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Cite as: [2014] IEHC 386
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Judgment Title: Cassidy -v- Comissioner of An Garda Siochana & ors Neutral Citation: [2014] IEHC 386 High Court Record Number: 2013 28 JR Date of Delivery: 29/07/2014 Court: High Court Composition of Court: Judgment by: Barr J. Status of Judgment: Approved |
Neutral Citation: [2014] IEHC 386 THE HIGH COURT JUDICIAL REVIEW [2013 No. 28 J.R.] BETWEEN HARRY CASSIDY APPLICANT AND
COMMISSIONER OF AN GARDA SÍOCHÁNA, JUDGE CORMAC DUNNE, IRELAND AND ATTORNEY GENERAL RESPONDENTS JUDGMENT of Mr. Justice Barr delivered the 29th day of July, 2014 Background 2. The subject matter of these proceedings concerns approximately €180,000 in two accounts with Bank of Ireland, being account numbers 81859879 and 67532132. These accounts are held by Magpie Private Pension Trust, which was set up in or around January or February 2000 as a self-administered pension scheme to administer the pension of the applicant. In order for the applicant to set up the scheme it was necessary for him to obtain two independent trustees to act as trustees in relation to the pension fund. The trustees of the pension are John Mulholland and Ruth Woods. The applicant is the sole beneficiary. 3. The funds in the two accounts were earning deposit interest of only 0.3%. Bank of Ireland would not increase the interest rate. The applicant states that it was decided to transfer the funds to another bank to enable a more competitive deposit rate to be earned. As such, it became necessary to withdraw the funds from the bank. It is a prerequisite that two of the three signatories sign the withdrawal forms. In early June 2012, all three signed the request to the bank to close the account, but the bank did not act on this. When it was followed up in July 2012, the bank informed the trustees who in turn informed the applicant that they had been served with a freezing order dated 9th July, 2012, pursuant to s. 17(2) of the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (hereinafter referred to as "the 2010 Act"). 4. The applicant states that he did not receive any notification of the freezing order dated 9th July, 2012, obtained by the first named respondent from District Court No. 1 in the Criminal Courts of Justice, nor was he in receipt of three further notifications of the renewal of this freezing order relating to the accounts. It was only when the applicant sought to challenge the freezing order that he received notification of further orders. 5. It appears from correspondence between the solicitor for the first named respondent and from subsequent notifications that freezing orders were issued pursuant to s. 17(2) of the 2010 Act, commencing on 9th July, 2012, and continuing on a monthly basis down to the present time. 6. The notices pursuant to s. 18 of the 2010 Act did not indicate the factual basis on which these freezing orders were made but stated as follows:-
8. Solicitors for the first named respondent entered into correspondence with the applicant's solicitor on 2nd October, 2012, as to the basis on which the applicant was making the application. The applicant's solicitor sent a letter by return on 4th October, 2012, stating that the application was confined to s. 19(1) and sought specific information, including a copy of the sworn information grounding the making of the freezing order. 9. Before the court on 5th October, 2012, it was indicated by counsel for the first named respondent that the applicant would be furnished with a copy of the sworn information in respect of the most recent freezing order at that time. It was further indicated that the sworn information would be furnished in a redacted form. The matter was then adjourned on consent to 2nd November, 2012, to enable the applicant's consideration of this disclosure. The applicant's solicitor received this disclosure on 17th October, 2012. 10. On receiving the sworn information of which the third page was redacted, the applicant's solicitor wrote to the Chief States Solicitor's Office on 30th October, 2012, seeking disclosure of the un-redacted sworn information and/or reasons for the redaction stating that the information received was inadequate to bring an application under section 19. 11. The applicant's solicitor received a written response to this letter from the third named respondent on 31st October, 2012, stating that "the sworn information contained information about the ongoing investigation which was not relevant as to why [their] clients had applied for an order under s. 17 of the 2010 Act". They further stated that they believed that they had given more information than required under the relevant Act and that the information provided up to that point was not inadequate to enable the applicant to bring an application under s. 19. 12. On 2nd November, 2012, an application was made to the second named respondent sitting in Court No. 1 in the Criminal Courts of Justice for disclosure of the un-redacted sworn information. The second named respondent held that the application before the court on that occasion concerned disclosure of the full content of the sworn information, rather than an application under s. 19 itself. The second named respondent stated as follows on that occasion:-
