Murphy v Gilligan

• Jurisdiction: Ireland
• Judge: Mr. Justice Feeney
• Judgment Date: 27 January 2011
• Neutral Citation: [2011] IEHC 62
• Court: High Court
• Date: 27 January 2011

[2011] IEHC 62

THE HIGH COURT

[No. 10143P/1996]

Murphy v Gilligan

IN THE MATTER OF THE PROCEEDS OF CRIME ACT 1996

BETWEEN

MICHAEL F. MURPHY

APPLICANT

AND

JOHN GILLIGAN, GERALDINE GILLIGAN, DARREN GILLIGAN AND TRACEY GILLIGAN

RESPONDENTS

PROCEEDS OF CRIME ACT 1996 S3(3)

PROCEEDS OF CRIME ACT 1996 S2

PROCEEDS OF CRIME ACT 1996 S3

PROCEEDS OF CRIME ACT 1996 S4

PROCEEDS OF CRIME ACT 1996 S3(1)

MURPHY v GILLIGAN UNREP SUPREME 13.5.1997 (EX TEMPORE)

MURPHY v GILLIGAN 2009 2 IR 271 2008/44/9462 2008 IESC 70

M (MF) v M (B) & M (K) UNREP FINNEGAN 3.11.2006 2006/37/7947 2006 IEHC 396

M (MF) v C (M) & ORS UNREP FINNEGAN 26.4.2002 2002/15/3754

PROCEEDS OF CRIME ACT 1996 S8

PROCEEDS OF CRIME ACT 1996 S8(2)

MURPHY v M (G) & ORS UNREP O'HIGGINS 4.6.1999 1999/19/5948

MURPHY v M (G) & ORS; GILLIGAN v CRIMINAL ASSETS BUREAU (CAB) & ORS 2001 4 IR 113 2003/39/9225

CONSTITUTION

EUROPEAN CONVENTION ON HUMAN RIGHTS & FUNDAMENTAL FREEDOMS FIRST PROTOCOL ART 1

PROCEEDS OF CRIME ACT 1996 S1

MCK v F & F UNREP FINNEGAN 24.2.2003 2003/41/9784

MCK v D (M) & ORS UNREP FINNEGAN 3.3.2003 2003/41/9807

DPP v GILLIGAN 2006 1 IR 107 2005/20/3987 2005 IESC 78

COURTS OF JUSTICE ACT 1924 S29

DPP v GILLIGAN (NO 3) 2006 3 IR 273 2007 1 ILRM 182 2006/18/3770 2006 IESC 42

CRIMINAL JUSTICE ACT 1994

HM ADVOCATE v MCINTOSH & ANOR (NO 1) 2003 1 AC 1078 2001 3 WLR 107 2001 2 AER 638

DRUG TRAFFICKING ACT 1994 S49(1)(A) (UK)

DRUG TRAFFICKING ACT 1994 S50(1) (UK)

CRIMINAL ASSETS BUREAU v O'BRIEN UNREP FEENEY 12.1.2010 2010 IEHC 12

EUROPEAN CONVENTION ON HUMAN RIGHTS & FUNDAMENTAL FREEDOMS ART 8

Abstract:

Criminal law - Proceeds of crime - Drug trafficking - Fair procedures - Property seizures - Criminal Assets Bureau - Standard of proof - Application to vary orders - Profits of gambling - Confiscation of proceeds of drug trafficking - Whether property represented proceeds of crime - Whether orders confiscating property should be discharged - Proceeds of Crime Act, 1996 - Bunreacht na hÉireann, 1937.

Facts The first-named respondent had been convicted of a number of drug offences. As well as receiving a prison sentence, property belonging to the applicant and members of his immediate family (the other respondents) were made the subject of orders under the Proceeds of Crime Act, 1996 whereby ownership of the property was transferred to the State. The respondents brought the present proceedings under the 1996 Act seeking to vary or discharge the orders in question. Various evidence was adduced on behalf of the respondents disputing the orders in question and seeking to have the orders discharged/varied. In particular on behalf of the first-named respondent it was claimed that the large sums of money that had been at his disposal were the results of loans, legitimate profits from the sale of goods and the result of successful bets. In addition it was contended that property owned by the other respondents had been obtained from funds derived from legitimate sources.

Held by Feeney J in dismissing the majority of the respondents' arguments. The explanations advanced on behalf of the respondents were in the main not credible and the court was satisfied that they could not be relied upon. The evidence regarding the gambling activity of the first-named respondent indicated that he had made losses as a gambler. In relation to property owned by the wife and son of the first-named respondent the court was satisfied that the explanations as to the source of funds were not credible. In relation to property owned by the fourth-named respondent the court was satisfied that some of the funds used to purchase a property did not represent the proceeds of crime and the court would make an order to reflect this finding.

Reporter: R.F.

