High Court of Ireland Decisions

Murphy v. GM PB PC Ltd. [1999] IEHC 5 (4th June, 1999)

BETWEEN

This is an application for an Interlocutory Order pursuant to section 3(1) of the Proceeds of Crime Act, 1996 prohibiting the Respondents from disposing or otherwise dealing with a sum of [sterling]300,000 partly made up of sterling and partly of Irish pounds. The said monies are the subject matter of an order made under section 2 of the Act made on the 28th day of July 1997 by Smyth J. and an Order of the same date under section 7 of the Act appointing Mr. Galvin Receiver over the said monies. Notwithstanding the fact that the Proceeds of Crime Act had been constitutionally challenged in the case of Gilligan v. The Criminal Assets Bureau and Others [1998] 3. I.R. 185, leave was granted by Order of the Supreme Court to argue constitutional issues in the present application. The hearing lasted a total of 28 days and a large number of issues, both constitutional and non-constitutional, were argued. There is an ancillary application before the Court for the appointment of Mr.Galvin as Receiver over the said monies, in the event of the Order sought by the Applicants being granted. It is proposed in this Judgment as far as practicable to separate the constitutional from the non-constitutional arguments in the case. The First Named Respondent did not appear in the proceedings and the Fourth Named Respondent, while represented, did not contest the case and confined himself to making somesubmissions. He was prepared to abide by the decision of the Court. The Second and Third Named Respondents were represented by the same set of Counsel and, save where otherwise appears, the references to submissions by the Respondents refer to submissions made on behalf of the Second and Third Named Respondents.

PLEADING POINTS

1. The Respondents contend that the Plenary Summons is defective since it contains no claim for substantive relief under Section 4 of the Proceeds of Crime Act and seeks merely interlocutory relief under Section 3. Accordingly, they argue the proceedings should be dismissed.

2. Order 4, Rule 1, of the Rules of the Superior Courts provides, inter alia, that:-

"The Indorsement of claim on a Plenary summons ... shall be an indorsement of the relief claimed and the grounds thereof expressed in general terms ..."

3. Order 11, Rule 1 (g) provides that:-

"Service out of the jurisdiction of an originating summons or notice of an originating summons may be allowed by the Court whenever any injunction is sought as to anything to be done within the jurisdiction ... whether damages are or are not also sought in respect of thereof"

In the case of Caudron and Others -v- Air Zaire [1985] I.R. 716, the Supreme Court held that, in order to come within Order 11, Rule 1 (g), the injunction sought in the action had to be part of the substantive relief to which the Plaintiffs' cause of action entitled them, and had to be properly and necessarily sought in the Indorsement of Claim contained in the originating Summons. In that case, the relief sought by the Plaintiffs was an interlocutory injunction pending the determination of the action, and not as part of the substantive relief. The Plaintiffs did not have a subsisting cause of action within the jurisdiction and the interlocutory injunction was set aside. Reliance was placed on the following passages in thejudgment of Finlay C.J. at page 721:-

"Consideration of the forms contained in Appendix B, Part II would indicate that whilst, of course, under the terms of the rule they are not exclusive, they universally bear a single characteristic which in my view is that they are the ultimate relief being sought by the plaintiff in the action commenced by his originating summons. There are, of course, many forms of relief which may be sought and obtained from the court between the issue and service of an originating summons and the final determination of the claim endorsed on it. Such can be an order for discovery of documents, an order for the delivery and answering of interrogatories, and orders by way of injunction the overall intention of which on an interlocutory basis is to maintain the status quo so as to permit the just realisation of the Plaintiff's claim in the event of his being successful. Such relief can and, in my view, should be obtained either on an interim basis ex parte or on an interlocutory basis by notice of motion served after the issue of the originating summons or in the matter of an intended action. They are not, however, the relief being sought in the action and are not, in my view, on the true interpretation of the Rules, matters which should be claimed by way of endorsement on the summons itself".

4. Later on in the same judgment Finlay C.J. stated:-

"As I have already indicated the injunction must be sought in something and, in my view, under the rule in Ireland the injunction must be properly and necessarily sought in the endorsement of claim contained in the originating summons which is what the plaintiffs claim in the action."

5. The Applicant, however, contends that what he is seeking is a statutory relief, analogous to an injunction under Section 27 of the Local Government (Planning and Development) Act, 1976 as substituted by section 19(4)(g) of the Local Government (Planning and Development) Act, 1992. This distinguishes it from the kind of injunction in theCaudron case. Moreover, the reason that an injunction was refused in the Caudron case was because it failed the test that "an injunction must be sought in something", and in that case there was no valid cause of action in the State. The position in the instant case is different. Furthermore they argue, insofar as the judgment in the Caudron case is reinforced by the reasoning in Siskina (Cargo Owners) -v-Distos S.A. [1979] A.C. 210, that decision was explained subsequently in the House of Lords in the case of Channel Tunnel Group Limited -v- Balfore Beatty Construction Limited [1993] 1 All E.R. 664 at 686:

"... the doctrine of The Siskina, put at its highest, is that the right to an interlocutory injunction cannot exist in isolation, but is always incidental to and dependent on the enforcement of a substantive right, which usually although not invariably takes the shape of a cause of action".

Section 3 of the Proceeds of Crime Act, 1996 provides for interlocutory relief as opposed to final relief as is clear from the definition in Section 1(1) of the Act which provides that an "interlocutory order" means an Order under Section 3. An Order under Section 27 of the Planning Acts, on the other hand, is substantive and final relief, and therefore not comparable to an interlocutory order under Section 3 of the Proceeds of Crime Act. While there are very significant differences between the type of injunction contemplated in the Proceeds of Crime Act and that sought in the Caudron case, the pleading point is still a valid one. The substantive relief sought, that is, relief under Section 4 of the Act, should have been claimed in the Indorsement of Claim.

6. The Applicants, however, maintain that the Respondents should have applied by way of Notice of Motion to have this claim struck out or to set aside the Plenary Summons for irregularity. Under Order 124, Rule 3, any claim to set aside proceedings for irregularity must be brought by way of Notice of Motion. The Applicants point out that although many Motions were brought seeking different types of relief, no such application was brought and that in the circumstances the application to have the proceedings struck out should fail. I agree with the Applicants on this point. The defect in the pleading was of a technical nature and could not conceivably have worked to the prejudice of the Respondents. In my view, it would be quite unfair to allow the Respondents avail of the defect in pleading at this stage.

7. The Applicants further submit that if an amendment is necessary, the Court should grant it. The Respondents contend, however, that an application to amend the Statement of Claim should be refused in view of the nature of these proceedings, and cite the case ofSavvinos [1996] 85 A. Crim. R. 343. That case concerned the Australian crimes (confiscation of profits) Act, 1986 (Vic). That Act made provisions for a forfeiture order, and provided that an application for such an order had to be made within a specified time. Leave to appeal outside that time could be granted, inter alia, where " it is otherwise in the interests of justice to do so". In the Savvinos case it was successfully argued that the provisions of the act were penal in nature and ought to be construed strictly; that the framework of the Act was designed to impose a strict time limit on the making of an application by the D.P.P. for an Order which would materially affect the interests of the person against whom it was sought, and that leave to bring the application out of time was not to be lightly granted, but only on proof by the Director of Public Prosecutions of circumstances entitling him to the grant of such leave. The following passage is at pp.347/348 of the Report:-

"It is our view that a court exercising its discretion under s. 5(2A) is not to regard itself as being at large in extending the time for the making of the application simply because it thinks that no prejudice has been occasioned to the Respondent by the making of the late application. In our view, the discretion is not available to be exercised in the circumstances which were exposed in this case, where the Director was effectively asking for an indulgence by the Court to relieve him of his own simple mistake caused by error on his part and in no way attributable to conduct on the part of the respondent to the proposed application".

8. In that case the Court decided how it would use its discretion in relation to a particular provision of a penal statute. It provides little assistance in determining whether an amendment to the Plenary Summons should be granted in the instant case. I cannot see how any unfairness could be occasioned by making the amendments sought. In my opinion, having regard to the purely technical nature of the defect in the pleadings, the lack of prejudice to the Respondents, the hybrid nature of an Order under Section 3 of the Proceeds of Crime Act, and the absence of procedural rules, it would be quite unfair not to allow the required amendments.

THE SERVICE POINT

9. Order 11, Rule 8, of the Superior Court Rules provides that "[w]here the Defendant is not, or is not known or believed to be, a citizen of Ireland, notice of the summons, and not the summons itself, shall be served upon him". In this particular case the service on the Third Named Defendant on the Isle of Man was not in compliance with the Rules in that the Plenary Summons was issued instead of Notice of the Summons. In the case of O'Connor -v- Commercial General and Marine Limited and Others [1996] 1 I.R. 68 Morris J. stated at page 72:

"The requirement for the service of notice of the proceedings, rather than the Summons itself, to be given to a non-national in another country was put by Lord Westbury in Cookney -v- Anderson (1863) 1 De. G.J.& S. 365 as follows:

"The right of administering justice is the attribute of sovereignty and all persons within the dominions of a sovereign are within his allegiance and under his protection. If, therefore, one sovereign causes process to be served in the territory of another, and summons a foreign subject to his court of justice, it is in fact an invasion of sovereignty, and would be unjustifiable, unless done with consent; which is assumed to be the fact, if it be done in a case where a foreign judgment would, by international law be accepted as binding".

10. The summons was set aside.

11. I have also been referred to the following passage at p.310 of Brownlie's Principles of Public International Law (5th Edition, 1998):-

"Persons may not be arrested, a summons may not be served, police or tax investigations may be not be mounted, orders for production of documents may not be executed, on the territory of another state, except under the terms of a treaty or other consent given."

12. I have been also been referred to the case of Short -v- Ireland [1996] 2 I.R. 188. In that case there was wrongful service, similar to that in the present case, but O'Hanlon J. exercised his discretion to overlook it.

In the case of Taher Meats (Ireland) Ltd. -v- State Company for Foodstuff Trading and Another [1991] 1 I.R. 443, there was a delay between the entry of an unconditional appearance to a Summons and a challenge to it. The delay was in the order of six months. In the circumstances of that case Costello J. excused the delay. Mr. Humphreys submits that the delay in taking the pleading point in this case as a preliminary point should be excused in the context of the large number and variety of issues which are sought to be canvassed. He indicates to the Court that the service point was one of the points he sought to mention at the outset of the hearing of this Motion and submitted that theSavvinos case is a guide as to how I should use my discretion.

13. The Applicant contends that an unconditional appearance was entered on behalf of the Third Named Defendant in this case and that in itself cures defects in the service. furthermore, he took the technical point that a Notice of Motion should be served in order to have the service set aside pursuant to Order 124, Rule 3, R.S.C. Thirdly, he pointed out that a service was accepted by Mr. H. on behalf of the Third Named Defendant within the jurisdiction. In my view, the unconditional appearance to the Summons cured any defect in it. Moreover, if I am wrong in so finding, there was a perfectly good service of the proceedings on the Third Named Defendant through his Solicitor, Mr. H.

14. If I am wrong in both these propositions it seems to me that in all the circumstances of the case including the unconditional appearance and the service on

15. Mr. H. that, notwithstanding Savvinos, I should overlook any defect in service.

POSSESSION AND CONTROL

16. This point can be simply stated. Section 3 of the Proceeds of Crime Act makes provision for the Courts, in certain circumstances, to make Interlocutory Orders "prohibiting the Respondent or any other specified person or any other person having notice of the Order from disposing of or otherwise dealing with" property. Since, by virtue of the appointment of a Receiver, the Respondents are not in "possession or control" of the property (so the argument runs) the Court cannot make an Order under Section 3. This aspect of the case centres around the construction of the Act and was argued in considerable detail by both sides.

17. Mr. Forde cited the case of Jeffrey -v- Director of Public Prosecutions (Cth.) (1995) 121 F.L.R. 16, and draws the attention of the Court to the following observations of the Court of Criminal Appeal of New South Wales: -

Principles applicable to the construction of the Proceeds of Crime Act, 1987

"1. An intention to abrogate or curtail fundamental property rights will not be imputed by the Courts. It must be 'clearly manifested by unmistakable and unambiguous language.' General words will rarely be sufficient for that purpose if they do not specifically deal with the question because, in the context in which they appear, they will often be ambiguous on the aspect of interference with fundamental rights.

2. A legislative intention to take away property without compensation requires expression of that intention with 'irresistible clearness' because it is presumed that the legislature would not 'over-throw fundamental principles, infringe rights, or depart from the general system of law, without expressing its intention with irresistible clearness' ...

3. Any statutory ambiguity should be interpreted so as to respect a person's property rights.... Unless no other interpretation is possible, justice requires that statutes should not be construed so as to enable the confiscation of an individual's property without payment of justcompensation. A fortiori where the statute does not provide for any compensation.

4. In construing a penal statute, and confiscation of property without compensation constitutes a penalty, if there are two reasonable interpretations, the more lenient of which will avoid the imposition of the penalty, that more lenient construction must be adopted".

18. The attention of the Court was drawn to the case of Director of Public Prosecutions -v- Logan Park Investments Pty Ltd. and Anor. (1995) A.L.R. 449 and in particular the following passage at page 455:-

"As in any task of statutory construction, the duty of the Court is to give effect to the will of Parliament as expressed in the language by which that will is stated .... [L]et me state a number of considerations of a general character which inform my approach to the task in hand:

1. The Act establishes a scheme for depriving persons of property rights which they otherwise enjoy by law... Therefore, it can be accepted that the Act, insofar as it manifests ambiguity or obscurity, would have been intended to respect basic property rights.

2. Provisions for the forfeiture of property have conventionally been construed strictly.

3. While it is legitimate to have regard to the explanatory memorandum and the purpose of the drafter, and while I would accept that the legislation here is ambiguous, permitting that course, the ultimate duty of a Court is one of fidelity to the language which Parliament has actually used.".

19. Later in the same judgment at p. 457 the following passage occurs:-

"The more substantial and radical the surgery required of the legislation, the less inclined will a Court be to perform it. A point will be reached where the Court will refuse to pass from interpretation to what it feels is, effectively, curial legislation; cf. Craies on Statute Law, 7th Ed. p. 109."

20. Mr. Forde also cited the case of R. -v- Cuthbertson and Ors. [1981] A.C. 470. In that case the Defendants pleaded guilty to conspiracy at common law to commit certain offences. The commission of the substantive offences could have attracted Forfeiture Orders under Section 27 of the U.K. Misuse of Drugs Act, 1971. In holding that there was no jurisdiction to make forfeiture orders since the conspiracies to which the Defendants had pleaded guilty were not "offences under the Act within the definition of Section 27". Lord Diplock said at page 480:

"The question should not be approached with any preconception that parliament must have intended the Section to be used as a mean of stripping professional drug-traffickers, such as the Appellants, of the whole of their ill-gotten gains - however laudable such a consummation might appear to be. Parliament's intention must be ascertained from the actual words which Parliament itself approved as expressing its intention when it passed the Act in the terms in which it reached the statute book."

21. Mr Humphreys cited a number of authorities on the question of construction. In the case of Aamand -v- Smithwick & Anor. [1995] 1 I.L.R.M. 61 Finlay C.J. said at page 67:-

"It is clear and of importance in this case that the Act of 1965 and the Statutory Instrument made pursuant to it incorporating the convention is a penal statutory code involving penal sanctions on an individual and must therefore be construed strictly as is contended in the sense that not by anything other than unambiguous provision should a person be subjected to detention and extradition."

22. The attention of the Court was also drawn to a passage in The State (Rollinson) -v- Kelly [1984] I.R. 248 at page 255 where O'Higgins C.J. said:-

"It is obvious that, in drafting regulation 29, the draftsman intended to refer to 'number 26' and that the wrong number was inserted in error. However, to give effect to the clear intention of the regulation is to ignore the error and, in effect, to treat 'number 27' as being 'number 26'. Can this be done? A very similar error became manifest in The State (Murphy) -v- Johnston [1983] I.R. 235 in which this Court unanimously concluded that an obvious error in a statute could not be rectified by judicial intervention.

In my view, it would not be possible to ignore the obvious error in regulation 29; to attempt to do so would be to attempt something which is not within the competence of the Courts. In my view, as it stands, so it must be read. This regulation is meaningless, and, this being a penal regulation, the prosecutor is entitled to rely on this fact. Accordingly, none of these summonses, based as they are on regulation 29, can be regarded as effective and valid."

23. Also, in relation to statutory construction I have been referred to various passages in the case of Howard -v- Commissioners of Public Works [1994] 1 I.R. 101. At page 151 of the Report Blayney J. cites the following passage:-

"The cardinal rule for the construction of Acts of Parliament is that they should be construed according to the intention expressed in the Acts themselves. If the words of the Statute are themselves precise and unambiguous, then no more can be necessary than to expound those words in their ordinary and natural sense. The words themselves alone do in such a case best declare the intention of thelaw-giver.

'The tribunal that has to construe an Act of a Legislature, or indeed any other document, has to determine the intention as expressed by the words used. And in order to understand these words it is natural to enquire what is the subject matter with respect to which they are used and the object in view'

[per Lord Blackburn in Direct United States Cable Co. -v- Anglo-American Telegraph Co. (1877) 2 App. Cas. 394]."

24. At pp. 152-153 Blayney J. goes on to quote from Craies on Statute Law (1971) (7th ed.) at p. 109:-

"If the meaning of a statute is not plain, it is permissible in certain cases to have recourse to a construction by implication, and to draw inferences or supply obvious omissions. But the general rule is 'not to import into statutes words which are not to be found there', [per Patteson J. in King -v- Burrell (1840) 12 Ad. 8 El. 460, 468] and there are particular purposes for which express language is absolutely indispensable. 'Words plainly should not be added by implication into the language of a Statute unless it is necessary to do so to give the paragraph sense and meaning in its context.' [per Evershed M.R.. in Tinkham -v- Perry [1951] 1 T.L.R. 91, 92]."

25. A passage from Maxwell on The Interpretation of Statutes (12th edition,

1976) at page 29, which was referred to in the judgment of Blayney J. at page 154, has been cited:-

"Where, by the use of clear and unequivocal language capable of only one meaning, anything is enacted by the legislature, it must be enforced however harsh or absurd or contrary to common sense the result may be. The interpretation of a statute is not to be collected from any notions which may be entertained by the Court as to what is just and expedient: words are not to be construed, contrary to their meaning, as embracing or excluding cases merely because no good reason appears why they should not be embraced or excluded. The duty of the Court is to expound the law as it stands, and to 'leave the remedy (if one be resolved upon) to others'."

26. In the course of her judgment in the same case at page 163 Denham J. cited with approval Craies on Statute Law (7th Ed) at page 67 where it is stated:-

"Even though a Court is satisfied that the Legislature did not contemplate the consequences of an enactment, a Court is bound to give effect to its clear language".

27. She goes on to say:-

"The correct conclusion to be drawn is that the plain language of the Act must not be extended beyond its natural meaning so as to supply omissions or remedy defects. The Court shall neither misconstrue words so as to amend defects in the legislation nor legislate to fill gaps left by the Legislature. If there is a plain intention expressed by the words of a statute then the Court should not speculate but rather construe the Act as enacted."

28. Reference was also made to a passage in Hamilton -v- Hamilton [1982] I.R. 466 where the Court refused to read an Act retrospectively.

29. Applying the criteria set down in all the passages cited above the Respondents contend that following the appointment of the Receiver they were not in 'possession or control' of the money, the subject matter of this application, and accordingly the application should be dismissed.

30. Counsel for the Applicants also referred me to several authorities concerning statutory interpretation. He first referred me to a passage in the judgment of Mr. Justice Henchy in the case of Nestor v. Murphy [1979] I.R. 326. That case concerned the meaning of Section 3, subsection (1), of the Family Home Protection Act, 1976. At page 329 Henchy J. stated:-

"To construe the sub-section in the way proposed on behalf of the Defendants would lead to a pointless absurdity. As is conceded by Counsel for the Defendants, if their construction of S.3, sub-s. 1, is correct then either the husband or the wife could have the contract declared void because the other did not give a prior consent in writing. Such an avoidance of an otherwise enforceable obligation would not be required for the protection of the family home when both spouses have entered into a contract to sell it. Therefore, it would be outside the spirit and purpose of the Act.

In such circumstances we must adopt what has been called a schematic or teleological approach. This means that S.3, sub-s. 1, must be given a construction which does not overstep the limits of the operative range that must be ascribed to it, having regard to the legislative scheme as expressed in the Act of 1976 as a whole. Therefore, the words of S.3, sub-s. 1, must be given no wider meaning than is necessary to effectuate the right of avoidance given when the non-participating spouse has not consented in advance in writing to the alienation of any interest in the family home. Such a departure from the literal in favour of a restricted meaning was given this justification by Lord Reid in Luke -v- Inland Revenue Commissioners ([1963] AC 557) when he said at page 577 of the Report:-

'to apply the words literally is to defeat the obvious intention of the legislation and to produce a wholly unreasonable result. To achieve the obvious intention and produce a reasonable result we must do some violence to the words. This is not a new problem, though our standard of drafting is such that it rarely emerges. The general principle is well settled. It is only where the words are absolutely incapable of a construction which will accord with the apparent intention of the provision and will avoid a wholly unreasonable result, that the words of the enactment must prevail.'"

