England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		19/10/2004

Mr. Justice McCombe :

1. This is an application, originally issued on 30 July 2003 and amended on 13 July 2004, by Mr. Satnam Singh. By the application in its amended form Mr. Singh claims two orders. First, he asks for the discharge wholly or in part of an interim receiving order under the Proceeds of Crime Act 2002 made by Hooper. J (as he then was) on 16 April 2003. Secondly, he applies for an order striking out a Claim Form issued on 31 March 2004, on the application of the Assets Recovery Agency claiming a Recovery Order pursuant to sections 243 and 266 of the same Act.
2. The matter has a lengthy history. On 30 November 1995, Mr. Singh was arrested with others on suspicion of being knowingly concerned in the fraudulent evasion of excise duty contrary to section 170(2) of the Customs and Excise Management Act, 1979. Thereafter he was charged with conspiracy to cheat the public revenue, contrary to section 1 of the Criminal Law Act, 1977. The offences alleged involved what was calculated to be the evasion of in excess of £5 million in duty and VAT on alcoholic drinks. The goods were diverted from a bonded warehouse and Mr. Singh was alleged to have been a party to a large and well organised "diversion fraud" between about April or August 1994 and November 1995.
3. After initial indications of an intention to contest the charges, on 8 September 1998, Mr. Singh pleaded guilty to a single count of conspiracy to cheat the public revenue. His sentence was adjourned pending trial of the co-accused. The matter was listed for sentence on 17/18 December 1998, at the Crown Court at Newcastle-upon-Tyne, before His Honour Judge Wood.

On 16 December 1998, in this Court Mr. Justice Dyson (as he then was) made a restraint order against Mr. Singh under the Criminal Justice Act 1988. On 18 December 1998, Mr. Singh was sentenced to 4 years imprisonment by the learned judge. He was taken to the cells and then, in his absence, the question of a confiscation order was raised for the first time before the Court. The procedure adopted gave rise to in due course to the argument that the statutory requirements of section 71 of the 1988 Act had not been followed.

4. The prosecutor's statement under section 73 of the Act was served in January 1999. The proceedings were mentioned before the judge in February 1999 and were adjourned to 7 June 1999, which I am told was beyond the relevant statutory time limit prescribed by the 1988 Act.
5. The substantive hearing of the confiscation proceedings was held between 7 and 9 June 1999. In a ruling of 8 June 1999, in Mr. Singh's case, the judge assessed the relevant benefit to him from the crime in the sum of £400,000 and found that he had realisable assets in the sum of £300,000. In July 1999, Mr. Singh's solicitors lodged grounds of appeal against sentence in so far as the confiscation order was concerned. The grounds alleged procedural defects in the confiscation proceedings. Leave to appeal was granted by the Single Judge in May 2000.
6. On 12 January 2001, conduct of the appeal was transferred to Mr. Singh's present solicitors. They received some papers on 15 January 2001, but many were missing – it is said that this was because files had been lost at the Crown Court, following taxation of the trial costs.
7. There had, by this time, been substantial delay in the determination of the appeal and on 29 June 2002 revised grounds of appeal were lodged. The matter came before the Court on 2 July 2002, when it was adjourned, apparently because of late revision to the grounds of appeal and possibly the late provision of prosecution papers. The Court directed all concerned, including the Registrar of Criminal Appeals, to report upon the delays. The Registrar's report of 9 July indicated that an official in the Court office appeared to have been responsible for failing to progress the appeal properly.
8. The substantive appeal came on for hearing before the Lord Chief Justice, Mr. Justice Holland and Mr. Justice Keith on 4 November 2002. After argument, (the Appellant's Counsel were not called on) the Court reserved judgment and, on 16 December 2002, the appeal was allowed and the confiscation order was quashed. Mr. Singh was awarded costs out of Central Funds.
9. By letter of 24 December 2002, Mr. Singh's solicitors asked whether the restraint order (made by Mr. Justice Dyson in December 1998) had been duly discharged. By reply of 3 January 2003, the solicitors were informed that application was being made to this Court for discharge of the order. On 16 January 2003, Mr. Justice Sullivan discharged the restraint order. The order was sealed by the Court on 23 January 2003. Copies of the order were supplied to Mr. Singh's solicitors under cover of a letter of Friday, 24 January 2003, and was received by them on Monday, 27 January 2003.
10. It is material to mention here that part of the assets identified as available to Mr. Singh in the confiscation proceedings was a sum of £50,021 in cash, taken from him on arrest. His solicitors, therefore, sought to procure the return of that money with interest from H.M. Customs and Excise who had held it since the arrest. There were telephone calls on the subject; and on 10 February 2003, the solicitors wrote formally demanding the return of the money. On 12 February, a letter from Customs and Excise was received by the solicitors asking for details of their bank account to enable re-payment to be made. Immediately that morning the solicitors faxed the details to Customs and Excise.
11. The partner concerned was then away from the office for a week and on his return on 20 February 2003 he checked whether the funds had been received. They had not. On 24 February 2003, the relevant part of the Proceeds of Crime Act 2002 came into force. As appears from a document produced for the first time during the hearing before me, on 25 February, the investigating officer at H.M. Customs and Excise, a Mr. Simon Cloke, presented to his superiors an application to refer the case to the Assets Recovery Agency for consideration for civil recovery action. On 28 February that proposal was endorsed by a senior investigating officer and on 3 March the Assistant Chief Investigating Officer endorsed his approval. The evidence filed by the Claimant in these proceedings states that the matter was so referred to the Agency that day.
12. On 4 March 2003 a sum of £61,504.10, representing the cash seized and accrued interest, was received into the bank account of Mr. Singh's solicitors. The solicitors did not know that the matter had been referred on the previous day to the Assets Recovery Agency.
13. No doubt very sensibly on 5 March 2003 the solicitors made a formal disclosure to the Asset Forfeiture Unit of Customs and Excise of receipt of the funds and the firm's intention to deal with the money in the following way, namely by transfer of £39,578.35 from client account to office account in discharge of the firm's outstanding fees and disbursements and the balance by release of funds to Mr. Singh. According to the solicitors' uncontested evidence, initial telephone contact with the Asset Forfeiture Unit suggested that there would be no objection to this course of action, because the funds had been released from restraint by the High Court.
14. On 7 March, a letter was faxed to the solicitors stating that, if the relevant property was thought possibly to be "criminal property", an appropriate disclosure should be made to a constable, a customs officer or a nominated officer. A letter dated Friday 7 March 2003 was sent from the Asset Forfeiture Unit to the solicitors on Sunday 9 March. It was seen on 10 March. The letter advised the solicitors to make disclosure to the original Customs case officer, Mr. Cloke. The further uncontested evidence about this matter from the solicitors is in the following terms. I quote the following passage from the statement of Miss Teasdale dated 25^th July 2003,

