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High Court of New Zealand Decisions |
Last Updated: 28 June 2023
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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
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CIV-2021-404-420
[2023] NZHC 727
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UNDER
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Criminal Proceeds (Recovery) Act 2009
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BETWEEN
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COMMISSIONER OF POLICE
Applicant
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AND
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WAYNE BRENDON FRANKLIN
Respondent
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Hearing:
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15 March 2023
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Appearances:
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S Earl and R Budd for the Applicant
P Wicks KC and K Hogan for Respondent
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Judgment:
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27 April 2023
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JUDGMENT OF WOOLFORD J
This judgment was delivered by me on Thursday, 27 April 2023 at 3:00 pm pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors: Meredith Connell (Office of the Crown Solicitor), Auckland Bruce Dell Law (B Dell), Auckland
Copy to: P Wicks KC, Auckland
COMMISSIONER OF POLICE v FRANKLIN [2023] NZHC 727 [27 April 2023]
[1] The Commissioner of Police applies under the Criminal Proceeds (Recovery) Act 2009 (CPRA) for a profit forfeiture order against Wayne Brendon Franklin or, in the alternative, an assets forfeiture order against him. The applications are made as a result of a Police search of a property occupied by Mr Franklin in Kumara, on the West Coast of the South Island, and seizure of 670 grams of methamphetamine, $12,050 in cash, electronic scales, a pistol and ammunition.
[2] Mr Franklin was subsequently charged with possession of methamphetamine for supply and unlawful possession of a firearm. However, the charges against Mr Franklin were dismissed following a decision of Judge J A Farish in the Greymouth District Court, dated 17 June 2021, in which the Judge came to the view that the search of the property was unlawful and therefore the evidence obtained was inadmissible.1
[3] This proceeding is a civil proceeding quite separate from the criminal prosecution and Mr Franklin has now filed an interlocutory application for rulings that the following are also inadmissible as evidence in this proceeding:
(a) evidence of events and items seized by Police at the Kumara address on 15 May 2020 (the search evidence); and
(b) any self-incriminating statements made by him in a compulsory examination conducted under s 107 of the CPRA (the self-incriminating statements).
Grounds of application
[4] The grounds on which the application is made are as follows:
(a) The search evidence was obtained by Police in serious breach of the New Zealand Bill of Rights Act 1990 (NZBORA). The principle of res judicata2 applies to Judge Farish’s decision, which should be followed by this Court.
1 R v Franklin [2021] NZDC 1203 [The District Court decision].
(b) Exclusion of the evidence in this proceeding is an appropriate remedy.
(c) Section 165(1) of the CPRA provides that any self-incriminating statement made in a compulsory examination may be used in evidence only in a prosecution for perjury or for breach of the Act itself.
(d) The decision in Commissioner of Police v Marshall3 was wrong to hold the s 165(1) use-restriction only applies in criminal prosecutions.
[5] I note, at the outset, that since the hearing of this interlocutory application, the CPRA has been amended by Parliament. The implications of that amendment on the admissibility of the self-incriminating statements will be addressed in this judgment.
Search of the Kumara address
[6] The following summary of the evidence is largely taken from the Commissioner’s submissions.
[7] On 15 May 2020, Sergeant Russell Glue was working in Hokitika, where he has been based for 14 years. He became aware that a person of interest, who I shall refer to as TD, had fled from Police after being stopped in a vehicle on a road leading to the local suburb of Seaview. Sergeant Glue was aware that TD’s mother and her partner lived in Seaview.
[8] Sergeant Glue patrolled Hokitika trying to locate TD and was then informed by officers that TD had again fled from Police when located at another Hokitika address and further, that a van had been stolen in Seaview. Sergeant Glue considered this vehicle theft was an unusual event in Hokitika and that as TD had been in Seaview that day, as his family lived in Seaview, and because he was wanted by Police for breach of bail, TD was the likely culprit.
[9] Sergeant Glue was aware that TD’s sister lived at an address in Kumara, approximately 20 kilometres from Hokitika. He and Constable Shane Allen, who was
3 Commissioner of Police v Marshall [2021] NZHC 1819.
his partner that day, considered it possible that TD could be located there. The two drove to the Kumara address and met a Police dog handler at the property.
