Police have been told to pay $126,000 in court and legal costs to the employer accused of profiting from health and safety breaches after an early skirmish in the landmark case.
In a significant High Court loss, police were told they would have to underwrite losses suffered by waste oil merchant Ron Salter and his businesses if they fail to prove their proceeds of crime case against him - as well as the legal costs involved in getting the undertaking.
Salter was convicted after Jamey Lee Bowring, 24, was killed in 2015 while welding on a silo filled with explosive fumes from waste oil at Salters Cartage headquarters in Wiri, South Auckland. Salter was fined about $400,000 and sentenced to 4½ months' home detention.
Last year, police filed a case with the High Court at Auckland alleging profits from the operation of the business when it was in breach of health and safety laws were the proceeds of crime.
After the case emerged, Salter told the Herald: "I'd done my time, paid the fines. I thought I'd done everything and it was all over."
Salter's lawyers have argued that the law wasn't intended to be used in such a way. Instead, they said it was conceived to target organised crime and the drug trade.
It was also argued the police approach was a "novel" use of the law - a term adopted by Justice Matthew Palmer - and that the Crown should undertake to cover any losses suffered by Salter or his business as a result of the case.
The High Court agreed and ordered police to provide the undertaking, effectively underwriting the financial position of Salter and his company.
It has now emerged the judgment came with a sting in the tail - an order for police to pay the costs and expenses Salter incurred pushing for the undertaking.
Justice Palmer's latest judgment shows police objected to paying costs, saying preparation for the hearing over the undertaking was part of the intermediate steps in a standard court process.
Justice Palmer rejected that argument, accepting the case put by Salter's lawyer Ron Mansfield QC that the hearing was "more like a trial". "That was not unreasonable, given the novel legal issues at stake and the nature of the factual context."
Mansfield had told the court that the work needed to respond to a "novel and complex application" was time-consuming and cost much more than actually claimed from police.
Justice Palmer said court rules allowed cost awards in three bands - small, normal and large. It was, he said, "rather like Goldilocks' choices". In the Salter case, for the hearing on the undertaking, it took a "relatively large bear's amount of time".
The costs judgment extended to police having to foot much of the bill for experts who gave evidence as part of Salter's case for the undertaking. In total, police face a bill of around $126,000.
Police tried to defer paying. Their lawyers told the High Court an appeal would be lodged and the costs should not be paid until it had been heard. But Justice Palmer said there was no good reason to put off payment.
The case has brought intense interest from the business community. Police tried to argue there was nothing unusual about taking the case against Salter, but business owners have expressed concern that they are left vulnerable to a law never intended to be used for health and safety breaches.
Police had argued the health and safety - and hazardous substances - breaches by Salter and his company were "profit-motivated criminal offending" that had "generated significant financial reward".
Salters Cartage collects and recycles waste fuel that is stored at its Wiri site. Evidence produced in the case showed the storage tank on which Bowring was working was labelled as containing diesel when it actually contained a much more volatile cocktail of substances.
One sample tested was shown to have a "flashpoint" of 17.5C, classifying it as "high hazard". Diesel, by contrast, was rated "low hazard" and ignited at between 60C and 93C.
Mansfield had previously told the court it was "an unprecedented test case" that would create a "significant" financial loss with court orders restraining Salter's business operations.
The undertaking police was ordered to provide was rare in proceeds of crime cases because the courts have ruled it posed the prospect of deterring police from taking cases that would be in the public interest.
Case law expressed concern over binding police to undertakings for fear they could "become excessively cautious and be inhibited from seeking restraining orders because of the spectre of having to face a damages claim".
However, Justice Palmer had also ruled there was public interest in ensuring the "proceeds of crime regime operates effectively" and protecting those targeted by it from possible injustice.