1. MR
JUSTICE JOWITT: This is an application for judicial review of the issue of
search warrants pursuant to Section 8 of the Police and Criminal Evidence Act
1984 in relation to seven different properties and their execution. There are
thirteen applicants. Nine of them, the fifth to thirteenth, are limited
companies to which I refer, because of the links between them, as the Venture
Group of companies. The first four applicants are connected with the
management of one or more of the nine companies. Four of the search warrants
related to the respective homes of these four applicants. Two related to
commercial premises connected with certain of the applicant companies. These
six search warrants were issued by the Magistrate on 11 4 97 and were executed
three days later. The seventh warrant was issued on 15 4 97 in respect of
Burnt Heath Farm, used as a document store by the 11th, 12th, & 13th
applicants, Commercial Guarantee Ltd, Venture Guarantee Ltd and Venture
Guarantee Group Holdings Ltd.
2. The
warrants were obtained to assist in the investigation of what the police
believed was a conspiracy to defraud.
3. The
first respondent is the Chief Constable of Warwickshire whose officers were
responsible for the application for and execution of the warrants.
4. The
second respondent is the Mid Warwickshire Magistrates Court, it being a
magistrate of that court who issued the warrants. The second respondent has
not appeared but the magistrate has sworn an affidavit which has been filed.
5. Leave
to move for judicial review was granted by Latham J. The applicants seek
orders of certiorari quashing the issue of the warrants, declarations that the
entry by police officers to the various premises and the removal of materials
was unlawful and orders for their return and the delivery up to the applicants
of any copies taken. The applicants also seek damages for trespass to land and
goods.
6. Latham
J ordered on 13 5 97 that this hearing be expedited and in these circumstances
an application for interlocutory relief was by consent adjourned generally with
liberty to restore.
7. The
11th to 13th applicants advertised that they were able to negotiate business
loans. They underlined the effectiveness of the service they could offer by
representing they had a successful track record of arranging loans running into
many millions of dollars. Would be borrowers who responded to these
advertisements, or who were introduced by third parties to these three
applicants, paid a fee in return for the agreement of the company approached
that it would try to negotiate the required loan. It was a condition of the
contract with the company that a loan could be refused for any reason. Under
the terms of the contract if the desired loan was not forthcoming the applicant
for the loan was not entitled to any return of the fees which had been paid.
8. The
allegation is that this business was fraudulent because, when fees were taken,
there was no intention of obtaining a genuine offer of a loan which would meet
the would be borrower's requirements. While this would not become apparent
from isolated cases of disappointed seekers after loans the true picture is
said to have emerged from the substantial number of complaints received. These
allegedly fraudulent activities are said not to have involved only the 11th to
13th applicants. Status reports on the financial soundness of the would be
borrowers were obtained. They were represented as being the reports of
independent firms whereas in truth they were the work of other companies within
the Venture Group.
9. The
police were anxious to discover the full extent of the alleged conspiracy.
This involved trying to obtain evidence about, for example, the following
matters:
10. The
view was taken by those conducting the police investigation that the records of
companies within the Venture Group would be likely to provide material which
would be of substantial value to their investigation and yield evidence which
would be admissible in any future trial of a charge of conspiracy to defraud.
11. In
late 1996 the Department of Trade and Industry (DTI) began winding up
proceedings in the Chancery Division against the eleventh to thirteenth
applicants. The winding up application was based on an allegation that the
affairs of these three companies had been conducted without proper commercial
probity.
12. The
substantive hearing was fixed for 14 5 97. Commercial Guarantee Ltd. was by
consent wound up, though without any admission as to any lack of probity in the
conduct of its business activities.
13. The
application was contested by Venture Group Ltd. and Venture Group Holdings Ltd.
Proceedings against them were adjourned for them to file evidence.
Subsequently, orders were made winding them up. The DTI's application was not
contested but they were not consent orders and the judge made findings adverse
to the two companies.
14. There
had been co-operation between the Warwickshire police and the DTI but it is
apparent from what I have said already that the scope of the police
investigation was appreciably wider than that being conducted by the DTI. It
was an independent investigation and not one conducted for the DTI.
15. The
police decided to apply for search warrants in time for them to be able to
execute them before any liquidator might step in and seize records. The
validity of the reasoning which led to this decision has been questioned but it
is irrelevant to the issues in these applications. If there were grounds for
seeking search warrants the police were entitled to choose when to apply for
them and when, within the time permitted by law, to execute them.
