National Crime Agency v Javanshir Feyziyev
| Jurisdiction | England & Wales |
| Judge | Mr Justice Poole |
| Judgment Date | 08 March 2024 |
| Neutral Citation | [2024] EWHC 501 (Admin) |
| Court | King's Bench Division (Administrative Court) |
| Docket Number | Case No: AC-2023-LON-001768 |
[2024] EWHC 501 (Admin)
Mr Justice Poole
Case No: AC-2023-LON-001768
IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
ADMINISTRATIVE COURT
Andrew Sutcliffe KC and Tom Rainsbury (instructed by the NCA) for the Applicant
Kenneth MacLean KC, David Caplan, and William Hays (instructed by Kingsley Napley LLP) for the First and Second Respondents
Hearing dates: 21–22 February 2024
Approved Judgment
This judgment was handed down remotely at 10.30am on 8 March 2024 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
Introduction
On 23 June 2023 Mrs Justice Heather Williams granted a without notice application by the National Crime Agency (“NCA”) for a Property Freezing Order (“PFO”) prohibiting the Respondents from in any way dealing with the their property specified in the PFO (“the PFO Properties”), which the NCA alleges has a total value of approximately £50m, namely 22 leasehold properties in London (“the London Properties”), rental income from the London Properties, and the balance of a bank account at LGT bank, Liechtenstein (“the Liechtenstein account”). The First and Second Respondents applied on 7 August 2023 to discharge the PFO (“the Discharge Application”) and for orders that the proceedings be heard in private with restrictions on reporting and publication of any judgments or transcripts (“the Privacy Application”).
I have had the advantage of detailed written and oral submissions from Leading and Junior Counsel and lengthy bundles of documentary material and witness statements to which I shall refer as necessary in this judgment.
The Third Respondent takes no active part in the proceedings and, for the sake of economy, I shall refer to the First and Second Respondents as “the Respondents”. The Respondents' case is that the PFO should not have been granted and in any event should now be discharged because (i) there was (and is) no real risk of dissipation; (ii) there were multiple and serious breaches of the NCA's duty of full and frank disclosure/fair presentation at the without notice hearing before Heather Williams J, and (iii) there is no good arguable case against them.
Heather Williams J heard the without notice application in private. She has not published her judgment. She gave case management directions on 4 September 2023 that the Discharge and Privacy Applications should be heard together with “the extent to which the combined hearing will take place in private” to be determined at the hearing. She made interim orders prohibiting the publication of the PFO, her judgment, and any transcript of the proceedings before her, such orders to continue until the hearing of the combined hearing. Notice of the combined hearing and of the court's consideration of reporting restrictions was given to the media in the prescribed manner. No representations from the media have been received but the parties differed on the approach that the court should take on the Privacy Application. The Respondents submitted that the Discharge Application should be heard in private and that the judgment of Heather Williams J and any judgment given on the Discharge Application, the orders made, and transcripts of the hearings, should not be published. The Applicant submitted that the Discharge Application should be heard in public and that there should be no derogations from the principle of open justice. I heard detailed submissions on the Privacy Application on 21 February and gave an ex tempore judgment directing that subject to very limited restrictions on identifying the names, home address, and schools of the Respondents' minor children, and account numbers and sort codes of any bank accounts referred to in the evidence, the Discharge Application should be heard in public, may be reported, and that the judgments would be published, and the orders and transcripts may be published with no anonymity for the Respondents. However, I have directed that the judgment, order, and transcripts from the without notice hearing may only be published once this judgment on the Discharge Application is published, so as to avoid the unfairness to the Respondents which Heather Williams J herself identified, which might be caused if her conclusions on the without notice application were published before the court's determination after a contested hearing.
This is my judgment on the Discharge Application only.
