Glenn & Co (Essex) Ltd & Ors v HM Commissioners for Revenue and Customs & Anor

In this claim for Judicial Review the Claimants challenge the legality of the issue and execution of Search Warrants issued by the 2nd Defendant (‘District Judge Vickers’).

On 9 September 2011 the 1st Defendant (‘HMRC’) applied to District Judge Vickers for the issue of warrants as part of a criminal investigation centred on the alleged corruption of two officers of HMRC (whom I will refer to as ‘X’ and ‘Y’). The two men were suspected of receiving payment for providing confidential information and improper assistance to organised crime groups (‘OCGs’) in order to assist in or facilitate excise fraud.

The application for the warrants was made by Adrian De Ath (a Higher Investigation Officer within the Criminal Investigation Directorate of HMRC), and was made under section 8 of the Police and Criminal Evidence Act 1984 (PACE).

Section 8 of PACE, which is headed ‘Power of Justice of the Peace to authorise entry and search of premises’, provides:

(1)

If on an application made by a constable a justice of the peace is satisfied that there are reasonable grounds for believing

(a)

that an indictable offence has been committed; and

(b)

that there is material on premises ... which is likely to be of substantial value (whether by itself or together with other material) to the investigation of the offence; and

(c)

that the material is likely to be relevant evidence; and

(d)

that it does not consist of or include items subject to legal privilege, excluded material or special procedure material; and

(e)

that any of the conditions specified in subsection (3) below applies in relation to each set of premises specified in the application,

(f)

he may issue a warrant authorising a constable to enter and search the premises.

Section 8(3) specifies the conditions mentioned in section 8(1). They include,

(c)

that entry to the premises will not be granted unless a warrant is produced; and

(d)

that the purpose of a search may be frustrated or seriously prejudiced unless a constable arriving at the premises can secure immediate entry to them.

A written Information in support of the warrant (dated 9 September) was provided and signed by Mr De Ath. It was largely in narrative form, but began with the statement:

The Applicant says on oath that there are reasonable grounds for believing:

(a)

that indictable offences: Cheating the Public Revenue contrary to Section 1(1) Criminal Law Act 1977 and Money Laundering contrary to s.327, 328 and 329 of the Proceeds of Crime 2002, Unauthorised disclosure of HM Revenue & Customs data contrary to s.19 of the Commissioners of Revenue and Customs Act 2005 (CRCA) and that at the residential premises detailed on the attached schedule there is material that is likely to be relevant evidence and be of substantial value to the investigation of the offences and does not consist of or include items subject to legal privilege, excluded material or special procedure material, namely:

any document relating to Excise Warehousing, HM Revenue and Customs, Customs and Excise duties, non UK duty paid alcohol and tobacco products, cash and carry traders, accounting documentation, business records, bank and building society statements, bank cards and credit cards, computers, hard disk drives, memory sticks, memory cards, floppy disks, CD ROMs, DVDs, FAX machines, mobile phones, mobile phone SIM cards, travel documents and passports, cash, stocks and share certificates, property situated within the United Kingdom and elsewhere, documents relating to the rental of property, deeds, leasehold agreements, rent books, rental agreements, Companies House documentation, overseas business transactions and documentation.

Three points may be noted. First, the offences in the written Information were described inaccurately: Cheating the Public Revenue is a common law offence; section 1(1) of the Criminal Law Act 1977 contains the statutory definition of the offence of Conspiracy and the words ‘have been committed’ appear to have been omitted after ‘(CRCA)’. Secondly, the form of the warrant which was signed by District Judge Vickers was in the same terms as set out in the Information and contained numerous grammatical errors to which it will be necessary to refer later in this judgment. Thirdly, there was no sub-paragraph (b). The information continued,

(c)

(i)

that it is not practicable to communicate with any person entitled to grant entry to the premises,

(ii)

that entry to the premises will not be granted unless a warrant is produced,

(iii)

that the purpose of a search may be frustrated or seriously prejudiced unless a constable arriving at the premises can secure immediate entry to them ...