1 Judgment of Mr. Justice Feeney delivered on the 27th day of January, 2011.

2 1. This judgment deals with four separate applications brought by each of the respondents pursuant to s. 3(3) of the Proceeds of Crime Act 1996 (the 1996 Act). Section 3(3) provides:

"where an interlocutory order is in force, the Court, on application to it in that behalf at any time by the respondent or any other person claiming ownership of any of the property concerned, may, if it is shown to the satisfaction of the Court that the property or a specified part of it is property to which paragraph (I) of subsection (1) applies, or that the order causes any other injustice, discharge or, as may be appropriate, vary the order."

3 The first named respondent is the separated husband of the second named respondent and they are the parents of the third and fourth named respondents.

4 2 1.2 The proceedings were commenced by plenary summons dated 21 ^st November, 1996 and were brought under the provisions of the 1996 Act. The proceedings were brought by the then Chief Superintendent, Michael F. Murphy, the applicant, who was a "Member" of An Garda Síochána within the meaning of the 1996 Act. That Act provides that if a court is satisfied on the evidence tendered by the applicant that property over a particular value is the proceeds of crime, a s. 2 order may be made in respect of that property. Thereafter a s. 3 order can be made where it appears appropriate to do so on the evidence tendered by the applicant and the property the subject of that order is in effect frozen. After a period of seven years, an application may be made to the Court under s. 4 of the 1996 Act for a disposal order which can result in the property, the subject of the s. 3 order, or part of it, being transferred to the Minster for Finance or to such other person as the Court may determine.

5 3 1.3 The order made under s. 3(1) of the 1996 Act and these proceedings have been the subject of a number of applications to this Court and by way of appeal to the Supreme Court. The Supreme Court ruled on the various matters raised before it in the case of Murphy v. Gilligan (Unreported, Supreme Court decision of 13 ^th May, 1997) and also in the reported decision of Murphy v. Gilligan [2009] 2 I.R. 271. The recent Supreme Court decision made it clear that the respondents were entitled to bring s. 3(3) applications and that each of the respondents could seek relief under that section. The applicant has not disputed the entitlement of the respondents to bring these applications. Applications under s. 3(3) of the 1996 Act can be taken by persons affected by a s. 3 order where a s. 3 order is in force. As was set out in the judgment of Geoghegan J. in the recent Supreme Court decision (at 294):

"It is not in dispute and cannot be in dispute that an operative order under s. 3(1) was and remains in force."

6 4 1.4 It is the existence of that operative order which provides this Court with jurisdiction to consider an application under s. 3(3) which is predicated upon such application being taken in circumstances where an interlocutory order, that is a s. 3(1) order, is in force. That position was identified in the judgment of Geoghegan J. in the Supreme Court when, in obiter dicta (at 298), Geoghegan J. stated:

"… I am firmly of the view that an application under s. 3(3) can still be brought and that that might well be a more appropriate remedy than raising the questions in the s. 4 application but that is all a matter for the defendants' advisers."

7 5 1.5 Each of the defendant/respondents have brought applications under s. 3(3) of the Act. Geoghegan J., in the judgment of the Court in Murphy v. Gilligan, identified the nature of a s. 3(3) application in the following terms (at 295/296):

"Section 3(3) on the other hand provides for the possibility of discharging or varying an order under s. 3(1) if the order under s. 3(1) 'causes any other injustice.'. Finnegan P. rightly takes the view that injustice covered by s. 3(3) is an injustice resulting from the earlier order not an injustice leading up to the making of that order."

8 Geoghegan J. went on to further address the scope of s. 3(3) of the Act at paragraph 53 of his judgment (at 299) in the following terms:

"This brings me to the rest of the machinery. For that very reason and with an eye on the Constitution, the Oireachtas enacted s. 3(3) which enabled the respondent in an application under that subsection and in a situation where an order under s. 3(1) was already in force to apply to a court to have that order discharged or varied. Such an order could be made if such respondent satisfied the court that the property or a specified part of it was property to which para. (I) of subs. (1) applies or in other words that the property frozen or part of it was not directly or indirectly proceeds of crime or if he satisfies the court that the order under s. 3(1) 'causes any other injustice'."

9 Geoghegan J. had also addressed the scope of a s. 3(3) when he stated (at p. 278):

"The scheme of s. 3(3) is that even if a freezing order is in fact made, the respondent … may have it discharged or varied as long as that order is in force, if he or she shows to the satisfaction of the court that the property or a part of it is not proceeds of crime or that the order already made under s. 3(1) causes any other injustice."

10 6 1.6 The respondents in this case have sought to operate that machinery and have each brought applications under s. 3(3). In considering those applications the Court has to consider whether the respondents or any of them have satisfied the Court that the property frozen or any part of it was not directly or indirectly proceeds of crime and also to consider whether any of the respondents have discharged the onus of establishing that the s. 3(1) order causes any other injustice. The issue as to whether or not the property or part of it is either directly or indirectly the proceeds of crime is primarily a matter for fact. Section 3(3) also allows and permits the Court...