Unexplained Wealth Order Discharge Under Criminal Assets Recovery Act

The NSW Supreme Court made an order under s 30(1) of the Criminal Assets Recovery Act 1990, directing the applicant to pay an amount sufficient to discharge a debt created by an Unexplained Wealth Order made on 20 November 2018.

Supreme Court New South Wales

Medium Neutral Citation: New South Wales Crime Commission v [NAME] [2020] NSWSC 1703 Hearing dates: 30 November 2020 Date of orders: 30 November 2020 Decision date: 30 November 2020 Jurisdiction: Common Law Before: Beech-[NAME] J Decision:

1. Pursuant to s 14 of the Civil Procedure Act 2005, service of the notice of motion be dispensed with.

2. Pursuant to s 30(1) of the Criminal Assets Recovery Act 1990, a "later order" is made directing the applicant to pay to the [NAME] an amount sufficient to discharge the debt created by the Unexplained Wealth Order made on 20 November 2018.

3. Declare that the [NAME] may comply with order 1 by applying the funds referred to in the Schedule below in accordance with s 30(4)(a), then s 30(4)(b) and s 30(5). SCHEDULE The sum of $432,395.75 plus interest accrued as payment to the applicant pursuant to orders made 5 September 2018.

4. The notice of motion filed 17 November 2020 be otherwise dismissed. Catchwords: No question of principle Legislation Cited: Civil Procedure Act 2005 Criminal Assets and Recovery Act 1990 Cases Cited: New South Wales Crime Commission v [NAME] [2017] NSWSC 443 New South Wales Crime Commission v [NAME] [2018] NSWSC 1372 Category: Principal judgment Parties: New South Wales Crime Commission (Plaintiff) [NAME] (aka [NAME]) (Defendant) [NAME] (Applicant) Representation: Counsel: [redacted] [NAME] (Applicant)

Solicitors: [redacted] File Number(s): 2017/118115

EX TEMPORE Judgment 1. This is a notice of motion returnable before me as duty judge brought by the [NAME] seeking an order under s 30(1) of the Criminal Assets and Recovery Act 1990 ("CARA").

2. In the circumstances in which I will explain, the application is consented to by the plaintiff, the New South Wales Crime Commission. The defendant to the proceedings has not been able to be served and it will be necessary to dispense with service.

3. The background of the proceedings has been addressed in earlier judgments of this Court including, for example, New South Wales Crime Commission v [NAME] [2017] NSWSC 443 and New South Wales Crime Commission v [NAME] [2018] NSWSC 1372.

4. On 20 April 2017, this Court made an order pursuant to s 10A of the CARA restraining all property of the defendant.

5. On 5 September 2018, the Court made further orders directing the [NAME], that is, the applicant on the motion, to take control of the principal sum, which was one half of the proceeds of the defendant's interest in the property that he owned with his wife in North Ryde.

6. On 20 November 2018, this Court made orders that the defendant pay to the [NAME] the sum of $1,928,474.09, being an unexplained wealth order made pursuant to s 28 of the CARA. By the operation of s 28C(6), the Unexplained Wealth Order for that amount is a debt payable by the defendant to the [NAME] and is recoverable as such. Interest accrues under the Civil Procedure Act 2005.

7. Further, by s 31 of the CARA, the order operates as a charge in favour of the [NAME] over all of the defendant's property to the extent necessary to secure payment of the assessed amount.

8. On 18 January 2019, the [NAME] received the principal sum which I understand to be a portion of the proceeds of the sale of the property to which I referred, being $422,395.75. According to the affidavit before me, it has been held in an account earning interest at a rate between 0.81 to 1.4% per annum. This is reflective of current deposit rates, but is below the rates prescribed to apply to judgments.

9. As for the defendant, at no stage has he ever entered an appearance in the proceedings, nor did he enter an appearance in family law proceedings between himself and his wife. He departed Australia on 26 January 2017 and, as at 14 October 2020, he had not returned. To the best of everyone's knowledge, he is in India but his location is otherwise unknown and he is unable to be contacted.

10. Given the nature of the proceedings and those circumstances, I consider it appropriate to allow service of the notice of motion seeking the relief today to be dispensed with.