"As advised, I contacted Mr Cloke by telephone the same day putting him on notice of our letter of 5^th March which was being faxed over for his attention. Mr Cloke was clearly uncomfortable speaking to me citing the Gower Hammond report under which he believed he was precluded from speaking to defence solicitors. In the alternative he suggested I make the report to the National Criminal intelligence Service (NCIS) and provided me with the contact details. I confirmed the contents of our telephone conversation by faxed letter, which enclosed for his attention in any event copy correspondence with the Asset Forfeiture Unit as per their original recommendation. This was copied to Mr Birkorang and Cheryl Hugil of the Asset Forfeiture Unit. …

On 12^th March, I received a faxed letter from Mr Birkorang concluding that my firm were "acting in utmost good faith, which is admirable" …. I was advised that I should make the disclosure to NCIS and was provided with the relevant contact details.

On 14^th March I wrote to NCIS enclosing all the copy correspondence between my firm and the Asset Forfeiture Unit, requesting an urgent response due to the fact that I had been attempting to make voluntary disclosure since 5^th March with no success, and that Mr Singh was daily chasing the release of the funds. … That letter was acknowledged by NCIS by letter dated 17^th March, received into these offices on 20^th March …

On 20^th March my firm received correspondence … from HMCE Financial Intelligence Team providing a disclosure reference and advising that Customs were investigating the report and confirming that until written confirmation was received, my firm were not authorised to deal with the money in part or full.

On 25^th March, two further letters were received from HMCE; firstly confirming that they were continuing investigations and again refusing permission to deal with the money "until you receive notification of consent in writing from us, or until a further period of 31 calendar days has elapsed"; secondly permitting my firm to write to the client in agreed wording such that we would not be "tipping-off" explaining that we were not presently allowed to release the funds. …

On 31^st March I received a letter from NCIS dated 26^th March refusing "appropriate consent" to deal with the funds … On the same day, I faxed a response to HMCE's letter of 24^th … enquiring what there was to investigate for a further 31 days when HMCE themselves released the money to my firm by order of the High Court, emphasising that my firm took the view that this is a technical, cautionary report. On 3^rd April I received a response from HMCE stating that they did not agree that this was a "cautionary report" and refused to provide details of the "further investigation" … .

On 16^th April, I faxed HMCE requesting an urgent update emphasising that although the 31 day deadline did not expire until 24^th April, the funds had been in my firms account since 4^th March and accordingly I was anxious for a conclusion to the matter. In response I received a fax by return confirming that investigations were ongoing and that my firm would be informed of the result as soon as possible. … I went on holiday that day and am aware that the following afternoon my firm were served with an interim receiving order in which they were named as a restrained party, together with a witness statement of George Gee and exhibit "GG1" in support. … .

15. On 16 April 2003, the Director of the Assets Recovery Agency made the "without notice" application to Mr. Justice Hooper for an interim receiving order ("IRO") under the 2002 Act. The learned judge made the order which was served on the solicitors on 17 April 2003.
16. Mr. Singh now applies for the relief set out earlier in this judgment. It will be convenient to deal with the "strike out" application first (as Counsel did in argument) because, if that application was successful, the IRO would fall also. Before turning to that application I should summarise the grounds upon which Mr. Singh's applications are based.
17. In applying to strike out the Claim Form, Mr. Simon Taylor on Mr. Singh's behalf submits (in a very persuasive argument) that none of the assets identified in the Claim Form is "recoverable property" under section 304 of the Act, because they fall within the exception to be found in sections 308(9) which is in the following terms:

"Property is not recoverable if it has been taken into account in deciding the amount of a person's benefit from criminal conduct for the purpose of making a confiscation order, that is –

(a) an order under section 6, 92 or 156, or

(b) an order under a corresponding provision of an enactment mentioned in section 8(7)(a) to (g)'

and, in relation to an order mentioned in paragraph (b), the reference to the amount of a person's benefit from criminal conduct is to be read as a reference to the corresponding amount under the enactment in question."