[10] The officers arrived at the Kumara address at 11.35 pm. Sergeant Glue could see lights on down the driveway and heard a generator working. Sergeant Glue could also see Mr Franklin through the window of a small cabin on the property. He noticed that Mr Franklin was looking down and appeared to be doing something at a bench inside the cabin.
[11] Mr Franklin’s vision of Sergeant Glue was partially blocked by a large wooden post on the cabin’s veranda, but as Sergeant Glue moved to the side Mr Franklin saw him approaching the cabin. Sergeant Glue shone his torch light on to his Police vest (in order to identify himself as Police) and saw Mr Franklin make a quick movement which he believed was consistent with Mr Franklin throwing something below the bench. As he walked on to the veranda, he had a closer look through the window and saw various items on the bench where Mr Franklin had been working, including scales, snap lock bags and ammunition on the windowsill.
[12] Mr Franklin came out of the cabin and spoke with Sergeant Glue. He gave an incorrect name and told Sergeant Glue that TD was not at the address.
[13] Because of what Sergeant Glue had seen while walking towards the cabin and on to the veranda, he advised Mr Franklin that he was going to conduct a warrantless search of the cabin for illegal drugs under the Search and Surveillance Act 2012 (SSA) and gave his reasons for doing so. He then advised Mr Franklin of his rights under the NZBORA.
[14] Upon entering the cabin and moving to the area where Mr Franklin had been standing, Sergeant Glue noted the following items:
(a) white powder in a bag on a shelf under the bench where Mr Franklin had been standing; and
(b) a bag on the bench which contained:
(i) cash inside a wallet;
(ii) white powder;
(iii) Mr Franklin’s passport; and
(iv) Mr Franklin’s credit cards.
[15] Sergeant Glue then contacted Detective Wendy Bennett to discuss what had been found. Detective Bennett then arrived at the scene. Following a joint phone discussion between Sergeant Glue, Detective Bennett and Detective Sergeant Brett Lyford, Detective Sergeant Lyford decided that an application should be made for a search warrant. The Kumara address was secured in the meantime.
[16] When the search warrant was executed the next day, on 16 May 2020, items found included the following:
(a) two bags of methamphetamine weighing 184 grams and 216 grams respectively, found in an ice cream container;
(b) one bag of methamphetamine weighing 208 grams, located under the kitchen bench as noted by Sergeant Glue;
(c) a bag on the bench which contained:
(i) a large wallet containing:
1. $12,050 in cash;
(ii) two bags of white powder containing 32 and 44 grams respectively;
(iii) Mr Franklin’s passport; and
(iv) an ACC injury claim form with Mr Franklin’s name on it;
(d) a black pistol and ammunition; and
(e) snap lock bags and scales.
District Court ruling
[17] In a pre-trial hearing at Greymouth District Court on 9 March 2021, Judge Farish ruled that the evidence was obtained unlawfully in breach of s 7 (entry without warrant to arrest person unlawfully at large) and s 20 (warrantless search of places in relation to some drug offences) of the SSA.
[18] Judge Farish found that the attending Police Officers were not entitled to be on the property, as they had not formed a reasonable belief in terms of s 7 of the SSA that TD would be there.4 Their presence constituted a breach of s 7 of the SSA which tainted the subsequent search of the Kumara address.5
[19] Judge Farish also concluded that Police did not have reasonable grounds to suspect in terms of s 20 of the SSA that an offence contrary to the Misuse of Drugs Act 1975 (MDA) was taking place at the Kumara address at the time Sergeant Glue entered the dwelling there.6
[20] The unlawful search of the dwelling constituted a breach of s 21 (unreasonable search and seizure) of the NZBORA, and the evidence obtained under it was ruled inadmissible at trial against Mr Franklin.7
4 The District Court decision, above n 1, at [66].
5 At [73] and [77].
6 At [86].
7 At [96].
[21] Although Judge Farish described the seriousness of the breach as “substantial”,8 she found the Police Officers acted in good faith and within what they considered to be honest and proper Police procedure.9 The Judge did not find the conduct of the Police to reach the threshold of gross negligence.10
[22] As a direct result, the Crown offered no evidence at Mr Franklin’s criminal trial and all criminal charges against him were dismissed. Notwithstanding the dismissal of the criminal prosecution, the Commissioner still wishes to adduce the search evidence in his application for a profit or assets forfeiture order.