31. This approach appears to have been endorsed by McCarthy J. in the case of McCann Limited -v- Ó'Culacháin [1986] 1 I.R. 196 where he said at page 201:-

"... one must, in aid of construction of the particular word as used in the statute, look to the scheme and purpose as disclosed by the statute or the relevant part thereof".

32. I was also referred to Alder -v- George [1964] 1 All E.R. 628. The Appellant was convicted of an offence contrary to Section 3 of the Official Secrets Act, 1920 in that being "in the vicinity" of a prohibited place, namely Marsham Royal Air Force Station, he obstructed a member of Her Majesty's Forces engaged in security duty in relation to the said prohibited place. The Appellant entered the station where the offence took place. He argued that he could not be "in the vicinity" of the station since he was in the station itself. Lord Parker C.J. however rejected that argument saying:-

"For my part I am quite satisfied that this is a case where no violence is done to the language by reading the words 'in the vicinity of' as meaning 'in or in the vicinity of' .... It would be extraordinary, and I venture to think it would be absurd, if an indictable offence was thereby created when the obstruction took place outside the precincts of the station, albeit in the vicinity, and no offence at all was created if the obstruction occurred on the station itself .... There may be of course many contexts in which 'vicinity' must be confined to its literal meaning of 'being near in space', but, under this Section, I am quite clear that the context demands that the words should be construed in the way which I have stated."

33. The Applicant placed considerable reliance on the case of D. (a minor) -v Berkshire County Council and Others [1987] 1 All E.R. 20 and contended that the argument in that case was "functionally identical" to that in the present case.

34. That case concerned the interpretation of certain provisions of The Children and Young Persons Act, 1969, as amended. The House of Lords considered the interpretation of the phrase "his proper development is being avoidably prevented or neglected, or his health is being avoidably impaired or neglected or he is being ill-treated". It rejected a literal interpretation. Lord Brandon analysed the statute, which provided for a place of safety order, an interim order and, finally, a full care order. He said at pp. 40-41 of the Report:-

"With regard to the second question relating to the expression 'is being', it is in my opinion necessary to have in mind the purpose sought to be achieved not only by Section 1 but also by Section 28 of the 1969 Act. The effect of Section 28, when combined with that of Section 1, is to create a process for the protection of children which may often include three separate but connected stages ....

Against the background of these three possible stages ... it is, in my view, clear that the Court, in considering whether a continuing situation ... exists, must do so at the point of time immediately before the process of protecting the child concerned is first put into motion. To consider that matter at a point of time when the child has been placed under protection for several weeks ... would ... defeat the purpose of Parliament."

35. Finally, I was referred to a judgment of mine dated the 1st April 1998 in the case of Mullins -v- Harnett & Ors [1998] 2 ILRM 304 and to certain passages from Bennion on Statutory Interpretation and from Maxwell on The Interpretation of Statutes dealing with the principle against doubtful penalisation, the so-called principle of strict interpretation of penal statutes. The following passage occurs at page 382 of the Second Edition of Bennion:-

"The true principle has never been that 'a penal statute must be construed strictly,' (though it is often stated in such terms). The correct formulation is that a penal statute must be construed with due regard to the principle against doubtful penalisation, along with all other relevant criteria".

36. Maxwell at page 246 of the 12th Edition puts it as follows:-

"The effect of the rule of strict construction might be summed up by saying that, where an equivocal word or ambiguous sentence leaves a reasonable doubt of its meaning which the canons of interpretation fail to solve, the benefit of the doubt should be given to the subject and against the legislature which has failed to explain itself. If there is no ambiguity, and the act or omission in question falls clearly within the mischief of the statute, the construction of a penal statute differs little, if at all, from that of any other".

37. The concept was expressed succinctly by Henchy J. in Inspector of Taxes -v- Kiernan [1981] I.R. 117, 122:-

"... if a word or expression is used in a statute creating a penal or taxation liability, and there is looseness or ambiguity attaching to it, the word should be construed strictly so as to prevent a fresh imposition of liability from being created unfairly by the use of oblique or slack language".

38. In dealing with the submissions made by Counsel on both sides, various passages have been cited to support various canons of construction. Canons of construction may overlap and are not always neatly compartmentalised. Some of the dicta may carry conflicting emphases. The purpose of the rules of construction, however, is to ascertain the intention of the Legislature - as that intention is expressed in the legislation - without adding words to the statute.

39. Neither the principle against doubtful penalisation - by which a person should not be subjected by law to any sort of detriment unless this is imposed by clear words - nor the rule of strict construction provide any real assistance as to how the words "possession or control" are to be interpreted.

40. I am entitled to look to the purpose or scheme of the Act. The essential structure of the Act is contained in Sections 2, 3 and 4 which permit a freezing of assets on an interim basis and subsequently on an interlocutory basis, and then their final disposal under Section 4 of the Act. The purpose of the Act is to adapt some concepts which are already available in civil litigation into statutory form.

41. If the appointment of a Receiver prevented the making of an order under Section 3 of the Act, it would defeat the purpose of the Act. Moreover, there is internal evidence in the Act itself which favours the Applicant's contention. Section 7(1) reads:-

"Where an interim order or an interlocutory order is in force, the Court may at any time appoint a receiver-

(a) to take possession of any property to which the order relates,

(b) in accordance with the Court's directions, to manage, keep possession or dispose of or otherwise deal with any property in respect of which he or she is appointed,

subject to such exceptions and conditions (if any) as may be specified by the Court, and may require any person having possession or control of property in respect of which the receiver is appointed to give possession of it to the receiver."

42. Section 7 therefore envisages the appointment of a Receiver between the interim order under Section 2 and the interlocutory order under Section 3. The Act envisages the making of a Section 3 Order in circumstances where the Receiver has possession of the goods. It is inconceivable that the Act, while permitting the appointment of a Receiver between the interim and the interlocutory order, would nevertheless bring about the destruction of the statutory provisions by preventing the Interlocutory Order being made if the Receiver were appointed.

43. Section 15(1) of the Act provides that:-

"Where an order under this Act is in force, a member of the Garda Síochána or an officer of the Customs and Excise may, for the purpose of preventing any property the subject of the order being removed from the State, seize the property".

44. If the literal interpretation contended for by the Respondent is correct, the exercise of powers by the Garda or officer of the Customs and Excise under Section 15, after the making of an Order under Section 2, would preclude the making of an Order under Section 3. This would seem to be an absurd result and frustrate the very purposes of the Act.

45. Section 13(1) of the Act provides:-

"Where property the subject of an interim order, an interlocutory order or a disposal order made before the relevant time is in the possession or control of a company and an order for the winding up of the company has been made or a resolution has been passed by the company for a voluntary winding up, the functions of the liquidator (or any provisional liquidator) shall not be exercisable in relation to the property."

46. Mr. O'Donnell contends that that provision strengthens his contention that "possession or control" means possession or control prior to the operation of the Act, since he argues that once an Order has been made it is not literally in his control. Certainly, it is difficult to see how a person could be in control of property after a Disposal Order has been made.

47. Mr. Forde, however, submits that the absence of a Receiver from the provisions of Section 13 strengthens his case. Moreover, he submits that one may have possession and control notwithstanding the making of the Orders. However, dealing with the property after a Disposal Order would render one liable for contempt of Court. I do not accept that a person can be said to be in control of assets after the making of such an Order since that person is manifestly not free to do with them as he may wish.

48. Mr. Forde, in submitting that the words "possession or control" should be construed as he contends for, argues that his construction would not necessarily make the Act unworkable. Having obtained an order under section 2, he submits that it would be possible to apply for an order under section 3, have that application adjourned and apply for the appointment of a Receiver. In those circumstances the appointment of a Receiver would not preclude the making of an order under section 3, because the Respondent would be in possession or in control at the commencement of the application. Even if this be correct, however, the order might well be resisted on the basis that since possession or control had passed to the Receiver it would be inappropriate to make the order. In interpreting the words I am entitled to have regard to the purpose and structure of the Act. The purpose of the Act has been described byMoriarty J. in the case of M. -v- D., an unreported judgment of 10th December 1996, where he said:-

"It seems to me that I am clearly entitled to take notice of the international phenomenon, far from peculiar to Ireland, that significant numbers of persons who engage as principals in lucrative professional crime, particularly that referable to the illicit supply of controlled drugs, are alert and effectively able to insulate themselves against the risk of successful criminal prosecution through deployment of intermediaries, and that the Act is designed to enable the lower probative requirements of civil law to be utilised in appropriate cases, not to achieve penal sanctions, but to effectively deprive such persons of such illicit financial fruits of their labours as can be shown to be the proceeds of crime".

49. The phenomenon was referred to much earlier by T. S. Elliott in 'Macavity: the Mystery Cat':

"Macavity, Macavity, there's no one like Macavity,

There never was a cat of such deceitfulness and suavity.

He always has an alibi, and one or two to spare:

At whatever time the deed took place - MACAVITY WASN'T THERE!"

50. The scope of the Act is not necessarily confined to such persons. It may also be used against people who are blameless in any respect, but who might be in possession or control of the proceeds of crime and against whom it would not be unjust to make an order.

51. Having regard to the scheme and purpose of the Act and having regard to all the arguments and having particular regard to the provisions of section 7 of the Act the interpretation argued for by the Applicant, is the preferable, more sensible and correct interpretation. Accordingly, I hold that there was such possession and control in the Respondents as is necessary for the making of an Order under section 3 of the Act. The fact that a Receiver was appointed is no bar to the making of an Order under section 3. It follows from that ruling that it is unnecessary for the Court to consider whether the property is now in possession of Mr.Galvin or of the Court, or to consider the case of The Deputy Commissioner of Taxation -v- Kunz 21 A.T.R. 949 in relation to whether the Court is a "person" for the purposes of the Act.

EXTRATERRITORIALITY

[sterling]181,356 sterling of the money, the subject matter of this application, was brought back from a bank account in London. It is important to state the circumstances in which the money was brought back. The Receiver advised Mr. H. of the making of the Court Order and requested him to sign an authority directly to the bank to give the DetectiveGarda Cliona Richardson a bank draft in the amount and made payable to the Receiver. He complied with that request. That document was prepared and a Receiver dispatched Detective Garda Cliona Richardson to London to collect the funds on his behalf. The request was made pursuant to the order of the Court. It is to be noted that the request (or demand as it might be more properly called) was made of an Irish citizen, in Ireland, in respect of monies that he had received in Ireland, some of which had been paid into his client account in Ireland and the remainder into the Solicitors' reserve account in London. The Respondents argue that the Proceeds of Crime Act does not apply to the said [sterling]181,356 sterling. They contend that although it is possible for the Legislature to legislate extra-territorially, this was not done in the instant case. It was pointed out that similar legislation in New Zealand, Australia and the United Kingdom as well as the 1994 Irish drug trafficking legislation, all specifically refer to theextra-territorial application of the enactments by the appropriate words such as "property wherever located" or "property abroad". The Respondents referred to a great number of Irish Acts which specifically refer to their extra-territorial application. It is contended that because there is a presumption against extra-territorial application of legislation, and because the Act does not specify extra-territoriality where similar legislation in other countries specifically does so, it should be assumed that the Act was not intended to have any extra-territorial application. That presumption against extra-territorial application of the Act would have been known to the Parliamentary Draftsman.

52. Moreover, it is also contended that there are some internal indications in the legislation that it is not intended to apply extra-territorially.

53. The definition of "dealing" includes removing from the State. Moreover, Section 15(1) provides for seizure of property for the purpose "of preventing any property the subject of the order being removed from the State".

54. Section 10 of the Act deals with what happens in relation to Orders affecting land and Orders affecting companies and in nine sub-sections dealing with a wide variety of eventualities, there is no mention about what happens in relation to Orders concerning property outside the State.

55. It is submitted that those are indications in the Act itself that the Act is not intended to have extra-territorial application.

56. Further, it is argued that this is criminal legislation and that there are presumptions that such legislation does not have an extra-territorial application. Even if the legislation is not criminal in the sense contended for in the constitutional argument, it is still penal legislation and carries the presumption against extra-territorial application. Finally, there is the argument that the State may exercise extra-territorial jurisdiction in accordance with generally recognised principles of international law and if the State can exercise extra-territorial jurisdiction in this case, it is contrary to the principles under international law and the law must be unconstitutional.

57. Dr. Forde cited the case of The Attorney General of New Zealand -v- Ortiz and Ors. [1984] 1 A.C. 1, which concerned the unlawful exportation from New Zealand of an artefact described characteristically by Lord Denning:-

"Years ago in New Zealand a great Chief of the Maoris had a treasure house. In it there were stored such things as dried fish, special foods and valuables. At the entrance there was a great door. It was made of totaro wood which is light, durable, tough, and of a dark red colour. This great door was four feet high and nearly five feet wide. It had five panels carved with exquisite skill. These depicted human figures with serpentine bodies and wide pointed heads."

58. The issues are set out in the headnote to the Report:-

"Section 12 (2) of the Historic Articles Act 1962 of New Zealand provided:

'An historic article knowingly exported or attempted to be exported in breach of this Act shall be forfeited to Her Majesty and, subject to the provisions of this Act, the provisions of the Customs Act 1913 relating to forfeited goods shall apply to any such article in the same manner as they apply to goods forfeited under the Customs Act 1913'

Section 5 (1) provided that it was unlawful for any person to remove an historic article from New Zealand, knowing it to be an historic article, without written permission. As from January 1, 1967, the Customs Act 1913 was replaced by the Customs Act 1966.

The Plaintiff, suing on behalf of the Crown in right of the Government of New Zealand, brought an action alleging that a Maori carving that was found in New Zealand in about 1972 and was an 'historic article' within the meaning of the Act of 1962, was removed from New Zealand with no certificate of permission as required by the Act by the third defendant, who knew that the carving was an historic article, and that the third defendant later sold the carving to the first defendant who in turn offered it for sale by auction by the second defendants in London. The plaintiff claimed that the Crown was theowner and entitled to possession of the carving, and he sought an injunction restraining the sale and an order for delivery up of the carving. A trial was ordered of two preliminary issues, namely, whether on the facts alleged the Crown was the owner and entitled to possession of the carving pursuant to the Historic Articles Act 1962 and the Customs Acts 1913 and 1966, and whether in any event the provisions of those Acts were unenforceable in England as being foreign penal, revenue and/or public laws.Staughton J., giving judgment for the plaintiff, held that the Customs Acts of 1913 and 1966 provided for forfeiture of goods only when the goods were seized, but that section 12 (2) of the Act of 1962 was ambiguous, and that having regard to the purpose of that Act, namely to secure the enjoyment of historic articles for the people of New Zealand, forfeiture, and hence the passing of title to the Crown, under section 12 (2) occurred automatically when goods were exported or attempted to be exported illegally. On the second preliminary issue, he held that section 12 was enforceable in England. The Court of Appeal allowed an appeal by the first and third defendants on the ground that forfeiture under section 12 (2) was not automatic. The court also indicated, in relation to the second preliminary issue, that that section was unenforceable in England.

On appeal by the plaintiff, on the question raised by the first preliminary issue:-

Held, dismissing the appeal, that on the true construction of section 12 of the Historic Articles Act 1962 and the relevant provisions of the Customs Act 1966, forfeiture under section 12 (2) of the Act of 1962 took effect only when the historic article was seized by the New Zealand customs or police, and notautomatically immediately the article was exported; and that since no seizure had taken place, the Crown was neither the owner nor entitled to possession of the carving (post, pp. 41c-f, 42d-e, 48d-e).

Per curiam. No conclusion is expressed as to the correctness or otherwise of the Court of Appeal's opinions, which were obiter, on the second preliminary issue (post, pp. 46c-e).

Decision of the Court of Appeal, post, p. 13e; [1982] 3 W.L.R. 570; [1982] 3 All E.R. 432 affirmed."

59. In the course of his judgment, Lord Denning discussed the territorial theory of jurisdiction as follows:

"It was said long ago by Story J. in the Supreme Court of the United States in The Apollon (1824) 9 Wheat. 362, 370: 'The laws of no nation can justly extend beyond its own territories, except so far as regards its own citizens." And in his book , Story's Conflict of Laws, 2nd ed. (1841), p. 26, he said: 'no state or nation can, by its laws, directly affect or bind property out of its own territory, or bind persons not resident therein,' except that, see p. 28, 'every nation has a right to bind its own subjects by its own laws in every other place.'

In our present case the New Zealand Government invite us to interpret section 12(2) of the Historic Articles Act 1962 as if it said: 'An historic article which has been knowingly exported from New Zealand in breach of this Act shall be automatically forfeited to Her Majesty, and Her Majesty can recover it in any other country into which it may be imported.' So interpreted, the Act seems to me to infringe the rule of international law which says that no country can legislate so as to affect the rights of property when that property is situated beyond the limits of its own territory. It is a direct infringement of the territorial theory of sovereignty which is most ably discussed by Dr. F. A. Mann in hisStudies in International Law (1973), pp. 1 to 139.

If this Historic Articles Act 1962 provided for 'automatic' forfeiture, that forfeiture would take place and would come into effect as soon as the historic article was exported, i.e. as soon as it left the territorial jurisdiction of New Zealand. That would be a piece of extra-territorial legislation which is invalid by international law.

Rather than suppose that the New Zealand Parliament would infringe international law, or would go beyond the limits of its own jurisdiction, I am quite clear that we should read section 12(2), not as providing for automatic forfeiture, but as meaning 'shall be liable to forfeiture.'

60. A point of vast importance

The next preliminary point proceeds on the assumption that the Historic Articles Act 1962 provides for automatic forfeiture and then asks: should this law be enforced by the courts of England?.

This point may become real when it is remembered that the Act of 1962 applies not only to actual export of an historic article, but also to attempted export. An attempt might be made to export an historic article. It might be taken to the airport and then prevented at the last moment from being loaded on to the aircraft."

61. He went on to discuss the circumstances in which foreign laws will be enforced:

"Applied to our present problem the class of laws which will be enforced are those laws which are an exercise by the Sovereign Government of its sovereign authority over property within its territory or over its subjects wherever they may be. But other laws will not be enforced. By international law, every Sovereign State has no sovereignty beyond its own frontiers. The Courts of other countries will not allow it to go beyond the bounds. They will not enforce any of its laws which purport to exercise sovereignty beyond the limits of its authority."

62. Lord Denning then reviewed a number of cases "about tangible things which have been confiscated - or attempted to be confiscated - by a Sovereign Government." The case of Don Alonso -v- Cornero (1611) Hob. 212; 2 Brownl. 29 concerned a confiscation on the high seas of 3,000 lbs of tobacco on behalf of the King of Spain. In proceedings before the English Court of Admiralty the Court refused to enforce the confiscation as it was an act done in the exercise of sovereign authority outside the territory of Spain.

In The King of Italy -v- Marquis Cosimo de Medici Tornaquinci (1918) 34 T.L.R. 623, the Defendant brought some family archives to England and put them in the hands of Christie's for sale. The Court refused to grant an injunction sought by the Italian Government notwithstanding that there was a prohibition on the exportation of such papers. Prohibition of export of the family papers was an exercise of Sovereign Authority by the King of Italy. It would not be enforced by the UK Court.

In Brokaw -v- Seatrain U.K. Ltd. [1971] 2 Q.B. 476, United States citizens living in the United States, sent furniture and household effects to England, to their daughter who had married an Englishman. The furniture was shipped on an American ship. While the vessel was on the high seas, the United States Government served a Notice of Levy on the ship-owners claiming possession of the goods on the basis that the American citizens owed the money for taxes and they were entitled by United States law to levy upon all the property. TheU.K. Courts held that the United States Government had no right to the goods. Lord Denning observed that:-

"The Notice of Levy was an act done in the exercise of sovereign authority. It was not done in the territory of the United States but outside it. It would not be enforced by our Courts. But if the United States Government had actually reduced the goods into their possession in the United States, that act would have been done within its own territory. It would therefore have been enforced in our Courts."

63. Having reviewed these authorities Lord Denning said:-

"Returning to our present case, I am of opinion that if any country should have legislation prohibiting the export of works of art, and providing for the automatic forfeiture of them to the State should they be exported, then that falls into the category of 'public laws' which will not be enforced by the Courts of the country to which it is exported, or any other country, because it is an act done in the exercise of sovereign authority which will not be enforced outside its own territory."

The dicta of Lord Denning were relied upon by the Respondent to support the contention that if an Act were to have extra-territorial application, it would be an unwarranted infringement of international law. Further authorities were opened to the Court to support the contention that the legislation was to be construed as having no extra-territorial application, because to do otherwise would contravene principles of international law.