18. If I do not accept that submission, Mr. Taylor submits that I should nonetheless strike out that part of the claim attributable to such part of the cash sum returned to the solicitors on 4 March 2003 as represented the then unpaid legal fees. That argument is based upon section 308(1) of the Act which provides as follows:

"If –

(a) a person disposes of recoverable property, and

(b) the person who obtains it on the disposal does so in good faith, for value and without notice that it was recoverable property,

the property may not be followed into that person's hands and, accordingly, it ceases to be recoverable."

19. Lastly, on this part of the application, Mr. Taylor submits that the proceedings ought to be struck out because the proceedings as a whole, including the criminal process have been so protracted and drawn out as to amount to a breach of the fair trial provisions of Article 6 of the European Convention on Human Rights.
20. Finally, if any part of the recovery claim survives, Mr. Taylor submits that the Interim Receiving Order should be discharged on the ground of "material non-disclosure" at the time of the "without notice" application to Mr. Justice Hooper in April 2003.
21. I turn now, therefore, to the "strike out" application and the arguments based upon section 308 of the Act.
22. I have set out section 308(9) above. Mr. Taylor's simple point is that all the property claimed in these proceedings was "… taken into account" by Judge Wood in 1999 "… in deciding the amount of [Mr. Singh's] benefit from criminal conduct for the purpose of an enactment mentioned in section 8(7)(a) to (g)". In this case it is section 8(7)(c) which applies, namely by reference to Part 6 of the Criminal Justice Act 1988. He submits that it does not matter that the order was "quashed" by the Court of Appeal; the relevant property was nonetheless "taken into account" by Judge Wood in making the Order in June 1999. The object of section 308(9), says Mr. Taylor, is to limit litigation and that once the assets have been fought over in relevant proceedings, whatever the ultimate outcome, they are excluded from civil recovery under the 2002 Act. That is the effect of the words of the subsection and, if Parliament had intended to confine the exclusion to extant orders, it would have so provided expressly.
23. Mr. Sutherland-Williams, who argued the Director's case equally persuasively, submits first, that it cannot be shown that Judge Wood did take relevant property into account in making his order in June 1999. However, in any event Mr. Sutherland-Williams argues that, on its true construction the exception in section 308(9) only applies to assets taken into account under extant confiscation orders. Moreover, he argues, the quashing of the order by the Court of Appeal renders it null, void and of no effect for all relevant purposes.
24. I can deal with the first argument relatively shortly. It seems to me to be quite clear that Judge Wood did take into account the property, identified in the Claim Form in the present proceedings, in deciding Mr. Singh's benefit from criminal conduct. When one examines the Prosecutor's statement and the Defence statement lodged in the Crown Court, it is clear that the prosecution were contending that the relevant benefit was simply lost revenue. They put the figure at £4,209,418.00 In the Defence statement, Mr. Singh disputed the arbitrary nature of this claim. The statement listed the realisable assets and identified them. They included the property sought to be recovered in this action. The confiscation hearing involved three other defendants in addition to Mr. Singh. On 7 June 1999, the learned Judge indicated that he would give a ruling in the case of one of the other defendants, a Mr. Gunder Singh Dhnoary, "… because that may assist in the approach being taken by the others". Having referred to the authorities cited to him, the learned judge said this:

"It seems to me that there are various means available to the court of assessing the benefit which a Defendant has obtained from relevant criminal conduct. In some cases, no doubt, the amount is easily ascertainable, because it is an amount stolen, or property taken, or something of that kind. Here it would be perfectly possible, it seems to me, for the Crown to say, as indeed they have done in Mr. Cloke's affidavit, that the proportion of loss to the Revenue occasioned by this Defendant is assessed at £1.5 million, and that that therefore is his benefit.

On the other hand, if a Defendant responds to a Section 73 statement by affidavit, or indeed gives evidence to the court, and this Defendant has done both, then it seems to me the court is also equally entitled to assess benefit according to the evidence that has been put before the court.

In my judgment the latter approach is more appropriate to this case, and I would therefore propose to assess the benefit, bearing in mind the evidence which I have read and the evidence which I have heard".

In that case, the judge then proceeded to refer to the defendant's evidence about particular sums of money used and how they had been applied either in investment or for other purposes.

25. On the following day, the judge ruled in Mr. Singh's case. He referred to Mr. Singh's affidavit listing the assets already described. His conclusion on the principle to be adopted was as follows:

"I do bear in mind the guidelines which are set out in Re:K and also the matters referred to, as I referred yesterday, in Mitchell Taylor and Talbot at page 117, the course that the Court should adopt. There are clearly a number of approaches in assessing benefits in cases of this kind. First of all I am satisfied that the Defendant has benefited from the criminal acts concerned in this conspiracy. The Customs have suggested in their statement that the proportion of loss for which he is responsible is £4.2m and that that ought to be therefore declared as his benefit. In my judgment, as in the previous case where the Court then had evidence in the form of statements and/or affidavits, even if the Defendant does not give evidence but there is nevertheless other material upon which the Court can make its assessment, I prefer again the approach that the Court should do that using the figures available from the statements and affidavits before it.

Mr. Muir on behalf of the Customs and Excise invites me to look at the statement produced by Mr. Cloke, adds up the assets there disclosed and comes to a total, including the money, to £508,000 and submits in effect that all of that sum is also realizable for the Defendant's assets, and he includes in that calculation at least half of the matrimonial home."

Having reviewed the evidence the judge's decision was expressed in these terms:

"In the end it seems to me that the Court can only adopt a broad brush approach to these various calculations, and I conclude that the Defendant has benefited in the sum of £400,000 and that he has realizable assets in the sum of £300,000. And I order therefore that he should pay a Confiscation Order in the sum of £300,000."

