The Commissioner of the New Zealand Police v Phillip James Musson

JurisdictionNew Zealand
JudgeNation J
Judgment Date02 February 2016
Neutral Citation[2016] NZHC 43
Docket NumberCIV-2014-409-000212
CourtHigh Court
Date02 February 2016
Between
The Commissioner of the New Zealand Police
Applicant
and
Phillip James Musson
First Respondent

and

Lesley Anne Musson
Second Respondent

and

Anne Maria Hammill
Fifth Respondent

[2016] NZHC 43

CIV-2014-409-000212

IN THE HIGH COURT OF NEW ZEALAND

CHRISTCHURCH REGISTRY

Application pursuant to the Criminal Proceeds (Recovery) Act 2009 (CPRA) for profit forfeiture orders against the respondents and an asset forfeiture order against a property owned by the first and second respondents — first respondent was convicted of serious offending under the Medicines Act 1981 and Misuse of Drugs Act 1975 — the fifth respondent had an equitable interest in the property as she had built a flat on the property — fifth respondent had allowed her bank account to be used for payments from first respondent's customers — Commissioner claimed the benefit first and second respondents obtained was $795,900 less any profit forfeiture orders made against the fourth respondent and fifth respondent — Commissioner did not allow for recovery from other respondents in respect of fifth respondent — whether the Commissioner should have made allowance for any recovery that might have been obtained from another party in relation to the claim against the fifth respondent — whether the respondents had unlawfully benefited from significant criminal activity as defined in s7 CPRA (meaning of unlawfully benefited from significant criminal activity — person has knowingly, directly or indirectly, derived a benefit) — whether the second and fifth respondents had “knowingly” benefited from the first respondent's serious criminal activity — whether the respondents were entitled to relief under s56 CPRA (exclusion of respondent's property from profit forfeiture order because of undue hardship.

Appearances:

K B Bell for the Applicant

T Aickin for the Respondents

JUDGMENT OF Nation J

Introduction
1

The Commissioner of Police applies, pursuant to the Criminal Proceeds (Recovery) Act 2009 (the Act), for profit forfeiture orders against the respondents Phillip Musson, his wife Lesley Musson and his mother-in-law Anne Hammill.

2

This application relates to:

  • (a) a property at 40 Breens Road, Bishopdale, Christchurch (40 Breens Road). The title is held by Phillip and Lesley Musson jointly. Anne Hammill has an equitable interest in the property;

  • (b) a 2004 Chrysler Grand Cherokee, registration URUZ, registered in the name of Phillip Musson;

  • (c) a 2009 Briford 6 x 4 silver trailer, registration P667L. This is registered in the name of Phillip Musson; and

  • (d) a 1996 Yamaha UMX 1200 motorcycle, registration 21ZNJ.

3

The 2009 Chrysler Grand Cherokee was not the subject of a restraining order and has remained in the possession of the respondents. At the hearing of the application, the Commissioner sought to amend the application so as to refer to that vehicle or the proceeds of its sale. That amendment was not opposed.

4

The Commissioner also applied for an assets forfeiture order in respect of $5,000 cash located at 40 Breens Road, Christchurch on 23 May 2012.

Orders by consent
5

The Commissioner's applications are consented to insofar as they relate to all property and cash other than 40 Breens Road.

6

I accordingly make an assets forfeiture order in respect of $5,000 cash located at 40 Breens Road, Christchurch on 23 May 2012. I vest that property in the Crown absolutely and put it in the custody and control of the Official Assignee.

7

In relation to the further property owned by Phillip James Musson, the Court determines:

  • (a) the value of the unlawful benefit Phillip James Musson obtained from significant criminal activity is $795,958 less the $152,667.83 forfeited to the Crown as a result of a profit forfeiture order made against a fourth respondent (Mr John Wisker) in respect of the same significant criminal activity to which the profit forfeiture order relates and the value of any profit forfeiture order made against Mrs Hammill;

  • (b) the maximum recoverable amount, determined in accordance with s 54, is the amount referred to in (a) less the $5,000 value of the further asset forfeiture order now made against Mr Musson in respect of the $5,000 cash; and

  • (c) the profit forfeiture order is made in respect of:

    • • a 2004 Chrysler Grand Cherokee, registration URUZ, registered in the name of Phillip Musson, or the proceeds of sale obtained from that vehicle;

    • • a 2009 Briford 6 x 4 silver trailer, registration P667L, registered in the name of Phillip Musson; and

    • • a 1996 Yamaha UMX 1200 motorcycle, registration 21ZNJ.

