R v Middlesex Guildhall Crown Court, ex parte Okoli
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE MOSES,LORD JUSTICE LAWS,MRS. JUSTICE RAFFERTY,LORD JUSTICE TUCKEY |
| Judgment Date | 10 July 2000 |
| Neutral Citation | [1999] EWHC J1105-12 |
| Judgment citation (vLex) | [2000] EWHC J0704-3 |
| Docket Number | CO/2233/2000,Case No. CO/3902/99 |
| Date | 10 July 2000 |
| Court | Queen's Bench Division (Administrative Court) |
[1999] EWHC J1105-12
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
CROWN OFFICE LIST
Lord Justice Tuckey ND
Mr Justice Moses
Case No. CO/3902/99
In the Matter of the Taxes Administration Act 1970
And in the Matter of a Search Warrant Under
Section 20C of the Taxes Administration Act 1970
Mr Michael Worsley QC and Mr Timothy Cray Instructed by The Commissioners of The Inland Revenue appeared for the Respondent.
Mr Patrick O'Connor QC and Mr Peter Clarke Instructed by Messrs Dibb Lupton Alsop appeared for the Applicants.
Friday 5 November 1999
Facts
Mr Alwin Tamosius is a United States citizen and qualified as an Attorney in Illinois. He has been in international legal practice in London. The applicant is the name under which he practices. Since about 1996 one of its clients, Johan Frestadius has been investigated by the Inland Revenue. In July 1998 the Revenue sought to execute a search warrant, granted by a judge at the Central Criminal Court, at the applicant's offices which were then in Upper Grosvenor Street W1. On 20th July 1998 Mr Tamosius claimed legal professional privilege in relation to the files which the Revenue sought to examine and seize. The Revenue agreed not to examine or seize any of them.
On 10 August 1999 Johan Frestadius was committed for trial on two counts of cheating the Revenue of tax payable by Spectron Energy (UK) Ltd. In short it is alleged that he took part in a scheme to evade tax by diverting commission off-shore.
Since July 1998 the Revenue claims that it has reasonable grounds for suspecting that Mr Tamosius was himself involved in the arrangements for diversion of commission off- shore, for diverting bonus payments payable to employees off -shore and arranging for them to be filtered back to those employees within the United Kingdom under the guise of false consultancy agreements. In addition it is alleged he assisted in concealing those arrangements from the Revenue. I should emphasise that those allegations are, at this stage, no more than that. However, those suspicions led the Revenue to revisit the question as to whether it was entitled to examine documents in the applicant's possession in relation to Mr Tamosius' own part in the allegedly dishonest arrangements.
Accordingly, on 21 September 1999 the Revenue obtained two search warrants ex parte from His Honour Judge Inman at the Middlesex Crown Court. Those search warrants related to the applicants former premises in Upper Grosvenor Street W1 and also in relation to office premises into which he had moved in Chelsea Harbour SW10. The warrants, with the relevant address, read:—
IN THE CROWN COURT SITTING AT MIDDLESEX GUILDHALL
SEARCH WARRANT
To: not more than 15 OFFICERS OF THE BOARD OF INLAND REVENUE
ON INFORMATION on oath given this day by Robert Christopher Grant an officer of the Board of Inland Revenue.
I am satisfied in accordance with Section 20C of the Taxes Management Act 1970 as amended by Section 146 of the Finance Act 1989 that the said Robert Christopher Grant acts with the approval of the Board given in relation to this particular case, that there is reasonable ground for suspecting that offences involving serious fraud in connection with, or in relation to tax, namely Corporation Tax Income Tax and other obligations touching upon them, are being, have been or are about to be committed and that evidence of them is to be found on those parts of the premises occupies by
Tamosius and Partners at 6th Floor, The Chambers, Chelsea Harbour, London SW10
PURSUANT to the power vested in me by subsection (1) of the said Section 20C, I therefore HEREBY AUTHORISE YOU TO ENTER the said premises, if necessary by force, between the hours of 7.00am on the first day to 11.00pm on the second day on any day within 14 days from the time of issue of this warrant AND SEARCH THEM.
