R (Faisaltex Ltd) v Preston Crown Court
| Jurisdiction | England & Wales |
| Judge | Lord Justice Keene |
| Judgment Date | 21 November 2008 |
| Neutral Citation | [2008] EWHC 2832 (Admin) |
| Docket Number | Case No: CO/6184/2008 CO/6186/2008 CO/6187/2008 CO/6188/2008 CO/6192/2008 CO/6194/2008 CO/6189/2008 CO/6193/2008 |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 21 November 2008 |
[2008] EWHC 2832 (Admin)
Lord Justice Keene and
Mr Justice Griffith Williams
Case No: CO/6184/2008
CO/6185/2008
CO/6186/2008
CO/6187/2008
CO/6188/2008
CO/6192/2008
CO/6194/2008
CO/6189/2008
CO/6193/2008
IN THE HIGH COURT OF JUSTICE
ADMINISTRATIVE COURT
DIVISIONAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Alun Jones QC & Amelia Nice (instructed by DLA Piper UK LLP, M2 3DL) for the Claimants
Andrew Bird & Robert Dudley (instructed by Constabulary Solicitor, Lancashire Constabulary) for the 2 nd Defendant and Interested Party
Hearing dates: 21 st and 22 nd October 2008
Introduction
This is the judgment of the court. These are nine associated applications for permission to apply for judicial review, and if granted, applications for judicial review relating to the issue of search warrants pursuant to Section 9 and Schedule 1 (Applications 1, 2 and 3) and to Section 8 (Applications 4–9) of the Police and Criminal Evidence Act 1984 [PACE]. 8 warrants were issued on 31 March 2008 and the 9th on 3 April 2008 at the Crown Court at Preston by His Honour Judge Brown. The warrants were executed on 3 April 2008. It is also sought to challenge their execution for excessive seizure and oppression.
The claimants are members of closely-related families with the surname Patel living in the Preston area of Lancashire, companies controlled by them and an accountant, Anil Hindocha trading as Hindocha and Company. The companies, to which we shall refer as the “Faisaltex companies”, are Faisaltex Limited, Faisaltex Manufacturing Limited and Faisal Imports Limited.
The Faisaltex companies are the claimants in the first application, which concerns a search warrant for the offices of Hill Dickinson LLP, solicitors, at 1 St Paul's Square, Liverpool.
The claimants in the second application are Anil Hindocha and the Faisaltex companies. This concerns a warrant in respect of the office premises of Hindocha & Co at 19 Harewood Road.
The same claimants make the third application, which relates to a search warrant issued on 3rd April 2008 for the office premises of Hindocha & Co at 17, Harewood Road and other premises.
The fourth application is made by the Faisaltex companies in respect of the search warrant for Faisal House, Fairways Office Park, Olivers Place.
Claimants 5–9 are Faisal Patel in respect of the search warrant for 4 Sharoe Green Park, Preston, Munaf Patel in respect of the search warrant for 6 Sharoe Green Park, Preston, Arif Patel in respect of the search warrant for Six Acres, 100 Sharoe Green Lane, Preston, Arif Patel, in respect of the search warrant for 3 Sharoe Green Park, Preston and Faisal Patel in respect of the search warrant for 11 Sharoe Green Park, Preston. There is an application for leave to amend application 8 to add Umarji Patel and Bibi Patel, the parents of Arif, Munaf and Faisal Patel and the occupiers of 3 Sharoe Green Park, as claimants.
The First Defendant is the Crown Court sitting at Preston [“the Crown Court”], the Second Defendant is the Chief Constable of the Lancashire Constabulary [“the Police”], whose officers were responsible for the applications for the search warrants and their execution, and the interested party is Her Majesty's Revenue and Customs [“HMRC”], who were parties to the applications for the search warrants. The Crown Court has not appeared.
The claims, which were issued on 30 June 2008, seek: -
(1) Judicial review of the decision of the Crown Court to issue the warrants to enter and search the properties in question, the decision of the Police to apply for those search warrants, and the execution of the warrants, the search of each of those properties and the seizure of property therefrom.
(2) Orders quashing each warrant and the decisions to apply for each warrant.
(3) Declarations that the entry and searches on 3 April 2008 of the properties of each of the application premises were unlawful.