There then followed a description of the material which formed the grounds for belief of the matters set out in section 8(1). District Judge Vickers was informed that it was intended to arrest X and Y and their suspected criminal associates, which included the 2nd to 4th Claimants. Among the addresses to be searched were: 27 Barleymow Close (the home of the 2nd Claimant, Manjit Deol), 41 Barleymow Close (the home of the 4th Claimant, Surjit Deol), 38 Manor Road (the home of the 3rd Claimant, Shammi Atwal), 41-45 River Road (the premises of 1st Claimant, Glenn and Co, through which Shammi Atwal conducted his business), and 31 Second Avenue Industrial Estate (the premises of the 5th Claimant, through which Manjit and Surjit Deol conducted their business)

The written Information covered a number of other people who were to be arrested and premises which were to be searched; and I shall refer only to those paragraphs which referred to the 2nd to 4th Claimants, with passages which were redacted represented by empty square brackets.

10.

[X] has been observed depositing cash into his personal bank account. Investigators have obtained Court Production orders relating to bank accounts operated by [X]. Inspection of the last six years of these records reveals that in excess of £500,000 of unexplained funds have been credited to the accounts. It is strongly suspected that these funds are derived from payments made to [X] in return for his corrupt activities. It is suspected that [X] has utilised online gambling facilities in order to launder these proceeds.

11.

It is suspected that [X] assisted an individual named Shammi Atwal and his businesses with an appeal against a HMRC seizure of alcohol. [X] and Shammi ATWAL have been observed meeting on many occasions outside of the work environment including on a number of occasions following the seizure of alcohol believed to be attributed to Shammi Atwal. During these meetings Officers have observed documents being examined by [X] and Shammi Atwal.

...

12.

[X] and the second Officer [Y] have been observed outside of the work environment in car parks, vehicles and restaurants in the company of another cash and carry trader named [ ]. Investigating Officers observed [X] being taken to the [ ]. [Y] has been observed meeting with [ ] on a number of occasions and is suspected to have passed [ ] details of a cash and carry run by a man named Manjit Singh Deol and his brother Surjit Singh Deol. During one meeting [ ] passing on details of the Deol’s business on a mobile phone. The Deols who are convicted excise fraudsters are suspected to be currently involved in excise fraud. [Y] has been observed meeting the Deols in car parks and hotels outside of the work environment. [Y] has also been observed meeting other persons linked to the Deols who have been the subject of HMRC enforcement action where large amounts of alcohol, tobacco and suspected criminal proceeds were seized.

...

15.

It is suspected that [Y] has recently used criminal proceeds to purchase a motor car and carry out a number of improvements to his home.

16.

High quality evidence has been recovered [ ] of a conversation between the two HMRC Officers [X] and [Y]. During the hour long conversation the Officers discuss facilitating the suspected criminal activities of many of the cash and carry traders mentioned in this application, selling sensitive intelligence and HMRC information to the traders, facilitating the granting of excise traders licences for money and a plan to intercept and keep cash from the proceeds of crime under the guise of a genuine HMRC operation. Frequently during the conversation the Officers discussed opportunities to make money from their criminal venture.

The first witness statement of Mr De Ath describes the hearing in front of District Judge Vickers.

12.

I swore the information under oath and was the only person to make oral submissions to the Judge. I read the information presented in the application in its entirety including details of what I expected to find at the premises.

13.

The hearing lasted about an hour.

14.

The Judge asked whether I suspected serious indictable offences had been committed and I replied that I did. He asked whether I had any suspicion that material subject to legal privilege would be discovered at the premises and I informed him that I had not found anything to suggest that it would ...

A contemporaneous manuscript note was taken at the time by the District Judge’s professionally qualified legal advisor.

Following their issue, the warrants were executed at various premises on 14 September. These included the homes of Manjit and Surjit Deol, and of Shammi Atwal, as well as the premises of the other Claimants. Solicitors and counsel (Mr Ashiq and Mr Bowers) attended while the warrants were being executed. They sought to persuade the officers that the warrants were too widely drawn and invited them not to remove or copy documents until the legality of the warrants had been determined by the Court. The officers declined this invitation. It will be necessary to return later to the circumstances in which the warrant was executed at the home of Shammi Atwal, since this gives rise to a discrete ground of complaint (Ground 4).

On 16 September 2011 the Claimants issued the present proceedings, seeking (among other things) an order quashing the warrants, and a declaration that their issue and execution were unlawful. Significantly in the context of the proposed Ground 5, there was a claim for interim relief, in the form of a without notice injunction to prevent HMRC from copying and examining the material seized.

On the same day Nicol J directed that the application for interim relief should be heard on notice.

On 20 September Messrs Rainer Hughes wrote to District Judge Vickers on behalf of the Claimants. The letter posed a number of questions, including an enquiry as to whether District Judge Vickers had given any reasons or committed anything to writing when issuing the warrants and, if so, asking for a copy or a transcript.

