Application of Asset Confiscation Operations, Department of Justice and Community Safety (Vic); In the matter of Zhang

On 2 December 2020, the County Court of Victoria made a “Serious Drug Offence Restraining Order” under the Confiscation Act 1997 (Vic) (“the Victorian Act”). The order related to items of property in which the defendant, Yi Zhang, was said to have an interest. Relevantly, the order included real estate at XXXXXXXX, Kingsford, described at Lot C in deposited plan XXXXXXX. The order also included various sums of cash.

On 10 December 2020, Wright J, sitting as Duty Judge in this Court, made an order under s 77 of the Confiscation of Proceeds of Crimes Act 1989 (NSW) (“the NSW Act”) registering the Victorian restraining order insofar as it related to the Kingsford property.

On 26 August 2022, on the application of Li Hua You and with the consent of all parties, the Victorian County Court made an exclusion order pursuant to ss 20-22A of the Victorian Act. The preamble to the exclusion order acknowledged that Li Hua You had “full beneficial interest” in the Kingsford Property and the formal order was as follows:

By summons filed on 29 September 2022, the plaintiff, represented by the NSW Director of Public Prosecutions (“the Director”), seeks registration of the exclusion order. The Director asked that the application be dealt with in the absence of the public and without the plaintiff’s attendance: see Uniform Civil Procedure Rules 2005, Sch 10, Pt 1, r 7(3). While I acceded to that request, I sought written submissions as to the application of s 77 of the NSW Act. That section provides:

As can be seen the section does not, on its terms, provide for the registration of an exclusion order. The plaintiff acknowledges this. However, I do accept the Director’s submission that a “beneficial and practical interpretation” should be adopted in order “to allow an innocent third party with a legitimate claim to the property to be excluded from the order operation of the original Restraining Order”.

It is difficult to accept the submission that the exclusion order is an “amendment” pursuant to s 77(3) of the NSW Act. However, I do accept that s 77, read as a whole and with a purposive approach to its construction, must allow for the registration of an interstate exclusion order. The potential for injustice otherwise, and the kinds of absurd results that might follow, dictate that this must be so.

I accept the force of the Director’s submission that the order was made by consent and that there is an innocent third party involved.

The Director refers to the structure of the Victorian Act and submits that exclusion orders are not “standalone” orders and fall within that part of the statute that deals with and provides for restraining orders. In other words, once it was made the exclusion order became part of the restraining order and, accordingly, could be registered in New South Wales under s 77 of the NSW Act.

An alternative approach, given that the restraining order as registered in this state seemed only to relate to the Kingsford property, would have been to revoke the order: cf s 80 of the NSW Act.

In any event, I will make the following order in accordance with the first order sought in the summons: