In re the Civil Asset Recovery and Management and Unexplained Wealth Act No.8 of 2019.
In re David Neeranjan, Kendra Neeranjan... Between Superintendent of Police (Ag) Lucas, Wendell v Neeranjan, David; Neeranjan, Kendra [C.A.CIV.P.231/2020]. In re an ex parte application by Richard Taylor Assistant Superintendent of Police (Ag)... Between Taylor, Richard Superintendent of Police (Ag) v Spring, Natalie, N.; Spring, Catherine, I.; Estate of Sheldon Spring [C.A.CIV.P.232/2020]
Civil Asset Recovery and Management and Unexplained Wealth Act No. 8 of 2019 (the UW Act).
This was a consolidated appeal.
Brief facts
The Spring respondents
Natalie Spring and Sheldon Spring were married however Sheldon Spring was murdered in 2018. The Unexplained Wealth Act was proclaimed in 2019. On January 20, 2020, the court appointed Natalie Spring as Administrator Ad Litem of the Estate of Sheldon Spring. On December 5, 2019, Ag. Asst. Supt. Taylor, by ex parte application, applied for a PUWO in respect of properties identified during the course of an investigation into specified offences. In his affidavit which accompanied the application, Ag. Asst. Supt. Taylor deposed that he had reasonable suspicion that the total wealth of the Spring Respondents exceeds the value of their lawfully obtained wealth.
The Neeranjan Respondents
David and Kendra Neeranjan are married. On December 5, 2019, Ag. Supt. Lucas, by ex parte application, applied for a PUWO in respect of property identified during the course of an investigation into a specified offence. In his affidavit filed on December 9, 2019, Ag. Supt. Lucas deposed that he had reasonable suspicion that the total wealth of the Neeranjan Respondents exceeds the value of their lawfully obtained wealth. He stated that property is owned by them and is under their effective control and that it was obtained through the commission of a specified offence.
In each case, the appellants, pursuant to section 58 of the UW Act, applied for and obtained ex parte Preliminary Unexplained Wealth Orders (PUWOs) against the respondents. In their affidavits both investigators deposed that they had reasonable suspicion that:
the total wealth of the respondents exceeded the value of his lawfully obtained wealth;
the total wealth of the respondents was over five hundred thousand dollars threshold set by the Act;
the properties are owned by the respondents or are the under the effective control the respondents; and
the properties were obtained through the commission of a specified offence(s),
The court found that the factors were satisfied against three of the four respondents. David Neeranjan had in fact transferred the property to his wife and there was no evidence that he retained effective control and or ownership of the property. The PUWO was therefore dismissed against him.
The issue of retrospectivity
At the High Court the judge dismissed the PUWO on the grounds that the UW Act had “no retrospective effect in relation to the making of a PUWO and so investigations conducted before the UW Act came into effect and offences before then could not be taken into account”.
The Court of Appeal examined the provisions of the Act and concluded that:
By virtue of the definitions set out the section on retrospectivity (s.4(1)) provided in effect that upon the coming into force the Act shall apply to all property:
(a) which constitutes a benefit to a person from criminal conduct or represents such benefit, in whole or in part whether directly or indirectly including economic gains and funds or property converted or transformed into other property; and
(b)which the alleged offender knows or suspects constitutes or represents a benefit and for which it is immaterial who carried out the conduct or who benefitted from the conduct,
Such application is irrespective of whether or not the conduct which constitutes a specified offence relative to the said property occurred before or after the coming into force of this Act.
The Court found that the judge had erred in coming to the conclusion that retrospectivity had no application to the PUWO but only applied where the Court makes a UWO. The fact that a PUWO is the forerunner for a UWO means “it is illogical to suppose that for the purposes of a UWO the court may take into account property acquired before the coming into force of the UW Act but cannot do so in relation to a PUWO. The clear intention is that such property may be taken into account in the making of a PUWO as well. That is a further indication of the intention of Parliament that the UW Act in relation to a PUWO should have retrospective effect”.
The court also stated that it is critical that the investigator must form the reasonable suspicion at the time of the application. However investigators must be clear that the historic facts and circumstances exist to ground the reasonable suspicion.
The court held that the investigators were therefore entitled to rely on investigations conducted and information gathered before the commencement of the UW Act to found a reasonable suspicion of the matters at section 58 (1) (a) to (d) of the UW Act to obtain the PUWO against the Spring Respondents.
Reasonable suspicion vs reasonable belief
The court examined the requisite test for reasonable suspicion and stated that reasonable suspicion required the existence of the matters at section 58(1)(a) to (d) and that there is both a subjective and objective element.
That implies that the applicant must subjectively suspect those matters to exist and there must be reasonable grounds for that suspicion. An applicant for a PUWO must therefore set out in the affidavit in support of the application for the PUWO that he suspects those matters to exist and the grounds on which that suspicion is based. The Court of course will decide whether the grounds for the suspicion held by the applicant are reasonable.
In defining what “reasonable suspicion” is the court stated
“is not the same as prima facie proof of the matters at section 58 (1) (a) to (d) or even as high a threshold as “reasonable belief”. Reasonable suspicion is a low threshold. It is not necessary to prove that the suspected fact is true. Indeed, the suspicion may ultimately turn out to be incorrect. Another aspect of reasonable suspicion that is worthy of emphasis is that in deciding whether there is reasonable suspicion, the court may receive evidence of matters that would not ordinarily be admissible in cases where it is necessary to establish a prima facie case. Direct evidence is not necessary and hearsay evidence is admissible.”
The court quoted with emphasis the dicta in A v Secretary of State for the Home Department (No 2)1that
“Belief and suspicion are not the same, though both are less than knowledge. Belief is a state of mind by which the person thinks that X is the case. Suspicion is a statement of mind by which the person in question thinks that X may be the case.”
The estate of the deceased person
On the issue of whether the estate of a deceased person could be subject to a PUWO the court concluded that there was no bar to the PUWO being made against the estate of a deceased person in circumstances where there is an administrator or the court had appointed an Administrator Ad Litem of the Estate.
In coming to that conclusion the court held that the UW Act is retrospective in its application. It applies to all property which constitutes a benefit to a person from criminal conduct or represents such benefit.
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