64. Mr. Forde cited the case of Arab Bank plc. -v- Mercantile Holdings Ltd. and Anor. [1994] Ch. 71. Section 151 of the Companies Act, 1985 made it unlawful for a company, or one of its subsidiaries, to give financial assistance for the purpose of acquiring its shares. It was held that the words "any of its subsidiaries" were to be construed as limited to such subsidiaries as were companies incorporated in England.

65. Millet J. at pp. 80-81 said:-

"Read literally and with the assistance of the statutory definition of 'subsidiary', Section 151 clearly purports to make it unlawful for a foreign subsidiary of an English parent company to give financial assistance for the purpose of the acquisition of shares of its parent company. The result, however, is to give the section anextra-territorial effect contrary to the general principles of private international law; for the capacity of a corporation, the regulation of its affairs, the maintenance of its capital and the protection of its creditors and shareholders are generally recognised to be matters for the law of the place of incorporation. But there have been many cases in which the words of a statute have been given a more limited meaning than they are capable of bearing where there is a proper ground for concluding that this was the intention of Parliament .... The consideration that the more limited meaning is necessary in order to avoid the creation of ajurisdiction wider than that generally recognised by international law has often been recognised as such a ground."

66. In that case, if the words had not been given the more limited reading, there would have been interference with the right of a foreign country to legislate for its own company law.

In the case of equal employment opportunity commission -v- Arabian American Oil Co. et al. 499 U.S. 244 it was held that the anti-discrimination legislation of the Civil Rights Act, 1964 did not afford protection to United States citizens employed abroad by American employers:

"It is a long-standing principle of American law 'that legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States' : Foley Bros., 336 U.S., at 285. 'This canon of construction ... is a valid approach whereby unexpressed congressional intent may be ascertained ....'

In applying this rule of construction, we look to see whether the 'language in the [relevant Act] gives any indication of a congressional purpose to extend its coverage beyond places over which the United States has sovereignty or has some measure of legislative control.'Foley Bros., supra at 285. We assume that Congress legislates against the backdrop of the presumption against extra-territoriality. Therefore, unless there is 'the affirmative intention of Congress clearly expressed,' Benz -v- Compania Naviera Hidalgo S.A. 353 U.S. 138 at 147, we must presume it is 'primarily concerned with domestic conditions'."

67. Later in the judgment the following passage occurs:-

"The intent of Congress as to the extra-territorial application of this statute must be deduced by inference from boiler-plate language which can be found in any number of Congressional Acts, none of which have ever been held to apply overseas."

68. Mr. Forde referred to a further passage in Reg. -v- Cuthbertson [1981] A.C. 470 at 485:-

"Under English rules of conflict of laws it is in my view well established that an English court has no jurisdiction either in a criminal or a civil matter to make orders purporting ipso jure to transfer moveable property situate abroad."

69. Mr. Forde also referred to the case of Frankfurther -v- W.L. Exner Limited [1947] 1 Ch. 629, which held that an Austrian Decree, giving control of Jewish businesses to Commissars, was a penal law, though not criminal legislation in the strict sense. The Courts in England would not enforce such penal legislation with regard to property in England.

70. At page 644 Romer J. stated:-

"It is true that our Courts would recognise Schober's title to property in Austria acquired by virtue of the decree, or his rights of control in relation to that property, conferred by that decree, even though such property was subsequently transferred over here; but, in my judgment, Schober would appeal in vain to the Courts of this country to assist him in establishing claim to property which was, and always had been, situate within the jurisdiction."

71. Finally, in relation to the extra-territoriality, Mr. Forde argued that the general principle is that ownership of property is governed by the law of the place where the property is located or lex loci. Furthermore, if the Act were construed to apply to property in England, it could give rise to difficult conflicts; for example, if there were a dispute in Ireland and somebody raised a dispute in England in a parallel matter.

72. Mr. O'Donnell for the Applicant agrees that the words such as "property wherever situated" or some similar words could have been put into the Act, but says that that is of minimal importance. What matters is the intention or the meaning of the Act. He contends that there is no real extra-territorial issue and says that the word "extra-territoriality" can be used loosely to describe a number of different concepts and issues. It is not, he says, coterminous with the foreign element in a case. He pointed out that the observations of Lord Denning in the Court of Appeal in Attorney General of New Zealand -v- Ortiz were treated as obiter dicta in the House of Lords. Even if he accepts the proposition in the Ortiz case, he argues that it is not relevant to this case. It is authority for the proposition that, in the absence of some specific agreement, one country does not normally enforce, although it recognises, the foreign, criminal, penal or tax legislation of another country. That principle was established in the Irish case ofBuchanan Ltd. -v- McVey [1954] I.R. 89. He submits that the issue is whether we can enforce our law against the Respondents, not whether we can ask an English Court to do so.

73. The Applicant accepted that there is a principle of statutory construction by which acts done wholly abroad are not presumed to be rendered criminal by domestic legislation unless such intention is clearly expressed. It was submitted however, that while that jurisdiction is limited territorially, there is no requirement that the words of general import must be read down - so as to be confined territorially. The reading down of the statute could only be required by some principle of statutory interpretation connected withextra-territoriality. The Applicant contends that there is no such principle. I was referred to the case of Treacy -v- Director of Public Prosecutions [1971] A.C. 537. In that case it was held that the doctrine of autrefois convict or autrefois acquit can be raised in respect of foreign as well as domestic convictions or acquittals. In that case the question arose whether a person could be convicted of making a demand with menaces, contrary to the Theft Act 1968, where a letter was posted making demand in the United Kingdom but addressed to a person in Germany. It was contended that the offence occurred in Germany since the demand was made when received. The question to be determined was whether, in those circumstances a person could be said to have made the demand with menaces. If those words were read subject to a territorial restriction limitation - that is, demand with menaces within the jurisdiction of Britain - he could not have been convicted. The House of Lords upheld the conviction. LordDiplock at page 561 said:-

"The Parliament of the United Kingdom has plenary power, if it chooses to exercise it, to empower any Court in the United Kingdom to punish persons present in its territories for having done physical acts wherever the acts were done and wherever their consequences took effect. When Parliament, as in the Theft Act, 1968, defines new crimes in words which, as a matter of language, do not contain any geographical limitation either as to where a person's punishable conduct took place or, when the definition requires that the conduct shall be followed by specified consequences, as to where those consequences took effect, what reason have we to suppose that Parliament intended any geographical limitation to be understood?

The only relevant reason, now that the technicalities of venue have long since been abolished, is to be found in the international rules of comity which, in the absence of express provision to the contrary, it is presumed that Parliament did not intend to break. It would be an unjustifiable interference with thesovereignty of other nations over the conduct of persons in their own territories if we were to punish persons for conduct which did not take place in the United Kingdom and had no harmful consequences there. But I see no reason in comity for requiring any wider limitation than that upon the exercise by Parliament of its legislative power in the field of criminal law.

There is no rule of comity to prevent Parliament from prohibiting under pain of punishment persons who are present in the United Kingdom, and so owe local obedience to our law, from doing physical acts in England, notwithstanding that the consequences of those acts take effect outside the United Kingdom. Indeed, where the prohibited acts are of a kind calculated to cause harm to private individuals it would savour of chauvinism rather than comity to treat them as excusable merely on the ground that the victim was not in the United Kingdom itself but in some other State."

74. I was also referred to the case of Bonalumi -v- The Secretary of State for the Home Department [1985] 1 All E.R. 797. In that case the applicants sought to appeal an Order made under Section 7 of the Bankers' Books Evidence Act 1879, whereby the Home Secretary sought evidence from a London Bank in aid of a Swedish prosecution. The Court held that this was a criminal cause or matter. If"criminal cause or matter" within the relevant statute had to be read as limited to a criminal cause or matter in the United Kingdom, this would not have been possible.

In Gold Star Publications Ltd. -v- D.P.P. [1981] 2 All E.R. 257, magazines had been seized on the grounds that they were "obscene articles ... kept for publication for gain". It was argued that, since the magazines were intended for export, the general word 'publication' had to be read as meaning publication in England. In rejecting that argument Lord Wilberforce observed at page 259:-

"I do not think, though the contrary was submitted, that the case raises any question as to the territoriality or extra-territoriality of United Kingdom legislation: the property in question is located in this country and the disposal of it by the police is to take place in this country .... Nor is the fact if, it be so, that property interests of foreigners may be affected by the seizure of any relevance."

In Re Paramount Airways Ltd. [1992] 3 All E.R. 1, the Court of Appeal in the United Kingdom had to interpret Section 238 of the United Kingdom Insolvency Act 1986, which enables an Administrator or Liquidator of a company to apply to a Court for an Order reversing a transaction entered into by the company with "any person" at an undervalue. It was argued that the words "any person" could not apply to a company which was not resident in the U.K. nor carried on business or had any place of business there. It was acknowledged as a general principle that U.K. legislation applied only to British subjects or foreigners within the United Kingdom but was held that the Act could not be sensibly limited by reference to this principle. Nicholls V-C concluded at page 11:

"In my view the solution to the question of statutory interpretation raised by this appeal does not lie in retreating to a rigid and indefensible line. Trade takes place increasingly on an international basis. So does fraud. Money is transferred quickly and easily. To meet these changing conditions English Courts are more prepared than formerly to grant injunctions in suitable cases against non-residents or foreign nationals in respect of overseas activities. As I see it, the considerations set out above and taken as a whole lead irresistibly to the conclusion that, when considering the expression 'any person' in thesections, it is impossible to identify any particular limitation which can be said, with any degree of confidence, to represent the presumed intention of Parliament. What can be seen is that Parliament cannot have intended an implied limitation along the lines ofEx parte Blain, re Sawers (1879) 12

Ch. D 522. The expression therefore must be left to bear its literal, and natural, meaning."

In Holmes -v- Bangladesh Biman Corporation [1989] 1 All E.R. 852, the Plaintiff was the widow of a passenger who died on an internal flight in Bangladesh. The U.K. Court held that it had no jurisdiction in the case, in conformity with the rule against giving extra-territorial effect to legislation, but was prepared to hold that if the flight had some connection with the United Kingdom - either commencing, arriving, or having an agreed stopping place there - that would have been sufficient connection to give the Court jurisdiction over an accident happening entirely abroad.

75. He submits that the principle is that an Irish Court does not involve itself, unless it is made very clear by the statute, with matters which occur entirely abroad and where every single component occurs abroad. There is no principle that everything has to occur in Ireland. For an Irish Court to assert jurisdiction, there should be sufficient connection with Ireland, and he submits that there is ample connection in this case. He submits that the fact that there is some foreign element, such as part of the money being abroad, or one of the Defendants being a foreign company, does not raise any question ofextra-territoriality. He cited the following passage from Bennion on statutory interpretation, (2nd Edition 1992) at page 257:-

"It is important to be clear what the power involves. A legislature does not have the capacity to make law for a territory outside its jurisdiction in such a way that what it enacts becomes part of the corpus juris of that external territory. The true position was put by Wheare -

'It is a mark of a sovereign, independent State that its legislature has power to make laws with extra-territorial effect. The nature and extent of this power should not be misunderstood. Extra-territorial legislation simply means legislation which attaches significance for Courts within the jurisdiction to facts and events occurring outside the jurisdiction. This does not imply that one State can pass laws for another State, or that several systems of law will be in operation regulating a particular sphere within any given State'"

76. Mr. O'Donnell's next argument was as follows:-

"This Act specifically provides for the appointment of a Receiver. The Courts have been prepared for many years to grant injunctions and appoint Receivers in respect of assets abroad on matters which are wholly or partially abroad. In those circumstances, it would be incongruous and also contrary to the purpose of the Act to restrict these Receivers."

77. He submitted that the jurisdiction exercised by Courts to grant injunctions and appoint Receivers, in respect of assets abroad, is itself based on the provision from a statute: that is, Section 28(8) of the Judicature Act (Ireland), 1877. That legislation does not contain any express provision allowing the Courts to appoint a Receiver over properties abroad. Neither does it contain any limitation. It has been interpreted so as not to contain a territorial limitation. In those circumstances there is no justification for seeking to restrict the ambit of the Proceeds ofCrime Act. Whether that legislation was prescriptive or descriptive of the law seems to me to be irrelevant.

78. Courts of Equity have been prepared to grant injunctions and appoint Receivers in respect of assets which are wholly or partially abroad. In Penn -v- Lord Baltimore (1750) 1 Ves. Sen. 444, where a Court of Equity in England granted specific performance of an agreement setting the boundaries of the then colonies of Maryland and Pennsylvania. The principle is stated in paragraph 3.06 of Keane, Equity and the Law of Trusts in the Republic of Ireland (Butterworths, 1988) as follows:

"The maxim that equity acts in personam, while not of universal application, is of particular relevance where property out of the jurisdiction is concerned. Because its decrees are enforced personally against the Defendant, it is not necessarily an objection to the Court's jurisdiction to entertain a suit that the property is situated outside the jurisdiction, provided the Defendant is within the jurisdiction or can be served outside the jurisdiction."

79. Under this principle a Receiver can be appointed over foreign property. In in re Maudslay, Sons & Field [1900] 1 Ch 602 Cozens-Hardy J. stated at page 611:-

"It is well settled that the Court can appoint Receivers over property out of the jurisdiction. This power, I apprehend, is based upon the doctrine that the Court acts in personam. The Court does not, and cannot attempt by its order to put its own officer in possession of foreign property, but it treats as guilty of contempt any party to the action in which the Order is made who prevents the necessary steps being taken to enable its officers to take possession according to the laws of the foreign country...."

In Derby & Company Ltd. -v- Weldon (Nos 3 and 4) [1990] 1 Ch. 65, the Court of Appeal held that:

"... in an appropriate case, the Court had power to make an Order concerning foreign assets in order to achieve the purpose of the injunction, subject to the ordinary principles of international law, and the existence of assets within the jurisdiction was not apre-condition of granting a Mareva injunction; that it was normally a sufficient sanction to ensure compliance with a Mareva injunction, even in the case of a foreign defendant, that failure to comply with it would result in the Defendant being debarred from defending the action; and that since a Mareva injunction operated in personam it did not offend against the principle that the Courts should not make Orders which infringed the exclusive jurisdiction of other countries."

80. That case has been approved in Bennett Enterprises Inc. & Others -v- Lipton & Others [1999] 1 ILRM 81

81. The power of the Court to appoint Receivers over assets situated abroad is well established without explicit statutory provision. There is nothing in the legislation to indicate that Receivers appointed under the Proceeds of Crime Act were intended by the legislature to have less powers than other Receivers. Furthermore, there is nothing in the Act that requires the reading down of the words so as to imply that the Act applies to assets within the jurisdiction only. If the powers of the Receiver under the Act were to be limited territorially the legislation would have so stipulated. Nor is there any legal principle or the principle of interpretation that requires such a narrowing down. I cannot agree that there are any internal indications in the Act to suggest intra-territorial application only. TheOrtiz case and the cases referred to therein deal with enforceability of foreign laws by the English Courts. The issue in this case is not whether foreign law will be enforced by the Irish Courts. The dictum of Lord Diplock in the Cuthbertson case already referred to, is not in my view directed towards the powers of a Receiver to make in personam orders effecting property abroad. I cannot accept that the judgment in Mahon -v- Butler [1998] 1 I.L.R.M. 284 contains any principle that would justify the Court in holding that a Receiver appointed under the Proceeds of Crime Act cannot be appointed over assets abroad.

82. In my view there is no constitutional requirement which prohibits the action complained of in this case. I do not accept that the appointment of receivers over property abroad is contrary to any principle of international law. Indeed, the widespread application of similar legislation in other countries to property "wherever situate" or "property abroad" is indicative that there is no prohibition on such terms in international law because those terms are not limited to countries with which the enacting legislature has a treaty arrangement. The principle does not prevent the action taken in the present case. The Receiver was appointed by an Irish Court. The assets were the property of an Irish citizen. They were held in the account of an Irish citizen. The request or demand of the Receiver was made in Ireland of an Irish citizen who had control over the assets which had been transferred to him in Ireland. In those circumstances there is sufficient connection with Ireland for the Court to exercise jurisdiction without offending against the sovereignty of any country. The fact that one of the Defendants is a foreign company does not oust the jurisdiction of the Irish Courts.

83. Considerations of comity require that Courts of this country refrain from making orders which infringe the exclusive jurisdiction of Courts of other countries but "a mareva injunction operates solely in personam and does not normally offend the principle in any way" per Lord Donaldson M.R. in Derby & Co. Ltd. -v- Weldon (No. 2) [1989] 1 All E.R. 1002 at page 1011. The Proceeds of Crime Act does not purport to make law for a territory outside its jurisdiction in such a way that it becomes part of the corpus juris of the foreign territory. It does not offend against the principle of comity.

RECEIVERSHIP

84. The Receivership is subject to attack from the Respondents on a number of grounds. First, it is argued that it is necessary for an Interim Order to be in force before a Receivership Order can be made. It is submitted that in this case the interim Order and the Receivership were made - impermissibly - at the same time. This is factually incorrect. The matter was dealt with in the fourth Affidavit of William P.O'Brien sworn on the 29th of April 1998. At paragraph 25 he states:-

"Subsequently, on the 28th of July 1997 the monies the subject matter of these proceedings were made the subject of a Section 2 Order and subsequently a Receivership Order subsequent (sic) to the Proceeds of Crime Act, 1996."

85. That sequence of events has not been denied. In any event in my opinion there is nothing to prohibit an application being made at the same time for relief under Section 2 and, should such relief be granted, for the appointment of a Receiver.

86. It is further argued that because of the absence of specific provision in the Proceeds of Crime Act for the appointment of a Receiver ex parte this cannot be done. The case of Mahon -v- Butler [1998] 1 I.L.R.M. 284 was cited as an authority for the proposition. It was submitted that the Proceeds of Crime Act is a self-contained code and should be strictly construed. The Court should not import general equitable principles and practices not expressly provided for in the Act itself. However, I do not accept thatMahon -v- Butler contains any principle which precludes the appointment of a Receiver ex parte or prior to the institution of proceedings. In that case a "quia timet" injunction was refused. Section 27 of the Local Government (Planning and Development) Act, 1976 as substituted by section 19(4)(g) of the Local Government (Planning and Development) Act, 1992 enables a planning authority or any other person to make an application where:-

"development of land ... has been carried out, or is being carried out, without ... permission, or an unauthorised use is being made of land" .

87. There is no reference to future events. It was held that Section 27 provided for a statutory injunction distinct and separate from the general equitable jurisdiction of the Court. The High Court had no jurisdiction to expand the statute by invoking the equitable jurisdiction. However, the Court did not overrule any of the decisions which imported equitable principles in relation to the grant or otherwise of injunctions under Section 27 of the Planning and Development Act. The matter has been helpfully set out in Mr.Galligan, Irish Planning Law and Procedure, (Round Hall Press, 1997) in a number of passages concerning Section 27:-

"First, the High Court has said in Avenue Properties Ltd. -v- Farrell Homes Limited [1982] I.L.R.M. 21 that the Order is analogous to the ordinary equitable injunction. This analogy is reinforced by the reference to "interim" and "interlocutory" Orders under sub-section 3. It follows from this that many of the principles on which courts of equity have exercised their discretion will also be relevant on an application for an Order under Section 27. Their application in the context of planning law, which is essentially a branch of public law, may sometimes contrast with their operation in private law situations."

88. At page 289 Mr. Galligan cites a passage from the unreported judgment of Barr J., dated April 26th, 1983 in O'Connor and Spollen Group Limited v. Frank Harrington Limited:

"It is well settled since time immemorial that for a party to seek equitable relief by way of injunction the Court in exercising its discretion takes into consideration the conduct of that party and relief will be refused if the Plaintiff does not come to the Court with clean hands. I am satisfied that this principle applies with equal force to applications made under Section 27 of the 1976 Act".

89. The equitable remedy of appointing a Receiver has always been available on an ex parte basis (Wylie's Judicature Acts (1906) page 701). If the intention of the legislature was to impose different rules for Receivers under the Proceeds of Crime Act that would have been specified in the legislation.

90. However, in this case neither the Applicants or the Respondents seek to have the Receivership set aside. Mr. Forde contended that Mr. Justice Smyth had no jurisdiction to grant the Receivership Order but that this Court cannot remedy the matter now as that would be the equivalent of quashing a decision of a Court co-equal by way of Certiorari. This Court is proceeding on the basis that there is a valid Receivership Order. I accept as correct the decision of McCracken J. in the case of Voluntary Purchasing Group v. Insurco Ltd. [1995] 2 I.L.R.M. 145 where he held that, in the absence of an express statutory provision to the contrary, the Court has an inherent jurisdiction to set aside an ex parte Order if requested to do so by any party affected by that Order. The remaining arguments concerning receivership have already been dealt with in the portion of this judgment dealing with extra-territoriality.

