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Commissioner of Police required to give undertaking on damages in novel use of criminal proceeds legislation

22 Mar 2024

| Author: Anna Longdill

Criminal Proceeds (Recovery) Act 2009, s 29 – appeal against High Court order that Commissioner of Police give undertaking as to damages – novel application of the Act to ‘ordinary commercial business’ that committed health and safety and hazardous substances offences – approach to appeals against s 29 decisions – relevant considerations for exercise of s 29 discretion

Commissioner of Police v Salter [2024] NZCA 6.

 

Salters Cartage Ltd (SCL) processes used or waste oil at premises in Wiri. It is owned by Ron and Natalie Salter. On 15 September 2015, there was a fatal accident at the SCL premises. Jamey Bowring (a worker for a contractor to SCL) was fatally injured after the large vertical tank he was working on top of exploded.

WorkSafe subsequently prosecuted SCL and CEO Ron Salter. Both pleaded guilty to charges under the Health and Safety in Employment Act 1992 and the Hazardous Substances and New Organisms Act 1996 and were sentenced in the District Court in late 2017. The court imposed substantial fines and reparation on SCL and Salter. Salter was also ordered to serve four and a half months home detention.

In November 2019, the High Court made without-notice restraining orders under the Criminal Proceeds (Recovery) Act 2009 (the Act) on properties owned by the Salters and related entities, including the Wiri premises occupied by SCL. The orders prevented any increase in the debt secured against the properties and limited the amount that an overdraft facility held by SCL could be drawn down.

The Commissioner of Police has not previously sought to apply the Act to health and safety or hazardous substance offending.

The Salters, SCL, and related entities applied under s 29 of the Act for an order that the commissioner give an undertaking as to damages.

The High Court granted this application, concluding that it was reasonably clear that the restraining orders could have a negative effect on the ability of SCL and its related entities to undertake significant borrowing for the purposes of investment. The court also observed that the circumstances in which the Act is sought to be applied by the commissioner were novel.

The commissioner appealed.

The Court of Appeal discussed at length the application of the relevant considerations in the exercise of the s 29 discretion as outlined in Yan v Commissioner of Police [2015] NZCA 576, [2016] 2 NZLR 593, concluding that it was relatively clear that the Salters wanted to sell the business and would be attempting to do so but for the restraining orders.

 

Applicable principles: Criminal Proceeds (Recovery) Act 2009, s 29 – discretion to order that Commissioner of Police give an undertaking as to damages – what is the correct approach to appeals from s 29 decisions? –  relevant considerations for exercise of s 29 discretion – risk that commissioner might be chilled must be balanced as part of broader assessment of needs of justice and fairness.

 

Held: The appeal was dismissed.

The appeal was to be approached as a general appeal, rather than an appeal against the exercise of a discretion. The power should be exercised where necessary to ensure that persons affected by restraining orders did not suffer loss because of an order that ought not to have been made. This required an evaluative exercise both at first instance and on appeal. The considerations in Yan were relevant to the evaluation. Overall, the court was satisfied that this was an appropriate case for an undertaking to be required.

 

Commissioner of Police v Salter

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