BILL 37

Civil Forfeiture Act

Her Majesty, by and with the advice and consent of the Legislative Assembly of New Brunswick, enacts as follows:

DEFINITIONS AND INTERPRETATION

Definitions

1 The following definitions apply in this Act.

“Attorney General” includes, for the purposes of section 5, an agent of the Attorney General and, for greater certainty, includes counsel acting on behalf of the Attorney General. (procureur général)

“court” means The Court of Queen’s Bench of New Brunswick and includes any judge of that court. (cour)

“forfeiture order” means an order made under section 9. (ordonnance de confiscation)

“instrument of unlawful activity” means property that (instrument d’une activité illicite)

(a)  has been used to engage in unlawful activity, or

(b)  is likely to be used to engage in unlawful activity.

“interest” means a right, title, interest, estate or claim to or in property. (intérêt)

“interim preservation order” means an order made under section 13. (ordonnance de conservation provisoire)

“land registration office” means a registry office established under the Registry Act or a land titles office established under the Land Titles Act. (bureau d’enregistrement des biens-fonds)

“personal property” means personal property as defined in the Personal Property Security Act. (bien personnel)

“property” means real property or personal property, and includes the whole or a portion of an interest in real or personal property. (bien)

“proceeds of unlawful activity” means (produit d’une activité illicite)

(a)  property acquired directly or indirectly as a result of unlawful activity,

(b)  an increase in value of property, if the increase in value results directly or indirectly from unlawful activity, or

(c)  a decrease in a debt obligation secured against property, if the decrease in debt obligation results directly or indirectly from unlawful activity.

“protection order” means an order referred to in section 15. (ordonnance de protection)

“unlawful activity” means an act or omission (activité illicite)

(a)  that occurs in the Province if, at the time of occurrence, the act or omission is an offence under an Act of the Legislature or an Act of the Parliament of Canada;

(b)  that occurs in another province of Canada if, at the time of occurrence, the act or omission

(i) is an offence under an Act of the Parliament of Canada or under an Act of the other province, and

(ii) would be an offence in the Province if the act or omission had occurred in the Province;

(c)  that occurs in a jurisdiction outside Canada if, at the time of occurrence, the act or omission

(i) is an offence under an Act of the jurisdiction, and

(ii) would be an offence in the Province if the act or omission had occurred in the Province;

but does not include an act or omission prescribed by regulation.

No conviction necessary

2 For the purposes of this Act, an unlawful activity may be found to have occurred regardless of whether

(a)  a person has been charged with an offence as a result of the unlawful activity, or

(b)  a person charged with an offence as a result of the unlawful activity was acquitted of all charges in proceedings before a criminal court or the charges were withdrawn, stayed or otherwise did not proceed.

PURPOSE AND APPLICATION OF ACT

Purpose

3 The purpose of this Act is to provide civil remedies that will assist in

(a)  preventing persons who engage in unlawful activities and others from keeping property that is acquired as a result of unlawful activities, and

(b)  preventing property from being used to engage in unlawful activities.

Application of Act

4(1) This Act applies to an unlawful activity occurring before, on or after the commencement of this Act.

4(2) This Act applies to proceeds of unlawful activity whether the acquisition of the property, the increase in the value of the property or the decrease in the debt obligation secured against the property occurred before, on or after the commencement of this Act.

COMMENCEMENT OF PROCEEDINGS

Attorney General may commence proceedings

5(1) The Attorney General may commence a proceeding in court for an order forfeiting to Her Majesty in right of the Province property that is alleged to be proceeds of unlawful activity or an instrument of unlawful activity, or both.

5(2) A proceeding under subsection (1) may be commenced by Notice of Action or Notice of Application.

5(3) A proceeding may only be commenced under this section with respect to property located in the Province.

Parties to the proceeding

6 The following persons shall be made parties to a proceeding commenced under subsection 5(1):

(a)  in relation to real property,

(i) the registered owner of the real property that is the subject of the proceeding, and

(ii) the person appearing from a search of the appropriate land registration office to be the owner of an interest in the real property that is the subject of the proceeding;

(b)  in relation to personal property, the person that the Attorney General has reason to believe is the owner of the whole or a portion of the property that is the subject of the proceeding; and

(c)  any other person the Attorney General has reason to believe has an interest in the property.

Notice

7 At any time in a proceeding, the court may order a party to give any notice that the court considers necessary to protect the interests of a person or party or to ensure the fair conduct of the proceedings.

Limitation period

8 A proceeding under this Act shall be commenced within 10 years after the date on which the unlawful activity occurred or is alleged to have occurred.