ANY OFFICER who enters the said premises under the Authority of THIS WARRANT may, by virtue of subsection (3) of the said Section 20C,
(a) TAKE with him such other persons as appear to him to be necessary,
(b) SEIZE AND REMOVE any things whatsoever relating to or appearing to relate to serious tax fraud in relation to Corporation Tax, Income Tax and other obligations touching upon them and which he has reasonable cause to believe may be required as evidence for the purposes of proceedings in respect of such an offence as is mentioned above and
(c) SEARCH or cause to be searched any person found on the premises whom he has reasonable cause to believe to be in possession of any such things; but no person shall be searched except by a person of the same sex.
NO ITEM may be taken from the premises which is subject to legal privilege (as defined in Section 10 of the Police and Criminal Evidence Act 1984)
DATED THIS 21st day of September 1999
Signed D A Inman (Circuit Judge)
On 29 September 1999 the Revenue executed those warrants and arrested Mr Tamosius. He was released after interview on police bail until 29 November 1999. Twenty- four sets of documents were taken from Upper Grosvenor Street W1 to the premises at Chelsea Harbour SW10.
The reason why those documents were removed from the W1 to the SW10 premises was to enable counsel to examine the documents. He had been nominated by the Attorney General and instructed by the Inland Revenue the evening before, 28 September 1999, to act as independent counsel in relation to a search operation . According to Agnes Quashie, a solicitor instructed on behalf of the applicant, it was agreed that the officers should bring the material from W1 to Chelsea Harbour so that it was all in one place. The warrants were executed on the morning of 29 September 1999 but no property was initially examined or seized. Discussions took place between the parties to attempt to reach agreement on how issues of legal professional privilege could be resolved. Negotiations continued but no resolution could be achieved. In particular the Revenue rejected a suggestion that a panel of two barristers should be appointed with reference to a referee in the absence of agreement.
On 29 September 1999 solicitors on behalf of the applicant moved for judicial review upon hand-written grounds. The matter came before Richards J at 5pm on 30 September 1999. Richards J gave leave to move upon the Revenue undertaking that any material removed from the premises would be sealed in opaque bags and not inspected until the full hearing.
During the course of negotiations on 29 September an inspector of taxes handed a manuscript list to leading counsel for the applicant, with thirty-five names of companies and persons involved in the arrangements which the Revenue alleged were designed to cheat. The warrants dated 21st September 1999 were limited to a period of fourteen days and were due to expire on the evening of 30th September. Accordingly the Revenue returned ex parte to Judge Inman and obtained a further search warrant for the SW10 premises. This warrant had attached to it the schedule containing the names, to which I have referred. The warrant itself was in identical terms to the previous warrants save as to dates and (b) in the final section read:—
(b) SEIZE AND REMOVE any things whatsoever relating to or appearing to relate to serious tax fraud in relation to Corporation Tax, Income Tax and other obligations touching upon them, in relation to the persons named in the attached schedule which he has reasonable cause to believe may be required as evidence for the purposes of proceedings in respect of such an offence as is mentioned above and
Thereafter between 9am and 4.23pm on 1st October some sixty nine documents, files and books were examined and seized by the Revenue at the SW10 premises pursuant to the warrant of 30 September 1999.
The technique adopted was as follows. Officers searched for relevant material. Once relevance had been decided, material was then reviewed by the counsel nominated by the Attorney General and instructed by the Inland Revenue for the purposes of deciding whether it was subject to legal professional privilege. Counsel has sworn an affidavit as to what took place. He was instructed to advise as to whether any document or other thing shown to him was:—
(a) subject to legal professional privilege
(b) not subject to legal professional privilege
(c) whether it would have been subject to legal professional privilege but for the fraud/crime exception set out in section 10(2) of the Police and Criminal Evidence Act 1984.
Counsel arrived on the evening of 30 September and was introduced to those conducting a search of the SW10 premises and two solicitors representing the applicant. He was given a desk in a room of his own. Any document or file thought by the Revenue to be relevant was handed to him. He read the document and came to his conclusion noting whether the document was either not subject to legal professional privilege or would have been but for the fraud/crime exception. This was then placed in a buff envelope, given an identifying number and sealed. Any document which counsel concluded was subject to legal professional privilege was handed back to solicitors for the applicant. All the documents he saw and his opinion as to those documents were listed.
The two issues .
Two issues arise:—
1. whether the warrants of 21 September 1999 and 30 September 1999 were valid and
2. whether the process by which the material at the SW10 premises was sifted and seized was lawful.
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