QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
MR JUSTICE FOSKETT
on the applications of
(1) SANJAY PANESAR
(2) ALEXANDER WINDSOR
(3) AVTAR HARE
(4) KULWANT HARE
(5) LOREDAN ILLIES
(1) SARBJIT SINGH GILL
(2) SURAJ PRAKASH SINGH BRAR
(3) BARRY DAVID CHAMBERS
(4) MICHAEL DAVID WELHAM
(5) AMARDEEP MARWAHA
(1) BRIJESH PATEL
(2) GARETH TURNER
|THE CENTRAL CRIMINAL COURT
| THE COMMISSIONER FOR HER MAJESTY'S REVENUE AND CUSTOMS
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Official Shorthand Writers to the Court)
Jamas Hodivala (instructed by Blackford LLP) for the Claimants (Gill to Marwaha)
Andrew Bird (instructed by Solicitor's Office, HM Revenue & Customs) for the Interested Party
James Hodivala (instructed by Bivonas LLP) for the Claimants (Patel and Turner)
The Defendant did not appear and was not represented
Hearing date: 24 June 2014
Crown Copyright ©
Foskett J (with whom Lord Thomas of Cwmgiedd, CJ joins in this judgment):
How the issue comes before the court
"HMRC accepts that all original material seized should be returned to the respective Claimants. However, HMRC invites the Court to suspend the operation of that obligation pending the outcome of an application under section 59 of the 2001 Act. The Claimants contend that section 59 has no application to the present circumstances and no suspension of the obligation to return is justified. HMRC also invites the Court, in the exercise of its discretion, to permit HMRC to take copies of, and generally make use of such copies, both to support any section 59 application and in furtherance of the (continuing) criminal investigation. The Court, therefore, heard argument in respect of the Crown Court's jurisdiction under section 59 and in relation to the appropriate form of discretionary relief in these claims."
"There has been significant delay ... in terms of [this application] being listed and dealt with timeously. This has been the result of a difficulty in identifying a judge [who is] suitable and willing to take this case and the general pressure of work at the Central Criminal Court. I am afraid that the unfamiliarity of the listing office with an application of this nature has also played its part. Despite my making every effort to try to improve matters in terms of being able to provide a suitable slot, I feel that I should record that whilst dealing with this matter I have had to deal with a number of other cases including a breach of a suspended sentence order, sentencing in a diminished responsibility manslaughter and trying an historic rape allegation. I have also had to comply with a commitment with the Judicial College. I am only able to deal with this case at all today because the rape [case] to which I have referred is only [to be heard] for three days this week for medical reasons. I mention all of this because even at this stage the parties are facing significant inconvenience as a result of the pressure of work which I face, which I regret …."
The relevant statutory provisions
"(1) This section applies where anything has been seized in exercise, or purported exercise, of a relevant power of seizure.
(2) Any person with a relevant interest in the seized property may apply to the appropriate judicial authority, on one or more of the grounds mentioned in subsection (3), for the return of the whole or a part of the seized property.
(3) Those grounds are—
(a) that there was no power to make the seizure;
(b) that the seized property is or contains an item subject to legal privilege that is not comprised in property falling within section 54(2);
(c) that the seized property is or contains any excluded material or special procedure material which—
(i) has been seized under a power to which section 55 applies;
(ii) is not comprised in property falling within section 55(2) or (3); and
(iii) is not property the retention of which is authorised by section 56;
(d) that the seized property is or contains something seized under section 50 or 51 which does not fall within section 53(3);
and subsections (5) and (6) of section 55 shall apply for the purposes of paragraph (c) as they apply for the purposes of that section.
(4) Subject to subsection (6), the appropriate judicial authority, on an application under subsection (2), shall—
(a) if satisfied as to any of the matters mentioned in subsection (3), order the return of so much of the seized property as is property in relation to which the authority is so satisfied; and
(b) to the extent that that authority is not so satisfied, dismiss the application.
