZHC 1821

UNDER

the Criminal Proceeds (Recovery) Act 2009

BETWEEN

COMMISSIONER OF POLICE

Applicant

AND

KARL DEE MCQUILLAN

First respondent

AND

PETREA JANE MCMAHON

Second respondent

AND

JEANETTE ANNE YUILE

Interested party

AND

DWIGHT MARK DAVIS

Interested party

Hearing:	On the papers
Appearances:	KRL Guthrie for applicant
Date of judgment:	5 July 2024

JUDGMENT OF JAGOSE J

This judgment was delivered by me on 5 July 2024 at 3.00pm.

Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Solicitors:

Hamilton Legal, Hamilton

COMMISSIONER OF POLICE v MCQUILLAN [2024] NZHC 1821 [5 July 2024]

[1]    As duty judge this week, I have the Commissioner’s without notice application for restraining and further orders dated 3 July 2024, seeking to place land, road and marine vehicles, funds in bank accounts and other property into the hands of the Official Assignee.1

[2]    The application is supported by 19 June and 2 July 2024 affidavits sworn by police officers, contending the property is tainted as having been obtained from significant criminal activity in possessing methamphetamine for supply,2 and/or that of the respondents who have unlawfully benefited from such significant criminal activity.

Law

[3]    I may determine an application can properly be dealt with without notice only if I am satisfied, here, requiring the Commissioner to proceed on notice would cause undue delay or prejudice to him, an enactment expressly permits the application to be made without serving notice of the application, or the interests of justice require the application to be determined without serving notice of it. Otherwise I must give directions for service and adjourn the application, or dismiss it.3

[4]    If then I am satisfied I have reasonable grounds to believe the property is “tainted property” – that is, wholly or partly acquired as a result of, or directly or indirectly derived from, significant criminal activity – or the respondents have in any event  “unlawfully  benefited  from  significant  criminal  activity”,  I  may  make     a restraining order in respect of that property. By the order, the property is not to be disposed of, or dealt with, other than is provided for in the restraining order, and is under the Official Assignee’s custody and control.4

1      Criminal Proceeds (Recovery) Act 2009, ss 24 and 25.

2      Misuse of Drugs Act 1975, s 6(1)(c), (f) and (6).

3      High Court Rules 2016, r 7.46(3) and (5).

4      Criminal Proceeds (Recovery) Act, s 50.

Discussion

[5]    ‘Restraining orders’ are “a holding measure”, to preserve property if to be forfeited to the Crown as derived from significant criminal activity.5 ‘Significant criminal activity’ is offending punishable by a maximum term of imprisonment of    5 years or more, or offending obtaining property with a value exceeding $30,000.6

[6]    Section 22 of the Criminal Proceeds (Recovery) Act 2009 entitles me to consider the application without notice if I am satisfied there is a risk of the proposed restrained property being destroyed, disposed of, altered, or concealed if notice were given.

[7]I am satisfied:

(a)notice of the application for restraining orders would put the property at relevant risk, given both Mr McQuillan’s arrangements to distance his ownership of the property and its ready fungibility, prejudicing the Commissioner in obtaining its forfeit to the Crown; and

(b)on the basis of the police officers’ affidavits, I have reasonable grounds to believe both:

(i)the property is tainted property, as acquired or derived in connection with significant criminal activity of drug offending, or in any event as obtained property with a value exceeding

$30,000; and

(ii)the respondents have — by receiving substantial payments in excess of reported income, seemingly attributable to revenues obtained by drug offending, and without withdrawals contemporaneous with their acquisition of assets — unlawfully benefited from such significant criminal activity.

5      Yan v Commissioner of Police [2015] NZCA 576, [2016] 2 NZLR 593 at [7].

6      Criminal Proceeds (Recovery) Act, s 6(1).

[8]    I see no reason not to exercise my residual discretion, precisely to preserve property if to be forfeited to the Crown, to make the restraining and further orders sought.

Result

[9]    I order in terms of paras 1–2 and 4–6 of the Commissioner’s 3 July 2024 application.

—Jagose J