Summary of the significant criminal activity
8

The Commissioner's application is opposed insofar as it relates to the property at 40 Breens Road. On this application, the Commissioner must prove on the balance of probabilities that the respondents have, in the relevant period of criminal activity, unlawfully benefited from significant criminal activity.

9

In accordance with the definition in the Act, the relevant period during which there must have been significant criminal activity is the seven years from 16 April 2007 to 16 April 2014 when the Commissioner filed in the High Court an application for restraining orders under the Act. 1

10

The serious criminal offending relied on by the Commissioner is, firstly, Mr Musson's offending under the Medicines Act 1981 which involved the importation, sale and possession for sale of prescription medicines (anabolic steroids, human growth hormones and other performance and image enhancing drugs). The Commissioner contends that this was significant criminal activity in terms of the Act because it resulted in proceeds or benefits valued in excess of $30,000.

11

Mr Musson arranged for the prescription medicines to be sent to him or to false names, care of Courier Post depots or Post Shops in the Canterbury region and to his home address.

12

Total prescription medicines imported and/or seized from Mr Musson and his associate, Mr Bailey, had an estimated street value of $1,498,826. Of this total, prescription medicines with a street value of $1,256,300 were imported by Mr Musson or in his possession.

13

The evidence for the Commissioner, by way of an affidavit from Detective Nicola Robinson, was that Mr Musson had been involved in this offending involving prescriptions over the period 1 April 2010 to 31 March 2013.

14

Mr Musson pleaded guilty to 187 charges under the Medicines Act 1981, a charge of forgery and a charge of use of a forged document. The Medicines Act charges covered a 16 month period from 12 October 2011 until 26 February 2013. Mr Musson was sentenced to four years, five months and three weeks' imprisonment.

15

The Commissioner's application is also based on Mr Musson's offending in the manufacture, possession and sale of party pills containing Class C controlled drugs contrary to the Misuse of Drugs Act 1975. (“Party pills” is a colloquial term for Ecstasy or Ecstasy mimic pills.) The Commissioner says this was serious significant criminal activity because it involved offending punishable by over five years' imprisonment or because proceeds or benefits valued in excess of $30,000 were directly or indirectly acquired or derived from the offending.

16

The affidavit evidence of Detective Robinson explains how, jointly with Chetan Viraj Jethwa of Hamilton, he imported 4-MEC, MDPV and alpha PVP (Class C controlled drugs) and then manufactured, possessed and sold party pills containing those ingredients. This resulted in party pill sales of not less than $701,350.

17

Mr Musson went into partnership with Mr Jethwa towards the end of 2011 or start of 2012 to make and sell party pills. Their roles were defined and they shared the profits equally. Mr Musson sold the party pills. He would receive the orders, organise the manufacture and delivery of these party pills by Mr Jethwa and arrange for payment for the party pills. Mr Jethwa imported the active ingredients for the party pills. Mr Jethwa then manufactured party pills in quantities Mr Musson advised. Once manufactured, Mr Jethwa sent the party pills to the customers as advised by Mr Musson. Mr Musson ensured Mr Jethwa received his share of the proceeds from the sale of the party pills.

18

Over the period 1 April 2010 to 31 March 2013, when the evidence indicates Mr Musson was involved in the offending over prescription drugs and later the party pills, he had unexplained income of not less than $795,958.

19

In her affidavit dated 11 April 2014, Detective Robinson said that charges in relation to offending under the Misuse of Drugs Act were “in the process of being resolved”. There is no evidence to indicate the Crown continued with charges in relation to that offending. Presumably, the Crown chose not to continue with such charges given Mr Musson's guilty pleas to the Medicines Act charges. The significant criminal activity which the Commissioner's application is based on did not have to be the subject of any criminal proceedings. 2 Mr Musson has not denied that he was involved in significant criminal activity in the way Detective Robinson outlined in her affidavit.

The applications against Mr and Mrs Musson
20

The application in respect of the $5,000 cash was made against Mr Musson as an assets forfeiture order on the grounds that:

  • • Mr Musson was engaged in significant criminal activity; and

  • • the cash was the proceeds of his significant criminal activity.

21

In relation to the other property, the application was for a profit forfeiture order.

22

In respect of Mr and Mrs Musson, the Commissioner contended that Mr Musson had been engaged in significant criminal activity. Mrs Musson was married to Mr Musson. The Commissioner contended that she and Mr Musson had lived off the proceeds of Mr Musson's significant criminal activity.

23

On the application against Mr and Mrs Musson, the Commissioner claimed:

  • (a) the...

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