(5) The appropriate judicial authority—
(a) on an application under subsection (2),
(b) on an application made by the person for the time being having possession of anything in consequence of its seizure under a relevant power of seizure, or
(c) on an application made—
(i) by a person with a relevant interest in anything seized under section 50 or 51, and
(ii) on the grounds that the requirements of section 53(2) have not been or are not being complied with,
may give such directions as the authority thinks fit as to the examination, retention, separation or return of the whole or any part of the seized property.
(6) On any application under this section, the appropriate judicial authority may authorise the retention of any property which—
(a) has been seized in exercise, or purported exercise, of a relevant power of seizure, and
(b) would otherwise fall to be returned,
if that authority is satisfied that the retention of the property is justified on grounds falling within subsection (7).
(7) Those grounds are that (if the property were returned) it would immediately become appropriate—
(a) to issue, on the application of the person who is in possession of the property at the time of the application under this section, a warrant in pursuance of which, or of the exercise of which, it would be lawful to seize the property; or
(b) to make an order under—
(i) paragraph 4 of Schedule 1 to the 1984 Act,
(ii) paragraph 4 of Schedule 1 to the Police and Criminal Evidence (Northern Ireland) Order 1989 (S.I. 1989 1341 (N.I. 12)),
(iii) section 20BA of the Taxes Management Act 1970 (c. 9), or
(iv) paragraph 5 of Schedule 5 to the Terrorism Act 2000 (c. 11),
under which the property would fall to be delivered up or produced to the person mentioned in paragraph (a).
(8) Where any property which has been seized in exercise, or purported exercise, of a relevant power of seizure has parts ("part A" and "part B") comprised in it such that—
(a) it would be inappropriate, if the property were returned, to take any action such as is mentioned in subsection (7) in relation to part A,
(b) it would (or would but for the facts mentioned in paragraph (a)) be appropriate, if the property were returned, to take such action in relation to part B, and
(c) in all the circumstances, it is not reasonably practicable to separate part A from part B without prejudicing the use of part B for purposes for which it is lawful to use property seized under the power in question,
the facts mentioned in paragraph (a) shall not be taken into account by the appropriate judicial authority in deciding whether the retention of the property is justified on grounds falling within subsection (7).
(9) If a person fails to comply with any order or direction made or given by a judge of the Crown Court in exercise of any jurisdiction under this section—
(a) the authority may deal with him as if he had committed a contempt of the Crown Court; and
(b) any enactment relating to contempt of the Crown Court shall have effect in relation to the failure as if it were such a contempt.
(10) The relevant powers of seizure for the purposes of this section are—
(a) the powers of seizure conferred by sections 50 and 51;
(b) each of the powers of seizure specified in Parts 1 and 2 of Schedule 1; and
(c) any power of seizure (not falling within paragraph (a) or (b)) conferred on a constable by or under any enactment, including an enactment passed after this Act.
(11) References in this section to a person with a relevant interest in seized property are references to—
(a) the person from whom it was seized;
(b) any person with an interest in the property; or
(c) any person, not falling within paragraph (a) or (b), who had custody or control of the property immediately before the seizure.
(12) For the purposes of subsection (11)(b), the persons who have an interest in seized property shall, in the case of property which is or contains an item subject to legal privilege, be taken to include the person in whose favour that privilege is conferred."
"(1) Subject to subsection (3)—
(a) in this Part, "seize" includes "take a copy of", and cognate expressions shall be construed accordingly;
(b) this Part shall apply as if any copy taken under any power to which any provision of this Part applies were the original of that of which it is a copy; and
(c) for the purposes of this Part, except sections 50 and 51, the powers mentioned in subsection (2) (which are powers to obtain hard copies etc. of information which is stored in electronic form) shall be treated as powers of seizure, and references to seizure and to seized property shall be construed accordingly …."
