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Cite as: [2005] IEHC 433

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Judgment Title: Rogers & Ors v Maloney & Ors

Neutral Citation: [2005] IEHC 433

High Court Record Number: 2004 638JR

Date of Delivery: 21/12/2005

Court: High Court

Composition of Court: O'Leary J.

Judgment by: O'Leary J.

Status of Judgment: Approved

Neutral Citation Number: [2005] IEHC 433

THE HIGH COURT

Record No. 638JR/2004

BETWEEN

PAUL ROGERS, PATRICK ROGERS AND BARNROE LIMITED

Applicants

AND
GEORGE MALONEY, THE DIRECTOR OF CORPORATE ENFORCEMENT, THE COMMISSIONER OF AN GARDA SÍOCHÁNA, THE DIRECTOR OF PUBLIC PROSECUTIONS AND DISTRICT JUDGE GEOFFREY BROWNE

Respondents

JUDGMENT delivered by The Honourable Mr Justice O’Leary on the 21st day of December 2005
Following the lodging of a grounding statement seeking judicial review and other relief supported by an affidavit of the first named applicant dated 23rd July, 2004, an order granting leave to apply for judicial review was made by Mr. Justice O’Neill in the following terms:
1. An Order of Certiorari quashing the decision of the first and/or second named respondent to seek from the fifth named respondent through an Officer appointed by the second named respondent a search warrant dated the 10th of June 2004 to enter onto the premises at 4 Kiltalawn Cottages, Blessington, Dublin 24.
2. An Order of Certiorari quashing the decision of the second named respondent to appoint the first named respondent as an officer of the Director of Corporate Enforcement within the meaning of s. 3 of the Company Law (Amendment) Act 2001 pursuant to a decision of the second named respondent dated the 26th of May, 2004.
3. An Order of Certiorari quashing the decision of the fifth named respondent to sign and issue a search warrant authorising Garda Kevin Peake and/or such other persons as the said Garda Peake thought necessary to inter alia enter onto the premises named in the said warrant dated the 10th day of June, 2004, to execute the said warrant in the manner therein provided.
4. An Order of Mandamus compelling the respondents to return forthwith to the applicants all items which have been unlawfully seized and retained by the servants or agents of the second and/or third named respondents
5. An Order of Mandamus compelling the respondents to return forthwith to the applicants all items seized and retained by the servants or agents of the second and/or third named respondents, as set out in the inventory exhibited in the affidavit grounding the within application.
6. An Order of Prohibition prohibiting the first, second, third and fourth named respondents from taking any further steps in the proceedings initiated by the second named respondent herein pursuant to the Company Law Enforcement Act 2001.
7. An Order of Prohibition prohibiting the third and/or fourth named respondents from taking any further steps in proceedings against the first applicant entitled the Director of Public Prosecutions at the suit of Garda Kevin Daly and Paul Rogers Charge Sheet No 28413.
8. An Order of Prohibition prohibiting the first, second, third and fourth named respondents from taking any steps to institute any proceedings against the applicants or any of them on foot of any evidence obtained on foot of the said warrant dated the 10th of June, 2004.
9. An Order of Prohibition prohibiting the respondents or any of them from taking copies of any of the documentation or data seized by the servant or agents of the second or third named respondents on the 10th of June, 2004, whether held electronically or otherwise.
10. A Declaration that the powers delegated to the first respondent pursuant to a decision of the second respondent dated the 26th of May, 2004, were limited to the powers specified in the schedule to the said decision.
11. A Declaration that the fifth named respondent did not have any or any proper regard to proper consideration in signing and permitting the issue of the said Warrant based on the information dated the 10th of June, 2004.
12. A Declaration that the search warrant dated the 10th day of June, 2004, was unlawfully obtained.
13. A Declaration that the material information referred to in the warrant related solely to the items specified in the letter of demand dated the 27th of May, 2004 from the respondent.
14. A Declaration that the said warrant on the face of it did not entitle the respondents or any of then to seize and remove from the custody of the applicants any documents or other items which were not material information and/or had not been specified in the letter of demand of the first named respondent dated the 27th of May, 2004.
15. A Declaration that the servants or agents of the third named respondent were not authorised by the search warrant dated the 10th day of June, 2004, or by the Company Law Enforcement Act 2001, to remove any computer hardware, lap tops, computer software, CCTV, tapes, or electronic equipment from the premises named on the said warrant.
16. A Declaration that the search warrant dated the 10th of June, 2004, did not entitle the servants or agents acting on behalf of the third named respondent to bring onto and use a camcorder to record the search carried out by the servants or agents of the second and/or third named respondents.
17. A Declaration that the first named respondent acted unreasonably and contrary to the rules of natural and ordinary justice in failing to provide a reasonable time frame for the production of the documents sought by the letter of demand dated the 27th of May, 2004.
18. A Declaration that the first named respondent acted unreasonably and contrary to the rules of natural and ordinary justice in failing to extend the time for the production of the said documentation required, despite a request made in writing by the first named applicant by letter dated the 31st of May, 2004.
19. An Order for discovery of the video of events recorded by a camcorder used by a servant or agent of the third named respondent during the course of the search on the premises named in the warrant dated the 10th June, 2004.
20. A direction pursuant to Order 84 r. 20(7) to the effect that the grant of leave to apply for judicial review shall operate as a stay on the following proceedings:

(a) The proceedings entitled the Director of Public Prosecutions at the suit of Garda Kevin Daly and Paul Rogers Charge Sheet No. 28413 pending the outcome of the within application;

(b) All charges which may be preferred at any time in the future arising out of evidence obtained on foot of the said warrant dated the 10th of June, 2004, pending the outcome of the within proceedings.

21. Damages for trespass, negligence, breach of duty and misfeasance of public office.

22. Any necessary or ancillary orders and/or such further and other order as this Honourable Court deems proper.

23. Costs.

By notice of motion dated 19th August, 2004, the applicants applied for judicial review in the above terms.
The matter came on for hearing before this court on 29th June, 2005. The Court has had the benefit of the following evidence in its consideration of the matter;
1. Affidavit of Paul Rogers dated 23rd July, 2004
2. Affidavit of the first named respondent dated 1st November, 2004.
3. Affidavit of Garda Kevin Peake sworn 19th October, 2004.
4. Affidavit of Garda Jim Clavin sworn 15th October, 2004.
5. Affidavit of Garda Jerry McGroarty sworn 14th December, 2004.
6. Affidavit of Garda Paul Flood sworn 15th December, 2004.
7. Affidavit of Aonghus Dwane sworn 21st December, 2004.
8. Replying affidavits (four in number) of the first named applicant to first named respondent, Jim Clavin, Kevin Peake, and a joint reply to Jerry McGroarty and Paul Flood all dated 3rd May, 2005.
9. Affidavit of second named respondent dated 3rd May, 2005.
10. Affidavit of discovery of Dermot B Morahan dated 6th May, 2005.
11. Affidavit of Sergeant Denis O’Sullivan dated 27th May, 2005.
12. Affidavits of Patrick Rogers two in number dated 24th June, 2005.
13. Affidavit of Ian O’Reilly dated 20th June, 2005.
14. Oral evidence of Garda Kevin Peake on cross-examination on his affidavits.
Judgment was reserved pending a hearing of a related application under the Companies Acts 1963 – 2003 by the Director of Corporate Enforcement against the first and second named applicants.