On the same day, Silber J (having considered the matter on the papers) made an order restraining HMRC from copying or examining the material seized pending further order, with liberty to apply to discharge the order.

On 21 September District Judge Vickers responded to Rainer Hughes’s letter.

My remarks are to answer so far as possible the immediate questions raised in your letter of 20 September 2011 but, in the time available to respond and in the light of the appearance by HMRC at the hearing tomorrow, this response will not be as full as requested. If the matter moves to a full Judicial Review I will of course provide a more detailed response ...

...

I considered a specific premises search warrant application under section 8 PACE 1984 and the application was made orally, on oath, in full as set out in the original nine page information. Further oral evidence was given in answer to my specific questions on the nature of the evidence available to the Revenue, the extent to which the identified premises would be searched and the covert and secret nature of much of the evidence received from authorised telephone surveillance and video recordings of meetings between the suspects and persons mentioned in the information. I was aware that the suspects of the Revenue’s investigation were employees of HMRC and the 56 premises and 48 motor vehicles identified meant a very large enquiry into the offences of Cheating the Public Revenue, Unauthorised Disclosure of HMRC Data and Money Laundering, contrary to the Proceeds of Crime Act 2002. I specifically enquired about and was satisfied that there would be no material removed that was subject to Legal Professional Privilege or Special Procedure material. The nature of the applications before me in the Thames Valley rather than in East London, indicated a measure of concern as to the security of this investigation. I gave my reasons orally, which were recorded by my legal Adviser and covered the indictable offences, the strength of the evidence, the impact of this operation upon the Human Rights of the individuals…

On 22 September the matter came back before Silber J and, following argument from both sides, he discharged his previous order, refused the claim for interim relief and directed a prompt ‘rolled-up’ hearing.

A number of witness statements have been served on behalf of the Claimants, HMRC and, most recently, by District Judge Vickers.

There are 5 grounds, although there is a degree of overlap in the first three of these.

This ground is divided into two parts (a) complaints about deficiencies in the written Information and the District Judge’s reasons ( the ‘deficiency of reasons’ argument), and (b) a complaint that the warrants were overdrawn, in other words too widely drawn (the ‘specificity’ argument’).

The warrants were in terms which replicated the contents of the Information.

On this day application supported by an information was made by Adrian De Ath, an officer of HM Revenue and Customs, for the issue of warrant under section 8 of the Police and Criminal Evidence Act 1984 to enter:

As per attached schedule

and search for:

any document relating to Excise Warehousing, HM Revenue and Customs, Customs and Excise duties, non UK duty paid alcohol and tobacco products, cash and carry traders, accounting documentation, business records, bank and building society statements, bank cards and credit cards, computers, hard disk drives, memory sticks, memory cards, floppy disks, CD ROMs, DVDs, FAX machines, mobile phones, mobile phone SIM cards, travel documents and passports, cash, stocks and share certificates, property situated within the United Kingdom and elsewhere, documents relating to the rental of property, deeds, leasehold agreements, rent books, rental agreements, Companies House documentation, overseas business transactions and documentation.

Authority is hereby given for any officer of Revenue and Customs, accompanied by such person or persons as are necessary for the purposes of the search, to enter the said premises on the number of occasions specified below within three months from the date of issue of this warrant and on each such occasion to search for the material in respect of which the application is made.

Number of occasions that each set of premises may be entered and searched under this warrant is: on ONE occasion only.

For the Claimants, Mr Pickup QC and Mr Bowers advanced Amended Summary Grounds, supplemented by a Reply and oral submissions.

They drew attention to the many cases in which the courts have stressed the importance of articulating reasons showing that the court issuing the warrant has applied the statutory criteria, see for example Wood v. North Avon Magistrates Court [2009] EWHC 3614 (Admin)

They submitted that District Judge Vickers had to be satisfied, reasonably on the written Information and the oral evidence, that the statutory criteria set out in section 8 of PACE were met, see (by analogy) R v. Crown Court at Lewes, ex p. Hill (1991) 93 Cr App R 60, at 69 (DC) They pointed out that §14 of Mr De Ath’s 1st witness statement referred to the District Judge enquiring whether he ‘suspected’ serious indictable offences had been committed and his answer that he did; and argued that this was not sufficient to satisfy section 8(1), which provided a test of ‘reasonable grounds for belief’ and not suspicion.