FORFEITURE ORDERS

Forfeiture order

9 If a proceeding is commenced under subsection 5(1), the court, subject to sections 10, 11, 15 and 16, shall make an order forfeiting to Her Majesty in right of the Province property that the court determines is either one of the following:

(a)  proceeds of unlawful activity; or

(b)  an instrument of unlawful activity.

Power to limit or place conditions on forfeiture order

10 A court that makes a forfeiture order may

(a)  limit the application of the forfeiture order, or

(b)  place conditions on the forfeiture order.

Relief from forfeiture

11 If a court determines that the forfeiture of property under this Act is not in the interests of justice, the court may refuse to issue a forfeiture order.

Management and disposition of forfeited property

12 The Attorney General shall manage, take control of, administer, sell or otherwise dispose of or deal with the property forfeited to Her Majesty in right of the Province under this Act in accordance with this Act, the Management of Seized and Forfeited Property Act and any order of a court.

INTERIM PRESERVATION ORDERS, PROTECTION ORDERS AND OTHER ORDERS

Interim preservation order

13(1) In a proceeding under subsection 5(1), the court, on motion, may make any one of the following orders for the preservation of the property:

(a)  an order restraining the disposition or transmission of the property;

(b)  an order for the possession, delivery to the Attorney General or safekeeping of the property;

(c)  an order for the disposition of the property in order to better preserve the value of the property;

(d)  any other order that the court considers just for the preservation of

(i) the property,

(ii) the value of the property,

(iii) the rights of creditors and persons holding any interest in the property; and

(e)  any other order that the court considers appropriate in the circumstances.

13(2) An interim preservation order may be made in relation to

(a)  the property that is the subject of the proceeding, or

(b)  property in which the property that is the subject of the proceeding is held.

13(3) Subject to section 14, an interim preservation order may be made without notice, in which case it shall be effective for not more than 30 days.

13(4) The court shall make an interim preservation order if the court is satisfied that it is in the interest of justice to do so and there are reasonable grounds to believe,

(a)  the property is proceeds of unlawful activity, or

(b)  the property is an instrument of unlawful activity.

13(5) A motion may be made under this section only with respect to property located in the Province.

Motion to extend an interim preservation order made without notice

14(1) Subject to subsection (2), if an interim preservation order is made on motion without notice, a motion to extend the order may be made only on notice to every party to the proceeding.

14(2) An interim preservation order made on motion without notice may be extended without notice to a party if the court is satisfied that the party has been evading service or is unable to be located despite the Attorney General’s reasonable efforts or because there are other exceptional circumstances.

Persons entitled to a protection order

15(1) The following are entitled to a protection order in respect of property that is determined to be proceeds of unlawful activity or an instrument of unlawful activity:

(a)  any of the following holders of a prior registered interest in the property:

(i) a loan company or a trust company licensed under the Loan and Trust Companies Act;

(ii) a bank listed in Schedule I, II or III of the Bank Act (Canada);

(iii) a credit union as defined in the Credit Unions Act;

(iv) Her Majesty in right of the Province, the Crown in right of Canada, a municipality or a rural community;

(v) a member of a class of interest holders prescribed by regulation; and

(b)  the holder of an interest in the property that is a prior registered interest prescribed by regulation.

15(2) If the court determines that property is the proceeds of unlawful activity or an instrument of unlawful activity, any person who acquired the property from a person referred to in subsection (1) is entitled to a protection order.

Other persons entitled to protection order

16(1) If the court determines that property is the proceeds of unlawful activity, a person who owns or has an interest in the property is entitled to a protection order if the person proves

(a)  that he or she did not, directly or indirectly, acquire the property or an interest in it as a result of the unlawful activity, and

(b)  that he or she

(i) co-owns the property with another person whose unlawful activity led to the finding that the property is proceeds of unlawful activity, but did not know and could not reasonably have known that his or her co-owner's interest in the property was acquired as a result of unlawful activity,

(ii) owned or had an interest in the property before the unlawful activity occurred and was deprived of the property or the benefit of his or her interest as a result of the unlawful activity,

(iii) acquired the property or an interest in it for fair market value after the unlawful activity occurred and did not know and could not reasonably have known at the time of the acquisition that the property was proceeds of unlawful activity, or

(iv) acquired the property or an interest in the property from a person to whom subparagraphs (i), (ii) or (iii) applies.

16(2) If the court determines that property is an instrument of unlawful activity, a person who owns or has an interest in the property is entitled to a protection order if the person proves that he or she did all that he or she could reasonably have done in the circumstances to prevent the property from being used to engage in the unlawful activity.

