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S.M. 2021, c. 50
Bill 58, 3rd Session, 42nd Legislature
The Criminal Property Forfeiture Amendment Act
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Explanatory Note This note was written as a reader's aid to the Bill and is not part of the law. This Bill amends The Criminal Property Forfeiture Act. The key changes are as follows. Court Orders Currently, forfeiture proceedings must begin before a person can be required to answer questions about property believed to be an instrument or proceeds of unlawful activity. This Bill allows the court to make two new orders before forfeiture proceedings begin: a preliminary preservation order, which prevents a person from disposing of property if the court is satisfied that there is a serious issue to be tried in forfeiture proceedings; a preliminary disclosure order, which requires a person to answer questions about their acquisition of property believed to be an instrument or proceeds of unlawful activity. Presumptions This Bill adds new presumptions concerning cash, vehicles and other property. The court is to presume, unless the contrary is proven, that cash found in close proximity to a controlled substance; or bundled in a manner that is not consistent with standard banking practices; is proceeds of unlawful activity. The court is also to presume, unless the contrary is proven, that a vehicle is an instrument of unlawful activity if the vehicle is used in a dangerous manner to flee from a peace officer; or the vehicle contains items associated with unlawful activity or has been modified in a manner consistent with its use in unlawful activity. A further presumption is provided that, unless the contrary is proven, a person's property is an instrument or proceeds of unlawful activity if the property is subject to a preliminary disclosure order and the person fails to disclose all the information about the property required by the court. Disclosure If the director has reasonable grounds to suspect that a person has property that is an instrument or proceeds of unlawful activity, and the person has dealings with a financial institution, the director can collect any information about the person's dealings with the institution directly from the institution. The information may be used only to determine whether to seek forfeiture of the property and in any forfeiture proceedings. Offences This Bill makes knowingly providing false or misleading information or failing to comply with a requirement to provide information under the Act an offence. This Bill also amends The Court of Queen's Bench Small Claims Practices Act to prevent a person from making a claim against the director with respect to forfeited property in small claims court. The claim must be pursued in the Court of Queen's Bench. |
(Assented to May 20, 2021)
HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Manitoba, enacts as follows:
The Criminal Property Forfeiture Act is amended by this Act.
Section 1 is amended
(a) by adding the following definitions:
"preliminary disclosure order" means an order made under section 2.3. (« ordonnance préliminaire de communication »)
"preliminary preservation order" means an order made under section 2.1. (« ordonnance préliminaire de conservation »)
(b) in the definition "prior registered interest",
(i) in clause (a), by striking out everything after "notice of a proceeding" and substituting "was filed under subsection 2.2(1) or section 6; and", and
(ii) in clause (b), by striking out everything after "notice of a proceeding" and substituting "was filed under subsection 2.2(1) or section 6 or a notice of administrative forfeiture proceedings was filed under subsection 17.2(3)."; and
(c) by replacing the definition "proceeds of unlawful activity" with the following:
"proceeds of unlawful activity" means property
(a) 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;
(b) in respect of which an increase in the value of the property resulted, directly or indirectly and in whole or in part, from unlawful activity;
(c) in respect of which a decrease in a debt obligation secured against the property resulted, directly or indirectly and in whole or in part, from unlawful activity; or
(d) realized by the sale or other disposition of an instrument of unlawful activity;
but does not include consideration paid or payable under a contract for the recollection of a crime as that term is defined in The Profits of Criminal Notoriety Act. (« produit d'activité illégale »)
The following is added after Part 1:
PART 1.1
PRELIMINARY PRESERVATION ORDERS
Application for preliminary preservation order
Before commencing proceedings under section 3 (forfeiture order) or subsection 17.2(3) (administrative forfeiture) in respect of property, the director may apply to the court for one or more of the following orders:
(a) an order restraining the disposition of the property;
(b) an order for the possession, delivery or safekeeping of the property;
(c) any other order respecting the preservation, management or disposition of the property, or a part of the property, that the court considers just.
Application to describe property
The notice of application must describe the property with sufficient detail to make it readily identifiable.
