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Second Session, Thirty-Eighth Legislature

This version is based on the printed bill that was distributed in the Legislature after First Reading.
It is not the official version.   If accuracy is critical, you can obtain a copy of the printed bill from Statutory Publications.

Bill 7

THE CRIMINAL PROPERTY FORFEITURE ACT


Table of Contents Explanatory Note

(Assented to                                             )

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:

DEFINITIONS

Definitions

1           The following definitions apply in this Act.

"court" means the Court of Queen's Bench. (« tribunal »)

"criminal organization" means a criminal organization as defined in section 2 of the Criminal Code (Canada). (« organisation criminelle »)

"instrument of unlawful activity" means property that is likely to be used to engage in unlawful activity that, in turn, would be likely to or is intended to result in the acquisition of other property or in serious bodily harm to a person. (« instrument d'activité illégale »)

"minister" means the minister appointed by the Lieutenant Governor in Council to administer this Act. (« ministre »)

"police chief" means

(a) the chief of police of a municipality in Manitoba;

(b) the commanding officer of the Royal Canadian Mounted Police in Manitoba; and

(c) a special constable appointed under The Provincial Police Act who is in charge of police services for one or more First Nations communities. (« chef de police »)

"prior registered interest" means

(a) with respect to real property, an interest, lien or judgment that was filed or registered against the property in accordance with The Real Property Act or The Registry Act before notice of an application under section 6 was filed; and

(b) with respect to personal property, a security interest that was registered against the property in accordance with The Personal Property Security Act before notice of an application under section 6 was filed. (« intérêt antérieur enregistré »)

"proceeds of unlawful activity" means property acquired directly or indirectly, in whole or in part, as a result of unlawful activity, whether the property was acquired before or after the coming into force of this Act. (« produit d'activité illégale »)

"property" means real or personal property, and includes any interest in real or personal property, and, for greater certainty, includes cash. (« bien »)

"protection order" means an order made under subsection 15(1). (« ordonnance de protection »)

"unlawful activity" means an act or omission that is an offence under

(a) an Act of Canada, Manitoba or another Canadian province or territory; or

(b) an Act of a jurisdiction outside Canada, if a similar act or omission would be an offence under an Act of Canada or Manitoba if it were committed in Manitoba;

whether the act or omission occurred before or after the coming into force of this Act. (« activité illégale »)

PURPOSE

Purpose

2           The purpose of this Act is to provide civil remedies that will prevent

(a) people who engage in unlawful activities and others from keeping property that was acquired as a result of unlawful activities; and

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

APPLICATION PROCEDURE

Application for forfeiture order

3(1)        If a police chief is satisfied that property is proceeds of unlawful activity or an instrument of unlawful activity, the police chief may apply to the court for an order forfeiting the property to the government.

Property in Manitoba subject to application

3(2)        A police chief may apply for a forfeiture order with respect to property located anywhere in Manitoba.

Application must identify property

4           The application must describe the property for which a forfeiture order is sought with sufficient detail to make it readily identifiable.

Respondents

5           The following must be named as respondents to the application:

(a) the owner of the property;

(b) any person other than the owner, who is in possession of the property;

(c) a person with a prior registered interest in the property;

(d) any other person known to the police chief to have an interest in the property.

Filing notice in registries

6           The police chief must, after filing an application for forfeiture

(a) of real property, file notice of the application against the property, in the prescribed form, in the proper land titles office or registry office; or

(b) of personal property, file notice of the application, in the prescribed form, against the property in the personal property registry.

Order for preservation of property

7(1)        On motion by the police chief, the court may make one or more of the following interim orders to preserve property that is the subject of an application under this Act:

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

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

(c) an order appointing a receiver or a receiver and manager for the property;

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

Grounds for order

7(2)        Unless it would clearly not be in the interests of justice, the court must make an order under subsection (1) if it is satisfied that there are reasonable grounds to believe that the property is proceeds of unlawful activity or an instrument of unlawful activity.

Motion made without notice

7(3)        An order under subsection (1) may be made on motion without notice for a period not exceeding 10 days.

Extension

7(4)        If an order under subsection (1) is made on a motion without notice, a motion to extend the order may be made only on notice to every party to the application, unless the court is satisfied that because a party has been evading service or because there are other exceptional circumstances, the order ought to be extended without notice to that party.

Extension without notice

7(5)        Where an extension is granted on a motion without notice, it may be made for a further period not exceeding 10 days from the date the extension is granted.

