Customs
was justified in seizing 4.8 tonnes of dried tobacco leaf intended to be sold
privately by Motueka grower Laurie Jury, the Court of Appeal ruled. If processed into smoking tobacco, excise
duty in excess of $3.3 million would have been lost.
A Customs stakeout in
March 2010 observed Mr Jury’s sale of a forty kilogram bale of dried tobacco
and tracked its transport to Auckland. A
Customs bust at an Auckland address found the tobacco being processed ready for
smoking. Growing tobacco in New Zealand
is not illegal; it is illegal to manufacture tobacco ready for smoking. Strict licensing rules apply to protect
collection of excise duty. Arguments
over Customs right to seize and destroy Mr Jury’s dried leaf have been fought through
the Customs Appeal Authority and the courts for the last seven years.
Mr Jury said he was
doing nothing illegal growing and drying tobacco. Customs said the volumes grown and then sold
indicated Mr Jury knew bulk leaf was to be manufactured into smoking tobacco.
The Court of Appeal
said it is for Mr Jury to prove Customs had no grounds for seizure. His partner, Michelle Ward, told the court of
alternative uses for tobacco leaf: wreaths for coffins; poultices for horses
and fungicide for organic farms. There
was evidence from the tobacco industry that the only local market for bulk
tobacco leaf is for cigarette manufacture and that licensed New Zealand
manufacturers import all leaf they require.
The Court of Appeal
said Mr Jury invested considerable time and expense in growing and storing
dried tobacco leaf. He knew the only
market for that volume of tobacco was to those who would unlawfully manufacture
smoking products from it. When selling,
he directly intended that the dried leaf be used illegally for manufacture, the
court said.
Customs
Service v. Jury – Court of Appeal (18.08.17)
17.105