Background facts
The first and second named applicants are directors of the third named applicant, a limited liability company. For reasons which are extraneous to this application the third named applicant Company (hereinafter referred to as ‘the Company’) came to the attention of the second named respondent (hereinafter referred to as ‘the Director’). The Director concluded that he should delegate his powers requiring inter alia the production of books and records as provided in section 19 of the Companies Act 1990, as substituted by s. 29 of the Company Law Enforcement Act 2001, to the first named respondent.
By instrument dated the 26th May, 2004, the Director delegated to the first named respondent the said powers under s 19(3) Companies Act 1990, together with the consequential powers of the Director under ss. 19(4)-(5) under the Act of 1990.
The Director produced at the time of the delegation a schedule showing his reasons for the appointment of the first named respondent as ‘The Authorised Officer’ (this being the name by which the delegated person is known following the delegation). These reasons outlined the opinion of the Director that there were circumstances existing which suggested (on the basis of a statement of facts attached to the document) breaches of s.19(2) (b) (i) of the Companies Act 1990 and further breaches of ss. 297 - 297A of the Companies Act 1963 and s. 242 of the Companies Act 1990.
The first named respondent (hereinafter called the ‘Authorised Officer’) took the following steps and set in train the following events
1. On the 27th May, 2004, he caused to be sent to the applicants a letter setting out his appointment and requiring the applicants to produce at the Authorised Officer’s office listed categories of documents no later than 5 p.m. on Monday 31st May, 2004.
2. The first named applicant replied on 31st May, 2004, seeking more time on the basis that the Company had had difficulties with creditors and other matters which would delay the request.
3. This letter was acknowledged on 1st June, 2004, and a meeting was suggested.
4. A further letter from the Authorised Officer dated 2nd June, 2004, gave a deadline of 5 p.m. on 3rd June, 2004, for the production of documents and further required the attendance of the first named applicant at the Authorised Officer’s office at 3p.m. on Friday 3rd June, 2004, ‘in accordance with s. 19 of the Companies Act 1990’.
5. The requirements were not complied with.
6. Detective Garda Peake visited the premises which contained the registered office of the Company in the period up to 10th June, 2004, for the purpose of establishing the lay out of the property. He noted that the registered office of the company was not identified in the required manner by a notice. He also noted that the property contained a number of properties not separately identified.
7. The applicant applied to and was granted by the fifth named respondent a search warrant in respect of premises known as 4 Kiltalawn Cottages.
8. In the information on which the search warrant was issued Garda Peake pointed out the difficulty of separately identifying the registered office of the Company at 4c Kiltalawn Cottages from the remainder of the property known as 4 Kiltalawn Cottages. The information further identified that the first named applicant and/or the company may have committed an offence under s. 19(6) of the Companies Act 1990 by their failure to produce books and records and by the failure of the first named applicant to attend as required.
9. On 10th June, 2004, the search warrant was executed by Garda Peake as the designated officer. The entire premises, known as 4 Kiltalawn Cottages, were searched. Books, documents and other material were seized on the authority of the search warrant. Material alleged to be the subject of the search warrant was taken not only from the separate building used by the Company (though this use was not known to the designated officer until the search was in progress) but also from each of the other buildings including the dwelling which forms part of the premises.
10. A comprehensive schedule of the documents (and other material if any) was not taken by either the authorities or the Company and their remains uncertainty as to what exactly was taken.
11. The Authorised Officer sent back to the Company all material which was found not to be relevant and sent copies of the retained documents. As there is no definitive list of what was originally taken neither party could inform the Court with certainty that all material was returned in original or copied form.
12. The number of documents taken was in the order of 120,000.
13. Arising from the foregoing events the first and second named applicants are the subject of an application for disqualification pursuant to s. 160 of the Companies Act 1990.
14. No criminal prosecution of any party has been mounted. The period for the prosecution for summary offences has expired but it is still possible (though very unlikely) that charges based in indictment could be proffered.
In the circumstances as set out the applicant seeks a myriad of reliefs which have been distilled to the following matters raised in the legal submissions of the applicants.
I. The first and second named respondent acted unreasonably and contrary to the rules of natural justice in the fact of and the manner in which they sought the search warrant
II. The search warrant was illegally issued
III. As a result of the foregoing illegality any information gathered cannot be used.
Reasonableness of action of first named respondent
It is a matter to be considered later whether the search warrant as issued is valid or of any legal effect. There was however a series of steps taken by the first named respondent which need to be assessed under this heading.
It appears to this court that the second named respondents reasons for invoking the powers under the Act of 1990 in relation to the affairs of the Company and the manner in which the requirement was made by the first named respondent were matters within the reasonable discretion of the respondents. Further the orders so made were not defective or unreasonable to such a degree (or in fact at all) as to permit them to be set aside by way of judicial review.
Notwithstanding the foregoing, the requirement that the documents be produced in the period between the receipt of the demand (28th May, 2004, at the earliest) and the time and date by which the documents were required i.e. 5.00 pm, 31st May, 2004, was unreasonable. If the remainder of the process depended on this demand then the Court would consider whether the whole proceedings should be vitiated. The production of 120,000 documents in such a short space of time when there is a criminal penalty for concealment (which may in the view of the Court be inferred in certain circumstances) would require a compelling reason. An example of such an emergency would be a fear of the possible destruction of the documents in the event of delay. No such concerns arose in this case.