The following must be named as parties to a proceeding under this section:
(a) the owner of the property;
(b) any person other than the owner who is in possession of the property, unless the property is in the possession of a law enforcement agency;
(c) any other person whom the director believes may have an interest in the property, unless the interest in question is a statutory easement as defined in The Real Property Act.
The proceedings under this section are in rem and not in personam, even though there are parties to the proceedings.
Application made without notice
A preliminary preservation order may be made on an application without notice.
Unless it would clearly not be in the interests of justice, the court must make a preliminary preservation order if the court is satisfied that one or both of the following constitute a serious question to be tried:
(a) whether the property is proceeds of unlawful activity;
(b) whether the property is an instrument of unlawful activity.
If the application is made without notice, the term of the preliminary preservation order must not exceed 30 days.
Subject to subsections (9) and (10), the court may grant one or more extensions to a preliminary preservation order whether or not the order is made on an application without notice.
Motion for extension requires notice
If a preliminary preservation order is made on an application without notice, a motion to extend the order may be made only on notice to every party to the proceeding, 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.
If one or more extensions are granted on a motion without notice, each extension may be made for a further period not exceeding 30 days after the date the extension is granted.
Respondent to identify interest in property
A person who files a response to proceedings commenced under this section must identify in the response the nature and extent of the interest that the person claims in the property that is the subject of the proceeding.
Assigning duties to asset manager
If requested by the director, the court may assign duties respecting property to the asset manager when making a preliminary preservation order.
After receiving a preliminary preservation order, the director must file a notice of the proceeding against the property
(a) in respect of real property, in the prescribed form, in the proper land titles office or registry office; or
(b) in respect of personal property, in the personal property registry.
The director must apply as soon as possible to have the notice filed under subsection (1) discharged
(a) if the director has not commenced proceedings for an order under section 3 (forfeiture order) or subsection 17.2(3) (administrative forfeiture) with respect to the property before the expiry of the preliminary preservation order; or
(b) if a proceeding seeking a forfeiture order with respect to the property is dismissed or discontinued.
PART 1.2
PRELIMINARY DISCLOSURE ORDERS
Application for preliminary disclosure order
Before commencing proceedings under section 3 (forfeiture order) in respect of property, the director may apply to the court for an order requiring a person to provide a statement
(a) setting out the nature and extent of the person's interest in the property that is the subject of the proceeding;
(b) explaining the particulars of the person's acquisition of the property, including how any costs incurred in acquiring the property were met;
(c) setting out the sources and amounts of the person's lawfully obtained income and assets;
(d) if the person holds the property, or any part of it, in trust for another person, setting out the details of the trust and the identity of the beneficial owners; and
(e) setting out any other specified information relating to the property.
Application to describe property
The notice of application must describe the property with sufficient detail to make it readily identifiable.
The following may be named as parties to a proceeding under this section:
(a) the owner of the property;
(b) any person who is in possession of the property;
(c) any other person whom the director believes may have an interest in the property.
The proceedings under this section are in rem and not in personam, even though there are parties to the proceedings.
Application made without notice
A preliminary disclosure order may be made on an application without notice.
Unless it would clearly not be in the interests of justice, the court must make a preliminary disclosure order if the court is satisfied that
(a) the director has reasonable grounds to suspect
(i) the respondent is the owner of, or has possession, of the property,
(ii) the fair market value of the property exceeds $100,000,
(iii) the known sources of the respondent's lawfully obtained income and assets would have been insufficient to enable the respondent to acquire the property, and
(iv) the respondent, or a person who does not deal with the respondent at arm's length, is, or has been, involved in unlawful activity; and
(b) the information or documents to be provided under the order would assist the director in determining whether to commence proceedings under section 3 (forfeiture order).
For the purposes of clause (6)(a),
(a) the respondent is deemed to have acquired the property for a price equivalent to its fair market value;
(b) the respondent is deemed to possess the property if the property is available for use by the respondent;
(c) the known sources of the respondent's income and assets are the sources reasonably ascertainable from available information at the time of the making of the application for the order;
(d) more than one person may have an interest in the property;
(e) persons are deemed not to be dealing at arm's length with each other when they are deemed for the purposes of the Income Tax Act (Canada) not to be dealing at arm's length with each other; and
(f) the property may have been acquired before or after the coming into force of this section.
