England and Wales High Court (Administrative Court) Decisions

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

		Royal Courts of Justice Strand London WC2A 2LL
		27 July 2010

1. LORD JUSTICE LEVESON: On 16th April 2010, in the Crown Court at Manchester, on the application of the Serious Organised Crime Agency ("SOCA"), based upon an underlying allegation of money laundering, His Honour Judge Henshall issued three warrants in relation to the claimant's home, his business premises and a third property owned by him but said to be uninhabitable due to building works. He also made a restraint order. The warrants were executed on 21st April and property was seized.
2. By this application for judicial review the claimant seeks a declaration that the decision to issue the warrants was unlawful and that their execution was unlawful. A mandatory order is sought for the return of all orders made and also a further order that no use be made of any knowledge gained as a result of the unlawful search and seizure. Although listed for the grant of interim relief and permission it was common ground that the interim order will be determinative. We grant permission and, with the consent of the parties, treat the hearing as the final determination. Aggravated damages are also sought on the basis "as a result of the knowing and wilful retention of material admittedly unlawfully seized". This last relief sought underlines an important part of the history which we must recount.
3. Before the issue of the warrant draft detailed grounds were sent to SOCA on 5 July. On the following day SOCA conceded that the warrants did not comply with section 15(6)(a)(iii) of the Police and Criminal Evidence Act 1984 ("PACE") as amended, on the grounds that they did not give sufficient indication of the nature of the investigation in respect of which the warrants were issued. As a result, it was conceded that the warrants were unlawful. SOCA also conceded that they would be prepared to make arrangements for the return of the material seized and suggested that there was no point in issuing proceedings for judicial review.
4. The caveat expressed in this letter was "in relation to the relatively small quantity of relevant material" in respect of which SOCA sought an irrevocable consent to its retention until the completion of the investigation or criminal proceedings, whichever was the latter, observing that if consent was not forthcoming steps would be taken to ensure that the material was obtained or retained by lawful means. By e-mail the following day the solicitors for the claimant insisted that all the property was delivered forthwith and that any attendance at their offices could solely be for that purpose, such that the execution of any other purpose would be regarded as a trespass. In that way the solicitors sought to avoid what occurred in a case of which they were aware, namely, Cook v SOCA, [2010] EWHC 2119 (Admin), which this court has also decided. The letter goes on:

"Further, it follows that as a direct consequence of the unlawful seizure that other considerations must apply. We list the same below:

(1) We require an undertaking that no use shall be made of any knowledge gained from any of the unlawfully seized material.

(2) We require a list of all personnel who have had dealings with the property to provide and comply with such an undertaking.

(3) We require a list of all personnel who have received any information from the unlawfully seized material to also provide and comply with such undertakings (to include legal advisers).

(4) We require an undertaking that no copies have been made of any of the unlawfully seized materials, and if such copies have been made we require an opportunity to witness the destruction of such copies, and a certificate that no further copies have been kept.

(5) It follows that entry to the three premises was unlawful, and in the case of April House our client was subject to witnessing for a brief period the continuation of his unlawful search by 18 officers some of whom were armed. We understand that these premises were damaged in the process. We maintain that these actions sound in damages at each of the three properties…[sums for settlement were identified without prejudice]"

5. On the same day SOCA replied:

"As you require return of all items we shall do so. However, we put you on notice that:

(1) We shall provide all the material to your firm. In our opinion, for reasons of clarity for your and our future purposes, this will be sorted into two parts: the material which is returned and not to be re-sought; the material to be re-sought. This does not involve copying or re-assessment: rather 'sorting' in accordance with the view previously taken as to relevance (the material uplifted having already been considered);

(2) The return of material is pending an application, currently being prepared under s345 POCA 2002 (Production Order) for you to produce the material considered to be relevant to the ongoing investigation;

(3) This application will be on notice.

(4) We specifically draw your attention to s343(2)(b) POCA which makes it an offence for a person to falsify, destroy, conceal or otherwise dispose of material relevant to the legislation.

We should emphasise and make it clear that as we regard some of the documents to be returned to you to be material, any disposal of such relevant material, by you to your client or to any other person, would amount to an offence contrary to s342.