The legislative history of section 59 and the arguments advanced
The Explanatory Note
"Section 59: Application to appropriate judicial authority
176. This gives anyone with a relevant interest in the seized property the right to apply to the appropriate judicial authority (as defined in section 64) for its return. It is hoped this will provide a quick and easy mechanism for challenging both the use of the new powers and, in certain circumstances, the exercise of existing powers. Subsection (3) sets out the grounds on which an application for the return of the property can be made. On such an application the Court can order the return of material or, amongst other things, order that it be examined, for example, by an independent third party. Subsections (5)(b), (6) and (7) enable the police or other body in possession of the property to make an application to keep any material which they would otherwise be obliged to return if it would immediately become appropriate to issue a warrant enabling them to seize that material or to demand its production in the circumstances set out in subsection (7)(b). This means, for example, that the police will not have to return material which might be of value to them and then have to immediately obtain a warrant to seize it back. Subsection (8) means that the Court can also authorise the retention of not just what the police or others could seize under a warrant but also any material which is inextricably linked to it."
The decision in R (El Kurd) v Winchester Crown Court and SOCA
"The new sections do two separate things. First they deal with the problem identified by Bramley. They give the police and other law enforcement agencies, powers to remove material from premises so that they can examine it elsewhere, where it is not possible to examine it properly on the premises, due to constraints of time or technology. Second, they recognise the fact that with the advent of modern technology and the expansion in the use of computers, it is often important for investigators to be able to seize and forensically examine an entire disk or hard drive, in order to determine when individual documents have been created, amended and/or deleted. This inevitably means retaining all the material on the hard drive, including possibly legally privileged material. The new sections give the police and others the power to retain this inextricably linked material. The sections also provide for a number of safeguards to prevent abuse and to allow for a mechanism whereby an application can be made to a Judge for the return of material seized. In certain circumstances there will be an obligation on the police and others to secure the material in question pending the determination of such an application." (Our emphasis.)
"In my view this makes it plain that the relevant provisions of Section 59 are not confined to property seized in the exercise or purported exercise of the powers conferred by Sections 50 or 51. It also in my view supports the proposition that the discretionary power to order retention of property seized in purported exercise of a relevant power extends to property which has been unlawfully seized. Such property is property which the police would otherwise be obliged to return and as made clear by paragraph 176 the purpose of the new discretionary power to order retention conferred by Section 59(6) is in an appropriate case to avoid the police having to return property which it is not otherwise entitled to retain if it would upon return be entitled to seize it pursuant to a fresh warrant." (Our emphasis.)
i) El Kurd was, of course, a case in which the application under section 59(5)(b) for authority for the retention of property seized under the defective warrant was made by the party that obtained (wrongfully) the warrant, namely, SOCA. It is one of the cases where the point raised in the present case could have been raised, but was not.
ii) In R (Rawlinson & Hunter) v Central Criminal Court and SFO  1 WLR 1634 the Divisional Court (Sir John Thomas P and Silber J) decided that, on the grounds of the serious non-disclosure, it should quash the search warrants that had been granted on the application of the SFO. The court was invited to conclude that if other material then available had been provided to the judge who granted the warrants, then the warrants would have been granted and, accordingly, the Divisional Court should not set them aside. For the reasons given in paragraphs 175-178 the court rejected that argument, but concluded its observations as follows at paragraph 179:"That is however not to say that the public interest should not be protected. As the court observed in R (Cook) v SOCA  1 WLR 144 at paragraph 16, there is the public interest to consider criminal justice. That public interest can be protected. If the SFO considers that the documents should not be returned, it can utilise the statutory procedure available under s.59 of the Criminal Justice and Police Act 2001 which we consider at paragraphs 276 and following."No point was taken in argument that the use of section 59 was not the obviously correct procedure by any of the experienced and distinguished advocates appearing.