The contemporary manuscript note taken by the legal advisor made no reference to the District Judge being satisfied of the matters referred to in section 8(1)(e) other than by reference to section 8(3)(d) and there was no reference to a consideration of section 8(1)(d) other than during the hearing,. Furthermore, the 21 September letter written by the District Judge Vickers shows that he did not even consider the statutory criteria in section 8(1)(a)-(c), far less conclude that they had been satisfied.

For HMRC, Mr Bird submitted that the starting point was the information available to the District Judge. If he accepted this then it was unreasonable to expect him to state his reasons, see R. (Cronin) v. Sheffield Justices [2003] 1 WLR 752. There was good evidence and reasonable grounds for believing that (1) an indictable offence had been committed (see section 8(1)(a)), and (2), since documents had been handed over by X and Y to suspect traders, material evidence would be found at the premises occupied or controlled by the Claimants which would be of substantial value to the investigation (see section 8(1)(b)), and that (3) it would be likely to be relevant evidence (see section 8(1)(c)).

In addition to the cases referred to above, the court was referred to a number of additional cases.

It is convenient shortly to summarise the relevant principles which apply.

In the present case the contemporaneous manuscript notes of the hearing do not provide a clear summary of what took place. However, taken with the Information, they show how District Judge Vickers could have been satisfied on reasonable grounds that indictable offences had been committed by X and Y, and that they had met the 2nd to 4th Claimants outside the working environment.

The letter of 21 September from District Judge Vickers to the Claimants’ solicitors did not significantly advance matters. On the other hand he was not being asked to address the particular points now in issue; and he specifically said that his response was not as full as he would have wished in view of the time available.

In §§ 5 and 6 of his witness statement of 7 October 2011 District Judge Vickers dealt with the requirement of section 8(1) of PACE. So far as section 8(1)(b) was concerned, he was dealing with ‘a specific premises warrant’ in which the Information set out the properties and cars which belonged to suspected associates of X and Y. Observations recorded the owners of the properties and vehicles as being linked to the alleged offending; and gave rise to reasonable grounds for a belief that there was material on the premises which was likely to be of substantial value to the investigation of the offences. As to the test in section 8(1)(c), the listed items were likely to contain evidence about the business aspects of the offence, and evidence which was relevant to the connections between X and Y and those running those businesses. X and Y gave official assurances in relation to the grant of licences to cash and carry traders enabling them to trade, as well as determining whether duty had been paid.

If it stood alone, the witness statement would not amount to a contemporary record of the reasons for the decision, as described by Moses LJ in the case of Wood. However, the evidence shows that District Judge Vickers took time and care in dealing with the application. He saw and took into account the contents of the Information, and a contemporaneous note was taken of the further matters which he considered.

Ultimately, the question is whether the statutory test has been applied, and on what basis. If, despite the lack of a fully reasoned decision, the court is able to discern a sufficient basis for the Magistrate’s decision to issue the warrant, the challenge will fail, see for example R v. Lewes Crown Court case, Kennedy LJ at [6A].

In the present case, it is clear from the 1st witness statement of Mr De Ath and the witness statement of District Judge Vickers that there were reasonable grounds for believing the matters set out in section 8(1)(b) and (c), and that this went beyond ‘suspicion’. Importantly, in relation to section 8(1)(c) there was the information about unauthorised contact between the two officers and those who could be properly characterised as members of OCGs, and further information that contact had been made with and/or assistance given to each of the 2nd to 4th Claimants.

In my view the section 8 test was satisfied and I would reject ground 1.

Although the specificity argument and the arguments about the drafting and compliance with section 15 of PACE were dealt with separately in the Claim and in the Claimants’ skeleton argument, Mr Pickup acknowledged that the points overlapped, and it is convenient to take them together.

Section 15 is headed ‘Search warrants – safeguards,’ and provides

(1)

This section and section 16 below have the effect in relation to the issue to constables under any enactment ... of warrants to enter and search premises; and an entry on or search of premises under a warrant is unlawful unless it complies with this section and section 16 below

(2)

Where a constable applies for any such warrant, it shall be his duty –

…

(c)

to identify, so far as practicable, the articles or persons to be sought.

…

(6)

A warrant

...

(b)

shall identify, so far as practicable, the articles or the persons to be sought.

Section 16 is headed ‘Execution of warrants’ and includes,

(8)

A search under a warrant may only be a search to the extent required for the purpose for which the warrant was issued.

