High Court of Ireland Decisions

 
THE HIGH COURT

001/11493P

IN THE MATTER OF THE PROCEEDS OF CRIME ACT 1996

BETWEEN

Mc K

PLAINTIFF

AND
M D, P P, D W
AND
P W

DEFENDANTS

Judgment of Finnegan P. delivered on the 3rd day of March 2003.

This matter comes before me by way of a Notice of Motion by the 2^nd 3^rd and 4^th named Defendants seeking an order compelling the Plaintiff to reply to Notices for Further and Better Particulars dated 26^th July 2002, 4^th November 2002 and 16^th December 2002.

So far as principally relevant to this application the Statement of Claim pleads as follows –

"6 The Defendants are in possession and/or in control of property set out in the Schedule to the Plenary Summons herein.

7. The scheduled property constitutes, directly and/or indirectly, the proceeds of crime within the meaning of the 1996 Act. Further or in the alternative (but without prejudice to the foregoing) the said property was acquired, in whole or in part, with or in connection with property that, directly or indirectly, constitutes the proceeds of crime within the meaning of the 1996 Act.

Particulars

The scheduled property constitutes, directly and/or indirectly, the proceeds of crime committed by the first named Defendant and/or crimes planned or orchestrated by him and/or from which he benefited, directly or indirectly.

Further or in the alternative (but without prejudice to the foregoing) the said property was acquired, in whole or in part, with or in connection with property (and particularly money) that, directly or indirectly, constitutes the proceeds of crime committed by the first named Defendant and/or planned or orchestrated by him and/or from which he benefited, directly or indirectly.

Further or in the alternative (but without prejudice to the foregoing) the scheduled property constitutes, directly or indirectly, the proceeds of crimes committed by the second, third and fourth named Defendants and/or crimes planned or orchestrated by them and each of them and from which they benefited, directly or indirectly.

Further or in the alternative (but without prejudice to the foregoing) the said properties were acquired, in whole or in part, with or in connection with properties (and particularly money) that, directly or indirectly, constitutes the proceeds of crimes committed by the second, third and fourth named Defendants and from which they benefited, directly or indirectly".

The 2^nd named Defendant delivered a Defence and Counter claim. The Defence so far as relevant pleads as follows:

"5. Under paragraph 7 of the Statement of Claim the 2^nd, 3^rd and 4^th named Defendants deny that the scheduled property or any property in their possession or control constitutes directly or indirectly the proceeds of crime whether within the meaning of the Proceeds of Crime Act 1996 or otherwise and put the Plaintiff to strict proof of his allegations as set out in paragraph 7 of the Statement of Claim. The 2^nd, 3^rd and 4^th named Defendants further deny that the said property was acquired by them in whole or in part either directly or indirectly from the proceeds of crime planned or orchestrated or committed by the 1^st named Defendant or from the 1^st named Defendant and puts the Plaintiff to strict proof as to the assertions made by him to the contrary in his Statement of Claim.

6. The 2^nd named Defendant denies that the said scheduled property constitutes directly or indirectly the proceeds of crime committed by him and further denies that the said property constitutes either directly or indirectly the proceeds of crime planned or orchestrated by him or by the 3^rd and 4^th named Defendants from which he benefited directly or indirectly and puts the Plaintiff to strict proof as to the assertions made by him in paragraph 7 of his Statement of Claim.

The 2^nd named Defendant denies that the said properties were acquired in whole or in part with or in connection with property whether monies or otherwise that directly or indirectly constitutes the proceeds of crime committed by him or by the 3^rd and 4^th named Defendants and from which he or his said co-defendants benefited directly or indirectly.

The 2^nd named Defendant avers that the said property was acquired as the result of a legitimate agreement between him and his said co-defendants and E A for the purpose of investing in various securities through the Bank of Ireland. In the premises the 2^nd named Defendant denies that he has benefited directly or indirectly from the acquisition or use of the proceeds of crime as alleged or at all."