26. It is clear that the judge rejected the Crown's contention that benefit should be calculated by reference to the duty avoided. He decided instead to adopt an "assets" basis of calculation. In doing so, he had regard to the assets identified which, in Mr. Singh's case, included the assets in issue here. In the end he adopted a "broadbrush" approach to determining both "benefit" and "realisable assets". However, to me it seems quite clear that in doing this and in making his order the learned judge took into account the assets identified in the present Claim Form.
27. Accordingly, if one ignores the fact that the confiscation order was ultimately quashed in the Court of Appeal, section 308(9) of the Act applies in this case. Mr. Taylor submits that the section is designed to prevent these matters being re-litigated, even if (as in this case) the confiscation order was quashed on a mere technicality. Thus, he submits the property in issue here is not "recoverable property" and the claim should be struck out or I should, in discharge of the duty imposed upon the Court under section 254(1), make an order excluding the property from the I.R.O.
28. Mr. Sutherland-Williams submits that this is not the proper construction of the Act. He argues that section 308(9) is merely another provision, among several others in the Act (to be found in section 278) to prevent "double counting" of assets already recovered or subject to existing confiscation orders in other proceedings. It is to be observed, however, that the provision with which I am concerned (s.308(9)) appears in an entirely different section of the Act from the rest of the "double counting" provisions which are to be found in section 278; Mr. Sutherland-Williams did not, I think, provide any clear explanation of why this should be. He further submits, however, that the whole object of the Act is to introduce a new regime for the civil recovery of property derived from crime, irrespective of the outcome of criminal proceedings and whether or not charges have been brought (see e.g section 240(2) of the Act). That purpose is tempered only by the prevention of double recovery. Mr. Sutherland-Williams submits that the construction contended for by Mr. Taylor would simply frustrate the clear object of the enactment. (By analogy he notes that, for the future, Parliament has legislated that technicalities such as availed Mr. Singh in the Court of Appeal under earlier legislation have been, he submits, blocked by section 14(11) of the 2002 Act). Moreover, as Mr. Sutherland-Williams points out, it has long been a feature of confiscation legislation that confiscation orders can be revisited when a defendant's property turns out to be of greater or lesser value than had been thought at the time of the original proceedings. In other words, statutes such as these have always carried with them a potential for "re-litigation" of matters decided at an earlier date.
29. I am inclined to think that Mr. Sutherland Williams's submission on this point of statutory construction is correct and, if necessary, I so decide. I find it inconceivable, having regard to the purpose of this legislation and the fact that civil proceedings under this Act are envisaged as possible, whether or not there have been criminal proceedings, as militating against the construction for which Mr. Taylor contends. It would be indeed surprising if, as is accepted on all sides, the Agency could bring such proceedings as these against this property if Mr. Singh had been acquitted, but cannot now do so where he stands convicted and there is no extant confiscation order against him. I consider that the relevant provision must be construed as referring to an existing confiscation order.
30. I would add that such a construction would make more sense having regard to section 278(9) of the Act also. That subsection reads:

"If –

(a) property has been taken into account in deciding the amount of a persons benefit from criminal conduct for the purpose of making a confiscation order, and

(b) the enforcement authority subsequently seeks a recovery order in respect of related property,

the confiscation order is to be treated for the purposes of this section as if it were a recovery order obtained by the enforcement authority in respect of the property referred to in paragraph (a)."

This provision uses exactly the same language as section 308(9) for these rather different circumstances. It would be odd if a provision against "double counting" were to give credit for a confiscation order which has been quashed on appeal. I consider, therefore, that both provisions should be read as referring to extant orders.

31. I am fortified in this conclusion by reference to the authorities dealing with the effect of the "quashing" of a conviction. In Hancock v Prison Commissioners [1960] QB 117, a prisoner had been sentenced to a term of imprisonment of 10 years. On appeal his sentence had been "quashed" pursuant to section 4(3) of the Criminal Appeal Act 1907; a sentence of 7 years was substituted. While serving the original sentence he had suffered 848 days loss of remission. After the appeal he had served his sentence in exemplary fashion and claimed that he was therefore entitled to release, disregarding the loss of remission in the period prior to the quashing of the original conviction. Mr. Justice Winn held that the quashing of the conviction did not make the original sentence null and void from the outset but only for the future. It was, therefore, immaterial to his eligibility for discharge whether or not he was taken to be serving the 7 year sentence or the original 10 year sentence. The losses of remission remained relevant. At pages 125-6 of the report, Mr. Justice Winn said,

" Mr. Neil McKinnon has submitted to me cogently (and one recognises that it is an argument which calls for careful consideration and has considerable weight) that the word "quash" in that order means that the 10-year sentence was thereby rendered null and void, and wholly set aside as though it had never been. There would be persuasive force in that argument and I would feel very well disposed to accept it, had I not found in the very wording of section 4(3) of the Act the provision that, wherever the Court of Criminal Appeal does find itself of the opinion that a sentence passed had been too severe, it "shall … "quash" that sentence and "pass such other sentence … as "they" (the court) "think ought to have been passed in substitution therefore." When one finds those words in the section and considers the context in which they are used, and the subject-matter to which those words must be applied, one is inevitably driven to the conclusion that the word "quash" is not there used in the sense in which the Shorter Oxford English Dictionary tells me that it often is used, namely, "to annul," "make null or void," but is used in the less drastic meaning that the former sentence is by order of the court rendered null and void at the moment when the Court of Criminal Appeal decides to substitute for it a different sentence, so as to make that earlier sentence null and void and of no effect for the future from that point of time onwards, but not so as to render it null and void ab initio, namely, as from the date when it was passed.

