IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

I TE KŌTI MATUA O AOTEAROA AHURIRI ROHE	
CIV-2023-441-043
[2023] NZHC 3435	

UNDER	the Criminal Proceeds (Recovery) Act 2009	
IN THE MATTER OF	an application under ss 21, 24 and 25	
BETWEEN	COMMISSIONER OF POLICE
Applicant	
AND	JOHN WHARE MAKO TE AHO
Respondent	

Hearing:	20 November 2023	
Counsel:	M J M Mitchell for the Applicant	
Judgment:	29 November 2023	

JUDGMENT OF GWYN J
(On notice restraining order)

[1]	By application dated 18 September 2023 the Commissioner of Police seeks an on notice restraining order in respect of cash totalling $16,510 located on the respondent’s person on 23 February 2023 (property).

[2]	The application is made in reliance on ss 21, 24 and 25 of the Criminal Proceeds (Recovery) Act 2009 (Act).

[3]	The grounds on which the order is sought:

(a)	the property is tainted property; and

(b)	the respondent, John Whare Mako Te Aho, has unlawfully benefited from significant criminal activity.

COMMISSIONER OF POLICE v TE AHO [2023] NZHC 3435 [29 November 2023]

Process to date

[4]	Police Constable Shaun Kennard has sworn an affidavit deposing that he personally served with Mr Te Aho with the application for restraining order, the affidavit in support and a letter filed by the Crown Solicitor Fiona Cleary. On Tuesday 19 September  2023 he went  to  Mr Te Aho’s  home address where he spoke with  Mr Te Aho. He introduced himself and explained his reason for being there. As Constable Kennard attempted to hand the documents to Mr Te Aho, he told Constable Kennard to talk to his lawyer and tried to close the door. Constable Kennard placed the documents at Mr Te Aho’s feet before he closed the door.

[5]	When the application was called before me on 24 October 2023, Ms Mitchell, counsel for the Commissioner, undertook to ensure that Mr Te Aho’s counsel in the related criminal proceedings was also served with the application.

[6]	In the Criminal Proceeds List on 20 November 2023, Ms Mitchell advised that she has now done so but has not received a substantive response from Mr Te Aho’s counsel.

[7]	On that basis, the Commissioner has invited the Court to determine the application for an on notice restraining order on the papers.

Background

[8]	The Commissioner says Mr Te Aho has benefited from significant criminal activity, in terms of s 25 of the Act, on the basis of the following information which is set out in an affidavit sworn by Constable Kennard dated 5 September 2023, in support of the application.

[9]	On Thursday 23 February 2023 Mr Te Aho and an associate, Michael Roser, were arrested in Bayview,  Napier, as they attempted to break down the gate to    Ross Cooper’s home address. The respondent was the driver of the vehicle, which was registered to Mr Roser. Mr Roser was a passenger in the vehicle.

[10]	The respondent was found in possession of $16,510, comprising cash amounts of $15,660 and $850 located on his person on 23 February 2023. That money is currently held in the New Zealand Police Trust Account and is the property that is the subject of this application.

[11]	A search of Mr Te Aho’s vehicle located a broken plastic container between the driver’s seat and door. Trace amounts of a white crystalline material suspected to be methamphetamine were found on the container and a subsequent examination confirmed the presence of methamphetamine.

[12]	Mr Cooper, whose house it was, was searched by Police and found to be in possession of firearms and approximately 20g of methamphetamine. He has pleaded guilty to the possession of methamphetamine. Mr Roser was searched and found in possession of methamphetamine.  He  admitted  to  supplying  methamphetamine. Mr Roser was charged with supplying methamphetamine and has since pleaded guilty to those charges and is awaiting sentencing.

[13]	Mr Te Aho was arrested and initially remanded in custody on one charge of wilful damage and one charge of being unlawfully in an enclosed yard or area, in respect of the attempt to break down the fence on 23 February 2023, before being released on court bail conditions on 15 March 2023.

[14]	On 3 May 2023 the Napier District Court convicted Mr Te Aho of both charges. He was not charged with methamphetamine offences.

[15]	On 22 March 2023 Police located a suspicious vehicle in a driveway in Carnell Street, Napier. The respondent was in the driver’s seat of the vehicle. The other occupant was Anthony Pearce to whom the vehicle was registered. Mr Pearce got out of the vehicle and ran into a nearby block of flats. The respondent abruptly reversed the vehicle and then sped forward towards the two attending constables, who had to take evasive action to avoid being hit.

[16]	Constable Kennard’s affidavit sets out his belief that Mr Pearce is the same person who communicated with Mr Roser about purchasing methamphetamine in February 2023.

[17]	Constable  Kennard  believed  that  Police  disturbed  the  respondent  and  Mr Pearce as they were involved in a drug deal, which explains Mr Pearce fleeing the vehicle and the respondent’s dangerous driving.