A preliminary disclosure order must specify
(a) the form and manner in which the statement under subsection (1) is to be provided;
(b) the person to whom the statement is to be given; and
(c) the place the statement is to be given or, if it is to be provided in writing, the address to which it is to be sent.
A preliminary disclosure order may require the respondent to provide documents as specified in the order.
The respondent must comply with a preliminary disclosure order within the time period specified in the order, and different periods may be specified in relation to different requirements.
The court may grant one or more extensions to a time period specified in the order.
A statement made, or a document provided, by a person in compliance with a requirement imposed under a preliminary disclosure order must not be used or disclosed except in proceedings under, or for the purposes of, this Act.
Orders made in same proceeding
The director may apply for a preliminary preservation order and a preliminary disclosure order in the same notice of application and the court may make both orders in the same proceeding.
The following is added after section 5:
Response must identify interest in property
A person who files a response to proceedings commenced under section 3 must identify in the response the nature and extent of the interest that the person claims in the property for which a forfeiture order is sought.
Clause 6(1)(a) of the French version is amended by striking out "prescrite" and substituting "réglementaire".
Subsection 6(1.1) is replaced with the following:
Subsection (1) does not apply to property in respect of which a notice of proceedings has been filed under subsection 2.2(1) or 17.2(3) and has not been discharged.
Subsections 7(2) and (3) are replaced with the following:
Unless it would clearly not be in the interests of justice, the court must make an order under subsection (1) if the court is satisfied that one or both of the following constitute a serious question to be tried:
(a) whether the property is proceeds of unlawful activity;
(b) whether the property is an instrument of unlawful activity.
An order under subsection (1) may be made on motion without notice. If it is made without notice, the term of the order must not exceed 30 days.
Subject to subsections (4) and (5), the court may grant one or more extensions to an order made under subsection (1) whether or not the order is made on a motion without notice.
Subsection 7(4) is amended
(a) by replacing the section heading with "Motion for extension requires notice"; and
(b) in the French version, by striking out "préavis" wherever it occurs and substituting "avis".
Subsection 7(5) is replaced with the following:
If one or more extensions are granted on a motion without notice, each extension may be made for a further period not exceeding 30 days after the date the extension is granted.
Clauses 7(6)(a) to (c) are replaced with the following:
(a) the government is deemed to be a secured party under The Personal Property Security Act and the owner of the property is deemed to be a debtor under that Act;
(b) the owner is deemed to have signed a security agreement stating that a security interest is taken in the property and the lien is deemed to be a perfected security interest in that property; and
(c) The Personal Property Security Act and the regulations under that Act apply to the lien, with necessary changes.
The following is added assubsection 14(1.2):
Forfeiture of part of a property
The court may make an order forfeiting a part of a property if the court determines a forfeiture of the entire property would clearly not be in the interests of justice.
Subsection 14(2) is amended
(a) by renumbering clause (a) as clause (a.1) and striking out everything after "filed under" and substituting "clause 17.2(3)(a); or"; and
(b) by adding the following before clause (a.1):
(a) as of the date the notice of proceedings was filed under subsection 2.2(1), unless the notice has been discharged;
Clause 16(1)(b) is amended in subclauses (i) and (ii), by striking out "section 141" and substituting "subsection 45(5)".
Clause 17(1)(a) is amended by replacing subclause (i) with the following:
(i) acquired the property or an interest in it before a notice was filed against the property under subsection 2.2(1), section 6 or subsection 17.2(3), and
Clause 17(2)(a) is replaced with the following:
(a) acquired the property or an interest in it before a notice was filed against the property under subsection 2.2(1), section 6 or subsection 17.2(3); and
Subsection 17.2(1) is amended by replacing clauses (c) and (d) with the following:
(c) the director has reason to believe that the fair market value of the property does not exceed
(i) the prescribed amount, or
(ii) if no amount is prescribed, $75,000;
(d) all persons who have a prior registered interest in the property consent in writing to proceedings under this Part; and
The following is added after subsection 17.2(3):
Clause (3)(a) does not apply to property in respect of which a notice of proceedings has been filed under subsection 2.2(1) and has not been discharged.