Compulsory examination
[23] On 15 February 2022, after the criminal prosecution against him had been dismissed, Mr Franklin attended with his lawyer at the Auckland Central Police Station for the purposes of a compulsory examination under s 107 of the CPRA. The Commissioner has filed an affidavit from an investigator annexing the full transcript of the examination of Mr Franklin on 15 February 2022. It is not contested that it contains self-incriminating statements. The investigator specifically notes:
Tax evasion
(a) He did cash jobs for UCL for which he would not invoice.
(b) He would put cash into his personal account and keep it “well clear” of tax authorities.
(c) He had cash income in excess of banked cash deposits he “put in his back pocket and kept”.
[24] The Commissioner now wishes to adduce as evidence statements made by Mr Franklin during his examination. The Commissioner’s position is as follows:
(a) Between 1 April 2015 and 15 May 2020, Mr Franklin received
$292,705.90 in ‘unexplained’ cash deposits.
8 At [96]
9 At [90].
10 At [90].
(i) Mr Franklin’s explanations regarding those deposits (given in the course of his compulsory examination) are incorrect.
(ii) ‘Unexplained’ cash was used to pay off the mortgage over 28B Portage Road.
(b) 28B Portage Road (tainted via the mortgage payments) has increased in capital gain by $290,000.
(c) Mr Franklin has evaded $73,365.54 tax.
Jurisdiction to rule evidence inadmissible
[25] In Marwood v Commissioner of Police,11 the Supreme Court unanimously held that a Court acting in its civil jurisdiction could exclude evidence under s 7(1)(b) of the Evidence Act 2006 (EA) as a remedy for breach of rights under the NZBORA if exclusion of the evidence in those proceedings was proportionate to the breach of the rights involved.12 In considering whether exclusion is an appropriate remedy, the majority of the Court held that what is required is an evaluative assessment — “necessarily open-textured” — and not the exercise of a discretion.13
Admissibility of the search evidence
[26] Counsel for Mr Franklin submits that the search evidence should be ruled inadmissible for the following reasons:
(a) the Police breach/unlawfulness was serious;
(b) an absence of bad faith is irrelevant;
(c) further vindication is warranted; and
11 Marwood v Commissioner of Police [2016] NZSC 139, [2017] 1 NZLR 260.
12 At [35] and [50].
13 At [46].
(d) the Court should rule as Judge Farish did.
[27] Counsel refers to the decision of Judge Farish in which she stated:14
[96] The seriousness of the breach here is substantial. Police were unlawfully on the property and then executed an unlawful search of the property. Although the charges that the defendant faces are serious, the impropriety here is gross ...
[28] Counsel notes that Judge Farish found the nature of the impropriety in this case was reckless. That is a serious impropriety and is referenced in s 30(3)(b) of the EA:
30 Improperly obtained evidence
...
(3) ...
(b) the nature of the impropriety, in particular, whether it was deliberate, reckless, or done in bad faith:
...
[29] Counsel also notes that the Supreme Court in Marwood did not regard the conduct of the Police as a serious breach of the NZBORA and so the evidence was not excluded. However here, unlike in Marwood, the conduct of the Police did involve a serious breach of rights under the NZBORA; breaches described by Judge Farish as “substantial” and “gross”. Counsel submits that in this case the Police trespassed and conducted an unlawful warrantless search, acting only under a mere suspicion that TD was present at the property and without any genuine belief that there was urgency.
[30] Counsel submits that Judge Farish also clearly had concerns about the credibility of the officers who gave evidence. In her judgment she focused on evidence given under oath by Police Officers as to whether Sergeant Glue could have seen what he claimed to see to trigger the search, and the officers’ failure to see a sign expressly revoking any implied licence to enter the property.
[31] Counsel submits that this is a case where, because of the seriousness of the Police breach/unlawfulness, the proportionality determination in the criminal jurisdiction should result in the same determination in the civil jurisdiction.