APPROACH TO CONSTITUTIONAL ARGUMENTS

91. As Acts of the Oireachtas are presumed to constitutional, it is for the Respondents in arguing against the constitutionality of the Proceeds of Crime Act to make and prove that case. It is suggested that, because of the circumstances in which the Act was passed, the presumption of constitutionality in this case is less strong than in other cases. The legislationwas passed after the killing of the journalist Veronica Guerin. It is clear the legislation was originally an Opposition Bill which was taken over by the Government. It is clear that there was considerable high feeling prevalent at the time of the enactment of the legislation. The presumption of constitutionality arises from the respect that the Courts owe to the Legislature and not on the quality or otherwise of the proceedings in theOireachtas. Mr. O'Donnell submits that the Dáil debates have no value in determining the issues that are before me but, without prejudice to his contention, has no objection to my perusing them. I was urged to have regard to them by Counsel for the Respondent. I found the debates to be of no assistance in deciding the issues in this case though they did provide an insight into the background against which the legislation was enacted. In deciding the constitutional issues the Court is bound to act in accordance with the principles set down byWalsh J. in East Donegal Co-operative Limited -v- Attorney General [1970] I.R. 317, and cited in the judgment of McGuinness J. in the Gilligan case at pp. 213/214. The relevant principles were summarised by Hamilton C.J. in Croke -v- Smith (No. 2) [1998] 1 I.R. 101 at pp. 111-112 where he stated that the Court must:-

"1. grant to the impugned provision the presumption of constitutionality unless and until the contrary is clearly established;

2. not declare the impugned provision to be invalid where it is possible to construe it in accordance with the Constitution;

3. favour the validity of the provision in cases of doubt, and

4. must have regard to the fact that the presumption of constitutionality carries with it not only the presumption that the constitutional interpretation or construction is the one intended by the Oireachtas but also that the Oireachtas intended that proceedings, procedures, discretions and adjudications which are permitted, provided for or prescribed by an Act of the Oireachtas are to be conducted in accordance with the principles of constitutional justice".

ERSATZ CIVIL LAW?

92. The Respondents contend that the Proceeds of Crime Act, 1996 is ersatz civil law; it is, in substance, a criminal law with does not afford the protections normally existing in the criminal law, such as the presumption of innocence and the standard of proof required in criminal cases. It is therefore unconstitutional both in failing to provide for due process of law and for fair procedures.

93. Counsel for the Applicants cited the case of The State (Burke) -v- Lennon [1940] I.R. 136 in support of his contention that in determining whether a particular process is criminal, the Court should have regard to the substance of the matter rather than its trappings.

94. Gavan Duffy J. stated at p. 147:

"I shall now examine the contention that s.55 of the Offences Against the State Act of 1939 is repugnant to the Constitution because it authorises an invasion by the Executive of the judicial domain by requiring a Minister of State to administer justice. In order to determine this question, I shall investigate the duty of a Minister under the section, in order to see its essential character and so to ascertain whether a Minister acting under S.55 is acting judicially."

95. Mr. Forde went on to refer to a number of decisions of the European Court of Human Rights in respect of which I adopt the same approach as that of McGuinness J. in the Gilligan case where she said at page 202 of the reported judgment:-

"While there can be no question but that this Court is entitled to have regard to decisions of the European Court of Human Rights in construing provisions of the Constitution there can be no question of any decision of the European Court of Human Rights furnishing in and of itself a basis for declaring legislation unconstitutional. I am bound by the repeated decisions of the Supreme Court that the European Convention on Human Rights is not a part of the domestic law of this jurisdiction".

96. The first of these cases was Öztürk v. Germany (1984) 6 EHRR 409. This case concerned a German law which allowed minor traffic offences to be treated as "regulatory" offences and dealt with by administrative authorities. It was decided that whether regulatory offences are "criminal" offences depends on:

(1) whether the text defining the offence belongs to the criminal law of the respondent State,

(2) on the nature of the offence, and

(3) on the nature and degree of severity of the penalty that could be incurred.

97. Of those the second and third factors were of greater weight. In addition "misconduct of the kind in question here is still classified in most States as criminal and is punishable by criminal penalties".

In Bendenoun v. France (1994) 18 EHRR 54, the applicant was prosecuted and fined first by the French Administrative Courts and then by the Conseil d'Etat. The question arose as to whether the administrative proceedings were criminal in nature. The following passage appears at page 54 of the Report:-

"In assessing the nature of the administrative proceedings in question, the Court weighed the characteristics which suggested that the proceedings were not criminal against those suggesting that they were. Four factors in particular suggested that the proceedings were criminal in nature notwithstanding their contrary characterisation under national law:

(a) the rules applied to to all citizens qua taxpayers, and not a given group,

(b) the penalties were intended not as compensation for damages to the Revenue but as punishment to deter re-offending,

(c) the purpose of the general rule under which they were imposed was both deterrence and punishment, and

(d) they were substantial penalties and failure to pay exposed the offender to imprisonment".

In Benham v. United Kingdom (1996) 22 EHRR 293, the applicant was imprisoned for non-payment of the community charge or poll tax as it was called. He relied on a violation of Article 6(1) of the Convention on Human Rights which is applicable only to criminal proceedings. The judgment contains the following passage:-

"56. The case law of the Court establishes that there are three criteria to be taken into account when deciding whether a person was 'charged with a criminal offence' for the purposes of Article 6. These are:

(1) the classification of the proceedings under national law,

(2) the nature of the proceedings, and

(3) the nature and degree of severity of the penalty.

As to the first of these criteria, the Court agrees with the Government that the weight of the domestic authority indicates that, under English law, the proceedings in question are regarded as civil rather than criminal in nature. However, this factor is of relative weight and serves only as a starting point. The second criterion, the nature of the proceedings, carries more weight".

98. All of these authorities are of persuasive authority. If and insofar as they are at variance with any of the principles laid down in Melling -v- O'Mathghamhna [1962] I.R. 1. I am obliged to follow the latter. However, I see no such conflict. In particular, they appear to all suggest that not too much weight should be placed on the classification of the legislation.

99. I was also referred to the case of A.G. -v- Casey [1930] I.R. 163 where penalties for fraudulent tax returns provided for in the Income Tax Act, 1918 were held to be civil rather than criminal. This case addressed the question of criminality predominantly from the point of view of form rather than substance. Mr.Forde also cites passages from The State (Gettins) -v- Fawsitt [1945] I.R. 183.

100. The Applicant relied on Attorney General -v- Southern Industrial Trust Limited & Simons [1960] 94 I.L.T.R. 161 and submitted that it was of considerable relevance to the present case. Section 5 of the Customs (Temporary Provisions) Act, 1945 provides by subsection (1):-

"If any goods (being goods the exportation of which is prohibited or restricted by any enactment or statutory instrument) have been, or are being dealt with in any of the following ways, that is to say:-

(a) have been exported in contravention of such enactment or statutory instrument ...

the goods shall be forfeited"

and by subsection (3):-

"Where -

(a) proceedings are taken, in pursuance of Section 207 of the [Customs Consolidation Act, 1876], for the forfeiture and condemnation of any goods, the exportation of which is prohibited or restricted by any enactment or statutory instrument, and

(b) it is averred in the information that the goods were seized for being dealt with in a specified way (being a way mentioned in sub-Section 1 of this Section), and

(c) it is proved in the proceedings that the goods were seized on suspicion of being dealt with in the way so specified,

it shall, until the contrary is proved, be presumed that the goods, at the date of seizure were being or had been dealt with in the way so specified."

101. The goods were seized under the provisions of section 207 of the Act of 1876. The Defendants, the Southern Industrial Trust Ltd., were a hire-purchase company who owned the car and it was common case that they were innocent of any wrong-doing. The Defendants contended:-

"1. That the proceedings were misconceived in as much as they were really criminal proceedings and could not be tried without a jury; and

2. That the provisions of Section 5(1) of the 1945 Act, insofar as they purported to authorise the forfeiture of the goods of an innocent party were contrary to the provisions of the Constitution and therefore void and of no effect."

102. It is useful to apply the criteria used by Davitt J. and to see how they conform with the Proceeds of Crime Act.

103. At page 167 of the Report of Davitt J. said:-

"These proceedings in my view are civil proceedings and not criminal. It is not sought here to make anyone amenable for a criminal offence."

w The Proceeds of Crime Act does not seek to make anyone amenable for a criminal offence.

"It is not even suggested in the pleadings or otherwise that the Southern Industrial Trust Company were guilty of anything whatever.

w It is not necessary for the operation of an Order made under the Proceeds of Crime Act that the Respondent be guilty of any crime, nor is it necessary that their conduct be morally reprehensible. It is quite conceivable that an Order could be made against a guiltless person who has possession of goods which are the proceeds of crime.

"... nor is it sought to bring Mr. Denis Simons to justice for the offence of exporting his car without a licence."

w It is not sought under the Proceeds of Crime Act to bring the person who committed the crime to justice in respect of any such crime.

"In proving the circumstances which justify the forfeiture it is necessary to establish facts to show that Denis Simons committed a criminal offence. That does not make these proceedings criminal proceedings."

w In proving the circumstances which justify forfeiture under the Proceeds of Crime Act, it is necessary to establish the fact that a crime was committed. That does not make these criminal proceedings.

104. The judgment of the Supreme Court was delivered by Lavery J. In the course of his judgment he said at p. 174:-

"The first question raised is whether a proceeding of this kind is criminal in character so as to require that the trial should be by a jury. Article 38 of the Constitution is relied on. It provides:- Article 38(1) 'No person shall be tried on any criminal charge save in due course of law'. Article 38(5) 'Save in the case of the trial of offences under Section 2, Section 3 or Section 4 of this Article, no person shall be tried on any criminal charge without a jury'. It was not adverted to in argument but the present proceeding is onein rem and not in personam."

w The proceedings under the Proceeds of Crime Act are in rem and not in personam.

105. Lavery J. went on to say:-

"No person is on trial here."

w No person is on trial under the Proceeds of Crime Act.

"No question of mens rea or of fraud arises. If the exportation is not lawful the forfeiture follows ..."

w No question of mens rea or fraud necessarily arises in the Proceeds of Crime Act. It may arise in many cases but it is not necessary. I cannot accept the contention that the "save for the injustice" clause imports mens rea into the Act.

"... nor does any question of imprisonment or even of pecuniary penalties directly arise."

w No question of imprisonment arises under the Proceeds of Crime Act. No question of pecuniary penalties directly arises from the Proceeds of Crime Act. What happens is forfeiture similar to forfeiture in the Southern Industrial Trust case:

"Moreover, the matter is determined by authority."

w The Southern Industrial Trust case itself is a binding authority.

106. Counsel for the Respondents have sought to distinguish the Southern Industrial Trust case from the present one in a number of respects. Mr. Forde argued that it is not authority for the proposition that a law which provides for forfeiture is invariably a civil law, but only for the proposition that laws which provide for forfeiture may be a civil law depending on the general context and terms of that law. I agree with this argument but I cannot see how it avails the Respondents in this case.

107. It is further argued that the case is at most authority for the proposition that penalties imposed in fiscal legislation for the contravention of fiscal laws are not always criminal in nature. The 1996 Act does not purport to be a fiscal law unlike the Customs (Temporary Provisions) Act, 1945. I cannot accept this contention. The analysis by the Supreme Court took into account the factors that it considered relevant in deciding on whether an act was criminal or otherwise and they were not confined to the fact that it was a fiscal law. In the event, the fact that exporting the car could also be a crime had no bearing on the forfeiture provisions under Section 5(1) (a) and (3) of the Customs (Temporary Provisions) Act, 1945; forfeiture was automatic on an unlicensed export taking place. Thirdly, it was submitted that there was a distinction to be drawn between theSouthern Industrial Trust case and the present one in that there could be forfeiture under Section 5 of the 1945 Act in circumstances where the owner had a full defence to a prosecution, for example, where the vehicle had been stolen from him or where he inadvertently took it over the border; by way of distinction, the 1996 Act is invariably predicated on crimes having been committed and the property in question deriving from those very offences. The distinction - even if valid - does not seem to me to be significant. Even if the owner were to have a defence to criminal charges, Section 5(1)(a) of the 1945 Act specifically refers to goods which have been exported "in contravention of such enactment or statutory instrument".

108. It is further submitted that it is fundamental that the criteria expounded in Melling -v- O'Mathghamhna [1962] I.R. 1 were not considered in the Southern Industrial Trust case which was decided four years prior to it. However, the Melling case, although it refers to the Southern Industrial Trust case, does not purport to overrule it.

In the Southern Industrial Trust case forfeiture of the goods of an innocent party was held to be a civil matter. No convincing reason has been adduced as to why the Proceeds of Crime Act should be distinguished from the Southern Industrial Trust case on this point.

109. Reliance is placed by both sides on the case of Melling -v- O'Mathghamhna [1962] I.R. 1 at pp. 24/25. The judgment of Kingsmill-Moore J. identifies three significant features in determining whether an act is criminal in nature or not. Kingsmill-Moore J. refers to what he calls the indicia of crimes:-

"(i) They are offences against the community at large and not against an individual. Blackstone defines a crime as "a violation of the public rights and duties due to the whole community, considered as a community": 4 Bl. Comm 5.

(ii) The sanction is punitive, and not merely a matter of fiscal reparation, for the penalty is [sterling]100 or three times the duty-paid value of the goods; and failure to pay, even where the offender has not the means, involves imprisonment.

(iii) They require mens rea for the act must be done 'knowingly' and 'with intent to invade the prohibition or restriction' .... Mens rea is not an invariable ingredient of a criminal offence, and even in a civil action of debt for a penalty it may be necessary to show that there was mens rea where the act complained of is an offence 'in the nature of a crime'. Lee -v- Dangar, Grant & Co [1892] 2 QB 337; Bagge -v- Whitehead [1892] 2 QB 355; but where mens rea is made an element of an offence it is generally an indication of criminality."

110. There is, in my view, no offence created by the Proceeds of Crime Act. I am not convinced that it creates a money-laundering type offence. Clearly, there is a public dimension to the legislation and it is not argued otherwise. Is the sanction punitive and not merely a matter of fiscal reparation? It is clear that if there is no title to the goods, confiscation could not rightly be said to be punishment. In many, if not all, circumstances, a person will not have any right to the proceeds of crime. A person has no title to stolen goods, and no punishment therefore accrues. A receiver of stolen goods has no title to goods and therefore no punishment accrues. An innocent receiver of stolen goods has no absolute title to the goods which can be recovered against him. Even if a thief sells goods on, he can have the proceeds of his crime taken from him.

111. If there are at least some situations in which the confiscation of the proceeds of crime cannot be considered a punishment, the Melling test in relation to infliction of punishment cannot be fully applicable. There is only one circumstance where a person gets an indefeasible title and that is where a person is a bona fide purchaser for value without notice.

112. Mr. O'Donnell submits that it is possible that what the bona fide purchaser for value acquires is not the proceeds of crime, but rather that the proceeds of crime is the money that he paid for the goods because, there are not several different proceeds of the crime. I do not have to decide that. However, while the punishment indicator is difficult to apply to the Proceeds of Crime Act, it is clear that in many, if not most, circumstances the confiscation will not constitute punishment.

113. The Act itself makes no provision for any finding of guilt by anybody. It is clear that the Act envisages that property could be taken from people who were innocent of any wrongdoing as well as people who were guilty of wrongdoing. Under the Act, the question of guilt does not arise. The contention that if the 1996 Act were to permit forfeiture of propertyowned by entirely innocent parties it would be invalid as an impermissible invasion of private property, cannot be sustained in view of the fact that that is precisely what happened in the Southern Industrial Trust case, where confiscation of property of an entirely innocent party was held to be constitutional.

114. Mr. Forde argues that the Proceeds of Crime legislation contains features over and above those contained in the Melling case:-

"I. "Crime" is the key word in the title and the main emphasis in the long title.

II. The obtaining of relief under Section 4 of the Act is on the assets deriving from crime; crime is the "central focus" of these provisions.

III. The Plaintiff in this case, (and similarly in other 1996 Act cases so far), is the senior Garda Officer attaching to the Criminal Assets Bureau."

115. These three points, in my view, do not address the question as to whether this is ersatz civil law.

"IV. Criminal law arrest, questioning and search powers have been used on several occasions to build up the Plaintiff's case, e.g. Section 63 of the Criminal Justice Act, 1994. Further, the assistance of the London Metropolitan Police was obtained in order to get into a bank account in London."

116. The use or otherwise of Section 63 of the Criminal Justice Act, 1994 does not impinge on the question as to whether or not this is ersatz civil law. Even if the assistance of the London Metropolitan Police was obtained in this case, that does not address the issue as to whether or not the Proceeds of Crime Act is really criminal legislation. I am not aware that there is any such evidence.

117. It was further contended that Mr. B. may succeed in demonstrating that the extradition applications that lead to his arrest were orchestrated on behalf of the Plaintiffs herein with reference to these proceedings. This is, in my view, irrelevant to the question as to whether the proceedings are ersatz criminal law.

118. The Applicant also referred to the judgment in the case of Clancy v. Ireland [1988] IR 326. In that case the constitutionality of an Act providing for forfeiture was upheld. It depended on the Minister certifying that certain monies were the property of an unlawful organisation and they stood forfeited to or invested in the Minister. Provision was made for a person claiming to be the owner of monies to apply to the Court for an Order directing that they be paid to him. Barrington J. said at page 335:-

"Mr. Fennelly has pointed to the fact that there are times, even in criminal proceedings, where Parliament has reversed the onus of proof in relation to particular issues. If, he submits, it is permissible to do it in criminal proceedings a fortiori it must be permissible to do it in civil litigation".

119. It is correctly pointed out by Mr. Forde that in Clancy's case it was never argued that the forfeiture provision was intrinsically criminal. It seems to me, however, implicit in the judgment of Barrington J. that he accepted it as being such. Furthermore, while the trappings in which the legislation is dressed are not a conclusive factor, they are something which the Court can take into account in deciding whether legislation is criminal or not. Judging by this criterion there is nothing to indicate that the Proceeds of Crime Act is criminal legislation.

In the case of McLoughlin -v- Tuite [1989] I.R. 82, the Supreme Court held that a penalty under section 500 of the Income Tax Act, 1967 for failure to make tax returns falls into the category of a deterrent or incentive and is not a criminal sanction. It is coercive in nature. The Court looked to the other provisions of the Act and found that in section 500, unlike other sections, there was no requirement for mens rea. However, at page 89 of the judgment Finlay C. J. cited from the judgment of Lavery J. in the Melling case:-

"Apart from authority, it seems to me clear that a proceeding, the course of which permits the detention of the person concerned, the bringing of him in custody to a Garda Station, the entry of a charge in all respects in the terms appropriate to the charge of a criminal offence, the searching of the person detained and the examination of papers and other things found upon him, the bringing of him before a District Justice in custody, the admission to bail to stand his trial and the detention in custody if bail be not granted or is not forthcoming, the imposition of a pecuniary penalty with the liability to imprisonment if the penalty is not paid, has all theindicia of a criminal charge."

120. The Court felt that it was significant, though not a determining factor, that none of those indicia were present in dealing with the penalty under the Income Tax Act.

121. The Court also attached significance to the absence of mens rea. It considered that "most importantly of all, he is never, by reason of the imposition on him of a penalty under this section, in any risk of being imprisoned for default of payment."

122. I was also referred to the case of O'Keeffe -v- Ferris [1997] 2 I.L.R.M. 161 where the Supreme Court had to consider whether the provisions of section 297(1) of the Companies Act, 1963 provided for the imposition of a criminal sanction in civil proceedings. Section 297(1) provided:

"If in the course of the winding up of a company it appears that any business of the company has been carried on with intent to defraud creditors of the company or creditors of any other person or for any fraudulent purpose, the court on the application of the liquidator or any creditor or contributory ofthe company, may, if it thinks proper to do so, declare that any persons who were knowingly parties to the carrying on of the business in manner aforesaid shall be personally responsible, without any limitation of liability, for all or any of the debts or other liabilities of the company as the court may direct."

123. The Supreme Court held that:-

"... none of the indicia of a criminal offence identified in Melling's case are present: there is no prosecutor; there is no offence created; there is no mode of trial of a criminal offence prescribed and there is no criminal sanction imposed."

124. All of these remarks could be applied to the Proceeds of Crime Act.

125. Not only are the trappings of crime such as arrest, detention, charging, remanding in custody or on bail, absent from or not contemplated by the legislation, the essential features of crime are not present either. There is no offence, there is no finding of guilt or innocence, there is no necessity formens rea and there is not always, and perhaps not even usually, a penalty. I am satisfied that these proceedings are not criminal.