Other orders for the preservation of property

17 On making a forfeiture order, the court, on motion, may make one or more of the following additional orders with respect to the property that is the subject of the proceeding:

(a)  an order requiring the disposition or transmission of the property;

(b)  an order directing the manner of disposition of the property, including the appointment of a receiver-manager to manage and dispose of the property;

(c)  an order directing that the money arising from the disposition of the property take into account all encumbrances;

(d)  an order requiring the severing or partitioning of the property;

(e)  an order requiring the cancellation of an interest in the property; and

(f)  any other order that the court considers appropriate in the circumstances.

PROCEEDINGS AND PRESUMPTIONS

Proceedings under this Act

18(1) All proceedings commenced under this Act are in rem and not in personam regardless that the proceedings have parties.

18(2) Subject to any other provision of this Act, findings of fact in a proceeding commenced under this Act and the discharge of any presumption are to be made on the balance of probabilities.

18(3) The Rules of Court apply to a proceeding commenced under this Act to the extent that those rules are not in conflict with this Act.

18(4) The Rules of Court apply with the necessary modifications to the court’s jurisdiction to make an order in respect of a party to a proceeding commenced under this Act as if the proceeding was in personam.

Presumption re unlawful activity

19 In a proceeding in which property is alleged to be the proceeds of unlawful activity, proof that a person did the following is proof, in the absence of evidence to the contrary, that the property is the proceeds of unlawful activity:

(a)  participated in an unlawful activity that resulted in or is likely to have resulted in the person receiving a financial benefit; and

(b)  subsequently acquired the property that is the subject of the proceeding, caused an increase in the value of the property or caused a decrease in the value of a debt obligation secured against the property.

INFORMATION AND AGREEMENTS

Information to which Attorney General is entitled and its disclosure

20(1) Subject to the regulations, the Attorney General is entitled to receive information that is

(a)  in the custody or control of a public body prescribed by regulation, and

(b)  reasonably required by the Attorney General in order to exercise his or her powers or perform his or her functions and duties under this Act.

20(2) On request, a public body referred to in subsection (1) shall disclose and provide to the Attorney General a copy of any information, including personal information, to which the Attorney General in entitled.

20(3) The Attorney General may disclose information he or she receives under subsection (2) to a person, court, tribunal, Minister of the Crown, government agency, local government body or law enforcement agency or as otherwise required by law for furthering the purposes of this Act.

20(4) Despite subsection (2), a public body referred to in subsection (1) is not required to disclose to the Attorney General information that is subject to solicitor-client privilege.

Agreements

21 Subject to the regulations, the Attorney General may enter into information-sharing agreements that are reasonably required by the Attorney General in order to exercise his or her powers or perform his or her functions and duties under this Act with

(a)  the Government of Canada, a province or territory of Canada or a jurisdiction outside Canada, or

(b)  a public body prescribed for the purposes of subsection 20(1).

GENERAL AND MISCELLANEOUS

Filing notices

22(1) A document that is otherwise capable of being registered or deposited under the Registry Act or registered under the Land Titles Act and that refers to a forfeiture order may be registered or deposited by the Attorney General under the Registry Act or registered by the Attorney General under the Land Titles Act, despite any provision of those Acts.

22(2) If a forfeiture order transfers any land to any person, the Attorney General shall file a copy of the order in the land registration office in the county or counties in which the land is situated.

If possession is unlawful

23 For the purposes of a proceeding under this Act, a person may not claim to have an interest in property if, under an Act of the Legislature or an Act of the Parliament of Canada, it is unlawful for that person to possess the property.

No responsibility

24 The Province does not assume any covenants or other obligations under a mortgage or other security interest on property forfeited under this Act.

Immunity

25 No action or other proceeding for damages or otherwise shall be instituted against the Attorney General or an agent, servant or employee of the Attorney General for an act done in good faith in the performance or intended performance of a duty under this Act or in the exercise or in the intended exercise of a power under this Act, or for a neglect or default in the performance or exercise in good faith of any such duty or power.

Administration

26 The Attorney General is responsible for the administration of this Act and may designate one or more persons to act on his or her behalf.

Regulations

27 The Lieutenant-Governor in Council may make regulations

(a)  prescribing an act or omission for the purpose of the definition of “unlawful activity” in section 1;

(b)  prescribing classes of interest holders for the purpose of subparagraph 15(1)(a)(v);

(c)  prescribing prior registered interests for the purpose of paragraph 15(1)(b);

(d)  prescribing the information or the type of information that the Attorney General is entitled to obtain from a public body or a class of public body;

(e)  prescribing public bodies or classes of public bodies for the purpose of paragraph 20(1)(a);

(f)  establishing circumstances in which the Attorney General may enter into an agreement referred to in section 21;

(g)  respecting any other matter or thing that the Lieutenant-Governor in Council considers necessary to carry out the intent of this Act.

COMMENCEMENT

Commencement

28 This Act or any provision of this Act comes into force on a day or days to be fixed by proclamation.