Section 50 of the Criminal Justice and Police Act 2001 (CJPA) contains additional powers of seizure where a person lawfully on the premises finds articles (for example a computer) which may contain material within the warrant but some which do not. In such a case the powers of seizure includes a power to seize both property and that from which it is not practical to separate it.

Mr Pickup submitted that the wide terms of the warrant (compounded by its vague references to ‘business records’) and its grammatical confusions made it objectionably imprecise and far reaching. The warrant should only have permitted the seizure of material which was likely to be relevant at trial (see section 8(1)(c)). Instead of describing what might be relevant evidence, the warrant was drawn so as to permit the seizure of very wide categories of material.

The warrants ought to have identified with far greater particularity what it was sought to search. In the Grounds of Resistance and in its witness statements HMRC had tried to identify the type of articles which might be covered by the warrant: for example, documents or copies handed over by X or Y. This demonstrated that the warrant could have been drafted with greater precision.

Mr Pickup referred to Power-Hynes v Norwich Magistrates Court [2009] EWHC (Admin) where, in quashing the warrant, Stanley Burnton LJ said at [19],

I have no doubt that the description in the warrant of the articles to be sought was too vague and did not identify so far as practical the articles to be sought, as required by section 15(6)(b) of PACE.

The Warrant did not limit the material which might be searched and did not, as has occurred in some cases, limit the search by reference to particular offences being investigated , see for example Burgin v. Metropolitan Police Comm [2011] EWHC 1835 (Admin) at [86], or to a confined time-frame.

The inclusion of computers should have been given particular attention. Although the computers might contain material which was relevant and to which section 50 of CJPA would apply, this did not absolve an applicant for a warrant from properly describing the material which might be contained on such a device, or indeed other material. The warrant failed to do this; and as a result it permitted the seizure and retention of much material which could not contain conceivably relevant evidence.

The fact that the warrants permitted the seizure of computers and their entire contents showed the lack of reasonable grounds for believing that the material did not ‘consist of or include items subject to legal privilege’ (as required by section 8(1)(d) of PACE); and the reference in §11 of the Information to the appeal of Shammi Atwal should have put HMRC on notice that there might be items which were subject to Legal Professional Privilege, see Bates v. Chief Constable of Avon & Somerset Police [2009] EWHC 942 (Admin), where the Court quashed a warrant in circumstances where it should have been envisaged that computers would have contained material subject to legal professional privilege.

Mr Bird submitted that it would be difficult to specify the material which might be found, since the nature of the offences (Conspiracy to Cheat the Public Revenue, Money Laundering and Unauthorised Disclosure of Data) did not admit any degree of precision as to what might be found and where. The warrant was to be executed at a number of different premises and in relation to a number of OCGs, and there was no requirement to specify what material might be found at any particular premises.

He argued that section 8 of PACE was concerned with ‘material’ on the premises and sections 15(1)(b) and (6)(b) were concerned with ‘articles’ sought; and that the difference was significant. Section 8 was concerned with legal procedures for obtaining a warrant and section 16 was concerned with the practicalities of what was to go into the warrant. A computer (which was the relevant article) was bound to contain some material which was not relevant evidence; but this did not prevent the article being sought from being a computer. He referred to R (Faisaltex Ltd and others) v. Crown Court at Preston and another [2009] 1 WLR 1687 and the judgment of Keene LJ at [79].

We conclude therefore that, once the judge was satisfied on the issue of legally privileged material, there was no reason why section 8 warrants should not specify computers and similar items amongst the material to be seized if there were reasonable grounds for believing that they contained relevant evidence, albeit they might also contain irrelevant material.

He acknowledged that the position might be different if the target of the search was highly likely to have privileged material on computers, as was the case in Bates. It was unclear whether there was in fact any privileged material on the computers, but where it was asserted (save in one case) the computer had been seized under section 50 of CJPA.

The nature and relevance of material and the articles where they might be found were set out in the 2nd witness statement of Mr De Ath. Thus for example, evidence of payments made to the officers might be contained in banking documents or cash withdrawal slips.

It was not practicable to confine the description of ‘articles’ in the warrant, as suggested in the Power-Hynes case at [19], by reference to client names or by reference to transactions. The nature of the inquiry and the offences precluded such specificity. There was evidence of illegitimate contact between X and Y and the individual Claimants. This was a broad enquiry into the nature of such contact and the commercial transactions to which it related.