The counter claim of the second named Defendant so far as relevant pleads as follows

"16. In or about 1998 monies were provided to the 3^rd named Defendant which were invested with the Bank of Ireland with the consent of the said E A. The said monies are still invested with the Bank of Ireland but are subject to an Order made by this Honourable Court denying the 2^nd 3^rd and 4^th named Defendants the right to use or deal with the said monies. As a direct result of the actions of the Plaintiff the 2^nd 3^rd and 4^th named Defendants have suffered loss in that interest to be paid on the said investment monies have not been paid and they are unable to carry out their contract relating to the investment monies with E A. The 2^nd 3^rd and 4^th named Defendants have provided sufficient information to the Plaintiff to make him fully aware of the origins of the said monies but the Plaintiff has continued to allege that the monies are the proceeds of crime. It is averred that the said monies are not the proceeds of crime for the reasons set out herein and in the Affidavits of the parties referred to herein.

The 3^rd and 4^th named Defendants have each delivered a Defence and Counter claim in which in relation to themselves they raise the like pleas.

Some elements of the history of this action are also relevant to this application. On the 18^th July 2001 I made an order herein pursuant to the Proceeds of Crime Act 1996 section 2. The Plaintiff issued a Notice of Motion returnable for the 27^th July 2001 seeking an order pursuant to the Proceeds of Crime Act 1996 section 3 and in relation thereto the 2^nd, 3^rd and 4^th named Defendants swore Affidavits. The 2^nd named Defendant deposed that he had no personal or business relationship with the 1^st named Defendant. He denies any involvement with the alleged criminal activities of the 1^st named Defendant. He denies that the monies the subject matter of this action which are in bank accounts in his name are the proceeds of crime and avers that they are monies obtained by him legitimately by way of a loan transaction. The 3^rd and 4^th named Defendant filed an Affidavit in similar terms to that of the 3^rd named Defendant.

The 2^nd named Defendant swore a further Affidavit herein on the 14^th January 2002 dealing with the source of the loan referred to in the Affidavits sworn by the 2^nd 3^rd and 4^th named Defendants. In that Affidavit he identified the owner of the funds as one Mr. E A who he believed a person of considerable wealth resident in Spain and from whom he intended to obtain an Affidavit. Therein he avers that the monies do not belong either directly or indirectly to the 1^st named Defendant.

Mr. E A swore an Affidavit on the 4^th March 2002 at the request of the solicitor to the 2^nd 3^rd and 4^th named Defendants but specifically states that the request was made by that solicitor in his capacity as solicitor to the 2^nd named Defendant. The averments in that Affidavit, again so far as the same relate to this application, are as follows –

"2 I am a private citizen residing in Spain. I have lived in Spain since 1982 and I am a person of good character and well known to the Spanish authorities, which can be determined by character references which I will disclose at such time if and when it is needed. I have been a successful businessman before I retired dealing in property and other commodities.

3. I have known D W since the early 90s when I first met him in Spain and struck up a friendly relationship with him. We had several things in common especially an interest in property. D was at that time a builder and after some time it was agreed that I would lend him monies in order to help him purchase properties, develop them and sell them for profit. I have loaned him different sums of money during our friendship, and in 1998 I entrusted with him a sum of One Million Sterling. The money was given to him in cash and come from my general capital resources. Being a businessman I gave Mr. D W permission to purchase any run down properties he knew about and we came to an agreement about this. But after holding the monies for a time then D informed me that he had a medical problem and could no longer carry on his activities as a builder. He then suggested to me that I should allow him to invest the said monies namely the sum of One Million Sterling in securities in a bank in the Republic of Ireland. He informed me that he could get a good return on the money and as I trusted him I agreed to allow him to invest the monies. He told me that the rates which could be earned on invested money in Ireland were very good and I allowed him to proceed. I believe that he with the assistance of his son invested the said money with the Bank of Ireland at its branch in Dundalk in the Republic of Ireland. I kept in touch with D and it was agreed between me and him that he would benefit from a percentage of the interest earned upon the sum of One Million Sterling which was invested with the Bank of Ireland. The actual amount to be paid to him was to be 10% of the total profit.