I feel that that must be the right way of construing the section, for otherwise, at least as a matter of theory, the successful appellant against the length of sentence would be a person who had been unlawfully imprisoned as from the date of his conviction and removal to gaol until the time when the Court of Criminal Appeal so pronounced; and all measures of restraint exercised on him (not merely by retaining him in gaol but in other ways) in that interim period would be, at least in theory, tortuous wrongs committed against him, were it not that the true intent of such an order and the true meanings of the words in subsection (3) of section 4 of the Criminal Appeal Act, 1907, which enables such an order to be made, is that the Court of Criminal Appeal quashes for the future the original sentence, and substitutes for the future the new sentence which the Court of Criminal Appeal considers the proper sentence, albeit that that sentence itself takes its extent from the original date of the first sentence; that is to say, it is a term of so many years calculated from a starting date which is the same date as the starting date of the sentence which has been, in the sense which I have indicated, quashed."

32. In this case, therefore, (section 11(3) of the Criminal Appeal Act 1968 also using the word "quash" in the same context), it seems to me that the confiscation order was, from the date of the Court of Appeal's order, "null and void and of no effect for the future from that point of time onwards" (see per Winn J [1960] QB at p.125, supra.). So today, in construing section 308(9) the order is null, void and of no effect in considering the question whether or not the relevant property was taken into account in deciding the amount of Mr. Singh's benefit from criminal conduct for the purpose of making a confiscation order. Today, there is no confiscation order to which this provision can be applied.
33. Having regard to my decision on this point, I do not consider that it is necessary to examine further the judicial review decisions cited by Mr. Sutherland-Williams. Those cases were: Boddington v British Transport Police [1999] 2 AC 143 and R (on the application of Wirral B.C and another) v Mental Health Review Tribunal and others. [2001] EWCA Civ 1902.
34. I turn now to Mr. Taylor's more limited attack upon the proceedings generally, based upon section 308(1) of the Act. This section reads as follows:

"If –

(a) a person disposes of recoverable property, and

(b) the person who obtains it on the disposal does so in good faith, for value and without notice that it was recoverable property,

the property may not be followed into that person's hands and, accordingly, it ceases to be recoverable."

35. The argument is that the sum of £39,578.35, in respect of Mr. Singh's solicitors outstanding accounts, represented property disposed of by Mr. Singh and obtained by his solicitors in good faith and for value without notice that the property was recoverable. Apart from any other arguments I cannot see that this sum was disposed of by Mr. Singh at all or that it was acquired by the solicitors in any relevant sense. It is a sum that was owed by Mr. Singh to the solicitors. (It is to be noted in passing that all but slightly in excess of £3,000 has now, in any event, been satisfied by means of the order for costs out of central funds made by the Court of Appeal.) The solicitors wanted to use some of the money, paid to them on Mr. Singh's behalf on 5 March 2003, to discharge the debt. It was never so applied before the IRO was made and, moreover, by the time of receipt of the money the solicitors had full notice of all facts which are now alleged to render these funds "recoverable property" for the purposes of the Act. I cannot, therefore, see that section 308(1) has any application.
36. Mr. Taylor submits that this sum was money on which the solicitors were entitled to draw under the exceptions to the restraint order of Mr. Justice Dyson of 16 December 1998. That order was in customary form and read as follows:

"The Defendant's solicitors shall be entitled to draw immediately the sum of £500 and then such other sums as have been actually, reasonably and properly incurred for legal costs in these and the associated criminal proceedings

PROVIDED THAT :-

Before such other sums are released for this purpose the solicitor for the Defendant shall notify the solicitor for Customs and Excise in writing of the following matters:

a. the source of the fund to pay the said costs

b. the general nature of the costs incurred

c. the time spent and by whom (whether partner, assistant solicitor or otherwise) incurring the costs

d. the hourly rate applicable to the costs incurred and

e. that, in the event that the solicitor for the Commissioner of Customs and Excise consider the claim to be in respect of costs that have not actually reasonably or properly been incurred then the entitlement to draw such costs be restricted to 65% of the amount claimed and the whole claim for costs then be subject to taxation in accordance with Order 62 r.15 without the provisions of Order 62 r.15 (2) applying. "

37. In February 2001 there was an exchange of correspondence between solicitors in which Mr. Singh's solicitors set out proposals for the drawing of further funds from the cash seized on Mr. Singh's arrest. Solicitors for H.M Customs proposed that invoices be submitted for approval and the appropriate releases could be made. It does not appear that any such invoices were submitted. I do not see that either the order or this exchange of correspondence goes any way to bringing the relevant sum within the terms of section 308(1) of the Act.
38. The last aspect of the "strike out" application is the point arising under Article 6 of the Human Rights Convention. Although the provisions are well known, in this context, it is worth reminding oneself of the terms of Article 6(1):

"In the determination of his civil rights and obligations or of any criminal charge against him, everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law. Judgment shall be pronounced publicly but the press and public may be excluded from all or part of the trial in the interests of morals, public order or national security in a democratic society, where the interests of juveniles or the protection of the private life of the parties so require, or to the extent strictly necessary in the opinion of the court in special circumstances where publicity would prejudice the interests of justice."