Criminal Justice (Money Laundering and Terrorist Financing) Act 2010
17(I) A member of the Garda Síochána not below the rank of superintendent may, by notice in writing, direct a person not to carry out any specified service or transaction during the period specified in the direction, not exceeding 7 days, if the member is satisfied that, on the basis of information that the Garda Síochána has obtained or received (whether or not in a report made under Chapter 4 of Part 4 ), such a direction is reasonably necessary to enable the Garda Síochána to carry out preliminary investigations into whether or not there are reasonable grounds to suspect that the service or transaction would, if it were to proceed, comprise or assist in money laundering or terrorist financing. (2) A judge of the District Court may order a person not to carry out any specified service or transaction during the period specified in the order, not exceeding 28 days, if satisfied by information on oath of a member of the Garda Síochána, that- (a) there are reasonable grounds to suspect that the service or transaction would, if it were to proceed, comprise or assist in money laundering or terrorist financing, and (b) an investigation of a person for that money laundering or terrorist financing is taking place. (3) An order may be made, under subsection (2), in relation to a particular service or transaction, on more than one occasion. (4) An application for an order under subsection (2) shall be made to a judge of the District Court assigned to the district in which the order is proposed to be served. (5) A person who fails to comply with a direction or order under this section commits an offence and is liable- (a) on summary conviction, to a fine not exceeding €5,000 or imprisonment for a term not exceeding 12 months (or both), or (b) on conviction on indictment, to a fine or imprisonment for a term not exceeding 5 years (or both). (6) Any act or omission by a person in compliance with a direction or order under this section shall not be treated, for any purpose, as a breach of any requirement or restriction imposed by any other enactment or rule of law. Notice of direction or order 18 (1) As soon as practicable after a direction is given or order is made under section 17, the member of the Garda Síochána who gave the direction or applied for the order shall ensure that any person who the member is aware is affected by the direction or order is given notice, in writing, of the direction or order unless - (a) it is not reasonably practicable to ascertain the whereabouts of the person, or (b) there are reasonable grounds for believing that disclosure to the person would prejudice the investigation in respect of which the direction or order is given. (2) Notwithstanding subsection (1)(b), a member of the Garda Síochána shall give notice, in writing, of a direction or order under this section to any person who is, or appears to be, affected by it as soon as practicable after the Garda Síochána becomes aware that the person is aware that the direction has been given or order has been made. (3) Nothing in subsection (1) or (2) requires notice to be given to a person to whom a direction is given or order is addressed under this section. (4) A notice given under this section shall include the reasons for the direction or order concerned and advise the person to whom the notice is given of the person 's right to make an application under section 19 or 20. (5) The reasons given in the notice need not include details the disclosure of which there are reasonable grounds for believing would prejudice the investigation in respect of which the direction is given or order is made. Revocation of direction or order on application 19 (1) At any time while a direction or order is in force under section 17, a judge of the District Court may revoke the direction or order if the judge is satisfied, on the application of a person affected by the direction or order, as the case may be, that the matters referred to in section 17 (1) or (2) do not, or no longer, apply. (2) Such an application may be made only if notice has been given to the Garda Síochána in accordance with any applicable rules of court. " Order in relation to property subject of direction or order 20 (1) At any time while a direction or order is in force under section 17, in relation to property, a judge of the District Court may, on application by any person affected by the direction or order concerned, as the case may be, make any order that the judge considers appropriate in relation to any of the property concerned if satisfied that it is necessary to do so for the purpose of enabling the person - (a) to discharge the reasonable living and other necessary expenses, including legal expenses in or in relation to legal proceedings, incurred or to be incurred in respect of the person or the person's dependants, or (b) to carry on a business, trade, profession or other occupation to which any of the property relates. (2) Such an application may be made only if notice has