Commissioner of Police v Tsai [2012] NZHC 2245 (31 August 2012)

Last Updated: 14 September 2012

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2010-404-006707 [2012] NZHC 2245

UNDER Criminal Proceeds (Recovery) Act 2009

BETWEEN THE COMMISSIONER OF POLICE Applicant

AND KUO LIANG (LEON) TSAI 12 Ridgefield

Lane, Dannemora, Manukau, Respondent

Hearing: 22 August 2012

Appearances: M R Harborow for the Applicant

V Withy for the Respondent

Judgment: 31 August 2012

_{JUDGMENT OF GILBERT J}

This judgment was delivered by me on 31 August 2012 at 4.30 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date:....................

Counsel: M R Harborow, Auckland: [e-mail]

_{V Withy, Auckland: [e-mail]}

POLICE V TSAI HC AK CIV 2010-404-006707 [31 August 2012]

[1] The Commissioner seeks an assets forfeiture order or alternatively a profit forfeiture order in respect of $3040 in cash found in Mr Tsai’s wardrobe and a further

$57,000 found in the spare wheel compartment of Mr Tsai’s car on 19 December

2006. The Commissioner alleges that this money was acquired, or directly or indirectly derived, from significant criminal activity, namely the supply of methamphetamine. Mr Tsai was convicted of supplying 395 grams of methamphetamine between 19 October and 7 December 2006.

[2] Keane J presided over Mr Tsai’s trial. He sentenced Mr Tsai to five years and six months’ imprisonment for this offending in July 2010. The Judge declined the Crown’s application for an order under s 32(3) of the Misuse of Drugs Act 1975 forfeiting the cash. Although he observed that there had to be “high suspicion” as to the money found in the car, he noted that the reward Mr Tsai obtained had not been the subject of evidence and there was insufficient evidence to prove that the money was paid to Mr Tsai in relation to the offending or to facilitate further offending. There could be no justification for me to reach a different conclusion on the evidence that was then available. However, the Crown has since provided further evidence in support of the current application. I need to consider whether orders should be made, taking into account that further evidence.

[3] Mr Tsai told the police that he had saved the money in the wardrobe, which was all in either $20 or $100 notes, from his student loan payments and his student allowance. There are two difficulties with this explanation. The first is that the student loan payments were made directly by WINZ to the University of Auckland. The second is that Mr Tsai only received $2700 from his student allowance in 2006 and $1000 for course related costs. These monies were paid into his bank accounts and used for everyday living expenses. Mr Tsai’s total declared income for the 2007 tax year was $5548, being the student loan payments. Mr Tsai confirmed to the police that he was not working at the time.

[4] The $57,000 found in Mr Tsai’s car was all in $50 and $100 notes bundled together with rubber bands and contained in a plastic Amazon carry bag concealed under the spare wheel. Mr Tsai was examined in April 2011 pursuant to an order

made under the Criminal Proceeds (Recovery) Act 2009. He gave various explanations for the source of this money. First, he said that the cash was money paid for his course fees for university. That explanation is demonstrably wrong. Then he said that his parents brought cash when they last visited New Zealand in

2001. However, he was unable to remember how much his parents had given him. He also said that he was paid $100 per day, four days per week, to play gaming machines at the casino and he would earn commission if the jackpot was won. He also that in 2005 he ran a kitchen selling food with a friend in a karaoke bar. However he could not remember either the name of the karaoke bar or how much he earned. No such income was declared to the Commissioner of Inland Revenue. Finally, he said that approximately $11,000 was transmitted by his family to his former girlfriend via two foreign exchange companies. He could not remember the name of either of these companies.

[5] In his notice of opposition to the present application Mr Tsai denied that the money was tainted property and indicated that further affidavits would be filed to support his position. However, no further affidavits were filed and his counsel advised that Mr Tsai had elected not to file any evidence. Mr Tsai’s counsel states, correctly, that the onus of proving on the balance of probabilities that the cash is tainted property rests with the Commissioner.

[6] The evidence now available as to Mr Tsai’s legitimate earnings establishes that he could not possibly have saved $60,000 from that source. The alternative explanations offered by Mr Tsai during the course of his examination, but not substantiated in evidence before me, are implausible and, in any event, would not account for all of this cash. I am therefore left in the position where a substantial sum of cash has been found in highly suspicious circumstances and no plausible explanation has been given for how it was acquired. Mr Tsai was convicted of having supplied methamphetamine from 19 October to 7 December 2006, almost immediately before the cash was found. It is likely that he was rewarded for his role in this serious offending. Taking all of these circumstances together, and the lack of any plausible explanation as to how Mr Tsai acquired the money legitimately, I am persuaded on the balance of probabilities that the money was acquired wholly or in

part as a result of significant criminal activity. Accordingly, the Commissioner’s

application for an asset forfeiture order must be granted.

[7] In view of this conclusion I do not need to consider the Commissioner’s

alternative application for a profit forfeiture order.

Result

[8] I make an order in terms of paragraph 1(c) of the Commissioner’s application dated 24 January 2012.

[9] Any memorandum seeking costs should be filed and served within 14 days of the date of this judgment. Any memorandum in response should be filed and served

_{within 14 days thereafter.}

M A Gilbert J