R (on the application of Mohammad Mumtaz Chaudhary) v (1) Bristol Crown Court (1st Defendant) (2) HMRC (2nd Defendant)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Fulford,Mr Justice Nicol |
| Judgment Date | 04 December 2014 |
| Neutral Citation | [2014] EWHC 4096 (Admin) |
| Docket Number | Case No: CO/17743/2013 |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 04 December 2014 |
[2014] EWHC 4096 (Admin)
Lord Justice Fulford
Mr Justice Nicol
Case No: CO/17743/2013
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Alun Jones Q.C. (instructed by Abbey Solicitors) for the Claimant
Mr James Fletcher (instructed by HM Revenue and Customs) for the 2nd Defendant
Hearing dates: 29 July 2014
The Facts
The relevant facts can be shortly stated. Mohammad Mumtaz Chaudhary (the applicant in these judicial review proceedings) is director and sole shareholder of a company called Accident Claim Helpline Ltd (ACHL). The company processes personal injury claims. It conducts investigations, and it refers cases to firms of solicitors to enable the latter to give legal advice and conduct litigation. The company was incorporated in 2002. As a necessary consequence of this business, files were created with details of the clients to which, at least to an extent, legal professional privilege (LPP) applied. The company operated out of nine properties in London, mostly in the Wandsworth area. ACHL had been the subject of investigations spanning some years, leading Her Majesty's Revenue and Custom ("HMRC"), the second defendant, to suspect large-scale fraud relating to VAT, PAYE and NIC.
On 26 August 2011 Mr Andrew Davies applied for nine warrants based on a lengthy information. Given the issues raised on this application, it is to be noted that HMRC anticipated the possible difficulty caused by LPP material, and there is reference to this at several junctures within the application. At paragraph 1.2, it is observed:
There may also be special procedure material acquired and/or created in the course of the trade such as business records, accounting records and accident reports held under similar undertakings and/or legal material in the form of general or pre/post litigation advice given by solicitors to clients regarding accidents held by ACHL. It is not intended to seize any of this material and the teams conducting the searches will be briefed accordingly.
On 2 September 2011 a judge at Bristol Crown Court (Her Honour Judge Hagen) issued the search warrants following an application by the second defendant in relation to nine addresses which included (as relevant to the present application) Accident Claim Helpline's business premises at Triangle House, 2 Broomhill Road, Wandsworth, London SW18 4HX and the applicant's home address at 156 Sutherland Grove, Wandsworth, London, SW18 5QN. Mr Davies had made the applications in his role as an investigator attached to HMRC Criminal Investigations Division. The warrants were granted pursuant to paragraph 2 of schedule 1 Police and Criminal Evidence Act 1984 ("the 1984 Act") on the basis of the written information referred to above under section 15 (2) and (3) of the 1984 Act. The relevant alleged offences related to " serious fraud in connection with, or in relation to, tax and money laundering", cheating the revenue, money laundering and fraudulent trading. The final words of the warrants stated:
HMRC recognises that no power of seizure conferred pursuant to this warrant is to be taken to authorise the seizure of an item which the officer exercising the power has reasonable grounds for believing to be subject to legal privilege.
They were executed at the premises on 8 September 2011 and items comprising many thousands of files were seized, including the computers on which these files were stored.
Following the execution of the warrants, the claimant was advised by a firm of solicitors called Farani Taylor for a period of over 12 months (until October 2012) and during that time they did not raise any issues relating to legal professional privilege or the legality of the searches and the retention of the material. They sought and secured the return of a number of documents and laptop computers from HMRC.
The claimant's present solicitors apparently advised that he should pursue the present proceedings after they were instructed in October 2012. It is suggested that the second defendant was aware, when the files were seized, that the contents included large quantities of privileged material.