16. The
focus of the challenge to the issue of the warrants has been the breadth of
material for which they permitted a search to be made.
18. The
7th warrant, which related to the document store at Burnt Heath Farm, used a
different form of words but their ambit was no less wide in relation to paper
documentation:
19. In
relation to the 7th warrant the documents which were stored at Burnt Heath Farm
were those of 11th, 12th and 13th applicants. Mr Barnes QC for the applicants
has not suggested that they have any concern about the seizures made upon the
authority of this warrant. That being so, I for my part would dismiss the
applications so far as they concern this warrant without finding it necessary
to say any more on the subject.
21. The
warrants should have been restricted in their scope to those documents and
other records of the 11th to 13th applicants which:
22. Further,
although there is no statutory requirement that a warrant shall specify what
offence is being investigated, some details of the offences should have been
set out in this case as a means of identifying the material to be sought and of
enabling the occupiers of the premises searched to know what the police were
entitled to search for and seize.
23. Certain
concessions were made on the applicant's behalf for the purpose of these
applications. It is conceded there were reasonable grounds for believing that
a serious arrestable offence, an advance fee fraud, had been committed and that
the conditions precedent to the issue of warrants in support of an
investigation of that offence were satisfied. It is conceded also that the
warrants were in the proper form, save for the failure to comply with section
15(6)(b).
24. Most
important, in the submission of Mr King QC, for the first respondent, is the
concession that had the warrants been restricted to documents concerning the
business documentation and financial records of the 11th to 13th applicants
(the three companies involved in the winding up application) no objection could
have been taken to them by way of judicial review.
25. I
also regard this concession as important in relation to Mr Barnes' first
submission. His concession does not call for any narrower restriction of the
materials for which search could be made under the warrants than that they
should have been those of the 11th to 13th applicants. Put another way, since
these three companies were a proper subject of investigation with the
assistance of search warrants the description of materials in them would not
have involved any breach of section 15(6)(b) had that restriction been added.
In my view it must follow from this that if other companies within the Venture
Group were a proper subject of investigation in relation to the advance fee
fraud with the assistance of search warrants it was not necessary to add this
restriction and so, following from the concession, no complaint could be made
about the failure to define more narrowly the materials covered by the
warrants. At this point it is helpful to look at the magistrate's power to
issue a search warrant contained in section 8 which, so far as is material,
provides:
26. Section
8(4) defines relevant evidence as anything which would be admissible in
evidence at a trial for the offence.
27. Mr
Barnes complained that the warrants were directed against premises rather than
companies. As warrants have to be in respect of named premises I do not see
how this could be otherwise. Section 8 does not authorise a search for
materials belonging to a named person or company wherever those materials may
be found. This would be a much wider and more draconian power than the section
provides.
28. It
is important to note that paragraphs (b) & (c) do not require that the
material to be sought shall belong to or be in the possession of someone who is
suspected of having committed the offence. It is easy to envisage
circumstances in which a person who is innocent of any offence has in his
possession documents which are not his, in the sense of not being created by
him, or which are his in that sense and which, in either case, provide evidence
of the commission of an offence by another.
29. Implicit
in the first submission are the unspoken and fallacious assumptions that the
parties to the conspiracy being investigated cannot have included any natural
person or any company other than those which received advance fees. A limited
company can only act through a natural person. Further, it is often the case
that in the acting out of a conspiracy different parties to it have different
roles. There were the status reports, to which I have already referred, said
to have been prepared by other members of the group. Moreover, it is apparent
from the material placed before the magistrate, evidenced by a report produced
to him, the note of the application made by the magistrates's clerk and the
second affidavit of DC Wilson, who made the application, that there were
reasonable grounds for believing other companies in the group were involved in
the conspiracy and that the group structure was like a web with members of it
changing their names and that the police wanted to discover what had happened
to the money which was alleged to have been received fraudulently. An example
of a name change has been given by the first applicant, Mr Fitzpatrick, in his
first affidavit. The 13th applicant was originally named Venture Guarantee
Limited. In February 1996 the 12th applicant was formed with the name Venture
Guarantee Group Holdings Limited. When it began to trade in April of that year
there were simultaneous exchanges of name so that the 12th and 13th applicants
became respectively Venture Guarantee Limited and Venture Guarantee Group
Holdings Limited, with their registered office at 7, The Parade, Leamington
Spa, one of the premises in respect of which a search warrant was issued. It
is clear from Mr Fitzpatrick's affidavit that through his share holdings and
the positions he holds in the various companies within the Venture Group he is
a guiding light in their activities and that they have close connections with
one another.