Subsection 17.8(2) is replaced with the following:
The subject property is forfeited
(a) as of the date the notice of proceedings was filed against the property under subsection 2.2(1), unless the notice has been discharged; or
(b) as of the date the notice of administrative forfeiture proceedings was filed against the property under subsection 17.2(3), in all other cases.
Clause 17.9(4)(a) is amended by replacing subclause (i) with the following:
(i) acquired the subject property or an interest in it before a notice of proceedings was filed against the property under subsection 2.2(1) or 17.2(3), and
Clause 17.9(5)(a) is replaced with the following:
(a) acquired the subject property or an interest in it before a notice of proceedings was filed against the property under subsection 2.2(1) or 17.2(3); and
The centred heading "CONDUCT OF PROCEEDINGS" is added before section 17.10.
The centred heading "PRESUMPTIONS — PROCEEDS OF UNLAWFUL ACTIVITY" is added before section 17.15.
Subsection 17.15(1) is amended,
(a) in the part before clause (a), by striking out "proof that" and substituting "if"; and
(b) in the part after clause (b), by striking out "is proof, in the absence of evidence to the contrary," and substituting "there is a rebuttable presumption".
Subsection 17.15(3) is amended by replacing the part before clause (a) with the following:
Presumption for members of criminal organization
In a proceeding under this Act in which property is alleged to be proceeds of unlawful activity, there is a rebuttable presumption that the property owned or possessed by any of the following is proceeds of unlawful activity:
The following is added after subsection 17.15(4):
In a proceeding under this Act in which property is alleged to be proceeds of unlawful activity, there is a rebuttable presumption that the property is proceeds of unlawful activity in the following circumstances:
(a) if the property is cash or negotiable instruments, the property is found in close proximity to a controlled substance as defined in the Controlled Drugs and Substances Act (Canada);
(b) if the property is cash, the cash is not bundled or packaged in a manner consistent with standard banking practices.
The centred heading "PRESUMPTIONS — INSTRUMENT OF UNLAWFUL ACTIVITY" is added before section 17.16.
The following is added after section 17.16 as part of Part 4:
In a proceeding under this Act in which a conveyance is alleged to be an instrument of unlawful activity, there is a rebuttable presumption that the conveyance is an instrument of unlawful activity if any of the following are found inside or attached to the conveyance:
(a) a restricted firearm or a prohibited firearm, as defined in subsection 84(1) of the Criminal Code (Canada);
(b) a controlled substance, as defined in the Controlled Drugs and Substances Act (Canada), in circumstances or in a quantity consistent with trafficking in the controlled substance;
(c) an after-market compartment;
(d) equipment, devices or other things related to trafficking in a controlled substance, including prescribed equipment, devices or things.
Presumption re refusing to stop conveyance
In a proceeding under this Act in which it is alleged that a conveyance is an instrument of unlawful activity, there is a rebuttable presumption that a conveyance is an instrument of unlawful activity if
(a) the driver
(i) failed to safely stop the conveyance within a reasonable period of time after being signalled to stop by a peace officer, or
(ii) used the conveyance to flee from a peace officer; and
(b) the driver's use of the conveyance could have resulted in serious bodily harm to a person.
The following definitions apply in this section.