11. The only real issue concerns the form of the order. The proposed form of the order is as follows: "Pursuant to s 30 of the Criminal Assets Recovery Act 1990, a 'later order' is made directing the applicant to discharge, in part, payment of the unexplained wealth order by paying the [NAME] the funds referred to in the schedule below."

1. The schedule below identifies the principal sum to which I have referred. Proposed order 3 seeks the costs and fees of the [NAME] in respect of the application be paid in accordance with s 34 of the CARA.

2. Section 30 of CARA provides as follows: (1) If: (a) the [NAME] has, under a restraining order, taken control of an interest in property, and (b) a proceeds assessment order or unexplained wealth order has been made against the person entitled to the interest, the Supreme Court may, on application by the [NAME], make an order (in this section referred to as the later order) directing the [NAME] to pay to the [NAME] an amount sufficient to discharge the debt created by section 27 arising under the proceeds assessment order or unexplained wealth order. (2) For the purpose of enabling the [NAME] to comply with the later order, the Supreme Court may, by that order or by a subsequent order: (a) direct the [NAME] to sell or otherwise dispose of a specified interest in property under the control of the [NAME], and (b) appoint an officer of the Court or any other person to execute any deed or instrument in the name of the person entitled to the interest and to do all acts and things necessary to give validity and operation to the deed or instrument. (3) The execution of the deed or instrument by the person so appointed has the same force and validity as it would have if it had been executed by the person who was entitled to the interest to which it relates. (4) As soon as practicable after the making of the later order, the [NAME]: (a) is to apply the money which has come into the [NAME]'s possession or under the [NAME]'s control because of the sale or other disposition specified in the later order, or the subsequent order, or otherwise in the course of the performance of the [NAME]'s duties in respect of the interests in property to which the restraining order relates, in payment of: (i) the fees payable in connection with, and (ii) the expenses incurred by the [NAME] in or in connection with, the performance of the duties imposed on the [NAME] under the restraining order, including the expenses incurred by the [NAME] in or in connection with the sale or other disposition of any of the interests in property to which the restraining order relates, and (b) is to pay the rest of the money as provided by subsection (5). (5) If the money to which subsection (4) (b) applies exceeds the amount required to discharge the debt arising under the proceeds assessment order or unexplained wealth order, the [NAME] is to use the money to discharge the debt by payment of the appropriate amount to the [NAME] and, if the property sold or disposed of: (a) was also the subject of an assets forfeiture order—is to pay the balance of the money to the [NAME], or (b) was not the subject of an assets forfeiture order—is to pay the balance of the money to the person against whom the proceeds assessment order or unexplained wealth order was made. (6) Money paid to the [NAME] under subsection (5) is to be credited to the Proceeds Account. (7) If the [NAME] pays, in accordance with the later order, money to the [NAME] in respect of the liability of a person under a proceeds assessment order or unexplained wealth order, the liability of the person under the proceeds assessment order or unexplained wealth order is discharged to the extent of the payment.

1. It can be seen that the order authorised by s 30(1) is an order "directing the [NAME] to pay to the [NAME] an amount sufficient to discharge the debt created by s 27 arising out of the proceeds assessment order or unexplained wealth order".

2. The balance of the section then provides a mechanism by which the [NAME] complies with that order. In particular, s 30(4)(a) authorises the [NAME] to apply the money in payment of their fees in connection with any expenses incurred by it in connection with the performance of its duties under the restraining order and then s 30(4)(b) provides that they are to pay the rest of the money as provided by s 30(5). Section 30(5) then requires that the money is to be used to discharge the debt owed by the relevant person by paying an appropriate amount to the [NAME]. Section 30(7) provides that, upon that payment, that person's liability under the proceeds assessment order is discharged to the extent of the payment.

3. Hence, the scheme of the provision is simply that the making of an order under s 30(1) by the Court and then ss 30(4), (5) and (7) operate according to their terms without any further order of the Court. The best the Court can do in respect of those provisions is to make a declaration.

4.

Accordingly, the appropriate form of order is an order made under s 30(1) on the understanding that the [NAME] can then deal with the funds under ss 30(4)(a), (4)(b) and (5) in that order.

5.

Accordingly, the orders that I make are as follows:

4. The notice of motion filed 17 November 2020 be otherwise dismissed.

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