14 The District Court decision, above n 1.
[32] Counsel argues that an uncomfortable inconsistency would result if the Crown, while unable to use the evidence to cross the s 147 of the Criminal Procedure Act 2011 threshold, can, however, use the same evidence to cross the CPRA balance of probabilities threshold. Counsel says that the Court risks setting a precedent that invites risk/reward reasoning by Police regarding rights breaches, and that Judges must always be satisfied that allowing Police to rely on improperly obtained evidence at trial would not erode public confidence in the justice system.
[33] Counsel notes that Judge Farish found Police only had a “mere suspicion” as to the presence of a person they were seeking being on the property and also only a “mere suspicion” as to Mr Franklin acting unlawfully. The Judge described the Police approach to the SSA as somewhat “gung ho”.
[34] Counsel acknowledges that Judge Farish did not go so far as to make a finding that the Police acted in bad faith, but emphasises that while bad faith may be a factor favouring exclusion of unlawfully obtained evidence, absence of bad faith does not tell in favour of admission.
[35] I am of the view that relief in the form of exclusion of evidence in the present proceeding would not be proportionate to the breach of rights involved. Although Judge Farish did find that the Police had a “gung ho” attitude, they acted in good faith and with what they considered at the time to be proper and honest Police procedure. Their behaviour was not grossly negligent.
[36] Judge Farish commences the section of her judgment labelled “Decision” with a statement that she was satisfied that there was not an implied licence for Police to enter the property.15 She considered that the true purpose behind the Police visit was to investigate whether TD was at the property, not to merely communicate with its occupier about TD's whereabouts.16 The Judge took the view that if it had been the latter, the Police would have had an implied licence to enter the property.
15 The District Court decision, above n 1, at [61].
16 At [61].
[37] However, the distinction between going to investigate whether TD was at the property and communicating with the occupier about TD’s potential whereabouts is not entirely clear. Communication with the occupier can be considered an investigatory step. In evidence before Judge Farish, Mr Franklin said he was directly at the front door when he first saw Sergeant Glue and that a brief discussion ensued in which Sergeant Glue asked for his name and the whereabouts of TD. There was therefore a communication with the occupier about TD’s potential whereabouts.
[38] The Judge gives three reasons why there was an investigation, which meant an implied licence to enter the property was not available to the Police. First, the manner in which Sergeant Glue parked his vehicle which blocked the main entry/exit to the property so as to impede at least in part anyone trying to get in or out.17 Whilst the Judge acknowledged that in the circumstances “this was reasonable Police practice”, she considered that it nonetheless gave rise to a clear inference that Police were conducting an investigation.18
[39] Secondly, the presence of the dog handler at the scene and advice given to him and Constable Allen to check the left-hand side of the driveway for a stolen vehicle.19 However, such investigation did not take long because Constable Allen ended up four or five metres behind Sergeant Glue as he approached the front door of the cabin. The dog handler was then situated at the rear of the cabin in case TD was there and tried to flee, as he had done twice previously that day. If the Judge found that the action of Sergeant Glue in parking his car in such a manner as to block the main entry/exit to the property was “reasonable Police practice” then the action of the dog handler in positioning himself at the rear of the cabin for similar reasons must also be seen as “reasonable Police practice”.
[40] Thirdly, it was not possible for the Police to reasonably believe that TD would be found at the property, the Police having formed an “educated guess” that TD might be at the address.20 However, the Judge is here referring to the test for entry without warrant under s 7 of the SSA — to arrest a person unlawfully at large. A Police Officer
17 At [62].
18 At [63].
19 At [64].
20 At [66].
must have reasonable grounds to suspect that a person is unlawfully at large and to believe that the person is there. Without calling into question the correctness of the Judge’s decision that the Police did not have an implied licence to enter the property, this case illustrates the fine line between going to investigate whether TD was there and communicating with the occupier about TD’s whereabouts.