30. The
affidavit of the second applicant, Mr Ferguson, shows he is a director of the
10th applicant which trades principally from his home address (another of the
premises in respect of which a search warrant was issued) and that finance to
start this company was provided as a result of arrangements made by Mr
Fitzpatrick.
31. The
affidavit of the third applicant, Miss Stephens, shows her to be company
secretary of a number of the companies in the group and to act on a day to day
basis as coordinator for all the companies in which Mr Fitzpatrick is involved.
The fact that the activities of the 5th to 13th applicants are coordinated
provides, in my view, cogent evidence of the close connections which exist
between them.
32. The
affidavit of the fourth applicant, Mr Brown, shows him to be managing director
of the fifth applicant which prepares reports and appraisals for, among others,
Vengua Limited, the seventh applicant. His home was also one of the premises
in respect of which a search warrant was issued.
33. The
sixth warrant issued on 11 4 97 was in respect of The Manor, Haseley,
Warwickshire. The premises consist of a series of office suites, the warrant
being restricted to the Mary Tudor suite, used as office accommodation by Mr
Fitzpatrick in relation to his business, the ninth applicant. For a period
approaching two years until March 1997 the twelfth applicant occupied another
suite of offices at this address. It can be seen, therefore, that the premises
for which search warrants were issued on 11 4 97 were all either the home of
one of the first four applicants or premises with which one or more of the 5th
to 13th applicants were connected. There was in my view ample material on
which the police were entitled to seek the assistance of search warrants for
each of these premises to help in their investigation of the conspiracy to
defraud and they had reasonable grounds for believing that offence had been
committed.
35. As
to the timescale point, the police were seeking to discover the extent of the
fraud and to have set a beginning and an end date to the period to be
investigated would not have been practicable. In advance of any search it
could not be known when any conspiracy had begun or had ceased to be active.
Nor was there any need to give details of the offence in the warrants in order
to describe the materials which could be sought under them.
36. In
my judgement there was ample material upon which the magistrate was entitled to
find himself satisfied that the requirements of paragraphs (b) & (c) of
section 8(1) had been made out. His decision to issue the warrants is one
which can only be challenged on
Wednesbury
principles and no successful challenge has in my view been established.
37. I
would therefore reject Mr Barnes' first and second submissions. His third
submission seems to a large extent to be based on a misreading of DC Wilson's
second affidavit and without finding it necessary to say more I would reject
this submission also.
38. Nor
am I able to accept Mr Barnes' fourth submission. His argument ignores two
factors. First the warrants issued on 11 4 97 all contained the limiting
words, "all relating to the stated offence". That the offence is not stated in
the warrants is nothing to the point. It had been stated to the magistrate and
the applicants accept for present purposes that there were reasonable grounds
for believing that offence had been committed. Thus the warrants provided no
authority for seizure of a document or other record simply because it was found
on the premises searched and fell within one of the four numbered categories
set out in them. It had to be related to the stated offence. Nor was this
all. The power of seizure in the case of these warrants was that set out in
section 8(2).
39. It
follows from this that it was not sufficient that any material seized should
fall simply within the terms of the warrant, including the words, "all relating
to the stated offence". It had also to be something for which a search had
been authorised under section 8(1). In other words, there had also to be
reasonable grounds for believing it was likely to be of substantial value to
the investigation and be evidence of the stated offence and not consist of or
include special procedure material. (I shall return to special procedure
material when I consider Mr Barnes' fifth submission.) The effect of section
8(1) and (2) is to limit what may be seized under a search warrant issued under
section 8. The effect of a description in the warrant is potentially to limit
further what may be seized. I say potentially because no doubt in practice,
where this is practicable, the description in the warrant will accurately
define that for which the warrant is intended to give a power to search and
seize. However, those executing a search warrant issued under section 8 should
not lose sight of the requirement that, even though material may fall within
the description in the warrant its seizure still has to fall within what is
permitted by section 8(1) & (2). This is the more important in a case in
which there are limitations on the practicability of identifying with any
precision the material to be sought.