126. I have been referred by Counsel to a number of American authorities where the question of civil forfeiture has been dealt with. However since the Supreme Court has considered the topic, the United States authorities are of limited assistance. Amongst the cases cited wereUnited States -v- Halper 490 U.S. 435, Austin -v- United States 509 U.S. 602, Department of Revenue of Montana -v- Kurth Ranch 511 U.S. In the case of United States -v- Ursery 518 U.S. 267 these decisions were considered. The Supreme Court held as follows:-

"First, in light of our decisions in Various Items, Emerald Cut Stones, and 89 Firearms, and the long tradition of federal statutes providing for a forfeiture proceeding following a criminal prosecution, it is absolutely clear that in rem civil forfeiture has not historically been regarded as punishment, as we have understood that term under the Double Jeopardy Clause. Second, there is no requirement in the statutes that we currently review that the Government demonstrate scienter in order to establish that the property is subject to forfeiture; indeed, the property may be subject to forfeiture even if no party files a claim to it and the Government never shows any connection between the property and a particular person. See 19USC SS 1609 [19 USCS SS 1609]. Though both SS 881(a) and SS 981(a) contain an 'innocent owner' exception, we do not think that such a provision, without more indication of an intent to punish, is relevant to the question whether a statute is punitive under the Double Jeopardy Clause. Third, though both statutes may fairly be said to serve the purpose of deterrence, we long have held that this purpose may serve civil as well as criminal goals. See, e.g.,89 Firearms, supra, at 364, 79 L Ed 2d 361, 104 S Ct 1099; Calero-Toledo, supra, at 677-678, 40 L Ed 2d 452, 94 S Ct 2080. We recently reaffirmed this conclusion in Bennis -v- Michigan, supra, at ----, 134 L Ed 2d 68, 116 S Ct 994, where we held that 'forfeiture ... serves a deterrent purpose distinct from any punitive purpose.' Finally, though both statutes are tied to criminal activity, as was the case in 89 Firearms, this fact is insufficient to render the statutes punitive."

The case of U.S. -v- Bajakajiam 524 U.S. 321, concerns forfeiture as part of the sentencing provisions following conviction and therefore is of little assistance in the present case.

127. I was also referred to the case of Calero-Toledo -v- Pearson Yacht Leasing Company (1994) 416 U.S. 663 which is authority for the proposition that forfeiture schemes arenot deemed unconstitutional because of their applicability to the property interests of innocent parties.

128. The U.S. authorities show that some of the concepts in the Proceeds of Crime Act have survived constitutional scrutiny in the United States.

129. Furthermore, I am strengthened in my decision on the basis that it accords with the careful decision of McGuinness J. on the same point in the Gilligan case. It is contended that she was mistaken in applying the test in Melling's case as being whether the Act has "all the features of a criminal prosecution". There is nothing in the judgment to suggest that she found that such was the test in Melling's case, nor is there anything to show that she misapplied the tests in Melling's case. The reference to "all the features of a criminal prosecution" is a quotation from the judgment of O'Dalaigh J. (as he then was). It was also contended that the action was not, strictly speaking, an action in rem rather than in personam because if it were, the money itself, would have been referred to in the title of the proceedings. In this jurisdiction many actions have held to be in rem notwithstanding that the res has not been named as defendant.

130. The learned Judge was also criticised for saying in relation to the money "that its removal could well be viewed in the light of reparation rather than punishment or penalty". While it is true that there is no provision for the forfeited assets being used to make reparation to any individual or any group, it is clear that a distinction was being made between penalty and punishment on the one hand, and reparation on the other. In that sense, as I have already stated, it is clear that in most, if not all, circumstances the application of the Act will not constitute a penalty.

131. In relation to the learned Judge's finding that "forfeiture proceedings are civil and not criminal in nature", it is unfair to construe this statement as meaning that the learned Judge implied that forfeiture proceedings are always civil and not criminal in nature. Indeed, it is true that forfeiture proceedings can take place in the context of criminal offences. However, as is quite clear from the context of the remark, the learned Judge was considering the authorities to which she was referred. She specifically said so. Moreover, to imply that because she saidthe procedures set out in the Act of 1996 are not criminal in nature indicates a misunderstanding of the issue is quite unfounded since it is quite clear from the rest of the very sentence criticised that the learned trial Judge was "bearing in mind the dicta set out in Melling's case".

DELAY

132. The Respondents complain about delay under different headings. The first contention is that since such delays as occurred in the instant case prior to the present hearing were possible under the Act, the Act is therefore constitutionally infirm. The second contention is that the delays specifically provided for in the Act are too long and unfair and unconstitutional.

133. In the present case, an Order under Section 2 the Proceeds of Crime Act was granted ex parte on the 28th of July 1997. The hearing of the interlocutory application commenced in November 1998. It is submitted that the fact that the Act permits of such delay makes it constitutionally oppressive. Section 45 of the 1987 Australian Proceeds of Crime Act and Section 41 of the 1991 New Zealand legislation expressly insist on expedition.North Georgia Finishing Inc. -v- Di-Chem Inc. 419 U.S. 601 (1975) is cited as an authority for the proposition that the Defendants are entitled to have the interlocutory application determined with considerable expedition. Calero-Toledo -v- Pearson Yacht Leasing Co. 416 US 663 (1973) fortifies the need for an expeditious hearing because the challenge to seizure "shall be heard without subjection to docket", that is, without having to be listed in the ordinary way. Moreover, under Section 3 of the Offences Against the State (Amendment) Act, 1985 an application claiming monies paid into Court must be made within six months of the day on which the monies were paid into that Court. It is contended that the absence of any such provision in the Proceeds of Crime Act wrongfully permits delays such as occurred in the present case to occur.

134. In order to deal with this point, it is necessary to refer to the facts. An Order under Section 2 was made on the 28th of July 1997 on consideration of the Affidavits of Michael F. Murphy and William P. O'Brien filed on that day. A Notice of Motion seeking relief pursuant to Section 3 of the Proceeds of Crime Act was filed on the 31st of July 1997, the last day of term. Appearances were entered on the 8th of August 1997. On the 13th of August the matter was adjourned by consent to October for the Respondents to file Affidavits. In October, on the application of the Respondents, the matter was adjourned until the 3rd of December.

135. On the 3rd of November 1997, the Respondent wanted the Court to deal with the preliminary issue in relation to possession and control. On that day there was still no Replying Affidavits on behalf of the Respondents. The Application commenced but there was an objection on the grounds of privilege, and the"possession and control" point was raised. The motion adjourned for one week. A series of other motions were then brought by the Respondent seeking Discovery, Particulars, Statement of Claim and the joining of the Criminal Assets Bureau as co-Plaintiff. Those matters came on before Shanley J. on the 10th and the 28th of November and were fully argued.

136. On the 28th of November, Shanley J. made rulings as to what proceedings should follow. He fixed the trial for the 10th of February and ordered that the Respondents file their Affidavits by the 15th of December. On the 15th of December, Mr. B. swore his Affidavit and it was responded to on the 21st of December.

137. On the 30th of January 1988, G.H. swore a second Affidavit and D. J. M. filed an Affidavit. It was indicated by the Respondents that further Affidavits would be filed (there were the Affidavits of B. McM. and the third Affidavit of P.B. both of which were filed on the 13th February). In those circumstances the Applicant applied for an adjournment and Shanley J. reserved the question as to whether the Applicant should be entitled to costs thrown away because of the necessity to adjourn the case in view of the forthcoming Affidavits of the Respondents.

138. The Affidavits of Mr. P.B. and Mr. D. J. M. disclosed accounts of how the money was obtained which necessitated the making of considerable enquiries by the Applicant.

139. On the 23rd of March a Motion was heard by the President seeking various reliefs, including an Order directing some of the Deponents for the Applicant to answer for contempt and an Order for Third Party Discovery and an Order dismissing the proceedings. The reliefs were refused.

140. On the 12th of June 1998, final replying Affidavits were filed by the Applicants, that is, the Affidavit of William P. O'Brien, Inspector Byrne and Mr. Christopher Laurence Magee, a computer expert. The Applicant was ready to proceed on from the 12th of June but a Motion dated 24th June was brought by the Respondents seeking to exclude the hearsay. On the 22nd of June a Notice of Motion was issued seeking an Order to vacate the Order pursuant to Section 2 and Section 7. A Motion was brought before me in late July, 1998 seeking to have the proceedings struck out on the basis of delay. I refused such relief. No appeal was taken from that decision.

141. On a factual basis, the complaint of delay from the Respondents requires a degree of "chutzpah" and is quite devoid of merit. The matter could have been heard at least in February, had it not been for the late filing of Affidavits by some of the Respondents. A delay ensued because of the failure of the Respondents to comply with the Order of Shanley J. Furthermore, it was absolutely essential, given the contents of the Affidavits that the Applicants be entitled to enquire into them. Such enquiries were vital in the interests of justice. Various Judges, in the exercise of their discretion, refused to determine the"possession and control" and/or any other preliminary points separately from the whole action. They were entitled to do so. It was open to the Respondent, if unhappy with any Order made by the Courts, to appeal the same. The responsibility for such delays as have occurred lies mainly with the Respondents.

142. The Court accepts that excessive delay constitutes a denial of fair procedures. What constitutes excessive delay must depend on the circumstances of each case. I was referred to the cases of Zimmermann and Stéiner -v- Switzerland 6 E.H.R.R. 17 and Guincho -v- Portugal 7 E.H.R.R. 223 in which the European Court of Human Rights considered the question of delay. Those authorities, while of considerable interest in themselves, are of little assistance in deciding this case. The Zimmermann case concerned "single and lengthy period of total inactivity" and the Guincho case "a total cessation of activity during two years". There was no such lack of activity in the present case. Even had there been a culpable delay, that fact in itself cannot make the Act unconstitutional, unless the Act itself requires that delay or prevents a person alleging prejudice through the delay from seeking redress. The Act has no inbuilt delays other than the time between the making of Orders under Section 3 and Section 4 to which I will refer. Moreover, it was open to the litigants who complain about delay to seek redress in the court. The Respondents in this case availed of such a right. An application to have the proceedings struck out on the grounds of delay failed on its merits. That adjudication was not appealed.

143. It is argued that there should be some built-in time limits in the Proceeds of Crime Act. If there were built-in time limits, that might indeed be of assistance in some cases. On the other hand, it could cause injustice in certain circumstances. In the present case an over-rigid time scale might well have prevented the necessary investigation into some of the Affidavits filed on behalf of the Respondents, and thereby enabled the Court to have been deceived. Every procedure under the Act is presumed to be done in accordance with constitutional fair procedures.O'Brien -v- Bord na Móna [1983] IR 255 decides that absence of an explicit procedure does not render an Act unconstitutional.

144. Central to aspects of the dispute were certain submissions in relation to the structure of the Act. The Act envisages a Freezing Order under Section 2. It provides for the appointment of Receivers, for an Interlocutory Order under Section 3 and finally for a Disposal Order under Section 4. The Interlocutory Order under Section 3 differs from the usualInterlocutory Injunction insofar as not only does it have the function of freezing the assets and preventing dealing in them, but it also provides part of the proof necessary for a Disposal Order under Section 4. While the structure contains certain similarities with themareva-type injunction, the comparison is not an exact one. There is no provision for an undertaking as to damages. Proof of the making of the Interlocutory Order is part of the proof required for a Disposal Order. On an application for a Disposal Order under Section 4 of the Act, a rehearing of the material on which a Section 3 Order was obtained is not envisaged. This is clear from the provisions of Section 4(1) of the Act which provides as follows:-

"Subject to subsection (2), where an interlocutory order has been in force for not less than seven years in relation to specified property, the Court, on application to it in that behalf by the Applicant, may make an order ('a disposal order') directing that the whole or, if appropriate, a specified part of the property be transferred, subject to such terms and conditions as the Court may specify, to the Minister or to such other person as the Court may determine."

145. Section 4(2) provides:-

"Subject to subsections (6) and (8), the Court shall make a disposal order in relation to any property the subject of an application under subsection (1) unless it is shown to its satisfaction that that particular property does not constitute, directly or indirectly, proceeds of crime and was not acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes proceeds of crime."

146. Section 4(6) provides:-

"In proceedings under subsection (1), before deciding whether to make a disposal order, the Court shall give an opportunity to be heard by the Court and to show cause why the order should not be made to any person claiming ownership of any of the property concerned."

147. Section 4(7) reads:

"The Court, if it considers it appropriate to do so in the interests of justice, on the application of the Respondent or, if the whereabouts of the Respondent cannot be ascertained, on its own initiative, may adjourn the hearing of an application under subsection (1) for such period not exceeding two years as it considers reasonable."

148. Section 4(8) provides:-

"The Court shall not make a disposal order if it is satisfied that there would be a serious risk of injustice."

149. The structure provided for by section 4 does not, in my view, contemplate a rehearing of the material on which a section 3 Order was made. In so finding, I do not intend to imply that the Respondent is precluded from presenting to the Court such evidence as may be relevant.

150. Thus, a period of not less than seven years must elapse between the making of the Section 3 Order and the Disposal Order under Section 4. On the application of the Respondent or on its own initiative, the Court may adjourn the hearing of an application for a Disposal Orderfor a period not exceeding two years further. Mr. Forde argues that this constitutes an excessive delay because he cannot get a hearing of his substantive case for at least seven years. He argues that he could have difficulty getting his witnesses and the delay might prejudice him considerably. The Act, he submits,"turns the Statute of Limitations on its head". However, an examination of the structure of the Act reveals this contention to be misplaced. In fact, the seven year period is intended to be in ease of the Respondents. It provides a period of a full seven years in which the Respondent can seek to demonstrate that the assets frozen are not the proceeds of crime, or that it would be otherwise unjust to continue the Section 3 Order. That is the only case they can make on an application for a Disposal Order under Section 4. They are not deprived or prevented or delayed from making their case because it is open to them, any time after the Section 3 Order is made, to make the same case that they could make on the Disposal Order.

151. The contention of the Respondent is based on the misconception as to the structure of the Act, as explained. The misconception is that the hearing under Section 4 will be akin to the usual form of trial in a civil action. However, the structure of the Act, as has been pointed out, is different. On proof that a Section 3 Order has been in place for not less than seven years the Court may make a Disposal Order on application to it in that behalf by the Applicant. The Court shall make a Disposal Order unless, subject to subsections 6 and 8, it has been shown to its satisfaction that the particular property "does not constitute, directly or indirectly, proceeds of crime and was not acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes proceeds of crime." Sub-Section 6 provides for an opportunity to be given to any person claiming ownership of the property to be heard prior to the making of a disposal Order, and sub-section 8 provides that the Court shall not make an disposal Order if it is satisfied that there would be serious risk of injustice. The Act does not contemplate a rehearing of the Section 3 application on an application for a Disposal Order under Section 4.

152. The Respondent claims that he is precluded - in the interval between an application under Section 3 and an application under Section 4 - from relitigating the grounds on which he contended "that there would be a serious risk of injustice" prior to the making of the Order under Section 3(1). Because Section 3(3) refers to "other injustice" it is submitted that it excludes the serious risk of injustice referred to in Section 3(1).

153. Section 3(3) provides as follows:-

"Where an interlocutory order is in force, the Court, on application to it in that behalf at any time by the Respondent or any other person claiming ownership of any of the property concerned, may, if it is shown to the satisfaction of the Court that the property or a specified part of it is property to which paragraph (I) of subsection (1) applies, or that the order causes any other injustice, discharge or, as may be appropriate, vary the Order."

The words "any other injustice" give a very wide discretion to the Court. It may vary or discharge an Order not only where it is shown to the satisfaction of the Court "that the particular property does not constitute, directly or indirectly, proceeds of crime and was not acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes proceeds of crime", but also where it is satisfied that the Order causes any other injustice. "Any other injustice" does not refer back to Section 3(1) of the Act and is not in contradistinction to the "serious risk of injustice" referred to in Section 3(1) of the Act. Furthermore, I do not accept that the principle of res judicata prevents the Respondents from reapplying to have the Order varied or discharged under Section 3(3) of the Act. There is nothing to preclude applications being made from time to time depending on a change in circumstances or additional information coming to light.

HEARSAY EVIDENCE

154. The Respondents object to the use of hearsay evidence in this application. While conceding that hearsay evidence is admissible in normal interlocutory applications, they contend that it should not be allowed in applications under Section 3 of the Proceeds of Crime Act, because they are not interlocutory applications in the accepted sense. Unlike most interlocutory applications there is no requirement for an undertaking as to damages. Moreover, the substantive case cannot be heard for seven years. In the circumstances, the Respondents contend that it is constitutionally unfair that hearsay evidence should be admitted.

155. By using the words "interlocutory" in the section, in my view the Legislature intended that the provisions of Order 40, Rule 4, of the Rules of the Superior Courts would apply. That Rule provides that:-

"Affidavits shall be confined to such facts as the witness is able of his own knowledge to prove, and shall state his means of knowledge thereof, except on interlocutory motions, on which statements as to his belief, with the grounds thereof, may be admitted ...."

156. The provision for hearsay was commented on by Moriarty J. in M. -v- D. Judgment of 10th December 1996 when he said:-

"Clearly, also, the Act adopts a procedure broadly analogous to Mareva applications and it is the established usage of the Courts that some appreciable measure of hearsay evidence is considered acceptable in Affidavits filed on behalf of parties."

"The Rule against hearsay, like any other evidentiary rule, is capable of producing injustice in individual cases, particularly if applied in a rigid and unyielding manner. For that reason, numerous exceptions have been grafted on to the general exclusionary rule, both by judicial decision and legislation." per Keane J. in D.P.P. -v- McGinley [1998] 2 I.R. 408 at p. 413.

157. It is clear, therefore, that the rule against hearsay is a rule of evidence only and is not a constitutional requirement. While it remains "an essential feature" of our legal system it may be modified by statute. I do not accept the contention that it is unfair per se. The unfairness through delay aspect of the argument is based on a misapprehension as to the nature of the proceedings and a misconception as to the processes of the Act (which have already been dealt with). It is open to the Defendant at any time before the bringing of an application under Section 4 for a Disposal Order, to make the same arguments as can be made on that application in order to obtain relief (other than some technical objection that might be taken as to the proof of the existence of the Section 3 Order). It is further contended that if the Act has this structure, the admissibility of hearsay is even more objectionable on the basis that the Disposal Order is achieved, at least indirectly, partly on the basis of hearsay. In that regard, it is necessary to emphasise that the weight to be attached to hearsay evidence is a matter for the Court. The Court is obliged in every case to examine the weight, if any, to be attached to such evidence. If such evidence is challenged in cross-examination its weight could be considerably diminished or indeed rendered at nought. In this case, however, there was no cross-examination of the Deponents in relation to any of the matters of hearsay, notwithstanding that it was open to the Respondents to do so.

158. Moreover, in my view, there is nothing to prevent the Court, on the application of a party from requiring the attendance of a specified person identified as the source of the Deponents' hearsay evidence to the Court in an appropriate case.

159. The Defendant's complaint of "unfairness of a seven year Freezing Order obtained on the basis of evidence that cannot possibly be tested on cross-examination" does not accord with either the structure of the Act or the availability of at least the Deponent to be cross-examined on his Affidavit.

160. It is also worthy of note that the admission of hearsay evidence for an application to forfeit goods survived constitutional scrutiny in the case of United States of America -v- $129,727.00 U.S. Currency and Trujillo 129 F. 3d 486 a judgment of th U.S. Court of Appeals.

THE STANDARD OF PROOF

Section 8(2) of the Proceeds of Crime Act provides that:-

"The standard of proof required to determine any question arising under this Act shall be that applicable to civil proceedings."

161. Counsel for the Applicant submits that this is to be interpreted as meaning the balance of probabilities but Counsel for the Respondents argues that the standard is that required to obtain an interlocutory injunction. The standard, he submits, is a prima facie / statable case.

162. In my view the standard of proof required by the Act is the balance of probabilities.

163. First, the standard of proof required in civil proceedings is generally the balance of probabilities and is understood to be such. In my view that is the most natural interpretation of the subsection.

164. Secondly, the structure of the Act (to which I have already referred) contemplates the making of a disposal order under section 4 of the Act, on proof of existence of an Order under Section 3 for a period of not less than seven years.

165. If such a disposal Order could be obtained by virtue of an Order obtained on a lower standard of proof than that of the balance of probabilities - that could be a fundamentally unfair procedure and unconstitutional. I must, therefore, adopt the interpretation which is constitutional - that is the balance of probabilities.

166. Thirdly, in my view the criteria for obtaining interlocutory reliefs are complex. The evidential standard is stated to be an arguable case but the issue as to the balance of convenience is central to the granting of such an injunction. Moreover, even on such applications, the balance of probabilities arises when the balance of convenience is equal. In those circumstances I agree with Counsel for the Applicant that the "arguable case" criterion set out inCampus Oil Ltd., -v- Minister for Industry and Energy [1983] I.R. 88 is not happily described as a "standard of proof".