39. Mr. Taylor submits that, taken as a whole, in the period from Mr. Singh's arrest to today Mr. Singh has not been afforded a hearing "within a reasonable time … In determination of his civil rights and obligations or of … [the] criminal charge against him". He submits that, for one reason or another, Mr. Singh's criminal conduct for a period of about 18 months in the mid – 1990s has been subject of proceedings for about 9 years and that offends Article 6. Mr. Sutherland-Williams submits that these civil proceedings under the 2002 Act are new and separate from the criminal proceedings and must be so regarded for the purposes of the Convention. He cited the decision of Mr. Justice Coghlin in the High Court in Northern Ireland in Director of the Assets Recovery Agency v Walsh [2004] NI QB 21 in which it was held that proceedings under the 2002 Act are civil proceedings to which Article 6(2) do not apply. With respect to Counsel, the arguments here on each side amounted to little more than assertion of the rival propositions that I have summarised above.
40. I incline to the view that Mr. Sutherland-Williams's submission is indeed correct: these are separate civil proceedings in which no question of relevant delay arises. However, even if I am wrong about that, it seems to me that there was no breach of the Article. The criminal proceedings to trial and conviction were relatively protracted but, given the number of defendants, and their varying defences, the course of proceedings did not offend the Convention. Moreover, the judge gave credit to Mr. Singh in the sentencing process for such part of the inevitable delay that was not attributable to him. There was administrative delay in the appeal from May 2000 (when leave was granted) to July 2002 when the matter first came before the full Court of Appeal. There was, however, little evidence of pressure from Mr. Singh's side to bring the appeal to conclusion and his own advisors produced new grounds of appeal very shortly before the hearing in July 2002. While administrative delay of this type cannot be condoned, it does not seem to me that such lapses will necessarily give rise to a breach of Article 6. In the end, the appeal process produced the result for which Mr. Singh contended. His complaint is rather that it did not do so speedily enough to enable him to recover what are alleged to be the proceeds of crime in sufficient time to prevent them becoming enmeshed in the present action. To my mind, there was no breach of Article 6, even if the proceedings from 1995, including these civil proceedings, have to be looked at as a whole.
41. For these reasons, the application to strike out the Claim Form fails. I turn now to the second part of the application by which an order is sought for the discharge of the IRO.
42. The ground for making this application is, as already explained, the contention that, on the application to Mr. Justice Hooper in April 2003, there was a failure to disclose material matters which ought to have been before the judge to enable him to consider whether an order should be made. Reliance is placed upon the well-known principle relating to all applications made without notice to a defendant, namely that the applicant must make "full and fair disclosure of all material facts": R v Kensington Income Tax Commissioners ex parte de Polignac [1917] 1 KB 486. Mr. Sutherland-Williams rightly accepts that this principle applies equally to all without notice applications.
43. There is no dispute about the criteria to be applied which, for the purposes of this case, were taken by Counsel from Siporex Trade S.A. v Condel Commodities Ltd [1986] 2 LI. R. 428 and Brink's Mat Ltd v Elcombe [1988] 1 WLR1350. In the first of the cases. Bingham J (as he then was) said:

"The scope of the duty of disclosure of a party applying ex parte for injunctive relief is, in broad terms, agreed between the parties. Such an applicant must show the utmost good faith and disclose his case fully and fairly. He must, for the protection and information of the defendant, summarize his case and the evidence in support of it by an affidavit sworn before or immediately after the application. He must identify the crucial points for and against the application, and not rely on general statements and the mere exhibiting of numerous documents. He must investigate the nature of the cause of action asserted and the facts relied on before applying and identify any likely defences. He must disclose all facts which reasonably could or would be taken into account by the Judge in deciding whether to grant the application. It is no excuse for an applicant to say that he was not aware of the importance of matters he has omitted to state. If the duty of full and fair disclosure is not observed the Court may discharge the injunction even if after full enquiry the view is taken that the order made was just and convenient and would probably have been made even if there had been full disclosure. Most of these principles are established by authorities such as Rex v. Kensington Income Tax Commissioners, [1917] 1 K.B. 486; Thermax Ltd. V. SchottIndustrial Glass Ltd.,[1981] F.S.R. 289; Wardle Fabrics Ltd. V. G. Myristis Ltd., [1984] F.S.R. 263; Bank Mellat v. Nikpour, [1985] F.S.R. 87. The other principles have not been the subject of detailed challenge."

In the second case, Ralph Gibson LJ said,

"In considering whether there has been relevant non-disclosure and what consequence the court should attach to any failure to comply with the duty to make full and frank disclosure, the principles relevant to the issues in these appeals appear to me to include the following. (1) the duty of the applicant to make "a full and fair disclosure of all the material facts:" see Rex v. Kensington Income Tax Commissioners, Ex parte Princess Edmond de Polignac [1917] 1 K.B. 486, 514, per Scrutton L.J.

(2) The material facts are those which it is material for the judge to know in dealing with the application as made: materiality is to be decided by the court and not by the assessment of the applicant or his legal advisers: see Rex v. Kensington Income Tax Commissioners, per Lord Cozens-Hardy M.R., at p. 504, citing Daglish v. Jarvie (1850) 2 Mac. & G. 231, 238, and Browne-Wilkinson J. in Thermax Ltd. V. Schott Industrial Glass Ltd. [1981] F.S.R. 289, 295.

(3) The applicant must make proper inquiries before making the application: see Bank Mellat v. Nikpour [1985] F.S.R. 87. The duty of disclosure therefore applies not only to material facts known to the applicant but also to any additional facts which he would have known if he had made such enquiries.