iii) In R (Van der Pijl) v Kingston Crown Court  1 WLR 2706, the Metropolitan Police Service ('MPS') applied to the Crown Court pursuant to section 9(1) and Schedule 1 of PACE for, and obtained, authorisation for a search warrant which was then executed. The MPS then sought orders under section 59(6) of the CJPA to permit its retention of material seized purportedly pursuant to the search warrant. Both the warrant and the orders were challenged in this court (Sir John Thomas P, as he then was, and Wilkie J). The search warrant was held not to comply with section 15 of PACE because the names of the suspects were omitted. It was, accordingly, quashed. Since the orders under section 59(6) had been obtained on the basis that there was a valid search warrant in existence, they too fell to be quashed: see paragraphs 67 and 68. The question arose of what should happen as a result of the warrant and the orders being quashed. Wilkie J (with whom Sir John Thomas P agreed) dealt with the position in the following paragraphs:"85. The claimants seek an order that the MPS return the material and any copies which have been taken of such material which is in their possession to the claimants on the basis that there is no lawful authority for its continued retention.86. In my judgment, on the face of it, that must be the appropriate order. However, as Mr Lewis QC has pointed out it is open to the MPS to make an application under s.59(5) in respect of material which is in their possession which has been seized in purported exercise of a relevant power of seizure, which includes seizure pursuant to Schedule 1 of the 1984 Act. In my judgment the property which was seized, under the, now known to be, unlawful search warrant, would, even in the light of its being quashed by this court, have been seized in purported exercise of the Schedule 1 power. In those circumstances, it would be open to the MPS to make an application to the Crown Court, pursuant to s.59(5), for an order under s.59(6) for retention of the property, which would otherwise fall to be returned, on the basis that s.59(7) applies namely: that if the property were returned it would immediately become appropriate to issue an application for a warrant in pursuance of which it would be lawful to seize the property.87. This might be on the basis that the defect with the search warrant, which has resulted in my conclusion that it must be quashed, was one which could have been remedied by the insertion into the warrant of the identity of "the suspects" in the five categories of property where, in the warrant granted, they were unidentified.88. In my judgment, it would not be just to quash the orders on terms which would preclude the ability of the MPS to make an application to the Crown Court pursuant to section 59, if so advised and provided they did so with due expedition. Therefore, I would make an order, ancillary to quashing the orders [made under section 59(6)], that the MPS be ordered to return all property and any copies which have been taken of such material, currently in its possession, seized, pursuant to the warrant … and/or retained pursuant to the orders … within 14 days of the making of the order unless, in the meantime, the MPS has made an application to the Crown Court at Kingston pursuant to s.59(5) for the retention of the material pursuant to s.59(6) on the grounds that the conditions in s.59(7) are satisfied."Mr Alun Jones QC, for the Claimant, did not challenge the approach taken by Mr James Lewis QC for the MPS or submit that an order in the terms set out in paragraph 88 of Wilkie J's judgment should not be made.
The argument advanced on behalf of the Claimants
i) Since a search warrant represents a serious invasion of the liberty of the subject and that fundamental rights cannot be overridden by general or ambiguous words, the drafting of section 59 is insufficiently precise to give rise to the jurisdiction for which HMRC contends.
ii) The absence of the expression "purported exercise of a relevant power of seizure" from section 59(5)(b) demonstrates Parliament's intention that if the "relevant power of seizure" has been quashed, then the material has not been seized pursuant to that power with the result that no application may be made to retain the unlawfully seized material pursuant to that provision.
There is, it may be thought, a tension between those two propositions because if the second proposition is correct, the first does not truly arise.
Our consideration of the Claimants' arguments
"It is right to point out that different language is used in Section 59(5)(b) and Section 59(6)(a) in relation to the power under which the property sought to be retained was seized. The former refers to an application made by the person for the time being having possession of anything in consequence of its seizure under a relevant power of seizure. The latter enables the appropriate judicial authority to authorise the retention of any property which has been seized in exercise, or purported exercise of a relevant power of seizure. Notwithstanding that difference of language, it seems to me that the former should be construed as including an application made by the person for the time being having possession of anything in consequence of its seizure under the purported exercise of a relevant power of seizure. That construction is in my view necessary to make sense of the power conferred by Section 59(6), and follows from the fact that one of the circumstances in which the latter power is exercisable is where (i) an application has been made under Section 59(5)(b) (which is "an application under this section") and (ii) property has been seized in purported exercise (as distinct from actual exercise) of a relevant power of seizure." (Emphasis as in original.)