40. Mr
Barnes' fifth submission, save for what he says about special procedure
material, is really an elaboration of his first submission. This is also true
of his sixth submission. Leaving aside special procedure material, the reasons
which lead me to reject his first submission lead me also to reject these two
submissions.
41. Special
procedure material is defined, so far as is relevant, by section 14(2)(b)(i) as
being held subject "to an express or implied undertaking to hold it in
confidence". So far as such material is concerned it is to be remembered that
paragraph (d) of section 8(1) does not debar a magistrate from issuing a search
warrant because there may be such material (or legally privileged or excluded
material) on the premises to be searched. It is only if the material which is
likely to be of substantial value to the investigation and be relevant evidence
is both caught by paragraph (d) and is or forms part of the subject matter of
the application that a warrant cannot be issued under section 8(1). Here the
magistrate enquired about this. The point is dealt with in paragraphs 20 &
21 of DC Wilson's second affidavit.
43. Plainly
would be borrowers must have expected that their borrowing requirements and
details concerning them would be passed on to potential lenders. In my
judgement, therefore, the magistrate was entitled to reach this conclusion and
I do not consider it is open to challenge on
Wednesbury
principles. I would therefore reject also this part of Mr Barnes' fifth
submission which relates to special procedure material.
45. It
follows that if in respect of any warrant there was a breach of section 16(8),
as Mr Barnes submits there was, the entry, search and seizure under that
warrant were unlawful.
46. It
is clear from section 8(1) and (2) that a warrant issued under sub-section (1)
authorises only a search for artifacts. Sections 15 and 16 refer to search
warrants generally and not only to warrants issued under section 8. The
references in section 15(6)(a)(iii) to the enactment under which the warrant is
issued and in section 15(2)(c) and (6)(b) and section 16(9)(a) to persons
sought make this clear.
47. I
have said already that a warrant issued under section 8(1) authorises the
search for and seizure of material which there are
reasonable
grounds for believing is likely
to be:
48. Thus
the criteria which have to be satisfied before material can be seized are that
there are reasonable grounds for believing that something is likely to be so.
A likelihood is less than a probability. Since the decision to seize or not to
seize has to be made by the person executing the warrant it is he who has to
decide whether the test has been satisfied. That calls for a judgement on his
part and it is a judgement which he has to make in the circumstances in which
he finds himself and on the basis of what is or should have been known to him.
What should have been known to him may include information he should have been
but was not given, for example by way of briefing, by others involved in the
search and the decision to search. The investigation may be of a complex
nature. There may be vast quantities of documents and other items which have
to be looked at in order to discover whether they do or do not fall within the
terms of the warrant. There may be time constraints - the warrants in this
case permitted a search only on a single occasion. A search is an intrusion
and it may be an embarrassment and inconvenience to those at the premises being
searched and, while it lasts, may have a seriously disruptive effect on normal
activities there. The circumstances, of which I have given some examples, may
very well require decisions to be made at speed and without time for reflection
or that opportunity to assess the significance of material which only becomes
possible when it can be considered in the context of other material. These and
such as these are important factors which the court must keep well in mind when
the allegation is made that material has been seized for which the warrant gave
no authority.
50. Does
this provision deal only with the method of search - the lifting of carpets,
breaking down of partitions and so forth - as Mr King submits? At the other
extreme does the seizure of a single document without lawful authority involve
a breach of the sub-section? Mr King points out that it makes no mention of
seizure. I derive no assistance from this point in construing the sub-section.
It would be strange if it did refer to seizure, bearing in mind it is intended
to deal not only with searches for articles but also for people. I do not
accept that section 16(8) is as restricted in its meaning as Mr King suggests.
It would be strange if, for example, the lawfulness of a search for stolen
hi-fi equipment were left untouched by the seizure of furniture, carpets and
curtains not covered by the warrant and not seized under the general power of
seizure conferred by section 19. It is clear that sections 15 and 16 are
intended to provide a statutory code by which the applications for, issue and
execution of search warrants are to be governed. I do not accept that by an
oversight Parliament has omitted to provide for the case in which articles have
been seized for which the search warrant has provided no authority, leaving
such a case to be dealt with by the common law. In my judgement section 16(8)
does apply to such cases.