[41] In R v Soma,21 two Police Officers went onto a property to execute a warrant issued in respect of a female defendant, not knowing that another officer had already entered the property eight days earlier to execute the same warrant. When they knocked at the front door, they received no answer. The two officers then proceeded around the side of the house with the purpose of knocking on the back door to ascertain if the female defendant was at home. The back door was open and there was a strong smell of cannabis. They knocked on the door and called out. Mr Soma came to the door. The two Police Officers then invoked their powers to make a warrantless search under the MDA. Mr Soma was arrested and charged with drug offences. The Court of Appeal held that the Police had an implied licence that permitted them to go to the back of the property (having received no response to their knock at the front door) and to make inquiries of the occupier in relation to the subject matter of their investigation.22
[42] After finding that the Police did not have an implied licence to enter the property, Judge Farish also found that the Police had no right to enter the property without warrant under s 7 of the SSA to arrest TD.23 The Judge accepted that the Police reasonably suspected that TD was at large but did not consider they had grounds to reasonably believe that TD was at the property. She accepted that from their experience in dealing with TD, the Police Officers reasonably concluded that he tended to end up at addresses where his family were located. However, the Kumara property was some 20 kilometres away from the address in Hokitika where TD had last been seen on foot and there was no evidence that TD had stolen the motor vehicle from Seaview that day.
21 R v Soma (2004) 21 CRNZ 23 (CA).
22 At [41].
23 The District Court decision, above n 1, at [73].
[43] Again, without calling into question the correctness of the Judge’s decision that the Police were unable to rely on s 7 of the SSA, the search for TD was not without foundation. The Judge noted that TD’s sister was recorded as living at the Kumara address with Mr Franklin. TD had also put forward the Kumara address as a bail address. He told Police he had been living there after he was “kicked out of his parents’ address”. The Judge accepted that TD tended to end up at addresses where his family were located. After fleeing the Police the first time that day, TD had gone to his grandmother’s address where he was found in a shed, but again, he had evaded the Police and fled from the backyard.
[44] After rejecting an implied licence and s 7 of the SSA as the basis for a lawful entry to the property, Judge Farish turned to the warrantless search under s 20. She noted the cumulative requirements before Police can execute a warrantless search. The Judge said they were:
(a) reasonable grounds to believe it is not practical to obtain a warrant and that there is a controlled drug on the premises; and
(b) reasonable grounds to suspect that an offence against the MDA has been, or is being, committed, and to believe that if entry and search is not carried out immediately evidential material relating to the suspected offence will be destroyed, concealed, altered or damaged.24
[45] Sergeant Glue had identified three factors which he said led him to a reasonable suspicion that an offence against the MDA was being committed:
(a) the action of Mr Franklin throwing something under a bench when he first saw Sergeant Glue;
(b) the presence of ammunition on a windowsill; and
(c) the presence of some small snap lock plastic bags and a set of electronic scales among other items on the kitchen bench.
24 At [79].
[46] Judge Farish said the first two factors were neutral.25 She accepted the third factor was relevant to the question of whether or not there were reasonable grounds for suspicion.26 The Judge had, however, earlier noted that she had reservations about what Sergeant Glue could see through the window as he walked along the veranda to speak to Mr Franklin, but commented that her inability to discern the reliability of his evidence was not material.27 The Judge then noted that there was no evidence given on the practicality of obtaining a warrant other than the fact that once the premises were secured, Sergeant Glue then did seek a warrant, which was issued at 5.30 am “so the time of [Mr Franklin’s] arrest was not detrimental to Police trying to obtain a warrant”.28
[47] Judge Farish concluded:
[86] I have therefore come to the view that Police did not have reasonable grounds to suspect that an offence against the MDA was being committed at the time that Sergeant Glue made his way into the defendant’s premises. There was also the ability for Police to obtain a warrant and carry out further enquiries with respect to Mr Franklin and what he may or may not have been doing at the time immediately prior to his arrest. Therefore the search of the drugs was not lawful in terms of a warrantless search.
[48] Given the Judge’s earlier comment about the immateriality of what Sergeant Glue could or could not see, it seems that the Judge’s decision turned on the fact that it was not impractical to obtain a search warrant.
[49] It must be accepted that it was not impractical because that is just what the Police did after a short initial search of the kitchen area only. While waiting for the warrant, Police were able to utilise their special powers to secure the address under s 117 of the SSA. The breach was therefore a matter of timing. The Police could have and should have made an application for a search warrant while securing the address at the outset, rather than invoking a warrantless search power and then deciding to make an application for a search warrant. The warrantless search did not, however, extend beyond the kitchen and merely provided a basis on which Sergeant Glue could arrest Mr Franklin and then seek advice and assistance from others.