In the light of the further action SOCA is now taking, we consider it unnecessary and unduly onerous to provide the undertakings you seek."

6. By return the solicitors challenged SOCA in relation to the failure to deal with the undertaking sought or the list of personnel who had had dealings with the property or received any information from the unlawfully seized material, including legal advisers. They made it clear that they do not own the material seized and that their offices were being offered only as what they describe as "a handing over post". On 8 July SOCA replied:

"Before any arrangement for return is fixed, please confirm what it is you propose to happen upon our attendance, namely:

— whether it is proposed that your client will be there;

— is it proposed that he will take possession of the material, which is a possibility when you refer to your offices as a 'handing over post' and delivery post.

We have already put you on notice of our intention to make an application for a production order for the relevant material under s345 POCA. In light of this we seek your urgent undertaking by return of fax that your client will not be present upon any attendance to return the material; that you take possession of it on behalf of your client; and further that you acknowledge that s342 POCA applies to you once you are in possession of the material."

The letter goes on to deal with the application and also the further application (inter parties) in relation to the discharge or variance of the restraint order due to be listed on Friday, 16 July.

7. The response on the following day was to dispatch a claim for judicial review which was issued in Manchester on that day. It does not simply proceed on the premise of the admitted unlawful seizure but seeks to extend the ambit of this review on the wider basis and does so as a matter of extreme urgency. The reason for the urgency is that SOCA has issued an inter partes application for a production order which is now due to be heard in the Crown Court on 4 August, it not being possible to hear it earlier on 16 July when the parties were due to appear in relation to the restraint order because of the unavailability of counsel for the claimant. The claimant wishes to have the property returned immediately. Having failed to have the production order determined on 16 July, SOCA wish to ensure that the property is preserved pending the inter partes application on 4 August.
8. For my part, on the urgent basis on which this application is pursued, I would not be prepared to condescend to an analysis of irrelevant issues. Once SOCA conceded that the warrants did not comply with the law, for whatever reason, the other issues raised in connection with the material placed the judge are moot. Whether they become relevant to other proceedings or in relation to any criminal prosecution is another matter. Further, I deprecate the failure to refocus the proceedings in the light of the correspondence, the result being that the detailed grounds for judicial review do not address what was known to be in issue when they were in fact issued. I am not suggesting that everything needed to be reworked. I am saying that the court should not be troubled in cases of urgency with an analysis of issues which are no longer central to the issues between the parties. To be fair to Mr Rupert Bowers, who appears for the claimant, he prepared a subsequent note in response to the second defendant's acknowledgement of service which deals with the issues which are now to be determined.
9. For my part, I have no doubt that the claimant is unconditionally entitled to the return of what was seized as a result of the issue and execution of the warrant which it is conceded was unlawful. That said, I repeat what I said in the preceding case of Cook v SOCA, to the effect that criminal litigation is not a game. Although the police, or in this case SOCA, cannot escape the consequences of the illegality of the warrant, there is no reason why they should be placed in a worse position than if the warrant had never been sought or, conversely, why those the subject of a warrant, even if unlawful, should be in a better position to protect themselves from prosecution for unlawful conduct. In that case SOCA could not enforce the voluntary production of these papers.
10. In this case a production order if granted would have that precise effect. Furthermore, being an allegation of money laundering, SOCA correctly identified that section 342(2)(b) of the Proceeds of Crime Act 2002, to which reference was made in correspondence, creates the offence, inter alia, to conceal, destroy or dispose of material relevant to a money laundering investigation where it is known or suspected that such an investigation is being conducted. Nobody, that is to say the claimant or his solicitors, can have any doubt that a money laundering investigation is under way. Equally, it is beyond argument, bearing in mind the correspondence, that there are said to be some documents relevant to that investigation presently with SOCA but due to the returned. If, as I would find, the documents must be returned, they must be returned to a person who will have to acknowledge receipt of them. Whoever does so should be in no doubt of their status, which should be made clear on any receipt, and should equally understand the gravity of disposing of the material by giving it to someone else if it later fails to be produced in answer to a production order.