51. Subject
to the de minimis principle, which common sense requires, I conclude that a
search has exceeded the purpose for which the warrant was issued - namely the
search for and seizure of material covered by the warrant in respect of which
the criteria already referred to have been satisfied - when material which does
not satisfy those criteria has been seized. But in deciding whether it has
been shown that a particular seizure was unlawful it is necessary to take as a
starting point the fact that one is examining the propriety of the judgement of
the officer executing the warrant made in the circumstances in which he found
himself and on the basis of what was or should have been known to him.
52. In
considering whether there has been an unlawful seizure valuable assistance is
to be had from passages in the judgements of the Court of Appeal in
R
-v- Commissioner of Police of the Metropolis
[1985] QB 881. The court in that case was considering an appeal in a civil
action, so that
Wednesbury
principles were not relevant as they are in a challenge by way of judicial
review. It concerned the grant of a search warrant under section 16(1) of the
Forgery Act 1913 which provided, so far as was material:
56. These
dicta seem to me to apply to a consideration of the decision of the person
seizing a document in a case such as the present with three caveats. Firstly,
the words might
and
reasonable suspicion do not form part of the relevant
criteria.
Secondly, as I have said already, the approach in a judicial review case to
the decision has to be on
Wednesbury
principles. Lastly, the consequence of a breach of section 16(8) is to make
the whole search unlawful so that there will have been a trespass to land as
well as to goods.
57. It
is necessary, therefore, to consider in respect of the execution of each of the
six warrants on 14 4 97 whether, in the light of the foregoing considerations,
a successful challenge has been made on
Wednesbury
principles to show that material has been seized beyond what can be seen as de
minimis of which the person executing the warrant was not entitled to form the
view that there were reasonable grounds for believing it was likely to be of
substantial value to the investigation and be relevant evidence and did not
consist of or include special procedure material.
58. I
can deal briefly with the point in relation to special procedure material.
Just as I consider the magistrate's decision about this is not open to
challenge on
Wednesbury
principles, I do not consider that the allegation that special procedure
material was seized can be sustained on
Wednesbury
59. The
affidavit evidence filed on behalf of the applicants complains that material
was seized wholesale including a vast quantity which had nothing to do with any
fraud but was concerned only with legitimate business. Broad assertions are
made as to the nature of that material and of such business. On the other
hand, Detective Inspector Varriale, who was in overall charge of the
investigation, asserts in paragraph 7 of his affidavit that only documentation
which the searching officers reasonably believed was likely to be evidence
relating to the criminal investigation was seized. In paragraphs 8 & 9 he
says that since the seizures officers have been analysing each document in
detail to decide whether it can properly be regarded as relevant evidence and
that it would not have been practicable to carry out such an exercise on the
premises at the time of the searches. In paragraph 55 of his affidavit
Detective Inspector Franklin, who as Detective Sergeant Franklin briefed the
officers who were to take part in the searches, says,
60. DC
Wilson, who was one of the search team of the Mary Tudor Suite said in
paragraphs 43 to 45 of his second affidavit,
61. There
are in my view a number of points to be borne in mind when considering the
allegation that there was excessive seizure when the warrants were executed.
62. I
have studied the seizure records and the lists of materials seized which are
exhibited to the applicants' affidavits. There are clearly some items, eg a
waistcoat and pens and some family photographs, which could not have been seen
to fall within the permitted scope of the search but I would regard these, when
seen in context, as de minimis. For the rest, save in relation to the seizure
from the home of the second applicant, Mr Ferguson, of certain material, the
descriptions of many documents and other records give a clue as to why they
were seized. Descriptions, though, of many others give no sufficient clue
about their contents to enable me to reach a conclusion about the lawfulness of
seizure in accordance with
Wednesbury
principles faced, as I am, with the conflicts in the affidavit evidence.
63. Judicial
review is not a fact finding exercise and it is an extremely unsatisfactory
tool by which to determine, in any but the clearest of cases, whether there has
been a seizure of material not permitted by a search warrant. In my judgement
a person who complains of excessive seizure in breach of section 16(8) should
not, save in such cases, seek his remedy by way of judicial review but should
rely on his private law remedy when he will have a tribunal which will be able
to hear evidence and make findings of fact unfettered by
Wednesbury
principles. In an appropriate case the court in a private law action is able
to grant interlocutory relief on a speedy basis on well recognised principles
so that in all but the clearest cases of a breach of section 16(8) judicial
review has only disadvantages and no advantages when compared with the private
law remedy.