been given to the Garda Siochána in accordance with any applicable rules of court. Cessation of direction or order on cessation of investigation 21 (1) A direction or order under section 17 ceases to have effect on the cessation of an investigation into whether the service or transaction the subject of the direction or order would, if it were to proceed, comprise or assist in money laundering or terrorist financing. (2) As soon as practicable after a direction or order under section 17 ceases, as a result of subsection (1), to have effect, a member of the Garda Siochána shall give notice in writing of the fact that the direction or order has ceased to have effect to - (a) the person to whom the direction or order has been given, and (b) any other person who the member is aware is affected by the direction or order. Suspicious transaction report not to be disclosed 22. A report made under Chapter 4 of Part 4 shall not be disclosed, in the course of proceedings under section 17 or 19, to any person other than the judge of the District Court concerned. "
Alleged interference with the applicant's property rights 19. The applicant cited the well known decision of East Donegal Co-op Livestock Mart Limited v. Attorney General [1970] I.R. 317, where the court held at p. 341:-
21. In Heaney v. Ireland [1994] 3 I.R. 593, Costello J. set out the proportionality test at p. 607 as follows:-
(a) be rationally connected to the objective and not be arbitrary, unfair or based on irrational considerations; (b) impair the right as little as possible, and (c) be such that their effects on rights are proportional to the objective: Chaulk v. R. [1990] 3 S.C.R. 1303 at pages 1335 and 1336." 23. The applicant cited para. 50 of the judgment of the European Court of Human Rights in James v. United Kingdom (1986) 8 EHRR 123 where it is stated:-
25. The applicant referred to Edwards and Lewis v. United Kingdom (2004) 40 EHRR 593 where the European Court of Human Rights determined that there had been a violation of Article 6.1 in criminal proceedings in the United Kingdom. The applicant's complaints centred on the allegation that they had been entrapped by the police into committing armed robbery and as the trial judge had decided to withhold disclosure of certain evidence on grounds of public interest immunity, they were unable to properly mount their defence. The applicant relies on the following portions of the judgment in that case:-
Despite this, the applicants were denied access to the evidence. It was not, therefore, possible for the defence representatives to argue the case on entrapment in full before the judge. Moreover, in each case the judge, who subsequently rejected the defence submissions on entrapment, had already seen prosecution evidence which may have been relevant to the issue. For example, in Mr Edwards ' case, the Government revealed before the European Court that the evidence produced to the trial judge and Court of Appeal in the ex parte hearings included material suggesting that Mr Edwards had been involved in drug dealing prior to the events which led to his arrest and prosecution. During the course of the criminal proceedings, the applicant and his representatives were not informed of the content of the undisclosed evidence and were thus denied the opportunity to counter this allegation, which might have been directly relevant to the judges' conclusions that the applicant had not been charged with a 'State-created crime' [see paragraph 33 above]. In Mr Lewis' case, the nature of the undisclosed material has not been revealed, but it is possible that it was also damaging to the applicant's submissions on entrapment. Under English law, where public interest immunity evidence is not likely to be of assistance to the accused, but would in fact assist the prosecution, the trial judge is likely to find the balance to weigh in favour of non-disclosure (see R. v. Keane, [paragraph 39] above). In these circumstances, the Court does not consider that the procedure employed to determine the issues of disclosure of evidence and entrapment complied with the requirements to provide adversarial proceedings and equality of arms or incorporated adequate safeguards to protect the interests of the accused. It follows that there has been a violation of Article 6.1 of the Convention in this case. "
28. The prevention of a criminal offence must be regarded, in the absence of weighty and countervailing factors, as a warranted justification for the interference with property rights. The respondents stated that the provision for the making of more than one freezing order recognised the reality that investigations for money laundering are often complex and may require some time to complete. The section is explicitly designed and operates to prevent the commission of a crime within the State. 29. In dealing with the issue of interference with property rights, it is necessary to set out the relevant portions of the Constitution concerning property rights. 30. Article 40.3 provides:-
2. The State shall, in particular, by its laws protect as best it may from unjust attack and, in the case of injustice done, vindicate the life, person, good name, and property rights of every citizen. "