11. In answer to the claim, Mr Talbot on behalf of SOCA points to section 37 of the Supreme Court 1981 which deals with the powers of the High Court with respect to injunctions. He identifies that it is open to the Crown Court to grant an injunction in all cases in which it appears to the court to be just and convenient to do so, and he particularly focuses on the provision that "any such order may be made either unconditionally or on such terms and conditions as the court thinks just." He argues that it is appropriate to put the parties back into the position which they were in before the execution of the search warrant, when they submit that the claimant was unaware that these documents were about to be sought and therefore did not need to take steps to destroy or otherwise dispose of them.
12. In my judgment, the exercise of the discretion of the court to impose terms and conditions is an exercise of discretion which must be exercised judicially. There is no basis, save for that which the criminal law already provides, for limiting or in any way casting a condition upon the return of these documents. The claimant should have no doubt, and indeed anybody who signs for the documents should have no doubt, of their significance. Whether or not they have been copied their importance has been asserted in witness statements in this action and repeated in this judgment. The consequence of disposing or otherwise destroying these documents is evident for all to see. The fact that documents have not been disclosed would not be irrelevant to any criminal prosecution if the document showed that the allegation of money laundering is without foundation. It is inconceivable that anyone would want to prevent the authorities from examining them and reaching that conclusion. The only basis upon which it would obviously be sensible to prevent such an examination is if they are in some way incriminating. Thus, if not produced I can readily visualise an argument that one, if not the only appropriate inference, is adverse to those who have disposed of them or destroyed them.
13. In addition to the return of the documents the claimant seeks destruction of all the copies and an order that no derivative use be made of any knowledge gained as a result of the unlawful search and seizure, together with the details of those who have seen them. As I explained in Cook v SOCA, in relation to copies of the documents no authority has been cited for the proposition sought. I have no doubt that section 78 of PACE amply controls the use to which any copies of documents could be put, bearing in mind that the deployment of unlawfully obtained evidence is not necessarily and inevitably prohibited irrespective of the circumstances (see Sang [1980] AC 402) and the many cases that developed the exclusionary principles which follow both from that decision and section 78.
14. I similarly repeat the observation which I made in Cook in relation to the derivative use of knowledge or the provision of lists of those who may or might have seen the documents. In my judgment, it is simply unnecessary to encourage satellite litigation, either in a civil or criminal context, as to the origin of lawfully obtained evidence.
15. In the circumstances I am prepared to grant the relief sought and to order these documents to be returned in circumstances of formality so that there is absolutely no doubt as to who is receiving the documents and who is taking responsibility for them, bearing in mind the forthcoming application to be determined on 4th August. In the light of the circumstances, this is not a casefor aggravated damages.
16. MR JUSTICE OUSELEY: I agree. I repeat what I added in the case of Cook. The position is that documents have been unlawfully obtained and withheld. The claimant, on the face of it, is entitled to their return but not to the other remedies in relation to copies or information. SOCA has an understandable concern that, alerted now to the significance of the documents, the claimant will seek their concealment or destruction, and regards the preservation of the documents as providing a better evidential basis for a criminal prosecution than what the drawing of an adverse inference from their destruction could provide.
17. However, the means whereby SOCA seek to be in no worse position than that in which they would have been had the warrant been lawful is not acceptable as an exercise of this court's power. In reality, SOCA seeks a restriction on the order for the return of the documents which deprives the claimant of access to them other than under the control of the police. Although it was suggested that the documents be retained by the claimant's solicitors under orders of the court, the claimant would have no readier access to them than he would have done had the same access restrictions and conditions applied to the retention of those documents at the police station. In effect, the only remedy for the unlawful retention of the documents would have been the ability of the claimant to have restricted access to them.
18. I agree with my Lord that that is not an adequate remedy for the unlawful possession of the documents. It is for SOCA to find a proper basis upon which it can invoke the assistance of the court in preserving by order documents before a warrant has been obtained or a production order made in cases where there is a perceived or evident risk of destruction. That is quite a large step for a civil court to be taking in the light of the various statutory powers which exist for the preservation of documents and other items. It would be a large step too far for section 37(2) of the Supreme Court Act to be invoked to enable the unlawfully retained documents to be retained on a basis of supervised access. For those reasons I agree that the order should be as proposed by my Lord.