Forfeiture proceedings are distinct from other criminal proceedings. They are not aimed at determining the criminal responsibility of accused persons, nor at punishing them. Forfeiture provisions found in contemporary criminal legislation in Canada instead reflect a long-standing general principle of law and give statutory expression to the Latin maxim ex turpi causa non oritur actio (from a shameful cause an action does not arise). Since courts must not be understood to be facilitating illegality by returning criminally tainted property to unclean hands, they will not lend their aid to a person who founds their claim, such as a claim to have property returned to them, on illegality. A court that returns criminally tainted property risks facilitating the commission of a criminal offence, as it is generally a crime to possess inherently tainted property, as well as to knowingly possess proceeds of crime. Returning property used to commit an offence also risks facilitating further criminal offences. Returning criminally tainted property to unclean hands therefore risks offending the public interest, placing the administration of justice into disrepute and undermining the goal of ensuring that crime does not pay.
Although a stay of the proceedings aimed at determining an accused’s criminal liability brings criminal liability proceedings to a conclusive end and leaves the accused in a position of presumptive innocence, it does not deprive a court of all forfeiture jurisdiction. It is not, for the purposes of the forfeiture matter, tantamount to an acquittal. Many provisions permit criminal forfeiture without a finding of guilt against the possessor of the property. A stay of the criminal proceedings for unreasonable delay does not ipso facto lead to a stay of the proceedings relating to the property.
Moreover, a stay does not foreclose any possibility that criminality may be proven in forfeiture proceedings. Unlike criminal liability proceedings, forfeiture proceedings do not involve charges brought against accused persons and do not place their liberty in jeopardy. Therefore, forfeiture proceedings do not engage double jeopardy protections. Where the issues required to establish whether property is criminally tainted were not decided in the accused’s favour at trial, it is open to the Crown to lead evidence on those issues to support forfeiture even after the accused has been acquitted. In the instant case, the stay flowed from the unreasonable delay in the individuals’ trial, not reasonable doubt as to whether the charged offences were committed. In the circumstances, issue estoppel cannot prevent the Crown from leading evidence on that point in distinct forfeiture proceedings.
Whether there is jurisdiction under a specific forfeiture provision is a matter of statutory interpretation. The Criminal Code and the CDSA contain provisions aimed at various forms of criminally tainted property in different settings, and each must be interpreted in accordance with its specific text, context and purpose. Notably, some forfeiture provisions are tied to trial or sentencing proceedings that determine an individual’s criminal liability, while others are independent of such proceedings.
Sections 462.37 and 491.1 Cr. C. and s. 16(2) CDSA are engaged only after trial or during the sentencing process. Section 462.37 Cr. C. addresses proceeds of crime. A court imposing sentence for a designated offence is empowered to make a forfeiture order if the Crown can show on a balance of probabilities that the property is the proceeds of the offence on which there is a finding of guilt or show beyond a reasonable doubt that the property is otherwise the proceeds of crime. Section 16 CDSA addresses offence-related property in connection with certain offences under the CDSA. When convicting or discharging an offender, the court is empowered to make a forfeiture order if the Crown can show on a balance of probabilities that the property is related to the offence on which there is a finding of guilt or show beyond a reasonable doubt that the property is otherwise offence-related property. Section 491.1 Cr. C. addresses any property that was obtained by the commission of an offence and that, at the time of trial, is available to be dealt with and will not be required as evidence in other proceedings. When an accused is tried for an offence and the court determines that an offence has been committed, whether or not the accused has been convicted or discharged, that court must dispose of the property.
The scope of forfeiture jurisdiction under these provisions is not limited to property connected to the offence on which there is a finding of guilt or for which the accused was tried. Further, the property need not be the offender’s property or that of the person who was tried. However, forfeiture under ss. 462.37(2) and 491.1 Cr. C. and s. 16(2) CDSA requires a sufficient nexus between the property and the criminal allegations underlying the proceedings in which the forfeiture power is triggered: the property must reasonably form part of the broader context surrounding the allegations. This does not mean that all the evidence justifying forfeiture need be adduced at trial, but merely that there is some connection between the property and the criminal allegations underlying the information or indictment that circumscribes the criminal liability proceedings. The nexus ensures that a court can order forfeiture regardless of whether property is connected to an offence on which a finding of guilt is made against a specific accused, but without the need for forfeiture completely unrelated to the criminal proceedings to which the legislation expressly ties it.
Sections 462.37(2) and 491.1 Cr. C. and s. 16(2) CDSA do not empower any judge of the trial court to order forfeiture at any time. Rather, these provisions may only be exercised by the court that tried the offence or that is imposing a sentence in respect of an offence on which there is a finding of guilt. They require a temporal link between the trial or sentencing proceedings and the forfeiture, and they cannot be exercised where there is no longer a trial or sentencing court seized of the matter. This ensures that the court that has heard evidence relevant to forfeiture can efficiently address the forfeiture issues, while providing necessary finality once those proceedings have ended.
Other criminal forfeiture provisions empower a court to order forfeiture of tainted property independently of trial and sentencing proceedings. Section 490 Cr. C. notably sets out default rules for the detention and disposition of seized property, which apply unless Parliament has provided more specific, conflicting rules. It also applies with necessary modifications to property that has not actually been seized but is nonetheless subject to judicial supervision, where this is contemplated by statute. The purpose of s. 490 is to ensure that courts supervising seized property can carefully balance the private interests in that property against the public need for that property to be detained in pursuit of investigating and prosecuting crime.
When it is validly engaged, s. 490(9) empowers the court to order the return of property to a lawful owner or possessor or, if there is no known lawful owner or possessor, order it forfeited to the Crown. A court will only order forfeiture pursuant to s. 490(9) if the Crown can satisfy it that three prerequisites are met. First, the Crown must satisfy the court either that the periods of detention have expired and proceedings have not been instituted in which the property may be required, or that the periods of detention have not expired but the continued detention of the property is not required for the purposes of investigation or prosecution. Second, the Crown must show that possession of the property by the person from whom it was seized or restrained is unlawful, or that it was not in the possession of any person. The fact of the property being in the possession of a person immediately prior to seizure raises a presumption that possession by that person is lawful, and the Crown must rebut that presumption by proving beyond a reasonable doubt that possession is unlawful. To meet this burden, the Crown may have to call evidence of the person’s unlawful acts in the context of the forfeiture hearing. Third, the Crown must show that no other known person lawfully owns or is entitled to possession of the property.
Forfeiture remains available under s. 490(9) Cr. C. despite proceedings having been instituted. Interpreting s. 490(9) to be inapplicable if proceedings were instituted at any point in the past would risk the indefinite detention of property in cases where charges were laid but proceedings were stayed before trial. The language “proceedings have not been instituted in which the thing detained may be required” in s. 490(9) ensures that the disposition of seized property under s. 490(9) does not occur until the continued detention of the property is no longer required for a proceeding. The prerequisite is not that proceedings must never have been instituted, but rather the absence of proceedings in which the detained thing “may be required”. When proceedings were commenced in the past but have since definitively ceased, it cannot be said that “proceedings have not been instituted”, but it is true that “proceedings have not been instituted in which the thing detained may be required”. No thing will “be required” for proceedings that have come to an end. This reading is further supported by the legislative context of s. 490(9), including the other subsections of s. 490, the wider scheme of the Criminal Code, and related provisions in the CDSA. It aligns with the purpose of s. 490, which is to provide a residual regime for the orderly detention and disposition of seized property.
Citation: R. v. Nguyen, 2026 SCC 10
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