2.1 The State recognises, however, that the exercise of the rights mentioned in the foregoing provisions of this Article ought, in civil society, to be regulated by the principles of social justice. 2.2 The State, accordingly, may as occasion requires delimit by law the exercise of the said rights with a view to reconciling their exercise with the exigencies of the common good. "
The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest ...." 34. The respondents referred to the judgment of O'Higgins C.J. in Blake v. Attorney General [1982] IR 117, where the learned judge at pp. 135-136 of the report contrasted the provisions of Article 40 and 43 of the Constitution and reached the following conclusion:-
The framework of the 2010 Act 38. The owner of the funds is the person who knows most about the source of the funds in the particular bank account. Under the legislation, it is this person who bears the burden of proof. If he wants a freezing order lifted, he must swear an affidavit showing why he maintains that the funds, the subject of the freezing order, are not being used as part of a money laundering operation or are not funds used for the financing of terrorist activities. Being the owner of the funds, he is in the best position to demonstrate the source of the funds in his account. 39. Once the person affected puts his case on affidavit for the purpose of a s. 19 application, it is then up to the gardaí to put in a replying affidavit setting out the basis on which they contend that the funds are connected to a money laundering operation, or are used to finance terrorism. This application under s. 19 should be listed before a District Judge who has not been involved in the granting of the orders pursuant to section 17. This is due to the fact that such a judge would have heard evidence from the gardaí when they produced the sworn information for the purpose for the s. 17 application. The reason why the matter must be listed before a different District Judge, is to avoid the situation whereby one party to a dispute would have private communications with the judge hearing that dispute. 40. Thus, when hearing an application under s. 19 of the 2010 Act, there must be equality of arms. This means that the respondents, if they wish to contest the lifting of the freezing order, must put in an affidavit setting out why they say that the freezing order should be maintained in place. When both sides have put their respective cases on affidavit then the matter can be set down for hearing. 41. The applicant makes the case that in order to mount his application pursuant to s. 19 of the Act, he must be shown the redacted part of the sworn information which was put before the District Judge at the time of s. 17(2) application. I do not agree with that assertion. Once a freezing order has been made, the burden of proof is shifted to the applicant if he wishes to have the freezing order lifted. He has to establish that the matters referred to in s. 17(1) or (2) do not, or no longer apply. In effect, he has to establish that the service or transaction were it to proceed, would not assist in money laundering, or terrorist financing. I do not think that the applicant has to have sight of the full sworn information to enable him to discharge this burden of proof. As the funds in the accounts allegedly belong to the applicant as constituting his pension, he is uniquely placed to show from where the funds were obtained. If he puts this on affidavit, the respondents will then have the option of either putting in a replying affidavit, or refraining from so doing. It would not be acceptable for the respondents, at the hearing of the s. 19 application, to put before the District Judge material which was not made available to the applicant. 42. In the course of argument, references were made to Finnegan v. District Judge Michael Walsh & Ors [2013] IEHC 276. Kearns P. had to deal with a similar application for disclosure of the reasons for the making of a freezing order over certain accounts. The gardaí had refused to furnish the disclosure sought, on the grounds that there was "an ongoing criminal investigation and there were reasonable grounds for believing that disclosure of this material at [that] time would prejudice the investigation in respect of which the orders were made". The learned President ruled that it was unclear from the reasoning of the learned District Judge whether he had held that he had jurisdiction to grant an order for disclosure, but was refusing to exercise that jurisdiction based on submissions as to privilege, or the statutory exceptions contained in ss. 18(5) and 22 of the 2010 Act; or whether he had concluded that did not have jurisdiction to order disclosure; or whether he had concluded that the application for disclosure following Gary Doyle principles was misconceived, and should properly have been framed as an application for discovery or disclosure pursuant to the rules of the District Court. In these circumstances, the learned judge held that the decision of the District Judge would, accordingly, be quashed. Hearings held in Private 44. It should be noted that s. 17 of the 2010 Act was amended by s. 3 of the Criminal Justice Act 2013 to provide that an application under s. 17(2) shall be made ex parte, and shall be heard otherwise than in public. Section 3 of the 2013 Act came into force on 14th June, 2013. 