ONUS OF PROOF

In the Proceeds of Crime Act both Section 3 and Section 4 contain provisions for the changing of the onus of proof from the Applicant to the Respondent.

167. The Respondents complain that such a shifting of the onus is unfair and impermissible.

168. It is contended that while there may be provision in the criminal law for shifting the onus of proof on a particular issue, because of the protection afforded by the standard of proof being beyond a reasonable doubt, there is no justification in so doing in a civil case.

169. I cannot agree with this contention. In my view, if a procedure is permissible, even under the exacting standards of the criminal law, it may certainly be allowed in civil proceedings. I agree with the submission of Counsel referred to in Clancy v. Ireland [1988] I.R. 326 at page 335 of the Judgment of Barrington J.:-

"Mr. Fennelly has pointed to the fact that there are times, even in criminal proceedings, where parliament has reversed the onus of proof in relation to particular issues. If, he submits, it is permissible to do it in criminal proceedings, a fortiori, it must be permissible to do it in civil litigation".

170. There are many instances where the onus of proof changes in both civil and criminal law. In O'Leary v. Attorney General [1993] 1 I.R. 102; [1995] 1 I.R. 254 a challenge to certain provisions of the Offences Against the State Acts on the basis that the onus of proof was shifted in certain circumstances failed. The Southern Industrial Trust and Clancy cases are both instances of civil cases where the onus of proof shifts.

171. Comparison may be made between the procedures and provisions of the Proceeds of Crime Act and those of the Offences Against the State (Amendment) Act, 1985, which survived constitutional challenge in Clancy -v- Ireland [1988] IR 326. That legislation permitted the freezing of monies by the Minister. In default of application to the Court the monies were forfeited. There were no provisions for ex parte Orders or interlocutory Orders. In that respect, the Proceeds of Crime Act is less stringent in its provisions than the Offences Against the State (Amendment) Act.

172. It is argued, however, that under the Proceeds of Crime Act the entire onus of proof shifts and not just the onus on "discrete" issues. I do not accept that contention. A Disposal Order under Section 4 of the Act is dependant on the existence of an Order under Section 3 for the requisite period.

173. In order to obtain an Order under Section 3 of the Act, it is necessary for the Applicant to prove "possession or control" of the specific property in the Respondent. It is also necessary for the Applicant to prove that "the property constitutes, directly or indirectly, proceeds of crime" or that the property "was acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes proceeds of crime".

174. It is also necessary for the Applicant to prove that the value of the property is not less than [sterling]10,000. Thus, it is clear that the entire onus of proof is not shifted to the Respondent.

The case of John Carway v. The Attorney General [1996] 3 I.R. 300 concerned a challenge to certain provisions of the Companies Acts, 1990. Section 150 contains a provision that in certain circumstances when a company goes into insolvent liquidation, the High Court shall declare that a person to whom the section applies shall not, for a period of 5 years, be appointed or act in any way as a director or secretary or be concerned or take part in the promotion or formation of any company. In those circumstances, the insolvency of the company could be certified by the Liquidator. It was suggested that this was unconstitutional because it certified an issue and did not allow the Court to determine it. The challenge failed.Carroll J. held that the certificate merely triggered off an application and that the onus of proof was then on the directors. There is nothing unfair or unconstitutional in that because the directors are in the best possible position to prove their honesty and the responsibility of their actions.

175. It is submitted that the provisions for reversing the onus of proof "compound the other inequalities" of the Act. In my view, there is nothing unfair or contrary to any concept of equality of arms in the onus shifting in a civil action on the attaining of certain proofs. It is quite reasonable in the context where it appears to the Court that the goods are proceeds of crime that the person in possession be asked to account for them. The Respondent is in a unique position to account for the property. The Act also provides safeguards by the provision in both Sections 3 and 4"the Court shall not make the Order if it is satisfied that there would be a serious risk of injustice" and by the provisions contained in Section 3 for the discharge or variation of the Order.

EVIDENCE OF BELIEF

Section 8(1) of the Act makes admissible evidence of belief. It reads as follows:

"Where a member or authorised officer states-

(a) in proceedings under Section 2, on Affidavit or, if the Court so directs, in oral evidence, or

(b) in proceedings under Section 3, in oral evidence,

that he or she believes either or both the following, that is to say:

(i) that the Respondent is in possession or control of specified property and that the property constitutes, directly or indirectly proceeds of crime,

(ii) that the Respondent is in possession of or control of specified property and that the property was acquired, in whole or in part, with or in connection with property that, directly or indirectly constitutes proceeds of crime,

and that the value of the property or, as the case may be, the total value of the property referred to in both paragraphs (i) and (ii) is not less than [sterling]10,000, then, if the Court is satisfied that there are reasonable grounds for the belief aforesaid, the statement shall be evidence of the matters referred to in paragraph (i) or paragraph (ii) or in both, as may be appropriate, and of the value of the property."

176. Mr. Forde submits that because the belief is based on hearsay the Court should not be satisfied that there are reasonable grounds for the belief aforesaid. I cannot accept that proposition. The basis of many beliefs is information gathered from different sources some of which frequently will be based on hearsay. It is illogical to conclude that it is unreasonable to accept such information. One can readily envisage circumstances where it would be quite wrong to refuse to accept - or indeed act on - information merely because it was based on hearsay.

177. It was further contended that evidence of belief is "plainly unconstitutional if the evidence is that of the Plaintiff himself". No authority was advanced for this proposition. In these proceedings the Chief Superintendent has no personal interest in the outcome of the case. He is not acting for himself. He is the Plaintiff because under the legislation he is entitled to bring these proceedings. I cannot discern any logical constitutional distinction which would allow the admission of opinion evidence in principle, but exclude it if it were that of the Plaintiff.The admission of opinion evidence cannot properly be objected to on the basis of nemo iudex in causa sua, as was contended. It is clear that the right to give opinion evidence does not make the Chief Superintendent a judge in his own cause. It merely makes him a witness.

178. It is contended that opinion evidence is unconstitutional because of "extra-ordinary inequality". It is contended that it is "monstrous" that opinion of the Plaintiff should have a decisive effect in civil proceedings. The admission of evidence of belief provided for in section 8 of the Act does not have the decisive effect contended for. It does not of itself even alter the onus of proof. Opinion of an authorised officer simply becomes admissible as part of the evidence and only if the Court is satisfied there are reasonable grounds for such a belief. Even at that point the onus does not shift to the Respondent unless it appears to the Court that:-

"(a) a person is in possession or control of -

(i) specified property and that the property constitutes, directly or indirectly, proceeds of crime, or

(ii) specified property that was acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes proceeds of crime, and

(b) the value of the property ... is not less than [sterling]10,000.00."

179. Only on the proof of those matters does the onus shift to the Respondent. Even in those circumstances, the Court "shall not make the Order if it is satisfied that there would be a serious risk of injustice". The requirements that the Court be satisfied that there are reasonable grounds for the belief and the provision that the Court shall not make an Order if it is satisfied that there would be a serious risk of injustice, in my view, provide protection for Respondents and prevent the provisions providing for evidence of belief from being unfair.

STATEMENT OF CLAIM: NOTICE FOR PARTICULARS DISCOVERY

Audi alteram partem. Under this principle of natural and constitutional justice it is necessary not only that the other side be heard in any case, but also that the Defendant know the case he has to meet. In this case the Plaintiff had been denied a Statement of Claim and also refused discovery. The Respondent claims that this is constitutionally unfair.There is disagreement between the parties as to whether a Statement of Claim was denied in these proceedings absolutely or whether the refusal was mainly on the basis that the application was premature. As has been pointed out, the only relief claimed in the Plenary Summons was of an interlocutory nature and it appears to me that a Statement of Claim is not appropriate in interlocutory proceedings. In my view there is no constitutional requirement for either a Statement of Claim or a notice for particulars or for discovery. There is, however, a requirement that a person knows reasonably the case that is being made against him and which he has to answer. These requirements may be fulfilled in different ways depending on the type of proceedings and the particular forum. In the instant case, the Defendants are aware not only of the nature of the claim but also of a great part, if not all, of the evidence as well. In those circumstances there is no infringement of any constitutional rights and there is no unfairness. The Act provides a novel cause of action and the procedures have not yet been fully settled. It may be that some procedure other than the Plenary Summons would be more appropriate. The Rules state that the Statement of Claim should set out specifically the relief which the Plaintiffs claim in simple terms. There is nothing to suggest that the furnishing of a Statement of Claim would have given the Respondents more information than they already have. Likewise, discovery and particulars are not matters that a Respondent can have as of right. It may be allowed depending on the individual case. In this context, a complaint is made repeatedly by Mr.Forde that he has no details of the precise crimes and maintains that the proceeds must be of an identifiable crime. The Act uses the word "offence" in Section 1(1) and the complaint is that details of the offence have not been supplied. The Act does not refer to "Proceeds of an offence" or "Proceeds of a crime" but rather to "Proceeds of crime". The Act does not contemplate that the proceeds must be that of an identifiable crime. Indeed, if the crime was identifiable the need for the legislation would be greatly diminished.

LEGISLATION OVERBROAD?

Section 34 of the Offences Against the State Act, 1939 provides, inter alia, that any person convicted of a scheduled offence by the Special Criminal Court shall forfeit any office or employment remunerated from public monies, be disqualified for a period of seven years after the date of conviction for eligibility to hold any such office or employment and, finally, be disqualified from the receipt of any pension, superannuation, allowance or gratuity payable from public monies. In the case of Cox -v- Ireland [1992] 2 I.R. 503, those provisions were held to be unconstitutional. It was held that the State is entitled to provide for the imposition of the penalties contained in the section and to ensure that amongst those involved in carrying out the functions of the State are not included persons who committed crimes against public peace and order and the maintenance and stability of the authority of the State. A distinction could justifiably be drawn between persons in public employment convicted of offences and others. In that case, however, the distinction was excessive in its nature. The provisions were held to be unconstitutional as beingoverbroad and disproportionate to the legitimate objectives of the Act. As such it was an unwarranted attack on the unenumerated constitutional right of a person to earn a living and also on certain property rights. The principle has been described in Kelly, The Irish Constitution, (3rd edition, 1994) at page 732 as "a distinction, though in its nature capable of justification, is unconstitutional if it is excessive in its measure". Kelly says in a footnote that "a similar principle, known as the principle of proportionality, operates under Article 14 of the European Convention on Human Rights."

180. It is submitted that the Proceeds of Crime Act is unconstitutionally overbroad. It fails "as far as practicable" to protect the constitutional rights of the citizen and is accordingly impermissibly wide and indiscriminate in the words of Cox -v- Ireland. Proceeds of crime is defined in the Act as "any property obtained or received at any time (whether before or after the passing of this Act) by or as a result of or in connection with the commission of an offence". It is submitted that that definition is overbroad particularly in relation to the provisions as to time. Section 3 of the Act empowers the Court in certain circumstances to make an Order where it appears that a person is in possession or control of:-

"(i) specified property and that the property constitutes, directly or indirectly, proceeds of crime, or

(ii) specified property that was acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes proceeds of crime."

181. It is submitted that this very wide definition is unconstitutionally overbroad and that the Act is unconstitutionally disproportionate. There is no doubt that the definition section is indeed broad and that the range of property coming within the ambit of section 3 is likewise very extensive. It is, however, difficult to envisage how an Act with the object of the Proceeds of Crime Act as set out byMoriarty J. in M. -v- D., already referred to, could in any way be effective without a broad definition. The Court is moreover precluded from making an Order under Section 3 if it is satisfied that there would be "a serious risk of injustice". The objects of the legislation are legitimate and laudable. For their achievement the legislation has, of necessity, to be widely framed. I am not satisfied that the legalisation is unconstitutional by reason of being overbroad.

182. By reason of the unjustifiably overbroad definition of property it is argued that there is a failure to protect the rights of a bona fide purchaser for value.

183. The Respondents in this case claim that the [sterling]300,000.00, the subject matter of this application, was not the proceeds of crime and have attempted to demonstrate to the Court how they came by the money legally. In those circumstances, it is not open to the Respondents to argue the case of a bona fide purchaser for value without notice. They are precluded from so doing by the principle laid down in Cahill -v- Sutton [1980] I.R. 269 that

"Where the person who questions the validity of a law can point to no right of his which has been broken, endangered or threatened by reason of the alleged invalidity, then, if nothing more can be advanced, the Courts should not entertain a question so raised."(per O'Higgins C.J. at page 276).

UNCONSTITUTIONALLY VAGUE?

184. It is submitted that the constitutional right to fair procedures entails a prohibition on excessive vagueness in statutory provisions. The Court was referred to the case concerning section 4 of the Vagrancy Act 1824, King -v- The Attorney General [1981] I.R. 233, and in particular to the celebrated passage of Henchy J. at pp. 256 - 257:

"It will be seen that, in order to secure a conviction in a prosecution such as this, it is necessary to prove that the accused was a suspected person or a reputed thief and that he was frequenting, or loitering in, any of the named types of places or areas with intent to commit a felony. To prove the intent to commit a felony, no overt act is necessary; instead, that intent may be inferred from the circumstances and from his known character (i.e. previous convictions) as proved to the Court.

In my opinion, the ingredients of the offence and the mode by which its commission may be proved are so arbitrary, so vague, so difficult to rebut, so related to rumour or ill-repute or past conduct, so ambiguous in failing to distinguish between apparent and real behaviour of a criminal nature, soprone to make a man's lawful occasions become unlawful and criminal by the breadth and arbitrariness of the discretion that is vested in both the prosecutor and the Judge, so indiscriminately contrived to mark as criminal conduct committed by one person in certain circumstances when the same conduct, when engaged in by another person in similar circumstances, would be free of the taint of criminality, so out of keeping with the basic concept inherent in our legal system that a man may walk abroad in the secure knowledge that he will not be singled out from his fellow-citizens and branded and punished as a criminal unless it has been established beyond reasonable doubt that he has deviated from a clearly prescribed standard of conduct, and generally so singularly at variance with both the explicit and implicit characteristics and limitations of the criminal law as to the onus of proof and mode of proof, that it is not so much a question of ruling unconstitutional the type of offence we are now considering as identifying the particular constitutional provisions with which such an offence is at variance."

185. It is submitted that the vagueness of the Proceeds of Crime Act is contrary to the right of fair procedures - an unenumerated right under Article 40.3.1 of the Constitution. In this context, the following passage from Kelly The Irish Constitution, Hogan and Whyte eds., (Butterworths, 1994) at page 777 was cited to the Court:

"Another right connected with - one would have said, inseparable from - the administration of justice, namely the right to fair procedures, has frequently been regarded as part of the latent content of Article 40.3, in relation to both civil and criminal proceedings ..."

186. At page 357 of Kelly the following passage from the Judgment of Walsh J. in McDonald -v- Bord na gCon [1965] I.R. 217, (1965) 100 I.L.T.R. 89 is quoted:-

"In the context of the Constitution natural justice might be more appropriately termed constitutional justice and must be understood to import more than the two well-established principles that no man shall be judge in his own cause and audialteram partem."

At page 358 of Kelly it is stated that:-

"While it is true that the phrase 'constitutional justice' embraces the two traditional precepts of natural justice - audi alteram partem and nemo iudex in causa sua - it also goes further by perhaps including certain substantive guarantees as well as by affording greater protection against statutory encroachment. Thus, the concept of 'constitutional justice' probably includes the right to sue for damages for breach of the constitutional right to fair procedures; the right to reasons in respect of an administrative decision; the right to a decision within a reasonable time and a requirement that an administrative decision is based on probative evidence."

187. It is argued that the Vagrancy Act is less vague than the Proceeds of Crime Act. It was pointed out that the Vagrancy Act requires at least an overt act whereas mere possession or control of property is encompassed by the Proceeds of Crime Act. Many different categories of people with different states of knowledge can be subject to the Proceeds of Crime Act. The contention is that the Act is excessively vague and thereby contravenes constitutional requirements of fair procedures.

188. Counsel also referred to a short passage at page 684 of American Constitutional Law by Professor Laurence H. Tribe (Second Edition, 1988):-

" Life, liberty and property could not, furthermore, be taken by virtue of a statue whose terms were 'so vague, indefinite and uncertain' that one cannot determine their meaning."

189. The accompanying footnote refers to Lanzetta -v- New Jersey 306 U.S. 451, 458 (1939), where a conviction under a statute that made it an offence to be a 'gangster' was reversed.

190. It was submitted that the Proceeds of Crime Act is excessively vague in terms of the property to which it refers and the degree of guilt necessary and also that the 'risk of injustice' saver is similarly too vague.

191. The terms of the property targeted in the Act, while very broad are not vague, and a Respondent will, in any given case, be quite aware of what they are. The argument that the Act is unconstitutionally vague in terms of guilt is based on a misconception of the Act. The Act does not necessarily require any degree of guilt. An essential characteristic of the Act is that it acknowledges a dislocation between the possession of an asset and criminality. The proceeds of crime may frequently be in the possession of an entirely blameless third party such as a financial institution. The concept of guilt is not essential to the application of the Act though it may have a bearing on the question as to whether there would be a risk ofinjustice in making an Order in a particular case. In those circumstances I reject the contention, also made, that the 'Risk of Injustice' saver in the Act, is also too vague.

192. It is also alleged the "legislative authority has been devolved by the Courts, contrary to the extended separation of powers". It is submitted that the Court is expected to "carry out legislation on a case by case basis under the guise of interpretation". While it is true that some of the definitions in the Act are very broad, and concepts such as "serious risk of injustice" are also wide, in my view neither the width of the definitions or the scope of discretion are such as to persuade the Court that the legislation requires the Courts to legislate rather than to interpret the law.

EQUALITY OF ARMS

In the Law of the European Convention on Human Rights (1995) by Harris, O'Boyle and Warbrick, the following passage occurs at page 207:-

"The right to 'fair hearing' also requires compliance with the principle of 'equality of arms'. The Commission has expressed the principle, in respect of both criminal and non-criminal cases, as entailing that 'everyone who is a party to such proceedings shall have a reasonable opportunity of presenting his case to the Court under conditions which do not place him at substantial disadvantage vis-à-vis his opponent' ... The principle of equality of arms is an inherent element of a fair trial."

193. Two cases were cited to illustrate the concept. In the case of Ruiz-Mateos -v- Spain (1993) 16 EHRR 505, 541, at paragraph 61, the following passage occurs:-

"The Ruiz-Mateos family alleged a violation of the principle of equality of arms. The Counsel for the State, their opponent in the civil proceedings, was able to submit to the Constitutional Court written observations on the lawfulness of Act 7/1983, whereas they were not allowed to do so because they were held to lacklocus standi; they were even refused the possibility of challenging two judges, whose impartiality appeared to them to be open to doubt. The Commission agreed in substance with this view."

194. Paragraph 63 of the Report is as follows:-

"The Court will examine the complaint in the light of the whole of Article 6(1) because the principle of equality of arms is only one feature of the wider concept of a fair trial, which also includes the fundamental right that proceedings should be adversarial.

The right to an adversarial trial means the opportunity for the parties to have knowledge of and comment on the observations filed or evidence adduced by the other party."

195. I was also referred to the case of Dombo Beheer B.V. -v- The Netherlands (1993) 18 E.H.R.R. 213, where the following passage occurs at paragraph 33 of the judgment:-

"The Court agrees with the Commission that as regards litigation involving opposing private interests, 'equality of arms' implies that each party must be afforded a reasonable opportunity to present his case - including his evidence - under conditions that do not place him at a substantial disadvantage vis-à-vis his opponent."

196. In that case, only two persons had been present at a meeting in which an agreement had been reached. Only one of those two persons was permitted to be heard in evidence. The other party to the agreement was precluded by law. The Court held that this constituted an inequality in arms. At paragraph 32 of the judgment it is stated that "the contracting states have greater latitude when dealing with civil cases concerning civil rights and obligations than they have when dealing with criminal cases." The cases cited by Counsel are extreme. In one case, a vital witness to a contract was precluded from giving evidence and, in the other, one of the parties in dispute was precluded from making certain legal submissions. The principles as enunciated in the above authorities do not in my view demand that the same procedures be available to both parties. The principles appear to apply to both criminal and civil law. Clearly the procedures in criminal law do not require sameness from the prosecution and the defence. The standard of proof is unchanging and one-sided. The onus of proof is generally on one side only. The right to pre-trial documentation is generally confined to one side. The contention the equality of arms demands identical resources does not bear scrutiny. There is no requirement forMega-Bucks Incorporated plc to refrain from using its financial resources in litigation against the Widow Quinn. I cannot accept therefore that the provision for hearsay evidence, opinion evidence, the lack of the Statement of Claim, Discovery and Particulars, and the continuation of an Interim Order provided for in section 2(1)(5) of the Act constitute inequality of arms in the sense contended for. The matters alleged to place the Respondents at a substantial disadvantage, namely, the admission of hearsay and opinion evidence in a section 3 application do not offend against the principle of equality of arms since the deponent who relies on hearsay may be challenged, as may the evidence of belief. The weight attaching to such evidence is likely to be greatly diminished if contradicted on oath or even challenged in cross-examination. Moreover, it must be taken into account that the Respondent in most, if not all, cases is in a unique position to account for property in his possession or control.