25 At [83].
26 At [84].
27 At [58].
28 At [85].
[50] As to the credibility of the Police Officers, counsel for Mr Franklin pointed to the evidence about what Sergeant Glue could see on the bench beneath the front window of the cabin and the officer’s failure to see a sign expressly revoking the implied licence to enter the property. Judge Farish did not, however, make a finding on either issue.
[51] On the first issue, the Judge stated:29
... On this crucial issue as to what Sergeant Glue may have seen prior to entering the dwelling I am left in the position that I do not know. For the reasons that follow that inability to discern the reliability of Sergeant Glue’s claim is not material.
[52] On the second issue, the Judge considered Mr Franklin’s evidence that there had been a sign at the front of the property which advised any on-looker that entry on to the property was forbidden. Mr Franklin said the sign had been turned around for the purposes of the evidential photographs produced as exhibits. The Judge stated:
[75] I have no view on whether that is the case. Both Constable Allen and Sergeant Glue gave consistent evidence that neither one saw the wooden board and it was late at night when they entered the property.
[53] The Judge went on to refer to an initial photograph which was not produced as an exhibit but had been included in a disclosure pack. It showed a sign which was consistent with Mr Franklin’s evidence. However, the Judge stated:30
... I do not consider that this point can be taken further and include it merely for completeness.
[54] This is not a case where further vindication is required. Mr Franklin is not at risk of conviction or imprisonment as the criminal prosecution against him has been dismissed. He cannot be re-tried. This proceeding simply seeks to remove an unlawful benefit from Mr Franklin. As noted in Marwood, the CPRA provides “a clear and emphatic signal” as to its legislative purpose which includes the elimination of the chance to profit from significant criminal activity.31
29 At [59].
30 At [76].
31 Marwood v Commissioner of Police, above n 11, at [12].
[55] If the evidence was found to be inadmissible in this proceeding, Mr Franklin’s rights would be further unnecessarily vindicated through the retention of what may otherwise be established to be the unlawful benefit of significant criminal activity. I am of the view that to grant relief by exclusion of the evidence would be disproportionate to the breach of rights involved.
[56] Counsel for Mr Franklin has referred to the concept of res judicata to submit that the Commissioner is not able to attack collaterally, nor the High Court rule inconsistently, with Judge Farish’s findings. Although there are differences between the principles of res judicata (which include causes of action estoppel and issue estoppel) and the abuse of process doctrine, I agree with counsel for the Commissioner that the principle relied upon by Mr Franklin appears to be the principle that the same parties cannot relitigate an issue determined in earlier litigation. There is, however, no violation of this principle nor any abuse of process. There is no collateral attack on Judge Farish’s decision. There is instead a re-evaluation of the search and seizure for the purpose of a civil proceeding, which has an entirely different focus to a criminal prosecution.
Admissibility of the self-incriminating statements
[57] A peculiar aspect of this case is that Mr Franklin’s challenge to the self- incriminating statements was argued in the shadow of an impending amendment to the CPRA. At the time of the hearing the Criminal Proceeds (Recovery) Amendment Bill 2022 (the Bill) was sitting in the Committee of the whole House, awaiting its Third Reading. That occurred on 28 March 2023. Royal assent was then granted on 31 March 2023 and the Bill became law as the Criminal Proceeds (Recovery) Amendment Act 2023 (the Amendment Act).
[58] The Amendment Act replaces s 165, which governs the admissibility of self- incriminating statements made in the course of a compulsory examination under the CPRA. Significantly, for Mr Franklin, the new s 165 came into force a day after royal assent32 and has retrospective effect.33 It follows, that the admissibility of the self-
32 Criminal Proceeds (Recovery) Amendment Act 2023, s 2(2).
33 Section 7A and sch 1 cl 7(2).
incriminating statements now falls to be determined under the new s 165. That said, I heard extensive argument from counsel on the interpretation and effect of the old s 165 and they are entitled to my views. I will, therefore, briefly address Mr Franklin’s position under the old s 165, mindful that the issue is now purely academic.