On 22 October 2012, the applicant's present legal representatives, Abbey Solicitors, wrote to HMRC. At paragraph 4 it was maintained:
The purpose of this communication is to address you regarding the scope and legality of the warrants executed by your officers on 8.9.2011. It is quite apparent that material outside the authority of the warrant has been seized. Additionally a large quantity of material which consists of legally privileged (LPP) material has been seized and remains in your possession.
On 7 January 2013, the Mr Chaudhary issued an application under section 59 Criminal Justice and Police Act 2001 ("the 2001 Act") for the return of the entirety of the seized items and any copies thereof. In the alternative, he sought the return of all the legally privileged material seized pursuant to the warrants.
On 22 November 2013 HHJ Bromilow delivered his draft written judgment in which he concluded that he had no jurisdiction to grant the application. He indicated that in any event he would have refused the application on its merits. The approved judgment was handed down on 3 January 2014, and in February 2014 the court resolved the issues as to costs.
Permission to bring this application was granted by King J on 10 March 2014.
The Grounds of Complaint
The judge erred when he concluded the court had no jurisdiction
First, it is argued that the judge erred when he concluded the court had no jurisdiction under section 59 of the 2001 Act to determine whether i) the warrants were in breach of the requirement in section 15(6) of the 1984 Act that the warrant shall "identify, as far as practicable, the articles or persons to be sought" and ii) whether the searches exceeded the purpose for which the warrants were sought, contrary to section 16(8) of the 1984 Act, namely that "a search under a warrant may only be a search to the extent required for the purpose for which the warrant was issued". It was submitted that it was necessary for the judge to resolve these issues in order to determine whether the property was unlawfully in the second defendant's possession. It is suggested that the second defendant accepted before the judge that he had power to determine whether the searches exceeded the purpose for which the warrants were issued.
The warrants were in breach of section 15(6) of the 1984 Act
Second, it is submitted that if the judge was wrong in deciding that he had no jurisdiction, the warrants were in breach of section 15(6) of the 1984 Act and in consequence the searches and the seizures were unlawful under section 15(1) of the 1984 Act.
The searches and seizures went beyond the purpose for which the warrants were issued
Third, the applicant contends that if the judge was wrong in deciding that he had no jurisdiction, the searches and the accompanying seizures went beyond the purpose for which the warrants were issued (in breach of section 16(8) of the 1984 Act) and it is argued that the searches and the seizures were unlawful under section 15(1) of the 1984 Act.
The relevant Statutory Provisions
Section 50 of the 2001 Act provides:
Additional powers of seizure from premises
(1) Where—
(a) a person who is lawfully on any premises finds anything on those premises that he has reasonable grounds for believing may be or may contain something for which he is authorised to search on those premises,
(b) a power of seizure to which this section applies or the power conferred by subsection (2) would entitle him, if he found it, to seize whatever it is that he has grounds for believing that thing to be or to contain, and
(c) in all the circumstances, it is not reasonably practicable for it to be determined, on those premises—
(i) whether what he has found is something that he is entitled to seize, or
(ii) the extent to which what he has found contains something that he is entitled to seize,
that person's powers of seizure shall include power under this section to seize so much of what he has found as it is necessary to remove from the premises to enable that to be determined.
(2) Where—
(a) a person who is lawfully on any premises finds anything on those premises ("the seizable property") which he would be entitled to seize but for its being comprised in something else that he has (apart from this subsection) no power to seize,
(b) the power under which that person would have power to seize the seizable property is a power to which this section applies, and
(c) in all the circumstances it is not reasonably practicable for the seizable property to be separated, on those premises, from that in which it is comprised,
that person's powers of seizure shall include power under this section to seize both the seizable property and that from which it is not reasonably practicable to separate it.
(3) The factors to be taken into account in considering, for the purposes of this section, whether or not it is reasonably practicable on particular premises for something to be determined, or for something to be separated from something else, shall be confined to the following—
(a) how long it would take to carry out the determination or separation on those premises;
(b) the number of persons that would be required to carry out that...
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