CONDUCT OF PROCEEDINGS

Queen's Bench Rules re discovery do not apply

8           The Queen's Bench Rules respecting the following matters do not apply to an application under this Act:

(a) examination for discovery;

(b) affidavits of documents and discovery of documents;

(c) examination and cross-examination of a deponent or a witness before a hearing.

Standard of proof

9           Except as otherwise provided in this Act, findings of fact in an application under this Act are to be made on the balance of probabilities.

Disclosure of interests

10          At the hearing of an application, the police chief must advise the court of all prior registered interests in the property that is the subject of the application and any other interest in the property known to the police chief.

PRESUMPTIONS

Presumption for members of criminal organization

11          In an application for forfeiture of property that is alleged to be proceeds of unlawful activity, proof that the property is owned or possessed by any of the following is proof, in the absence of evidence to the contrary, that the property is proceeds of unlawful activity:

(a) a member of a criminal organization;

(b) a corporation, if a member of a criminal organization is one of its officers or directors or has a significant ownership interest in it;

(c) a person to whom it was transferred for consideration that was significantly less than the fair market value at the time of transfer, if the transferor was a person or corporation described in clause (a) or (b).

Presumption for instruments of unlawful activity

12          In an application for forfeiture of property that is alleged to be an instrument of unlawful activity, proof that the property was used to engage in unlawful activity that, in turn, resulted in the acquisition of other property or in serious bodily harm to a person is proof, in the absence of evidence to the contrary, that the property is an instrument of unlawful activity.

Presumptions re offences

13          In an application under this Act,

(a) there is a rebuttable presumption that a person is a member of a criminal organization if he or she has been found guilty or convicted of a criminal organization offence as defined in section 2 of the Criminal Code (Canada);

(b) proof that a person was convicted, found guilty, or found not criminally responsible on account of mental disorder in respect of an offence is proof that the person committed the offence; and

(c) evidence that a person was charged with and acquitted of an offence under the Criminal Code (Canada), or that such a charge was withdrawn or stayed, is not relevant in making a finding of fact.

ORDERS

Forfeiture order

14(1)       Subject to section 15, and unless it would clearly not be in the interests of justice, the court must make an order forfeiting property to the government if it finds that the property is proceeds of unlawful activity or an instrument of unlawful activity.

Date of forfeiture

14(2)       When a forfeiture order is made, the property is forfeited to the government as of the date the notice of the application under section 6 was filed.

No assumption of mortgage or security interest

14(3)       The government does not assume any covenants or other obligations under a mortgage or other security interest on forfeited property.

Protection order

15(1)       When property is found to be proceeds of unlawful activity or an instrument of unlawful activity, the court must make an order to protect, as much as reasonably possible, interests in the property held by persons entitled to such an order under section 16 or 17.

Possible orders

15(2)       Without limiting the generality of subsection (1), a protection order may

(a) sever or partition any interest in the property or require any interest in the property to be sold or otherwise disposed of by any person;

(b) subject to subsection 14(3), provide that the government takes the property subject to the interest of a person; or

(c) direct that the proceeds of the sale of the property be applied to any debt secured by a prior registered interest in the property.

Protected holders of prior registered interests

16(1)       The following holders of a prior registered interest in property that is found to be proceeds of unlawful activity or an instrument of unlawful activity are entitled to a protection order:

(a) a bank, a credit union, or a trust or loan corporation with a business authorization under Part XXIV of The Corporations Act;

(b) an insurance company licensed under The Insurance Act;

(c) the government, a municipality or a local government district;

(d) the holder of a right or interest set out in section 141 of The Real Property Act;

(e) the holder of any other right or interest prescribed by regulation;

(f) a member of a class of holders, prescribed by regulation, whose members are similar to the holders set out in clause (a) or (b).

Other persons entitled to protection order

16(2)       If property is found to be proceeds of unlawful activity or an instrument of unlawful activity, any person who acquired the property or an interest in the property from a person referred to in subsection (1) is entitled to a protection order.

Protection order for proceeds of unlawful activity

17(1)       If property is found to be 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

(i) acquired the property or an interest in it before notice of the application under section 6 was filed against the property, and

(ii) did not, directly or indirectly, acquire the property or an interest in it as a result of 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 it from a person described in subclause (i), (ii) or (iii).

Protection order for instrument of unlawful activity

17(2)        If property is found to be 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

(a) acquired the property or an interest in the property before notice of the application under section 6 was filed against the property; and

(b) did all that he or she could reasonably have done in the circumstances to prevent the property from being used to engage in unlawful activity.