UNWARRANTED INTERFERENCE WITH JUDICIAL FUNCTIONS?

"The exercise of the judicial power of the State is confined by theConstitution to the Courts and their judges established under the Constitution. In the hearing and determination of a case within its jurisdiction, the District Court is exercising that judicial power. The doing of any act or the taking of any step by any non-judicial authority in the State, which interferes with, restricts or prevents the District Court from deciding the particular case before it in accordance with the law applicable to it, is an infringement of the judicial power." Per Walsh J. in The State (C) -v- The Minister for Justice [1967] I.R. 106 at page 122.

197. It is contended by the Respondents that a number of provisions of the Proceeds of Crime Act constitute an unwarranted interference with the judicial function. As is stated in Buckley and ors -v- A.G. and another [1950] I.R. 67 at page 84, "[t]he effect of that Article [Article 6] and of Articles 34 to 37, inclusive, is to vest in the Courts the exclusive right to determine justiciable controversies..." A number of cases were cited to the Court as authority in support of that contention. In Maher -v- The Attorney General [1973] I.R. 140, a provision in section 44 of the Road Traffic Act, 1968 that a certificate should be "conclusive" evidence as to the concentration of alcohol in a person's blood was found to be unconstitutional as it purported to remove from a judicial determination a matter which was within the judicial domain. In The State (McEldowney) -v- Kelleher [1983] I.R. 289, Section 13(4) of the Street and House-to-House Collections Act, 1962 was held to be unconstitutional. It obliged a District Justice to disallow an appeal under the Act once a statement on oath to a certain effect was given by a police officer. It was held that"[t]he statute creates a justiciable controversy and then purports to compel the Court to decide it in a particular way upon a particular statement of opinion being given upon oath as to whether or not a statutory reason for refusing the permit exists..."(per Walsh J. at page 306.)

In the case of Cashman -v- Clifford & Ors. [1989] I.R. 121, a restriction imposed on a District Court by limiting the persons who might be heard or adduce evidence before it in relation to an appeal under the Betting Act, 1931 was held to be unconstitutional. Notwithstanding the fact that it did not seek to impose a particular decision on the District Court, the restriction was held to come within the principles stated in the passage inThe State (C) -v- The Minister for Justice, mentioned above. Mr. Humphreys also cited the case of Stran Greek Refineries & Anor -v- Greece (1994) 19 E.H.R.R. 293, which he aptly described as the European Buckley -v- The Attorney General. In that case, the State infringed the Applicant's rights under Article 6(1) of the European Convention on Human Rights by intervening in a manner which was decisive to ensure that the - imminent - outcome of proceedings in which it was a party was favourable to it. The State in that case enacted legislation while proceedings were pending rendering the award invalid and unenforceable. It is contended that a number of provisions in the Proceeds of Crime Act constitute unwarranted interference with the judicial function

(1) Section 2(5) of the Act provides that an Interim Order shall expire after twenty-one days from the date of the making unless the Applicant applies for interlocutory relief in which case it is automatically continued. It is argued that the absence of a provision for the Court to discharge the Interim Order on its own motion is an unwarranted interference and an invasion into the judicial domain.

(2) The provision in the Act for a seven year interval between an Order under section 3 of the Act and a Disposal Order under section 4 is also contended to be an invasion into the judicial domain.

(3) It is argued that the provision in section 8 of the Act which limits the opinion evidence in such a way that it only allows opinion evidence to be given on behalf of the Applicant and not on behalf of the Respondent is an unwarranted interference with the judicial power to receive evidence. A complaint is also made that the Court must discharge the interim Order at the request of theApplicant but is not compelled to do so on the request of the Respondent. That, in my view, is not indicative of inequality nor is it an unwarranted interference in the judicial domain. The discharge of an Order under Section 2 normally has the effect of terminating the proceedings. There are good reasons why an Applicant can be in control over his own litigation but to assert that the Respondent should be entitled to terminate the proceedings as of right is not a sustainable proposition. The provision by which an Interim Order continues by virtue of the Applicant seeking an Interlocutory Order might be open to serious objection were there not a provision for the Respondent also to apply to have the Interim Order discharged by showing certain things to the satisfaction of the Court. The bringing of an appeal undoubtedly prolongs the existence of a section 2 Order where a section 3 Order has been refused. The seven year interval between Section 3 and Section 4 proceedings does not constitute an invasion into the judicial domain any more than does a statute of limitations. In my opinion, it does not amount to an unconstitutional interference with judicial power. Moreover, I do not consider that the section interferes with the Courts' power to determine justiciable controversies. The Court is not influenced in any way by the Legislature in determining the issue of whether an Order under section 3 should be granted.

198. Nor can I accept that the provision for the reception of evidence of belief on the part of the Applicant only and not on behalf of the Respondent is an unwarranted interference with the judicial power to receive evidence. Moreover, as has been pointed out, the right of the Legislature to provide for the admission of evidence of belief has survived constitutional scrutiny even in criminal cases. No authority was cited for this proposition. There is no requirement in law or in justice that requires evidence of belief, if admissible by legislation, concerning any particular matter to becounter-balanced by a similar provision for the opposing party.

EXECUTIVE FUNCTION?

199. Article 34.1 of the Constitution provides that:-

"Justice shall be administered in Courts established by law by Judges appointed in the manner provided by this Constitution ..."

200. It is contended on behalf of the Respondents that the Proceeds of Crime Act is unconstitutional in that it requires the Court to carry out intrinsically Executive functions. The expropriation of land, it is contended, is intrinsically an Executive rather than a Judicial function. The Respondent cited the case of theAttorney General for Australia -v- The Queen and the Boiler-makers' Society of Australia & Ors [1957] AC 288. In that case is was held that:-

"it is not permissible under the Constitution of the Commonwealth of Australia for the Dominion Parliament to enact that upon one body of persons - Tribunal or Court - arbitral functions and judicial functions shall be together conferred."

201. The following passage from page 317 of the judgment was cited:-

"The functions must not be functions which Courts are not capable of performing consistently with the judicial process. Purely administrative discretions governed by nothing but standards of convenience and general fairness could not be imposed upon them. Discretionary judgments are not beyond the pale but there must be some standards applicable to a set of facts not altogether undefined before a Court can hear and determine a matter".

202. The colourful - and at the time appealing - prospect of a High Court Judge directing traffic with his tipstaff on O'Connell Bridge pursuant to the provisions of a theoretical Road Traffic Act containing legislation to that effect was cited to illustrate the proposition.

203. The Court was referred to the case of In the Matter of CountyGlen plc. (Under Investigation) [1995] 1 I.L.R.M. 213. In that case, the question arose as to what constituted the administration of Justice. The Inspector appointed to investigate the affairs of a company applied to the Court for a direction as to whether his functions constituted the administration of justice. Murphy J., in the course of hisjudgment at pp. 216-217, said as follows:-

"Does the giving of directions under that subsection constitute the administration of justice? The fact that Orders under that subsection must be made by a Judge of the High Court does not of itself determine whether such Orders constitute the administration of Justice. AsWalsh J. pointed out in The State (O) -v- O'Brien [1973] I.R. 50, at page 67,

'the quality of the act is to be determined by the act itself, not by the person who is doing the act'.

Important decisions made by Judges in relation to the composition of Courts and the listing of criminal trials have been held to be administrative procedures rather than the administration of justice (In re Singer [1963] 97 I.L.T.R. 130 and McGlinchey -v- Governor of Portlaoise Prison [1988] I.R. 671). Furthermore in In re R. Limited [1989] I.R. 126; [1989] I.L.R.M. 757, Walsh J. adverted to the fact that

'many matters which come under the headings 'lunacy and minor matters', probably do not constitute the administration of justice but simply the administration of the estates and affairs of the Wards of Court.'

Not only do I agree with the view tentatively expressed by Walsh J in In re R. Limited, but I believe that it is generally accepted in practice, though not tested formally, that many Orders made in the course of the winding-up of companies by the Court are merely administrative directions and not the administration of justice. Indeed in recent years practice directions have been made by the President of the High Court which expressly recognise that Orders for the extension of time for thelodgment of a Statement of Affairs, a direction to the Taxing Master to tax costs already awarded and other similar matters can and should be made informally and in camera".

204. Some of the functions carried on by the Courts in relation to licensing matters are essentially Executive or administrative as has been pointed out in 3rd edition of Kelly The Irish Constitution at p. 50.

205. In my view, the functions given to the Court under the Proceeds of Crime Act essentially constitute the administration of justice. The granting of injunctions, the appointing of Receivers, the granting of tracing remedies and the determination of ownership of property are clearly matters with which Courts have traditionally been engaged. I do not consider that they may correctly be classified as essentially Executive or administrative functions. The Proceeds of Crime Act envisages findings of fact and determinations by the Court with very far-reaching effects. If and insofar as any of these provisions could be regarded as administrative or Executive functions, they are not thereby automatically removed from the ambit of the Courts. If the Act contains incidental powers conferred on the Courts which are of an administrativenature that does not render the Act or those provisions constitutionally infirm. There is nothing in the doctrine of the Separation of Powers as applied to the Irish Constitution that puts the functions of the Courts into watertight compartments. As noted in Kelly,The Irish Constitution, Hogan and Whyte eds., (3rd Ed. 1994) at page 50 "complete insulation is not a feature of the Legislature", "complete insulation is not a feature of the Executive" and "complete insulation is not a feature even of the Courts".

USE OF MATERIAL OBTAINED UNDER PROVISIONS OF THE CRIMINAL JUSTICE ACT 1994 IN THESE PROCEEDINGS:

206. Objection was taken to the use in these proceedings of certain information obtained under section 63 of the Criminal Justice Act, 1994 in garda investigations. It was argued that it was improper and impermissible that the information so obtained should be used in these proceedings by the Criminal Assets Bureau. The case of Taylor and Ors -v- Serious Fraud Office and Ors [1998] 4 All ER 801 was cited in support of that proposition.

207. That case concerned the extent to which documents obtained by discovery by reason of their disclosure as unused material in criminal proceedings may be used by a third party in other proceedings. The headnote reads:

"Action - implied undertaking not to use disclosed material for collateral purposes".

208. It was held that the accused was not entitled without the leave of the Court to provide Mr. Taylor with a letter to allow him use it as the basis of a defamation claim against the Serious Fraud Office.

In the case of Desmond and Dedeir -v- Glackin and Ors [1993] 3 I.R. 67 certain information came into the hands of the Central Bank acting as agents for the Minister for Finance. It was held that the Minister for Finance was entitled to divulge that information to the Minister for Industry and Commerce. An Inspector appointed pursuant to the Companies Act, 1990 by the Minister was entitled to use the information so obtained for the purposes of the investigation.

209. In his judgment, at page 98, O'Hanlon J. referred to the English case of Marcel -v- Commissioner of Police [1991] 2 W.L.R. 1118, and said:-

"It was held by Browne-Wilkinson V-C that, since the police were authorised to seize, retain and use the documents only for public purposes related to the investigation and prosecution of crime and the return of stolen property to the true owner, they were not entitled to disclose documents seized under the Police and Criminal Evidence Act, 1984, to a third party to enable him to use the documents in civil proceedings to protect his legal rights since the public interest in ensuring that the documents were used solely for the public purposes for which the power of seizure was conferred was inviolate and outweighed the public interest in ensuring that in the civil proceedings all relevant information should be available to the Court.

It was further held that where the police or any other public authority used compulsory powers to obtain information and documents from a citizen, that information and those documents were received solely for those purposes and equity would impose on the public authority a duty not to disclose them to third parties except by order of the Court."

210. The decision of the Vice-Chancellor was set aside by the Court of Appeal which held that a subpoena duces tecum could lawfully be served "on the police for the purpose of compelling production in civil proceedings of documents which they had seized in exercise of their powers under Part II of the Police and Criminal Evidence Act, 1984."

211. At pp. 101-102 of the Report O'Hanlon J. says as follows:-

"Putting the duty of confidentiality at its highest level, as was done by Browne-Wilkinson V-C before his suggested statements of principle were qualified in a material respect by the Court of Appeal, he appeared to accept that the powers to seize documents which he was there considering were conferred for the better performance of public functions by public bodies, and he considered that they should not be used to make information available to private individuals for their private purposes.

In the present case what is involved is the communication of information obtained in the course of performance of his public functions by a public body (the Minister for Finance), and the communication of that information by him to another public body (the Minister for Industry and Commerce) for use by an inspector appointed by him under the Act of 1990 in carrying out other public functions arising under the provisions of that Act.

I do not share Browne-Wilkinson V-C's stated apprehension about the consequences of sharing information lawfully obtained across a wide spectrum of state agencies and consider that it may be helpful for good government and the welfare of the community. The Vice-Chancellor considered at p. 1130 that '[t]he dossier of private information is the badge of the totalitarian state'. I would think that the protection of a free society must rest on surer grounds than the operation of the affairs of State in watertight compartments."

212. This passage in the judgment of O'Hanlon J. was specifically approved by McCarthy J. in the Supreme Court which upheld the decision of O'Hanlon J. He said at page 132 of the Report:

"I am satisfied that there is no principle of law, nor indeed is there any principle of common sense, which would prohibit a Minister of State who properly has obtained from an agent carrying out on his behalf a statutory power vested in him, information which may be of assistance to another Minister of State in carrying out a statutory duty imposed on him, such as the investigation by an inspector appointed under Section 14 of the Act of 1990, from assisting that investigation."

213. In my view, similar considerations arise in this case. I can see no good reason why the information obtained by the Gardaí in a criminal investigation should not be available in these proceedings - which have a public dimension to them - and while they are not criminal proceedings they are specifically concerned with the proceeds of crime.

214. It is further suggested that Detective-Sergeant O'Brien was acting in some way mala fides in his application to the District Court for a Production Order obtained under Section 63 of the Criminal Justice Act and referred to in paragraph 4 of his fifth Affidavit which reads as follows:-

"Mr H has previously stated that he has never transacted business for G.M., the first named Respondent and that he has never received any monies from Mr M., whether directly or indirectly. Since the date on which I filed my last Affidavit in these proceedings, as a result of further investigations carried out by me I can say that G.H. did in fact act in a professional capacity for G.M. On the 12th May, 1998 on foot of a production order obtained pursuant to Section 63 of the Criminal Justice Act 1994 I received from AIB Bank, International Banking Services of Ashford House, Tara Street, Dublin 2, three original bank drafts".

215. Mr. Forde submits that it was 'perfectly clear' from that paragraph that the motive for his particular requests for a Production Order in the District Court was to deal with Mr. H.'s Affidavit. There is no evidence whatsoever to justify that contention and it is worth noting that Detective-Sergeant O'Brien was not cross-examined in this application although he was available for cross-examination.

216. Furthermore, insofar as it was contended that there was something wrong in Detective-Garda Richardson travelling to England to obtain the money, I reject that contention. She was authorised to go and collect the money and that is what she did. There is no evidence of any contact, much less impermissible contact, with her colleagues in the U.K. It may be appropriate to state that, in my view, there was no requirement on Mr. Galvin to notify Mr. H. of anything prior to his appointment as Receiver.

FINALITY OF SUPREME COURT ORDERS

Section 3(5) of the Act provide as follows:-

"Subject to subsections (3) and (4), an interlocutory order shall continue in force until -

(a) the determination of an application for a disposal order in relation to the property concerned,

(b) the expiration of the ordinary time for bringing an appeal from that determination,

(c) if such an appeal is brought, it or any other further appeal is determined or abandoned or the ordinary time for bringing any further appeal has expired.,

whichever is the latest, and shall then lapse."

Section 9 of the Act provides that at any time during proceedings under section 2 or 3 or while an interim or an interlocutory order is in force, the Court or, as appropriate, in the case of an appeal in such proceedings, the Supreme Court may make certain Orders.

217. It is argued that the words 'any further appeal' contemplate or permit an appeal beyond the Supreme Court, and that the lack of such words in section 9 strengthens the argument. If the Act provided for an appeal beyond the Supreme Court it would be contrary to the provisions of Article 34.4.6 of the Constitution which provides that the decision of the Supreme Court shall in all cases be final and conclusive. It is the duty of this Court to construe the Act in accordance with the presumption of constitutionally. In my view, it is quite reasonable to construe the words'any further appeal' as any further appeal on different issues to the Supreme Court and that is the way the provisions of section 5(3) of the Proceeds of Crime Act should be read.

RETROSPECTIVE?

218. The Respondents submitted that on a proper interpretation of the definitions section of the Act it applied to offences prior to the date of coming into force of the Act. Alternatively, he submits that there is an ambiguity concerning the interpretation of section 1. If there is such an ambiguity the Section must be strictly construed because of the principle of strict construction of penal statutes and also because of the presumption for prospective and against retrospective legislation. I accept that those are the correct principles of interpretation.Furthermore, I accept that "if an enactment is expressed in language which is fairly capable of either interpretation, it ought to be construed as being prospective only." I was referred to Section 1(2) of the Extradition (Amendment) Act, 1994 and Section 31(11) of the Criminal Justice Act, 1994, both of which specify "before or after the commencement" of the Act or its relevant section. A passage was cited from the judgment of Murphy J. in Chestvale Properties Ltd. -v- Glackin [1993] 3 I.R. 35 at page 43 as follows:-

"At common law there was a presumption, a strong presumption, that a statute is intended by Parliament to operate prospectively and not retrospectively."

In the case of Dublin County Council -v- Grealy [1990] 1 I.R. 77, Blayney J. referred to a passage in the judgment of O'Higgins C.J. in Hamilton -v- Hamilton [1982] I.R. 466 where the Chief Justice cited with approval the dictum of Wright J. in Athlumney's case [1898] 2 QB 547 at pp. 551-1:-

"Perhaps no rule of construction is more firmly established than this - that a retrospective operation is not to be given to a statute so as to impair an existing right or obligation, otherwise than as regards matters of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment ..."

219. Or, as Henchy J. put it also inHamilton -v- Hamilton at page 484 of the Report "unless there is a clear and unambiguous intention to the contrary expressed or necessarily implied ..."

220. I was also referred to the case of in In re Hefferon Kearns Ltd. (No. 1) [1993] 3 I.R. 177, where the Court declined to apply the statutory provision on reckless trading in relation to matters which predated the Act in default of an express provision for so doing, and to the case of Land Commission -v- Dolan [1930] I.R. 235, where Sullivan P. stated at page 236 that the rule of construction is well established: "[t]he sub-section must not be construed so as to operate retrospectively unless it is clear that the Legislature so intended." Counsel also referred me to the Judgment of Barron J. in O'H. -v- O'H. [1990] 2 I.R. 558.

In section 1(1) of the Act, 'proceeds of crime' is defined as "any property obtained or received at any time (whether before or after the passing of this Act) by or as a result of or in connection with the commission of an offence." That definition clearly contemplates property received before the passing of the Act "as a result of the commission of an offence". In order for something to be the result of the commission of an offence, it has to come after the commission of that offence. The Act thus contemplates property obtained before the passing of the Act but after the commission of an offence. In my view, therefore, the Act clearly and unambiguously contemplates offences committed before the Act. That intention appears clearly from an examination of the definition of"proceeds of crime".

In any event, the Act is prospective not retrospective. The action upon which the Act focuses is a possession or control of the proceeds of crime. It is only possession or control after the fourth day of August 1996 to which the Act attaches consequences. It does not affect the possession or control of anything prior to the coming into force of the Act. While the Act looks at events that predated the coming into force of the Act, it cannot be said to have a retrospective operation. At page 387 ofCraies on Statute Law (7th Edition), it is stated that "a statute is not properly called a retrospective statute because part of the requisites for its action is drawn from a time antecedent to its passing."

THE FACTS

221. On the 22nd July 1997 Detective Sergeant Paul O'Brien was investigating and following the trail of certain monies belonging to the first named Respondent, G.M. and in particular, two bank drafts for [sterling]25,000 sterling and [sterling]23,000 sterling respectively which were made out to the first named Respondent. In the course of his enquiries the Detective Sergeant had occasion to search the office of the fourth-named Respondent, Mr. H., a Solicitor, and there he found a file entitled "B -M/D", B being the second named Respondent, M. being the first named Respondent and D being an associate of the first named Respondent in this application. The file contained an attendance indicating that B. was "representing G.M." the first named Respondent. It appeared to Sergeant O'Brien that the monies in question had gone into an account of Mr. H., the fourth named Respondent. On the following day, Sergeant O'Brien asked Mr. H. how much money was being held relative to the file B - M/D which also bore the name of the third named Respondent P.C. Limited. He was told by the fourth named Respondent that the amount was [sterling]300,000. Having sought and failed to obtain an assurance from Mr. H. that the monies would not be moved, application was made to the Court on the 28th July 1997, and an order under section 2 of the Act was made. An order under section 7 of the Act appointing Mr. Galvin as Receiver over the said monies was also made.