(4) The extent of the inquiries which will be proper, and therefore necessary, must depend on all the circumstances of the case including (a) the nature of the case which the applicant is making when he makes the application; and (b) the order for which application is made and the probable effect of the order on the defendant : see, for example, the examination by Scott J. of the possible effect of an Anton Piller order in Columbia Picture Industries Inc. v. Robinson [1987] Ch.38; and (c) the degree of legitimate urgency and the time available for the making of inquiries: see per Slade L.J. in Bank Mellat v. Nikpour [1085] F.S.R. 87, 92-93.

(5) If material non-disclosure is established the court will be "astute to ensure that a plaintiff who obtains [an ex parte injunction] without full disclosure … is deprived of any advantage he may have derived by that breach of duty:" see per Donaldson L.J. in Bank Mellat v. Nikpour, at p.91, citing Warrington L.J. in the Kensington Income Tax Commissioners' case[1917] 1 K.B. 486, 509.

(6) Whether the fact was not disclosed is of sufficient materiality to justify or require immediate discharge of the order without examination of the merits depends on the importance of the fact to the issues which were to be decided by the judge on the application. The answer to the question whether the non-disclosure was innocent, in the sense that the fact was not known to the applicant or that its relevance was not perceived, is an important consideration but not decisive by reason of the duty on the applicant to make all proper inquiries and to give careful consideration to the case being presented.

(7) Finally, it "is not for every omission that the injunction will be automatically discharged. A locus poenitentiae may sometimes be afforded:" per Lord Denning M.R. in Bank Mellat v. Nikpour [1985] F.S.R. 87, 90. The court has a discretion, notwithstanding proof of material non-disclosure which justifies or requires the immediate discharge of the ex parte order, nevertheless to continue the order, or to make new terms.

"when the whole of the facts, including that of the original non-disclosure, are before [the court, it] may well grant … a second injunction if the original non-disclosure was innocent and if an injunction could properly be granted even had the facts been disclosed:" per Glidewell L.J. in Lloyds Bowmaker Ltd. V. Britannia Arrow Holdings Plc., ante, pp. 1343H-1344A. "

To these remarks, Slade LJ added,

" … The principle is, I think a healthy one. It serves the important purposes of encouraging persons who are making ex parte applications to the court diligently to observe their duty to make full disclosure of all material facts and to deter them from any failure to observe this duty, whether through deliberate lack of candour or innocent lack of due care.

Nevertheless, the nature of the principle, as I see it, is essentially penal and in its application the practical realities of any case before the court cannot be overlooked. By their very nature ex parte applications usually necessitate the giving and taking of instructions and the preparation of the requisite drafts in some haste. Particularly, in heavy commercial cases, the borderline between material facts and non-material facts may be a somewhat uncertain one. While in no way discounting the heavy duty of candour and care which falls on persons making ex parte applications, I do not think the application of the principle should be carried to extreme lengths. In one or two other recent cases coming before this court, I have suspected signs of a growing tendency on the part of some litigants against whom ex parte injunctions have been granted, or of their legal advisers to rush to the Rex v. Kensington Income Tax Commissioners [1917] 1 K.B. 486 principle as a tabula in naufragio, alleging material non-disclosure on sometimes rather slender grounds, as representing substantially the only hope of obtaining the discharge of injunctions in cases where there is little hope of doing so on the substantial merits of the case or on the balance of convenience."