The legality of the search warrant
The legality of the search warrant is challenged on a number of grounds. The Court must consider whether these objections are of significance or have a legal basis. The following matters were the subject of legal submissions in this regard.
Was there sufficient evidence before the District Judge in relation to an alleged offence under s.19 (6) of the Act of 1990?
It is clear both from the written information produced to the District Judge exhibited to this court and the oral evidence of Garda Peake that the Garda had sufficient information to himself form that view and that he did pass on that information to the District Judge. This Court may or may not have arrived at the same view but the decision taken by the District Judge on this matter was taken within his jurisdiction.
Did the warrant, if valid, otherwise authorise the entering of a private dwelling and/or did it, if valid, otherwise cover all the buildings on the site?
The warrant was issued on the basis that there was a difficulty in relation to the division of the site into 4, 4A and 4C, Kiltalawn Cottages. Further it was not apparent on the ground how the division operated. The information and warrant addressed this problem in a legal and practical way by authorising the search of the entire premises known as 4 Kiltalawn Cottages. In so far as this contained a dwelling this dwelling could also have been the registered office and there was no reason to exclude that portion of the site. In fact the discovery of documents, relating to the company, in all parts of the site searched is in itself vindication of the view that the site was properly considered as an entity. On the assumption that the warrant was otherwise valid, the description of the site in the warrant and the search conducted was reasonable in the context of the area which was correctly described in the warrant.
Was there an entitlement on the face of the warrant to seize a computer or other equipment?
There is no doubt that the face of the warrant permitted the seizing of these things, as the warrant clearly adds ‘other things’ to the books and documents which formed the central focus of the search.
The applicants are on firmer ground in submitting that the statutory provision does not authorise the seizing of equipment and to that extent the warrant is invalid. The basis of the issue of the warrant is s. 20 of the Companies Act 1990, as amended by s. 30 of the Company Law Enforcement Act 2001. The Act of 1990 permits the seizing of material information and the taking of other steps which appear to be necessary for preserving or preventing the interference with material information. The exact status of the machines seized and whether they fell within the definition of the Act of 1990 is a matter for plenary hearing in the event of it being relevant. In view of the Courts general conclusions on the validity of the warrant for the purpose of this application this matter can be put to one side to be further considered if necessary.
Was their evidence of the commission of offences under the Companies Acts 1963 – 2003 such as to justify the seizing of documents other than those the subject of the previous requirement?
Garda Peake gave evidence that his information was based on the non-supply of the documents requested. By implication it was submitted on behalf of the applicants that that the only offence in contemplation was the s. 19 offence (failing to supply the documents and books requested) and the warrant should have been confined to those items.
Conclusion on legality of warrant
There is an issue to be decided if necessary as to the validity of the warrant in total or in part and such matter will, if necessary, be decided by this Court. For reasons which will become apparent this decision is, in the view of the Court, moot.
Use of information seized
Can the information gathered be used in the s.160 of the Companies Act 1990 proceedings (re disqualification of person from involvement in the affairs of companies) and/or in respect of any future criminal prosecution?
In so far as future possible criminal prosecutions are concerned the admissibility of evidence gathered on foot of this warrant is a matter for the trial judge and any attempt to usurp his function in the matter is ill-founded. Declarations as to the admissibility of evidence gathered by the search will not be made by this Court as a matter of general principle. Further in the absence of any prosecution such a decision is moot.
Ideally the admissibility of evidence in a s.160 proceeding should also be decided in the proceedings themselves. In this case, as agreed by the parties, the issue will be decided in this application and the decision applied in the connected s.160 matter. The Court has been informed that all evidence to be used in the s. 160 application from the company source was material acquired in the course of the search which was also within the documents demanded in the letter of 27th May, 2004. In the view of the Court an application to disallow any evidence gathered in the search which was also included in the material sought in the requirement of 27th May, 2004, is bound to fail. If the warrant is valid for the seizing of such material then there is obviously no issue. If the warrant is not valid then an order would ordinarily be made to return the material unused. In this case however if such an order was made the recipient of the returned documentation would have a continuing unfulfilled obligation to send the document back on foot of its duty under s. 19 of the Act of 1990. Such an order to return the documents because of a defect in the warrant, if made, would have no legal or practical result as the respondents have a continuing statutory right to the documents. What distinguishes this seizure from the normal search warrant case is that the respondents have a right to the material in question and that right is not extinguished by any defect in the warrant.
In the exercise of its discretion in judicial review matters, this court will not make an order which would not have any practical effect.
The court has been informed that all material seized not the subject of the requirement of 27th May, 2004, has been returned.
The Board has noted that the Company does not appear to have been in active trading at the time of the execution of the warrant. Further it is noted that no loss to the applicants in respect of any matter seized has been proven. Insofar as it is necessary to decide on the various claims made for damages these are refused.
The decision of the Court in relation to the issues raised may give rise to the need for further consideration as to which party should bear the costs of the action. The court will in due course, if necessary, hear the parties on that issue.