FJ McK v FC and Others

• Jurisdiction: Ireland
• Judge: Keane C.J.
• Judgment Date: 23 July 2001
• Neutral Citation: 2003 WJSC-SC 9819
• Docket Number: [S.C. No. 26 of 2001]
• Court: Supreme Court
• Date: 23 July 2001

2003 WJSC-SC 9819

THE SUPREME COURT

Keane C.J.

Murray J.

Fennelly J.

26/01

318/00

MCK (FJ) v. C (F) & G (MJ)

FJMcK

v.

FC & Ors.

and

FJMcK

v.

MJG & Ors.

Citations:

PROCEEDS OF CRIME ACT 1996 S3

PROCEEDS OF CRIME ACT 1996 S4

Synopsis:

Proceeds of Crime

Proceeds of crime; discovery; two appeals; in first appeal defendants seeking discovery from plaintiff in order to meet plaintiff's case relating to restraining disposal of their property, appointing a receiver over it and directing them to make full disclosure of means and income over last ten years; in second appeal application for discovery confined to two categories of document; whether in relation to first appeal, as discovery usually only arises once pleadings closed and as in this case no pleadings in strict sense, approach adopted by High Court judge subject to difficulty that it in effect imposes obligation on defendants to make specific plea to put before court information showing that properties legitimately acquired; whether High Court judge erred in holding that defendants in principle not entitled to discovery, as details of case not clear and so application is premature; whether in relation to second appeal High Court judge in error in treating application as premature and approaching it on basis that a further stage would be reached at which it could be said that pleadings could be regarded as closed.

Held: Appeals allowed; in relation to first appeal order of High Court set aside and matter remitted to High Court to be determined in the light of any further affidavits filed; in relation to second appeal, order granted in substitution for High Court order, requiring plaintiff to make discovery of documents referred to in notice of motion making clear that that would be an affidavit of discovery in the ordinary sense.

McK v. C - Supreme Court: Keane C.J. (ex tempore), Murray J., Fennelly J. - 23/07/2001 - [2001] 4 IR 521

Facts: In each case the plaintiff had sought orders under Proceeds of Crime legislation to freeze property which allegedly constituted the proceeds of crime. In the first case the respondents, the relatives of a deceased person who was also allegedly a criminal, sought an order of discovery in order to meet the case being undertaken against them by the Criminal Assets Bureau. Mr. Justice O’Sullivan refused the application for discovery on the grounds that it was premature. In the second case the respondent who allegedly controlled the properties in question was in custody in Spain facing charges. The respondent claimed that the properties in question had been purchased with bona fide resources. The respondent had sought discovery of statements made by persons to English authorities allegedly implicating the respondent in criminal activities. In the High Court Mr. Justice Finnegan had concluded that the documents sought were relevant and necessary for the disposal of the action but that to order discovery at this point was premature.

Held by Keane C.J. in making the following orders. The Proceeds of Crime legislation conferred draconian powers upon the Criminal Assets Bureau and given the presumption of constitutionality it necessarily followed that fair procedures would be observed. In cases involving the Criminal Assets Bureau the action was not a normal civil action. It was not a simple matter to determine when the pleadings had closed because there were no pleadings in the strict sense. In the first case the learned High Court judge was in error in determining that the application for discovery was premature. The appropriate course for the High Court was to allow the plaintiff to file an affidavit identifying any documents that would be discovered and those which were not relevant or privileged. Thus the order issued in the first case would be set aside and the case remitted to the High Court to allow the filing of further affidavits. In regard to the second case the learned High Court judge was in error in failing to order discovery of the documents concerned. The plaintiff would be required to make an affidavit of discovery in respect of the documents concerned. The plaintiff should make the affidavit in the normal way and should plead privilege if required. This appeal would be allowed also.

1 JUDGMENT of the Court (ex-tempore) delivered by Keane C.J. on the 23rd day of July, 2001.

2 These are two appeals brought from Orders of the High Court Mr. Justice Finnegan and Mr. Justice O'Sullivan respectively in deciding to make Orders for Discovery sought by the Defendants/Respondents in each case. The proceedings are brought under The Proceeds of Crime Act, 1996and in each case the Plaintiff is Chief Superintendant McK who is effectively acting on behalf of the Criminal Assets Bureau and there are certain general features relating to both cases which I can deal with initially before referring to the facts which are peculiar to each of the cases.

3 In each case the Plaintiff sought Orders under The Proceeds of Crime Act, specifically under Section 3 of that Act, and the Section which effectively enables the High Court to make an Order freezing property which the Applicant, an authorised officer of the Criminal Assets Bureau, alleges constitutes directly or indirectly the proceeds of crime or is property that was acquired and in whole or in part with or in connection with property that directly or indirectly constitutes the proceeds of crime.

4 In each of these cases the Plaintiff in the proceedings has sworn Affidavits alleging that the Respondents in each case are in possession or in control of such property constituting the proceeds of crime and that the value of the property is not less than £10,000 which is also a condition that is to be satisfied before any Order is made. It is to be noted, because it has undoubtedly given rise to some difficulty in this and in other cases which have been heard by the High Court and have come on appeal to this Court, that while the legislation envisages such an application being made to the High Court there are no rules of court made under this Act and the practice has been adopted by the Criminal Assets Bureau of commencing the proceedings by way of Plenary Summons, and it is not suggested that they are not within their rights in proceeding in that way, in fact it may be the only way of so proceeding where no Rules of Court have been made providing for initiation of the proceedings by way of Special Summons or Notice of Motion or in some other manner. The Plaintiff, when I say the Plaintiff I do not mean the particular Plaintiff in this case, Officers authorised by the Criminal Assets Bureau have adopted that practice and adopted the practice of applying for an interim Order initially ex parte and then an Order under Section 3. As is clear from the Act where the application was made under Section 3 and was made by a Notice of Motion in each of these cases grounded on Affidavit by the Chief Superintendent, the Court is then entitled to make an Order which is expressly described as an Interlocutory Order prohibiting the Respondents or any specified person from disposing or otherwise dealing with the holder of the specified part of property unless it is shown that the particular property does not constitute either directly or indirectly the proceeds of crime and so forth and also containing a proviso that the Court is not to make the Order if it is satisfied that there would be a serious risk of injustice.

5 Finally I come to Section 4. It is provided that where the Interlocutory Order has been in force for not less than seven years the Court may make an Order called a Disposal Order directing that the whole of the property or specified part is to be transferred to the Minister for Finance or such other persons that the Court may determine. Again the onus is on anybody disputing the making of such an order to show that the property does not constitute the proceeds of crime. Given that statutory framework it is evident that in a sense in a practical way...