(4) Mandatory Orders directing the Police to restore all property seized and/or copies of property seized on 3 April 2008 to the Claimants.
(5) Costs
(6) Damages
By Application Notices dated 18 July 2008, the claimants applied pursuant to CPR Part 25 for interim injunctions or standstill pending the determination of the applications for judicial review. Their applications were listed before Blake J in the Administrative Court on 29 July 2008 when no order was made, upon the court accepting undertakings given by the Police and HMRC. The effect of those undertakings was that no one acting on or behalf of the Police or HMRC would access, view, inspect or use (i) any of the seized material, in whatever form until the conclusion of the applications for judicial review or further order, save that arrangements could be made for the scanning and creating of digital images of the material by a contractor independent of the Police in accordance with the agreed protocol in Schedule 2 to the order; (ii) any digital storage devices, material stored thereon and any copies of that material save that the Police are entitled to deliver the thumb drive seized from the offices of Hill Dickinson LLP to a contractor independent of the Police for copying, in accordance with the protocol in Schedule 2 to the order directions; (iii) the computer tower seized from the offices of Hill Dickinson, material stored thereon and copies of that material or the “blue bagged” material seized from the offices of Hill Dickinson, save that the Police are entitled to give access to Hill Dickinson LLP and independent counsel solely for the purpose of determining relevance and privilege in accordance with the protocol set out in Schedule 2 to the Order.
The Background :
The applications for the warrants arose from Police and HMRC investigations, whose principal subjects were Arif Patel, Munaf Patel and Faisal Patel. They are brothers, and were believed by the Police and HMRC to be responsible for the day to day running of many businesses operated by or associated with members of the Patel family under a variety of names, including Morville Trading Limited, Oakville (UK) Limited and Faisal Management Limited, and of which Faisaltex Limited was allegedly the main one. A police operation known as Operation Mimosa was and is concerned with the investigation of the importation and exportation of counterfeit clothing as well as offences of money laundering (allegedly the laundering of the proceeds of the frauds) and an allegation against Arif and Faisal Patel of a conspiracy to pervert the course of justice in relation to an employee, who was convicted in Scotland of counterfeiting offences.
Between March 2004 and April 2007, HMRC seized 39 consignments of clothing being imported to this country. All were found to contain counterfeit clothing, mainly socks, underwear, hats and pyjamas all bearing labels or in packaging from a number of well known brand companies (35 in all) who following the seizure of the goods have inspected the goods, and identified them as counterfeit. The total losses, based on losses of sales had the goods been genuine, have been estimated to be over £1m per consignment. Some of the containers inspected contained 'unbranded goods' mixed together with the counterfeit goods in such a way as to avoid detection.
The documents for the 39 consignments related allegedly to various companies directly owned and operated by members of the Patel family (Morville Trading Limited, Oakville (UK) Limited and Faisal Imports Limited) or companies which could be linked to the Patel family and their businesses (FT International Limited, Nirvana Trading Limited, Faisaltex Management Limited, Faisal Imports Limited, Excelious Distribution Limited and Stage One Clothing).
Once there had been confirmation from the rights holders that the samples were counterfeit, a notice of seizure was issued by customs officials and sent to the importer companies or agents, in each case one of those identified above. That notice advised that the detained goods had been confirmed as counterfeit and that if the importers made no appeal within one month the goods would be destroyed. Detention notices were sent in respect of all 39 consignments and although notices of appeal in respect of 5 consignments were received from Hill Dickinson, solicitors acting on behalf of the Patel company identified as the importer in respect of each of those consignments, those notices were withdrawn subsequently. The 39 consignments seized are regarded by the Police and HMRC as a very small proportion of such consignments, which in all amounted to over 600 containers. It was believed by those authorities that the three Patel brothers and their companies had been involved in the counterfeiting trade since the late 1990's, both by manufacture and by importation.
Further investigations by HMRC were also being carried out into false export declarations, which enabled the exporter to reclaim VAT on the goods allegedly being exported. This was said to involve companies controlled by members of the Patel family. The method, identified in early 2006 by HMRC, was to fill containers with low value material and waste but declare the goods as high value textiles on which the VAT could be reclaimed. The consignee was a...
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