[59] The old s 165 provided as follows:
165 Admissibility of self-incriminating statements
(a) a refusal or failure to answer any question, supply any information, produce any document, provide any explanation, or comply with any other requirement may be used in evidence against that person in any prosecution for any offence under section 152 arising from that refusal or failure:
(b) the answering of any question in a way that is false or misleading in a material particular, or the supply of any information, or the production of any document, or the providing of any explanation that is false or misleading in a material particular, may be used in evidence against that person in any prosecution for any offence under section 152 arising from that act.
[60] Counsel argued that because the CPRA is a “draconian regime”, the checks and balances built into the regime are particularly important. One of those checks and balances was the use-restriction in the old s 165(1). The Court of Appeal has stated that the effect of that subsection was that a self-incriminating statement made in a compulsory examination “may be used in evidence only in a prosecution for perjury or for breach of the CPRA itself”.34 According to counsel, s 165(1) therefore
34 Commissioner of Police v Burgess [2012] NZCA 436 at [11].
prohibited the Commissioner from adducing Mr Franklin’s statements as evidence in his application for a profit or assets forfeiture order against him.
[61] In Commissioner of Police v Marshall,35 Lang J held that the s 165(1) use- restriction only applied in criminal prosecutions. Counsel submitted, however, that Lang J was wrong for the following reasons:
(a) Section 165(1) contained no such constriction of application.
(b) Like similar use-restriction provisions in other Acts,36 s 165 provided investigators with an investigative tool and only provided a prosecutive tool to the extent it precluded the later giving of inconsistent evidence.
(c) By restricting the use of compulsorily obtained self-incriminatory statements, s 165 properly balanced investigation/prosecution imperatives with an individual’s enshrined rights against self- incrimination (ss 23 and 25 of the NZBORA and s 60 of the EA).
(d) Lang J ultimately decided that the statements were not self- incriminating and so s 165 was not engaged. His opinion that s 165 applied only to criminal prosecution was therefore obiter.
[62] For the ensuing reasons, I would have been prepared to rule the self- incriminating statements as inadmissible in the hearing of the Commissioner’s application for a profit or assets forfeiture order.
[63] First, I accept that the explanations given by Mr Franklin at the compulsory examination can amount to self-incriminating statements within the definition of s 4 of the EA. I am advised that the statements sought to be admitted are admissions of tax evasion and explanations given by him regarding unexplained cash deposits which can be shown by the Commissioner to be incorrect. It seems to me that Mr Franklin could therefore reasonably be in jeopardy of a prosecution for tax evasion and money
35 Commissioner of Police v Marshall, above n 2.
laundering. A Judge is able to place weight on evidence of a defendant’s lies in terms of s 124(4) of the EA in such a prosecution.
[64] Secondly, s 165(1) of the CPRA provided that self-incriminating statements made in a compulsory examination may be used in evidence only in a prosecution under the Crimes Act for perjury or under the CPRA “in relation to any evidence given by the person that is inconsistent with the statement”. Thus, if Mr Franklin chose to give evidence at the hearing of the Commissioner’s application for a profit or assets forfeiture order and gave evidence inconsistent with a statement he made in the compulsory examination, then the Commissioner would have been able to adduce evidence of the earlier statement in any prosecution under s 152 of the CPRA for making a false or misleading statement.
[65] Thirdly, in so finding I would have, with respect, differed from the approach taken by Lang J in Commissioner of Police v Marshall,37 who found that the wording used in the old s 165(1) made it clear that the use-restriction only applied to criminal prosecutions. He acknowledged that the word “only” in s 165(1) left open the argument relied upon by Mr Franklin in the present proceeding, but said:38
It would produce an absurd outcome, and one that is wholly inconsistent with the purpose of the CPRA, if the Commissioner could obtain relevant information using an examination under s 107 and then be prevented from using it to obtain forfeiture orders by virtue of s 165.
