Family trust loses house used for drug making

File photo / NZ Herald

The High Court has ordered that a Northland home used to manufacture methamphetamine be forfeited to the Crown, despite it being owned by a family trust.

In July 2009 the Solicitor-General applied to have the property in Tinopai where Clinton Monk and his then-partner Tania Penerata made methamphetamine - or P as it is also known - seized under the Proceeds of Crime Act.

The four-hectare rural lifestyle block is owned by the Monk Family Trust, of which Monk and his father, Brian, are trustees.

The trust became its owner well before Monk and Penerata's offending and was bought with funds from legitimate sources.

Crown Solicitor Mike Smith submitted that the house was used by the Monk family for just over a year before it was used for at least 18 months to manufacture the drug.

Mr Smith said yesterday the case was an unusual one for Northland and possibly the first time such a decision had been made in the region.

The manufacturing operation in the home, garage and workshop must have been known to at least the older family members, he said.

John Anderson, representing the trust, argued that forfeiture of the property would cause undue hardship to the beneficiaries of the trust who had no involvement with the offending.

In his reserved decision Justice Geoffrey Venning said since Monk had no personal interest in the house, an order for its seizure could not result in hardship to him.

His children would also lose their home, although they currently lived with their mother, Justice Venning said.

The property was bought with $155,000 advanced by Monk, who also gifted $27,000 to the trust.

Justice Venning said a Government valuation in September 2008 valued the house at $170,000.

The offending was serious and the court had to recognise Parliament's intention that the forfeiture of tainted property was an important part of the deterrent aspect of drug offending, the judge said.

The Official Assignee is to take custody and control of the property.

Justice Venning ordered the Crown to pay the trustees an amount equal to the value of that interest from the proceeds of sale of the property.

The expense of sale would be paid out of the Crown's share of the property.

Monk was sentenced to five years and four months for drug offences in July last year while Penerata was sentenced to six months home detention last June.

Manufacturing the class A drug methamphetamine carries a maximum penalty of life imprisonment.