Examples

17(3)       For the purpose of clause (2)(b), a person can prevent property from being used to engage in unlawful activity by actions such as

(a) promptly notifying appropriate law enforcement agencies whenever the person knows or ought to know that the property has been or is likely to be used to engage in unlawful activity; or

(b) refusing or withdrawing any permission that the person has authority to give and that the person knows or ought to know has facilitated or is likely to facilitate the property's being used to engage in unlawful activity.

SALE AND DISTRIBUTION OF PROCEEDS

Forfeited property to be sold

18(1)       Subject to subsection (2), the government must sell all property forfeited to it under this Act, other than cash.

Exception

18(2)       The government may destroy, donate or otherwise dispose of any forfeited property that has little or no commercial value or that requires so much repair or improvement that a sale is not commercially viable.

Distribution of proceeds

19          Subject to any protection order, forfeited property that is cash and the proceeds of a sale of forfeited property must be distributed as follows:

(a) first, to pay any costs of the government in selling the forfeited property;

(b) second, to reimburse the police chief for expenses incurred in bringing the application for the forfeiture order;

(c) any remaining cash or proceeds are to be paid to the Victims' Assistance Fund under The Victims' Bill of Rights and The Legal Aid Services Society of Manitoba, as directed by the minister.

GENERAL PROVISIONS

Assistance of peace officer

20          When requested by a person authorized to do so by regulation, a peace officer must provide any assistance necessary to enforce an order made under this Act.

Where possession unlawful

21          In an application under this Act, a person cannot claim to have an interest in property if it would be an offence under the law of Canada or Manitoba for the person to possess the property.

No limitation period

22          There is no limitation period for an application under this Act.

Protection from liability

23          No action or proceeding may be brought against a police chief or any other person acting under the authority of this Act for anything done, or not done, or for any neglect,

(a) in the performance or intended performance of a duty under this Act; or

(b) in the exercise or intended exercise of a power under this Act;

unless the person was acting in bad faith.

Regulations

24          The Lieutenant Governor in Council may make regulations

(a) prescribing the form and content of notices filed under section 6 and respecting the discharge of those notices;

(b) prescribing rights or interests for the purpose of clause 16(1)(e);

(c) prescribing classes of holders for the purpose of clause 16(1)(f);

(d) authorizing persons or members of a class of persons to request assistance from a peace officer for the purpose of section 20;

(e) respecting the manner in which forfeited property is to be sold by the government, including authorizing sheriffs to sell forfeited property on behalf of the government;

(f) respecting the expenses that the government or a sheriff may claim for selling forfeited property;

(g) respecting the expenses that a police chief may claim for bringing an application under this Act;

(h) respecting any other matter necessary or advisable to carry out the purposes of this Act.

Consequential amendments, C.C.S.M. c. V55

25(1)        The Victims' Bill of Rights is amended by this section.

25(2)        Subsection 40(2) is amended by adding the following after clause (c.1):

(c.2) money directed by the minister to be paid into the fund under The Criminal Property Forfeiture Act;

25(3)        The following is added after section 43.1:

Funds from The Criminal Property Forfeiture Act

43.2        When any money is deposited into the fund under clause 40(2)(c.2), the minister may request that payment of that amount of money be made from the fund

(a) for any of the purposes set out in section 43; or

(b) to support programs or initiatives designed to reduce or prevent criminal activity.

C.C.S.M. reference

26          This Act may be referred to as chapter C306 of the Continuing Consolidation of the Statutes of Manitoba.

Coming into force

27          This Act comes into force on a day to be fixed by proclamation.

Explanatory Note

This Bill enables a police chief or the commanding officer of the RCMP in Manitoba to apply to the Court of Queen's Bench for an order forfeiting property to the government. Property may be forfeited if the judge is satisfied that it was acquired as a result of unlawful activity or it is likely to be used to commit certain unlawful activities.

The judge may make orders to protect people who have interests in property that is subject to forfeiture. Specified interest holders are entitled to automatic protection. Other interest holders must prove to the judge that they did not know about the unlawful activity or did all that reasonably could be done to prevent the property from being used to engage in unlawful activity.

Forfeited property must be sold by the government. After paying expenses related to the forfeiture and sale of the property, the balance of the sale proceeds will be paid to the Victims' Assistance Fund to support victims' services or crime prevention programs, and to The Legal Aid Services Society of Manitoba.

Consequential amendments are also made to The Victims' Bill of Rights.