45. The respondents make two points in response to this application. Firstly, they deny that the granting of a freezing order under s. 17 is an administration of justice by the District Judge. Secondly, they argue that it is implicit in the scheme of the 2010 Act, that applications under s. 17 should be heard otherwise than in public. They state that the fact that this was explicitly stated in the amending legislation does not mean that there was no right to have the application in private under the earlier legislation. 46. In support of their first argument, the respondents pointed to the provisions relating to the issuing of search warrants. They argue that in Ryan v. O’Callaghan [1987] IEHC 61, it was held that the issuing of a search warrant prior to the commencement of a prosecution was part of the process of criminal investigation and was executive rather than judicial in nature. Similar findings were made in Buckley v. Edwards & Ors [1988] I.R. 217 and in Byrne v. Grey [1988] I.R. 31. In Brady v. Judge Gerard Haughton & Ors [2006] 1 IR 1, it was held that the function of the designated District Judge pursuant to s. 51 of the Criminal Justice Act 1994, in receiving evidence to be used in a foreign investigation, was purely administrative in nature and as there was no determination of the rights of an individual in the position of the applicant, he was not entitled as of right, derived from the principles of constitutional justice or otherwise, to be present and represented in the procedures before the designated judge. 47. In McDonald v. Bard na gCon [1965] I.R. 217, Kenny J. in the High Court set out the characteristics of an "administration of justice" at pp. 230-231 of the report as follows:
1. A dispute or controversy as to the existence of legal rights or a violation of the law; 2. The determination or ascertainment of the rights of parties or the imposition of liabilities or the infliction of a penalty; 3. The final determination (subject to appeal) of legal rights or liabilities or the imposition of penalties; 4. The enforcement of those rights or liabilities or the imposition of a penalty by the Court or by the executive power of the State which is called in by the Court to enforce its judgment; 5. The making of an order by the Court which as a matter of history is an order characteristic of Courts in this country. " Whether this administration of justice was required to be heard in public 50. I accept that when a particular provison is provided for in amending legislation, this does not necessarily mean that it made a change in the law existing at that time. As Griffin J. states in Cronin (Inspector of Taxes) v. Cork and County Development Company Limited [1986] I.R. 559 at p. 572:-
52. Having regard to the fact that the obligation to administer justice in public is provided for in Article 34.1 of Bunreacht na hEireann, and where the proceedings can only be heard in private in "such special and limited cases as may be prescribed by law", I have reached the conclusion that if the former statutory scheme had intended the applications to be heard in private, this would have been expressly stated in the legislation. There does not seem to me to be any basis for the argument that it was implicit in the 2010 Act, prior to its amendment in 2013, that applications under s. 17 be heard in private. 53. Thus, I am satisfied that the hearings that were held in private prior to June 2013 were held in breach of the provisions of Article 34.1 of the Constitution. However, it does not seem to me that this is of any real benefit to the applicant, because those applications were going to be heard on an ex parte basis in any event. Accordingly, I hold that the fact that the hearings prior to June 2013 were held in private in breach of the provisions of the Constitution, does not give any remedy to the applicant as the orders made by the District Court as a result of those hearings have been spent and have been replaced by orders which were obtained in compliance with the law. Conclusion
56. In deference to the extensive arguments on both sides, the court has ruled on whether or not the applicant is entitled to sight of such documentation. 57. The court has ruled that on a s. 19 application, the applicant is not entitled to have sight of the un-redacted sworn information which was used to obtain the freezing order in question. The applicant must bear the burden of proof of establishing that there were no grounds to make the order under s. 17 of the 2010 Act, or that such reasons no longer apply. When he has set out the origins of the funds on affidavit, it is then up to the first named respondent to place on affidavit the grounds on which he alleges that the s. 17 order should not be revoked. The court has also indicated that in an effort to ensure equality of arms the matter should be heard before a judge who has
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