The Legal Framework
Statutory Provisions
Part 5 of the Proceeds of Crime Act 2002 (“ POCA 2002”) concerns the civil recovery of the proceeds of unlawful conduct and has the purpose of enabling the enforcement authority to recover in civil proceedings property which is or represents property obtained through unlawful conduct, conferring interim powers which are exercisable whether or not any proceedings have been brought for an offence in connection with the property. A PFO is one such interim measure which does not require a final determination that a recovery order must be made ( NCA v Davies [2016] EWHC 899 (Admin)). POCA 2002 s245A provides:
“245A Application for property freezing order
(1) Where the enforcement authority may take proceedings for a recovery order in the High Court, the authority may apply to the court for a property freezing order (whether before or after starting the proceedings).
(2) A property freezing order is an order that—
(a) specifies or describes the property to which it applies, and
(b) subject to any exclusions (see section 245C(1)(b) and (2)), prohibits any person to whose property the order applies from in any way dealing with the property.
(3) An application for a property freezing order may be made without notice if the circumstances are such that notice of the application would prejudice any right of the enforcement authority to obtain a recovery order in respect of any property.
(4) The court may make a property freezing order on an application if it is satisfied that the condition in subsection (5) is met and, where applicable, that the condition in subsection (6) is met.
(5) The first condition is that there is a good arguable case—
(a) that the property to which the application for the order relates is or includes recoverable property, and
(b) that, if any of it is not recoverable property, it is associated property.
(6) The second condition is that, if—
(a) the property to which the application for the order relates includes property alleged to be associated property, and
(b) the enforcement authority has not established the identity of the person who holds it, the authority has taken all reasonable steps to do so.”
The submissions before me focused on the allegation that the PFO Properties was “recoverable” rather than “associated” property and I shall refer in this judgment only to “recoverable” property. There is no dispute that the NCA is an enforcement authority. The Practice Direction – Civil Recovery Proceedings (“PD-CRP”) applies. The application must be made in the Administrative Court (paragraph 2.1), to a High Court Judge and in accordance with CPR Part 23 (paragraph 5.1 of PD-CRP). Certain formal requirements of the application are set out in PD-CRP which Heather Williams J found had been complied with. The Respondents take no issue with that finding. PD-CRP Paragraph 7.1, reflecting POCA 2002 s245B, provides that an application to vary or set aside a PFO (also referred to within PD-CRP as the “discharge” of a PFO) may be made at any time by any person affected by the order. In NCA v Simkus [2016] 1 WLR 3481, [2016] EWHC 255 (Admin) Edis J noted at paragraph [38] that “the jurisdiction to vary or discharge is not a review of the decision to grant the order, still less an appeal… The judge hearing an application on notice to vary or discharge the without notice order is not in any way bound by the approach of the first judge.”
The key condition for the making of a PFO is that the applicant is able to establish a “good arguable case” that the property concerned is or includes “recoverable property”. As to what is meant by “recoverable property”, by POCA 2002 s304 provides:
“(1) Property obtained through unlawful conduct is recoverable property.
(2) But if property obtained through unlawful conduct has been disposed of (since it was so obtained), it is recoverable property only if it is held by a person into whose hands it may be followed.
(3) Recoverable property obtained through unlawful conduct may be followed into the hands of a person obtaining it on a disposal by—
(a) the person who through the conduct obtained the property, or
(b) a person into whose hands it may (by virtue of this subsection) be followed.”
“Unlawful conduct” is defined by POCA 2002 s241:
“(1) Conduct occurring in any part of the United Kingdom is unlawful conduct if it is unlawful under the criminal law of that part.
(2) Conduct which—
(a) occurs in a country or territory outside the United Kingdom and is unlawful under the criminal law applying in that country or territory, and
(b) if it occurred in a part of the United Kingdom, would be unlawful under the criminal law of that part, is also unlawful conduct.”
By POCA 2002 s242:
“(1) A person obtains property through unlawful conduct (whether his own conduct or another's) if he obtains property by or in return for the conduct.
(2) In deciding whether any property was obtained through unlawful conduct—
(a) it is immaterial whether or not any money, goods or services were provided in order to put the person in question in a position to carry out the conduct,
(b) it is not necessary to show that the conduct was of a particular kind if it is shown that the property was obtained through conduct of one of a number of kinds,...
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