"after-market compartment" means a compartment in a conveyance which
(a) is not part of the manufacturer's design of, or equipment for, the conveyance; and
(b) is incorporated into the equipment or structure of the conveyance after it has left the factory in which it was manufactured;
but does not include a storage compartment or safe that is
(c) designed by its manufacturer for after-market installation in a conveyance;
(d) sold to the general public by retail vendors of automotive or security equipment; and
(e) attached to the conveyance as designed by the manufacturer and in accordance with the manufacturer's instructions, if any. (« compartiment présumé illicite »)
"conveyance" includes
(a) a motor vehicle or trailer as defined in subsection 1(1) of The Highway Traffic Act;
(b) an off-road vehicle as defined in The Off-Road Vehicles Act;
(c) a vessel as defined in the Canada Shipping Act, 2001 (Canada); and
(d) an aircraft. (« moyen de transport »)
"trafficking" has the same meaning as in the Controlled Drugs and Substances Act (Canada). (« trafic »)
PRESUMPTIONS — NON-COMPLIANCE
WITH ORDER
Presumption re preliminary disclosure order
In a proceeding under this Act in which property is alleged to be proceeds of unlawful activity or an instrument of unlawful activity, there is a rebuttable presumption that property that is subject to a preliminary disclosure order is proceeds of unlawful activity or an instrument of unlawful activity if the respondent does not provide all of the information and documents required to be provided under the preliminary disclosure order within the time specified in the order or any extension of time allowed by the court.
The following is added after subsection 19.3(3):
Director may request information from financial institution
If the director has reasonable grounds to suspect that property is proceeds of unlawful activity or an instrument of unlawful activity and that the owner of the property has dealt with a financial institution, the director may, in writing, request that the financial institution provide information, including personal information, about one or more of the following:
(a) the property;
(b) the owner's account or accounts with the financial institution;
(c) the owner's dealings with the financial institution;
(d) any other person's interest in
(i) the property, and
(ii) the owner's account or accounts with the financial institution.
Financial institution must comply
A financial institution must comply with a request made under subsection (3.1) within the time period specified in the request.
No disclosure of director's request
A person from whom information is requested under this section must not disclose to any person that the director has requested information.
Subsection 19.3(5) is amended by adding the following definition:
"financial institution" includes
(a) a bank;
(b) a credit union;
(c) the issuer of a credit card;
(d) an investment fund manager, a trust company and a loan company, as those terms are defined in The Securities Act; and
(e) a payday lender as defined in section 137 of The Consumer Protection Act. (« institution financière »)
Section 19.4 is amended, in the part before clause (a), by striking out "subsection 19.3(1)" and substituting "section 19.3".
Subsection 19.6.1(1) is amended
(a) in the section heading, by striking out "collect" and substituting "request"; and
(b) by striking out "is authorized to collect" and substituting "may request".
Subsection 19.6.1(2) is replaced with the following:
The registered interest holder must comply with a request made under subsection (1) within the time period specified in the request.
Clause 19.7(2)(b) is amended by adding "a preliminary preservation order or" after "the subject of".
Section 19.9 is amended by adding "a preliminary preservation order or" before "an interim order".
The following is added after subsection 23(2):
A person commits an offence who
(a) in response to a preliminary disclosure order, makes a statement that the person knows to be false or misleading;
(b) knowingly provides false or misleading information to the director;
(c) does not comply with a request made under subsection 19.3(3.1) or 19.6.1(2) within the time period specified in the request; or
(d) contravenes subsection 19.3(3.3) (no disclosure of director's request).
Directors and officers of corporations
If a corporation commits an offence under this Act, a director or officer of the corporation who authorized, permitted or acquiesced in the commission of the offence is also guilty of an offence.
A person who commits an offence under this Act is liable on conviction,
(a) in the case of an individual, to a fine of not more than $10,000, or to imprisonment for a term of not more than six months, or both; and
(b) in the case of a corporation, to a fine of not more than $25,000.
Clause 24(a) is amended by adding "subsection 2.2(1)," after "filed under".
Related amendment, C.C.S.M. c. C285
The Court of Queen's Bench Small Claims Practices Act is amended by adding the following after subsection 3(2):
Exception — criminal property forfeiture
Subsection (1) does not apply to an action for losses from administrative forfeiture under section 17.9 of The Criminal Property Forfeiture Act.
Coming into force and application
This Act comes into force on the day it receives royal assent and applies to proceedings commenced under The Criminal Property Forfeiture Act on or after that day.