222. On foot of that order Mr. Galvin attended the office of Mr. H. and sought the [sterling]300,000 from him. It then emerged for the first time that the [sterling]300,000 included Irish pounds and pounds sterling, and that a substantial part of the money - [sterling]181,356.20 - was held in Mr. H.'s reserve client account in a branch of the Nat West Bank in London. On being asked Mr. H. said that by means of subtraction from the figure of [sterling]300,000 he must have [sterling]118,643.80 in his Ulster Bank client account in Dublin. On being requested to do so by the Receiver pursuant to the Order of the Court Mr. G.H. signed an authority directly to the bank to give to D/Garda Cliona Richardson a bank draft in the sum of [sterling]181,375.20 sterling payable to Mr. Galvin the Receiver. The document having been prepared, D/Garda Richardson went to London where she collected the relevant funds on behalf of the Receiver. Mr. Galvin obtained from Mr. H. a cheque in the amount of [sterling]118,643.80 drawn on the Ulster Bank Account. Monies from both accounts are lodged in a receivership account.

223. While this application concerns the [sterling]300,000 already mentioned, it is necessary to examine other transactions in order to determine whether the order under section 3 should be granted or not. Those other transactions can be conveniently divided into transactions concerning a sum of [sterling]75,000 in the London bank account and transactions concerning a sum of [sterling]169,746.36.

THE [sterling]75,000 STERLING

1. A sterling demand draft in the sum of [sterling]25,000 in favour of G.M. the first named defendant and dated the 25th May 1996, endorsed on the back "lodge to H Solicitors" was lodged on the 30th May to the London account ofG.H. The lodgment docket said "credit GM". This lodgment was made by Mr. H. and appears in the client reserve account for P.B. on the 30th May.

2. A further sterling demand draft in the sum of [sterling]25,000 dated the 24th June in favour of G.M. and endorsed on the back "pay H. Solicitors" was lodged by bank giro paid in by Mr. H. to the London bank on the 8th July 1996. It appears in the client reserve account for P.B.

3. Another sterling demand draft for [sterling]25,000 dated July 3rd 1996 in favour of David D. endorsed on the back "pay H. Solicitors" reserve a/c was lodged by bank giro dated the 5th July 1996 by G.H. to the London account and stamped July by the bank on the 9th July 1996. The lodgment appears in the client reserve account for P.B. on the 9th July. Thus [sterling]75,000 emanating from G.M. and David D. was lodged by Mr. H. to the client reserve account for P.B. in the course of approximately six weeks. That money was given to Mr. H. for lodgment by P.B.

224. On the 18th July 1997 Mr. G.H. sent a fax to the London bank re "GM - our client" asking for a copy of a transfer order in respect of certain monies namely [sterling]10,000 which was to be paid to the credit of G.M. the first named Respondent in a specified account in the Allied Irish Bank in Tallaght, Dublin 24. Of the [sterling]75,000 emanating from G.M. which was lodged in the London bank a sum of over [sterling]34,000 was paid to P.C. Limited the third named Respondent, which is a company owned by Mr. P.B., the second named Defendant. Of that [sterling]75,000 which was lodged, monies were disbursed at the behest of P.B., some to G.M. himself and some to P.C. Limited, the company of P.B. No explanation has been forthcoming for any of these transactions other than that contained in the document found on Mr. H.'s premises on the 22nd July 1997 and dated the 4th July 1996 which read "attendance on P.B. where he confirmed to me that he was instructed by Mr. G.M. and Mr. David D. for whom he was arranging finance to enable them to purchase a property in the United Kingdom. These clients are looking for an investment property in the region of one million pounds". It is dealt with in the affidavit of Mr. H. as follows:

225. It was dealt with in the affidavit of Mr. P.B. as follows:

"At a time when Mr. B. asked me if I would act in connection with this transaction, I informed him that I would have to get instructions directely from Mr. M. and Mr. D. before taking the matter further or at the very least, I would have to get written instructions upon which I could rely before I would act."

226. Mr. H. is making the case that G.M. was a potential rather than an actual client. The evidence shows that Mr. G.H. did the following:

1. He lodged two bank drafts made out to G.M., and one to David D. into the London account.

2. He flew to London to secure the release of [sterling]10,000 of money which was to be transferred to G.M.'s account in the AIB in Tallaght.

3. In correspondence with the bank he referred to "our client GM".

4. He opened the file 0575 B - M/D which contains instructions from G.M. and D.D. to P.B. concerning the proposed purchase of property in the U.K.

227. Referring to the letter of instruction to the bank in relation to a transfer of monies to Mr. M, Mr. H. states:

"This transfer is couched in such terms as be open to the interpretation that the instruction was given on behalf of the GM named in the letter as being a client of Haughtons."

228. In view of the fact that the letter specifically refers to him as "our client" it is difficult to interpret the said letter in any other way. Even if Mr. H. is correct in that he was acting for P.B. who in turn was acting for G.M. Mr. H.'s affidavit contains the following averment:

'I have never received any monies from G.M. whether it be the person named as the first named Defendant in these proceedings or any other GM directly nor have I received any such monies indirectly to the best of my knowledge information and belief'

229. I do not accept that testimony in view of the fact that, on his own admission, Mr. H. lodged two bank drafts to G.M. made out to the London account. Moreover, the reason furnished by G.M. for having a foreign sterling account - namely to facilitate customers who would be affected by the exchange rate - is singularly unconvincing. As a Solicitor qualified to practice in England and Wales there is nothing improper with him having a sterling account, or indeed a client account. However, there is nothing to prevent him having a sterling account in this jurisdiction. Moreover, Mr. H. gives no convincing account as to what a Solicitor was doingwith all these monies which had been lodged. He was less than candid with the Court. In this context the rather self-righteous tone of parts of his affidavit ring hollow indeed.

The [sterling]169,746.36

230. In the Solicitor's accounts print-out used in relation to the Dublin client account of Mr. H. there appears a credit dated the 30th September 1996, it in the sum of IR[sterling]169,746.36. The account given by Mr. H. in his affidavit is that the said sum was transferred to his client account on the instructions of P.B. from the account of solicitors "in connection with his business". Of that the sum of[sterling]15,000 went to Mr. H.'s firm. Over [sterling]79,000 went to the third named Respondent P.C. Ltd. which is beneficially owned by P.B. Two sums, one of [sterling]50,000.00 and another of [sterling]25,000.00 went to P.B. Two further payments one of [sterling]38,000 and one of [sterling]26,000 were made to P.C. Ltd. and a payment of precisely 1% was made to Mr. H. Mr. P.B. accounts for the monies as follows in his affidavit: (I have used initials instead of names)

"(a) Mr T. a resident of Sierra Leone, with whom I had previous dealings, was selling diamonds to Mr I. The nature of the transaction involved Mr T. shipping the diamonds to Antwerp where they were being held pending payment by or for Mr I. in respect thereof into a Solicitors' Clients' account. On notification that the money had been so received, Mr T. would cause the diamonds to be released to Mr I. That is what happened here.

(b) The role of PC Limited in this matter was to facilitate a transaction by identifying a Solicitor into whose Clients account the money could be paid, and also hold moneys (sic) to the order of Mr T. who, because of the deteriorating situation in Sierra Leone, wanted to hold monies outside that country.

(c) What then happened was that monies totalling [sterling]169746.36 were credited to the Solicitors' Clients' account and identified in respect of the purchase price due to Mr T. from Mr I..

(d) I played no part in arranging those monies nor in the direct transfer of those monies into the Solicitors' Clients' account.

(e) I understand that the fact that the money had been received into the

account was notified to Mr T. and that he gave instructions for the release of the diamonds to Mr. I.

(f) In any event, I was instructed to make payments from those funds held in the Solicitors' Clients' account. The instructions were given to me by Mr T."

231. This account as Counsel for the Applicant pointed out is "exotic even on its face" and there are no supporting affidavits from either Mr. T. or from Mr. I. Moreover, there is no mention at all of Mr. T. or of this transaction by Mr. H. in his affidavit; yet on the account given by Mr. B., Mr. H. was the safekeeper of Mr. T's money. He merely says that "the sum of [sterling]169,746.46 was transferred into our Client account on the instructions of P.B. from the account of P.F. & Co. Solicitors". There is no credible evidence before the court of any instructions from Mr. T. nor indeed Mr. I. There is evidence of a hearsay nature in the affidavit of Detective Sergeant O'Brien. He says that he was informed and believed by a certain Mr. K. that he was approached by Mr. B. the third named Respondent, who was then a business associate of his. P.B. asked him to lodge money into a solicitor's account. He gave him an envelope. Mr. K. lodged the money with Mr. PF Solicitor. The monies contained a total of [sterling]198,000 which included two drafts for [sterling]25,000 sterling drawn on the AIB in favour of G.M. and [sterling]23,000 drawn on the EBS. He states that he was informed by Mr. F. the Solicitor that he F negotiated certain of the other instruments in the envelope. On the instructions of Mr. K., having reimbursed the amounts negotiated, he lodged a total of [sterling]169,746.36 to the client account of H. and obtained a bank draft in the sum of [sterling]28,000 which he gave to Mr. K. That lodgment included a bankdraft and an E.B.S. cheque payable to the first named G.M.. He was informed by Mr. K. that B. directed him to pay the money into the client account and gave him a number for that purpose. Both F. and Mr. K. told the deponent that they had no dealings with either Mr. T. or Mr. I. On the 11th August 1997 Mr. F received a large white envelope. In it there was a smaller envelope and a letter purporting to come from Mr. D. I. onnotepaper called "Timemarch Construction Northern Limited" purporting to be dated the 23rd August 1996 - almost one year previously - and approximating to the time when Mr. F had received the [sterling]198,000 through Mr. K. The letter corroborates Mr. P.B.'s interest in purchasing diamonds through P.C. Ltd and the deal with Mr. T. On the 15th September Mr. F solicitor received a fax on similar notepaper purporting to come from Mr. I. apologising for the fact that there had been an investigation and asserting that the transaction had been bona fide. Garda Denis O'Leary, a Bureau Officer of the Criminal Assets Bureau received, a fax from Mr. I. denying that he had ever written either letter referred to dated Monday March 23rd 1998. It is worth recording in full.

"Dear Mr O'Leary,

I have been informed by Mr C. that you telephoned him and informed him you had letter on "Timemarch" letter headed paper with my signature to a person called PF, I wish to inform you herein now I have no knowledge of this man or any such letter as you described to Mr C.! This letter you say you have can only be a fraudulent document, as myself and all connected at that time to "Timemarch" have no knowledge whatsoever of such a letter or the person PF and there is no record of any correspondence between this man and "Timemarch" which you would expect if the letter was real. As I said above it is obviously fraudulent.

Signed:

D. I."

232. It would appear, therefore, that the version of Mr. B is in conflict with that of Mr. K., Mr. F and Mr. I. as well as in some particulars with that of Mr. H. Moreover, the former Managing Director of 'Timemarch' Northern Limited informed the Gardaí that, as of the 23rd August 1996 (the purported date of the first letter) the company had ceased trading, and furthermore that it had been struck off the register of companies some ten months before the date of the second letter. Much of the evidence of DetectiveGarda O'Brien is of a hearsay nature. The amount of reliance that could be placed on such evidence varies from case to case. The court must approach such evidence with particular caution and a degree of scepticism. In this case however, it has been amply demonstrated that in relation to these proceedings that much of the evidence of Mr.P.B. is patently untrue and was deliberately cynically manufactured - a topic to which I will return. Secondly, the account given in relation to [sterling]169,000 is inherently unlikely. Thirdly, no effort was made to challenge the evidence of Sergeant O'Brien in this regard. I am satisfied that the account given by Mr. P.B. is untrue and that given by Sergeant O'Brien is correct. This being so, there is evidence of yet more money being given by Mr. P.B. through P.F. & Co. to Mr. H. some of which at least, that is the Bank draft for [sterling]25,000 and the EBS cheque [sterling]23,000, comes from G.M. It was lodged by Mr. H. in the Client account of P.B.

233. The sum in excess of [sterling]169,000.00 therefore came from monies supplied by Mr. P.B. to Mr. K. Part of those monies consisted of an AIB sterling demand draft made out to Mr. G.M. in the sum of [sterling]25,000.00 and another cheque from the EBS Building Society to Mr. G.M. in the sum of [sterling]23,000.00. Those monies were lodged in Mr. H.'s client account for Mr. P.B. The said monies were disbursed as follows: [sterling]15,000.00 and later a sum of [sterling]1,697.00 (being 1% of the total) were paid to Mr. H.'s firm. Sums of [sterling]79,647.00 and a further sum in excess of [sterling]38,000.00 went to P.C. Ltd., the company controlled by Mr. B. and a sum of [sterling]50,000.00 and a further sum of [sterling]25,720.00 were paid to P.B. himself. The Court has not been told why.

234. It is in the context of these findings concerning the [sterling]75,000 sterling and the [sterling]169,746.36 that the evidence concerning the [sterling]300,000, the subject matter of this application, must be evaluated.

235. In relation to the [sterling]300,000 the subject matter of these proceedings, the matter is dealt with in the Affidavit of Mr. B. at paragraph 4:-

"The allegation that the [sterling]300,000 which stood to the credit of P.B. and/or P.C. Ltd. in the client account of H. solicitors 'is beneficially owned by G.M.' See paragraph 3 of Mr. O'Brien's Affidavit of 28th July, 1997.

Response:

1. The replying evidence of Mr. G.H., Mr. B. McM. and Mr. D.J.M. addresses this allegation. The [sterling]300,000 was not, nor ever has been beneficially owned by G.M. The sum of [sterling]300,000 came from Mr. McM. and from Mr. M. in the sums deposed to in their Affidavits. Neither Mr. H.'s firm nor I have to my knowledge received any money from G.M."

236. Mr. M. in his Affidavit dated the 30th January 1998 averred that he knows Mr. P.B., the second-named Defendant for over 5 years and was appraised in March 1997 of an investment. A contract proposal was sent. The proposal was exhibited in his Affidavit, and promised high returns and a very little risk to capital.

237. In January 1997 he had arranged for the sale of a portion of his shareholding in a Liberian logging company and the results of the shares generated [sterling]130,000 sterling, which funds were available for short-term investment. He then exhibited what he called true copies of correspondence relating to this transaction. He stated in April 1997 cash funds were realised and he arranged to visit Dublin to sign the contract and hand the funds to P.B. the second-named Defendant, which he did and he stated that he handed over [sterling]90,000 in cash. These monies were obtained from the sale of his shares in the Liberian Logging Company and had no criminal provenance either direct or indirect. He refers to a copy of the contract dated April 28th 1997. This deponent says that he holds diplomatic status as a consultant. He exhibited a letter fromP.B. on P.C. Limited notepaper with the address of 19 Peel Road, Douglas, Isle of Man, dated 3rd March 1997, he exhibited documentation signed by G.W. Gb. to verify the fact that he had money from Liberia and some further correspondence.

238. D.J.M. also exhibited a memorandum of the agreement by which he lent

239. P.C. Ltd., the third-named Respondents, the money. This accounts for [sterling]90,000 of the [sterling]300,000 the subject matter of this claim.

240. The provenance of the rest was explained in the Affidavit of B. McM. He stated he has known Mr. P.B. for six years and in April 1997 he was approached with the proposal. At the time he was in control of funds belonging to D. Textiles Limited. He consulted with the managing director of D. Textiles and got Power of Attorney. Monies had been generated from the proceeds of six shipments of goods from Latvia to D. Textiles, which shipments were sold primarily to market traders for cash. The proceeds of six shipments were in excess of [sterling]220,000. The deponent exhibited a Power of Attorney and a letter of authority. He referred to the shipping import documents, invoice documents and Customs certificates relating to shipment of goods. He lodged the proceeds of sale generated from the imported goods with G. Financial Services, a company which carries on, inter alia, the business of a Bureau de Change .

241. During the correspondence with Mr. P.B. and his company, P.C. Limited, he was satisfied with the investment and proceeded to sign an agreement dated the 26th May, 1997 to invest [sterling]180,000 sterling. He obtained that money from D. Textiles's account at G. Financial Services in the form of two cheques for [sterling]90,000 in favour of Messrs. H. Solicitors. He gave those cheques to Mr. B. upon signing the agreement between the parties. He referred to a copy of the agreement. On the 18th June 1997 he obtained [sterling]15,000 cash from G. Financial Services and signed a further contract with P.C. Limited for an investment of that [sterling]15,000. On the 23rd June 1997 he obtained a further cheque from G. Financial Services, again made payable to Messrs H. Solicitors in the sum of [sterling]14,105.00. He added [sterling]895.00 cash and signed a further contract with Mr. B. of P.C. Ltd. for [sterling]15,000. He exhibits a true copy of that agreement.

[sterling]180,000 together with two sums of [sterling]15,000 make up the balance of the money, that is [sterling]210,000. Memorandums of Agreement dated 26th May for [sterling]180,000, the 18th June 1997 in respect of [sterling]15,000 and 23rd June 1997 in respect of [sterling]15,000 are all exhibited.

242. Amongst the exhibits of Mr. M.'s affidavit is an exhibit showing that the proposal made to him by Mr. B., was contained in a letter dated the 3rd March 1997. It is D.G.M. 1 in his Affidavit.

243. In the material recovered from a shredder located beside Mr. B's desk in his home on the 6th August 1997 was a handwritten draft of the purported letter of the 3rd March 1997. The presence of a draft of the said letter in a shredder beside the desk of P.B. is unexplained - and inexplicable ofter than in terms of a sham.

244. Exhibit D.G.M.2 in the Affidavit of Mr. M. is a letter of the 25th February purported to be signed by Mr. G.B. of C. Corporation confirming payment to Mr. M. of [sterling]90,000 sterling. The docket has been reconstructed from the shredder of Mr. B. and it is apparent that this is the same letter as that contained in Mr. D.G.M's letter of the 25th February 1997. It is however unsigned. It is difficult to understand how P.B. would have in his possession in August 1997 a letter from a Liberian company to Mr. M. of the 25th February, but it is impossible to understand how he could have an unsigned version of the document. The unescapable conclusion is that this is a fabricated document has not being contradicted. A further letter, purported date 4th June 1997, was found in the shredder. This is a letter providing updated information to Mr. M. and suggested contracts were signed on the 30th May. What appears to be ahandwritten draft of the letter of the 4th June 1997 was also found in the shredder. As can be seen from the draft, the dates of both the letter and the purported agreement have been subjected to considerable alteration. The Sergeant says that he believes that this shows thecorrespondence and the purported agreement are not genuine but were concocted in late July and early August to provide some explanation for the source of funds in Mr. H.'s account.

245. A draft letter of the 14th May, an unsigned letter from Mr. M. to P.B. dated the 11th June and an earlier draft of the agreement dated 28th April 1997 were also found in the shredder. No explanation has been forthcoming in relation to these documents.

246. It is clear from the evidence of D/Inspector Patrick Byrne that the agreements which, according to Mr. P.B., were the source of the[sterling]300,000 the subject matter of these proceedings were all created on his computer in August of 1997. It is equally clear that a Letter of authority and a Power of Attorney referred to in the Affidavit of B. McM. were all documents generated on the computer in Mr. B.'s house. I am quite satisfied that Mr. B. was involved in a premeditated, calculated, sophisticated and outrageous attempt to deliberately mislead this Court. His explanation as to the genesis of the money, the subject matter of these proceedings - is in shreds.

247. Having regard to the evidence tendered by the Applicant I am satisfied that the Respondents herein are in possession and control of [sterling]300,000 and that that property constitutes directly or indirectly the proceeds of crime or was acquired in whole or in part with or in connection with property that directly or indirectly constitutes the proceeds of crime and that the value of the property is not less than[sterling]10,000. Far from it being shown to the satisfaction of the court on evidence tendered by the Respondent or any other person that the money does not constitute directly or indirectly proceeds of crime and was not acquired in whole or in part with or in connection with property that directly or indirectly constitutes the proceeds of crime or that the value of property is less than[sterling]10,000 the view of the Court is reinforced and strenghtened by the evidence proffered on behalf of the Respondents. Moreover, I am satisfied that there is no serious risk of injustice in making the order. Accordingly, I am prepared to make an Order under section 3 of the Act as sought by the Applicants. It is appropriate to make the Order as against all the Respondents including Mr. H.

248. As I have already indicated, I am prepared to allow the applicants to amend their pleadings appropriately.

249. The applicants further seek the appointment of Mr. Galvin as Receiver over the said monies in the event of such an Order being necessary. In my view, it is appropriate that a fresh Order be made and accordingly I make an Order appointing Mr. Barry Galvin Receiver over the monies the subject matter of this application until further Order of the Court.