4. I have been advised that I will be required to attend Court in Dublin and give oral evidence in support of what I said in the Affidavit and I am willing to do so."

The function of Pleadings is to define with clarity and precision the issues of fact and law between the parties. Where issues are so defined each party will have given fair and proper notice to his opponent of the case he has to meet and each party will be enabled to prepare his own case for trial. Discovery can be directed to the issues and delay and expense thereby incurred minimised. See McGee v O'Reilly 1996 2 I.R. 229. Insofar as the particulars sought here are concerned I must ascertain whether the Applicant on this motion will be taken at a disadvantage by the introduction of matters which could not fairly be ascertained from the Statement of Claim and the particulars furnished to date. The Defendants are entitled to know in broad outline the case that will be advanced against them at the hearing. Where a Statement of Claim is so general or so imprecise that the other side cannot know what case he will have to meet at the trial he should be entitled to such particulars as will inform him of the range of evidence as distinct from any particular items of evidence which he will have to deal with at the trial: Cooney v Browne & Others 1985 I.R. 185.

A special feature of proceedings instituted pursuant to the Proceeds of Crime Act 1996 are the provisions in relation to evidence contained in section 8 thereof. Where a member or authorised officer of the Criminal Assets Bureau states his belief that the property constitutes directly or indirectly the 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 the proceeds of crime and the court is satisfied that there are reasonable grounds for the belief the statement is evidence of such matters. If a Defendant is to meet such evidence it is essential that he should know the grounds for the belief. Also relevant are the provisions of the Criminal Assets Bureau Act 1996 section 8(7) which provides that information, documents or other material obtained by a Bureau Officer or any other person under the provisions of the sub-section shall be admitted in evidence in any subsequent proceedings. The combined effect of the Proceeds of Crime Act 1996 section 8 and the Criminal Assets Bureau Act 1996 section 8(7) can make it more difficult than would otherwise be the case to distinguish between facts and evidence when considering whether particulars furnished in any particular case are adequate.

Having regard to the foregoing I propose considering a Notice for Particulars dated 26^th June 2002 and the replies thereto dated the 26^th July 2002 and 4^th November 2002 and the Notices for Further and Better Particulars dated 25^th November 2002 and 16^th December 2002.

The Statement of Claim in paragraph 6 pleads that the Defendants are in possession and/or in control of the property set out in the Schedule to the Plenary Summons. In relation to this plea the Defendant sought copies of documents upon which the Plaintiff will rely and these were furnished with the reply to the Notice for Particulars dated 4^th November 2002. The Plaintiff also sought particulars as follows –

"If the Plaintiff relies upon the alleged fact that the 1^st Defendant has or had joint possession with the 2^nd, 3^rd and 4^th Defendants of the said property identify:

(i) Each and every person or body relied upon to show such joint possession.

(ii) Each and every transaction stating the property involved, the terms of the transaction, the parties to the transaction, the date of the transaction.

This Particular I am satisfied seeks details of the evidence upon which the Plaintiff will rely and accordingly the Plaintiff is not obliged to reply to the same. The Plaintiff did however reply to the same in his replies of both the 26^th July 2002 and 4^th November 2002. The effect of these replies is that the Plaintiff's case is that the assets in question in whole or in part are the proceeds of crime committed by the1st named Defendant or in the alternative in whole or in part the proceeds of crime committed by the 2^nd, 3^rd and 4^th named Defendants. It is not pleaded in either the Statement of Claim or in the replies to the Particulars that the 1^st named Defendant and the 2^nd, 3^rd and 4^th named Defendants have or had joint possession of the assets. In these circumstances I will not direct a further reply to this request.