[18]	On the basis of the information set out above, Constable Kennard believes that the respondent has committed the following offence:

(a)	Supplying the Class A controlled drug methamphetamine, pursuant to s 6(1)(c) of the Misuse of Drugs Act 1975. The maximum penalty for the offence is life imprisonment.

[19]	Accordingly, Constable Kennard says there are reasonable grounds to believe that:

(a)	the respondent has been involved in “significant criminal activity” as defined in s 6 of the Act;

(b)	the property sought to be restrained has been directly or indirectly derived from significant criminal activity; and

(c)	the property is tainted property.

[20]	In addition, Constable Kennard refers to an analysis of the respondent’s banking records for the period 1 April 2016 until 1 April 2023.

[21]	That analysis shows that, between 20 June 2019 and 23 March 2023, there were 85 separate cash ATM deposits into the respondent’s bank account with the ASB Bank Ltd, totalling $117,115.

[22]	Constable Kennard also obtained Inland Revenue Department reports for the respondent’s declared income over the past six years. During the periods when

Mr Te Aho was not in prison, he received a job seeker benefit from the Ministry of Social Development. He was also briefly employed in 2018 when he declared an income of $2,458.

[23]	Mr Te Aho’s overall total declared income for the six year period was
$62,567.72, an average yearly declared income of $10,427.53.

Discussion

[24]	The Commissioner relies on both ss 24 and 25 of the Act.

Section 24

[25]	Section 24 provides that the Court may make a restraining order over specific property if satisfied there are reasonable grounds to believe that the property is tainted property.

[26]	“Tainted property” means:1

(a)	any property that has, wholly or in part, been—
(i)	acquired as a result of significant criminal activity; or
(ii)	directly or indirectly derived from significant criminal activity.
…

[27]	“Significant criminal activity” is in turn defined as:2

… an activity engaged in by a person that if proceeded against as a criminal offence would amount to offending—
(a)	that consists of, or includes, 1 or more offences punishable by a maximum term of imprisonment of 5 years or more; or
(b)	from which property, proceeds, or benefits of a value of the threshold amount or more have, directly or indirectly, been acquired or derived.

[28]	Relevant to Mr Te Aho’s situation, as noted at [18] above, the maximum penalty for supplying methamphetamine is life imprisonment.

1	Criminal Proceeds (Recovery) Act 2009, s 5.
2	Section 6(1).

[29]	As Ellis J said in Commissioner of Police v Briggs,3 an order made under s 24 is predicated on the (unlawful) source, or derivation, of all or party of the property concerned. No particular connection between the property and a respondent is required. It is the source rather than the ownership or control of the property concerned that is the determining feature.4

[30]	I am satisfied that there are reasonable grounds to believe that the property is tainted property as defined in s 5 of the Act, having considered Constable Kennard’s evidence. There is a clear disjunct between Mr Te Aho’s declared income and the number and size of the cash deposits made to his bank account in the four years prior to his arrest. The cash deposits are consistent with income generated by trading methamphetamine. In my view, it is significant that Mr Te Aho has not offered an alternative explanation of the source of the cash amount seized by Police, nor sought its return.

[31]	While Mr Te Aho has not been charged with or convicted of offending under s 6(1)(c) of the Misuse of Drugs Act, as is clear from the wording of s 6(2)(a) of the Criminal Proceeds (Recovery) Act, that is not a prerequisite to the making of a restraint order.5

[32]	Mr Te Aho has previously been convicted for possession of methamphetamine for supply.

[33]	Taking the evidence as a whole I am satisfied there are reasonable grounds to believe that the $16,510 in cash is tainted property.

Section 25

[34]	Section 25 provides that a court may make a restraining order relating to all or part of a respondent’s property if it has reasonable grounds to believe that the respondent has unlawfully benefited from significant criminal activity.6 The phrase

3	Commissioner of Police v Briggs [2012] NZHC 2324 at [19].
4	At [35].
5	Commissioner of Police v Debreceny [2016] NZHC 3152 at [26].
6	Defined at [27] above.

“unlawfully benefited from significant criminal activity” is defined in s 7 of the Act as meaning that a “person has knowingly, directly or indirectly, derived a benefit from significant criminal activity”.

[35]	In contrast to s 24, s 25 relies on both the existence of a relationship between the relevant property and the respondent.7 It is sufficient for the respondent to have an interest in the property. In addition, the respondent must have obtained a benefit from significant criminal activity.

[36]	The property was found on the respondent’s person. Mr Te Aho has not explained how he came by it. I infer from that and the evidence as to Mr Te Aho’s presence at the incidents on 23 February 2023 and 22 March 2023 and the traces of methamphetamine found in his car, that the property is the proceeds of the sale of methamphetamine.

Result

[37]	The application for an on notice restraining order over the property is granted on the basis that I am satisfied that there are reasonable grounds to believe that the property is tainted and that the respondent has unlawfully benefited from significant criminal activity.

Gwyn J
Solicitor:
Crown Solicitor, Napier

7	Commissioner of Police v Briggs, above n 3, at [20].