[66] To my way of thinking, however, s 165(1) was part of a carefully crafted regime that balanced the public interest in facilitating the bringing of applications for profit and assets forfeiture orders and an individual’s long held and cherished right not to incriminate oneself. Statements made by an individual subject to an examination order could be utilised by the Commissioner to confirm information already held or to make further enquiries, as he has in this case. Examination orders would therefore still be of real utility. The individual’s right against self-incrimination is also not absolute, but would be lost if he said something different in a hearing in the Commissioner’s application for a profit or assets forfeiture order and a prosecution follows.
37 Commissioner of Police v Marshall, above n 3.
38 At [13].
[67] Section 60 of the EA effectively codified the common law privilege against self-incrimination, which could only be removed by an enactment either expressly or by necessary implication.39 An example is s 63 of the EA, which replaces the privilege with respect to disclosure requirements in civil proceedings. It does not, however, trump s 165, which dealt specifically with the recovery of criminal proceeds. Further, s 165(1) did not specifically refer to civil proceedings, it merely stated “[a] self- incriminating statement ... may be used in evidence against that person only in ...”. Various other enactments also modify the privilege.40 Each enactment, however, has to be interpreted according to its own wording in light of its purpose.
[68] The Commissioner seeks to use the self-incriminating statements made in a compulsory examination of Mr Franklin in evidence against him. But in terms of the old s 165, that could only occur “in a prosecution for an offence under section 108 of the Crimes Act 1961 (which relates to perjury) or under [the CPRA] in relation to any evidence given by that person that is inconsistent with the statement”. Mr Franklin has not been charged with perjury or any offence under the CPRA in relation to any evidence given by him that is inconsistent with the self-incriminating statements made by him in the compulsory examination. Mr Franklin has not given evidence inconsistent with which he said in the examination.
[69] Finally, the very fact that the Amendment Act was to repeal and replace s 165 indicated to me that Parliament considered it necessary to broaden the use- restriction. Why else amend the legislation?
[70] Section 165 of the CPRA now provides:
General
(a) answering any question:
(b) supplying any information:
(c) producing any document:
(d) providing any explanation.
Exception for civil proceedings
Exceptions for criminal proceedings
Definitions
false or misleading means false or misleading in a material particular
production or examination order means—
(a) a production order made under section 105; or
(b) an examination order made under section 107.
[71] Section 165(4) is clear and explicit in its effect: the self-incriminating statements are now admissible in a hearing of the Commissioner’s application for a profit or assets forfeiture order, being a civil proceeding specified in s 10(1) of the CPRA.
[72] Counsel for Mr Franklin filed in Court a memorandum dated 4 April 2023. In that memorandum concerns are raised regarding the process which resulted in the enactment of the Amendment Act. In particular, counsel argues that the commentary associated with the Bill, as reported by the Justice Committee, was misrepresentative in its analysis of case law relating to the old s 165 and that the Attorney-General’s vetting of the Bill, pursuant to his obligation under s 7 of the NZBORA, failed to reference the Bill’s abrogation of the s 165 use-restriction. Counsel says further that given the Bill’s impact on enshrined rights, parliamentary reconsideration is warranted. Counsel notes that the New Zealand Bar Association has written to the Minister of Justice communicating similar concerns.
[73] It is unclear how those these points come to bear on the Court’s application of the new s 165 in the present case. Counsel instead appears to impugn the Amendment Act itself and the parliamentary proceedings which led to its enactment. Any argument along those lines must be rejected. The Privy Council stated in Te Heheu Tukino v Aotea District Maori Land Board that:41
... it is not open to the Court to go behind what has been enacted by the Legislature, and to inquire how the enactment came to be made, whether it arose out of incorrect information or, indeed, on actual deception by someone on whom reliance was placed by it. The court must accept the enactment as the law unless and until the Legislature itself alters such enactment, on being persuaded of its error.
41 Te Heheu Tukino v Aotea District Maori Land Board [1941] NZLR 590 (PC) at 595.
Result
[74] The evidence of events and items seized during the search of the Kumara address on 15 May 2020 is admissible in the present proceeding, being the Commissioner’s application for profit and assets forfeiture orders against Mr Franklin.
[75] The self-incriminating statements made by Mr Franklin in the compulsory examination on 15 February 2022 are admissible in the present proceeding in terms of s 165 of the CPRA, as amended.
Woolford J
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URL: http://www.nzlii.org/nz/cases/NZHC/2023/727.html