In relation to paragraph 7. of the Statement of Claim the 2^nd, 3^rd and 4^th named Defendants seek particulars of the specific crimes upon which the Plaintiff will rely at the hearing of the action. The true scheme of the Act is that the Plaintiff is not required to rely upon specific crimes or to relate the assets in question to any specific crime: see McKenna v Farrell & Another High Court (unreported) Finnegan P. 24^th February 2003. In the reply to Particulars dated 4^th November 2002 the Plaintiff sets out full particulars of the criminal activity alleged against the 1^st named Defendant and the 2^nd, 3^rd and 4^th named Defendants. The Plaintiff in paragraph 7. of the Statement of Claim pleads that the assets in issue constitute directly or indirectly the proceeds of crime and in the alternative that the same were acquired in whole or in part with or in connection with property that directly or indirectly constitutes the proceeds of crime. The Defendant seeks in Particulars to have the Plaintiff distinguish between those of the assets which it is alleged fall into each of these alternative categories. As the plea is in the alternative it is not necessary that the Plaintiff should do so. Again having regard to the fact that the plea is in the alternative it is not necessary that the Plaintiff should distinguish between assets which are related to crimes alleged to have been committed by the 1^st named Defendant and crimes alleged to have been committed by the 2^nd, 3^rd and 4^th named Defendants. The 2^nd,3^rd and 4^th Defendants also seek that the Plaintiff identify more precisely the proceeds of crime referred to stating the basis upon which it is alleged that such property actually constitutes the proceeds of crime giving full particulars of the crimes allegedly committed. The Plaintiff's reply to this request is sufficient having regard to the circumstance that he will be confined to the particulars which he has given and also having regard to the provisions of the Proceeds of Crime Act 1996 section 8 and the Criminal Assets Bureau Act 1996 section 8(7). The 2^nd, 3^rd and 4^th named Defendants sought confirmation that the only assets with which these proceedings are concerned are those set out in the Schedule to the Plenary Summons and this confirmation was furnished.

The Statement of Claim pleads that the Defendants and each of them were aware of the matters referred to in paragraph 7. thereof and the 2^nd, 3^rd and 4^th named Defendants in their Notice for Particulars of 27^th June 2002 seek full details of the facts and matters relied upon by the Plaintiff in relation to this plea. Order 19 Rule 22 provides as follows –

"Wherever it is material to allege malice, fraudulent intention, knowledge, or other condition of the mind of any person it shall be sufficient to allege the same as a fact without setting out the circumstances from which the same is to be inferred".

Having regard to this provision of the Rules it is not incumbent on the Plaintiff to reply to this request.

In relation to paragraphs 10. and 11. of the Statement of Claim the 2^nd, 3^rd and 4^th named Defendants seek a statement of the present value of the assets sought to be affected including all interest earned thereon and charges made thereon since 1998. I cannot see that this information is necessary to enable the 2^nd, 3^rd and 4^th named Defendants to conduct their defence. The assets in question all stand in their names and the information is available to them for the asking from the institution concerned. In any event with the Reply to Particulars of 4^th November 2002 the Plaintiff furnished up to date statements which clearly showed the value of the assets to exceed the statutory threshold of €12,697. The 2^nd, 3^rd and 4^th named Defendants are not entitled to a reply to this request.

Following receipt of the Replies to Particulars dated the 26^th July 2002 and 4^th November 2002 the 2^nd, 3^rd and 4^th named Defendants pressed for further and more detailed replies. Having regard to what I have said in relation to the Notice for Particulars dated the 27^th June 2002 and the replies thereto dated 26^th July 2002 and 4^th November 2002 it was inappropriate that they should do so. The Plaintiff at the hearing of the action will be confined to the Particulars given in response to the Notice for Particulars subject however to the discretion which the court always enjoys upon such terms as it thinks appropriate whether as to costs or otherwise in relation to any amendment of the Pleadings. The Notice for Further and Better Particulars dated 16^th December 2002, insofar as the matters raised therein have not been addressed by me herein, is in the nature of a request for the evidence upon which the Plaintiff will rely and a reply to the same is not appropriate.

Having regard to the foregoing the 2^nd, 3^rd and 4^th named Defendants are not entitled to the relief which they seek.