44. I have set out at the beginning of this judgment the chronological background to the present proceedings, by reference to which the points made on Mr. Singh's behalf will, I think, be adequately understood. Mr. Taylor's submissions, in the end, were confined to three points in respect of which he said inadequate disclosure had been made to Mr. Justice Hooper. First, he argued that the material put before the learned judge inadequately set out the chronology of the proceedings so that the judge could see that Mr. Singh was initially arrested in November 1995 and had, therefore, been subject to processes of civil and criminal litigation for nearly 8 years by the time of the application. Secondly, it was submitted that the Director failed properly to disclose the extenuated process whereby Mr. Singh's solicitors had been endeavouring, following the quashing of the confiscation order, to secure the release of the funds seized by Customs on Mr. Singh's arrest. This meant that the judge did not fully appreciate that the delay meant that, prior to return of the money, the 2002 Act had come into force and so the Director was able to launch proceedings which would not have been available to any relevant authority either at the time of the appeal decision or of the discharge of the restraint order. Comprised in this part of the submission was the point that the evidence before the judge did not include a copy of the letter from Mr. Singh's solicitors of 5 March 2003, seeking to make disclosure to H.M Customs pursuant to Section 338 of the Act. That letter also raised the argument (considered above) that some of the money released on 4 March had been disposed of "for valuable consideration". Thirdly, it is argued that the Director's solicitors prevaricated unjustifiably in supplying to Mr. Singh's solicitors a note of the hearing before Mr. Justice Hooper in accordance with the practice established in Interoute Telecommunications (UK) Ltd. v Fashion Gossip Ltd and others [1999] TLR 762.
45. With regard to the first argument, it is right that the principal witness statement served on behalf of the Director, a statement of Mr. George Gee of 15 April 2003, began the chronology by referring to the sentence of Mr. Singh by His Honour Judge Wood on 18 December 1998. It did not deal with his arrest in 1995, nor with the administrative delay in the processing of the appeal to the Court of Appeal. Mr. Sutherland-Williams points out that the date of arrest was dealt with in the affidavit of Mr. Cloke (which was sworn in support of the application for a restraint order) and that a copy of that affidavit was exhibited to Mr. Gee's statement. Further, as Mr. Sutherland-Williams says, by reference to the transcript of the hearing before Mr. Justice Hooper, the learned judge indicated at the outset that he had read the papers which had been submitted and these clearly included Mr. Gee's statement and exhibits.
46. Ideally, I think it would have been desirable for the date of arrest to have appeared in Mr. Gee's statement itself, rather than in an exhibit. However, the delays were there for all to see and, as the judge had read the papers, it must have been clear to him that the proceedings had been protracted. I do not consider, therefore, that there was any failure to disclose material facts in this respect.
47. I turn secondly to the point about non-provision of the notes of the hearing. Mr. Justice Hooper's order was served upon Mr. Singh's solicitors on 17 April 2003. By letter of 24 April 2003 the solicitors asked to be provided with a copy of the note of the ex parte hearing. It seems to me that, in accordance with the decision of Mr. Justice Lightman in the Interoute case (supra), such a note should have been provided. The practice as to this has been well-known for sometime and I can see no good reason why it should not apply to applications for IROs made without notice. However, on 30 April 2003 the Treasury Solicitor inquired as to the legal basis for the request that had been made. The reference to Mr. Justice Lightman's case was provided by letter of 8 May 2003. In a reply of 14 May, the Treasury Solicitor observed that freezing orders (such as were sought in the Interoute case) were not the same as IROs; it was said, however, that permission was being sought from Mr. Justice Hooper to release the note that had been made. The Treasury Solicitor did supply a copy of a note on the law which had been given to Mr. Justice Hooper on 16 April. It is clear, however, from Mr. Justice Lightman's case that he regarded the requirement to provide a note of the hearing to interested parties as being applicable to all applications without notice. On 16 May 2003, a copy of the note of the hearing was supplied. The covering letter indicated that permission had been received from the judge to disclose it.
48. Mr. Taylor submitted that the events which I have outlined suggested an unjustifiable course of prevarication on the part of the Treasury Solicitor in making a disclosure to which the solicitors were entitled.
49. I agree that disclosure of the note should have been made far more speedily. However, I consider that the correspondence demonstrates a genuine uncertainty on the part of the Treasury Solicitor as whether the note should be supplied as a matter of law or practice. Mr. Sutherland-Williams submits that it has not been common practice to disclose notes of such hearings held under earlier legislation of this type, However, many such applications today are dealt with by the judges of this Court on paper alone without a hearing. Therefore, the occasion for an oral hearing such as is required under the new procedure may have been rare. For the future, I can see no reason why the common practice in relation to without notice applications in the High Court should not be followed in cases of this type, unless the judge hearing the application expressly decides that, for good reason, a note should not be served on affected parties and provided that that decision is recorded on the face of the order, so that all affected parties may know that that decision also is susceptible to the customary permission to apply to vary or discharge the order. All that said, however, I do not see this matter as giving any reason for discharging Mr. Justice Hooper's order. The failure to disclose was, in the present context, founded upon misunderstanding and was relatively short lived. No application was made to vary or discharge the order once the note was provided. It was not argued that the note revealed that any relevant matter had been misstated by the judge.
50. Finally, I turn to the question of the failure to reveal the exchanges between Mr. Singh's solicitors and H.M Customs and Excise between 16 December 2003 and 5 March 2004 concerning the repayment of the £50,000 seized from Mr. Singh on arrest. The exchanges were of some importance, given the fact that the solicitors had been trying for some time, prior to the coming into force of the 2002 Act on 24 February 2003, to secure the release of the funds which ought to have followed promptly upon the quashing of the confiscation order on 16 December 2002 and the discharge of the restraint order on 16 January 2003. I have no doubt that a judge hearing the application for the IRO would have wanted to be informed of the delays in acceding to the solicitors' requests and the reasons for those delays. This is particularly so as a suspicion might arise that the money was being withheld pending the coming into force of the new Act. Of course, the relevant exchanges were between the solicitors and H.M Customs and Excise. The Assets Recovery Agency was not involved and was ignorant of what had transpired in the period since the decision of the Court of Appeal.
51. In my view, this failure to disclose the recent history to Mr. Justice Hooper was material in the relevant sense, although no blame for it attaches in any way to the Agency or to its solicitors or Counsel. The question arises whether it affords grounds upon which the Court should now discharge the IRO. In my view, it does not. I consider that this situation is one to which the remarks of Slade LJ in the Brink's Mat case (supra) at page 1359 A-E are particularly applicable. The non-disclosure was attributable to an innocent lack of knowledge on the part of the Director and her advisors. A discharge of the order on these grounds would not serve the justice of the case, where apart from this feature there are no merits at all either in substance or on the balance of convenience for doing so.
52. My decision is not to be taken as in any way discounting the duties of disclosure incumbent on all applicants who come to court to make application without notice to the persons likely to be affected by the order sought. The duty applies equally to applicants who discharge public functions as they do to private litigants but, for the reasons given, I do not consider that this matter calls for the discharge of the Order made in this case. No doubt, again for the future, the Agency will be anxious to ensure that the full background circumstances of any case are fully explained to it by any referring authority prior to the making of an application to the Court so that all necessary disclosures can be made.
53. I would add that I suggested to Mr. Taylor that it might be appropriate to adjourn this application to enable an explanation to be sought from H.M Customs and Excise of the reasons for the delays that had occurred and as to whether the operative date of the new legislative scheme had had any part in the decision making process. That suggestion was declined and I decided, therefore, that, in the absence of any evidence of anything other than administrative delay in the period up to 4 March 2003, there was no need to take the matter further.
54. For these reasons, Mr. Singh's application is dismissed.