He accepted that the warrants must be intelligible both to the owners of the premises and to the officers who execute the warrant at those premises. On the other hand, section 15(6) made it clear what the warrant must specify, and this did not include a requirement to identify the offences being investigated or the nature of the investigation. Bearing in mind those to whom the warrants may have to be shown, for example the family of a suspect, there might be good reason for this.

He submitted that ‘with a modicum of common sense’, the listed articles were sufficiently identified and identifiable. Although it might have been possible to draft the warrant with a simple description: for example, ‘any articles relating to or evidencing fraud or corruption’, similar to the broad category held to be acceptable in the Burgin case, such a description would simply have begged further questions as to how the officers were to identify such a document. There was no evidence that the way in which the warrant was drafted, as opposed to its breadth, gave rise to confusion or misunderstanding either on the part of the searching officers or the occupiers.

The warrant can be justifiably criticised in a number of respects.

Mr Bird accepted that it would have been ‘more helpful and more effective’ to have set out a bullet-pointed list of items, and that the list was ‘not grammatically perfect’. He was plainly right, if not bound, to make those concessions.

A Search Warrant should be expressed clearly. In the present case the warrant was poorly drafted, with grammatical confusion and lack of clarity as to whether the search related to documents or to objects. It is difficult to see, for example, how there could be a search within the named premises ‘for ... property situated within the United Kingdom and elsewhere.’ The errors of grammar were also likely to give rise to difficulties in interpreting the ambit of the warrant. However, as Mr Bird noted, there is no real evidence that the terms of the warrant in fact caused confusion or misunderstanding.

I am doubtful that the argument based on section 50 of CJPA assists the Claimants in this case. The fact that there may be legally privileged or irrelevant material on a computer does not mean that the warrants should not specify computers among the material to be seized, if there were reasonable grounds for believing that they contained relevant material, see Faisaltex (above).

In this type of case, there will often be two competing factors.

The first is the important consideration that the warrant should be sufficiently clear and precise for those interested in their execution to know precisely what are the limits of the power, see Lord Clyde in McGrath v. Chief Constable of the Royal Ulster Constabulary [2001] 2 AC 731 at 738g in the context of an arrest warrant.

The second is the nature of the investigation. The broad scope of an investigation may require a correspondingly broad power of search, and make it less ‘practicable’ (to use the word in section 15(2)(b) and (6)(b)) to identify the articles sought. This point was noted by Lord Woolf CJ in Kent Pharmaceuticals Ltd v. Serious Fraud Office [2002] EWHC 3023 (Admin), at [24].

There is clearly difficulty in drafting a warrant when the scale of the investigation is of the nature of that in which the SFO is at present engaged ...

Kennedy LJ referred to the balance between these two competing considerations in the context of a search warrant, in R (Energy Financing Team Ltd) v. Bow Street Magistrates Court and others [2006] 1 WLR 1316 at 1325d at [24(5)]

When there is an ongoing investigation into, for example, the affairs of a company such as EPRS, which appears to have been at the centre of a fraud, it will always be difficult to say precisely what documentation of value to the inquiry may be recovered from those who are justifiably suspected of being in contact with the main target company, but nevertheless the warrant needs to be drafted with sufficient precision to enable both those who execute it and those whose property is affected by it to know whether any individual document or class of document falls within it. If that is done it seems to me that the specificity required will be no less than would be required for a notice under section 2(3) were it practicable to serve such a notice, and although the terms of the warrant may be wide it will not simply be fishing if it is directed to support an investigation which has apparent merit.

In the Burgin case a complaint was made that a warrant which had included the phrase, ‘any document which evidences possible money-laundering offences under the Proceeds of Crime Act 2002’, was expressed too broadly. The Court held at [86] that the warrant had to be considered as a whole, and that it must be approached with a sense of proportion to the type of issues embraced by the investigation.

It is necessary to bear in mind the nature of the inquiry in the present case. This was not a narrow investigation where it would be possible to say precisely what relevant material might be discovered, see the Energy Financing case. Nor is it easy to see how the search could be narrowed by reference to specific offences, as had happened in part of the warrant in the Burgin case.

In my view, where the question of where the balance lies in an individual case will not be answered by reference to authority, since each case is likely to turn on particular facts. It will be answered by considering whether the warrant has identified the articles sought ‘so far as practicable’ in the circumstances. The present case was a wide ranging, and necessarily broad, investigation into the corruption by two HMRC officers in relation to OCGs (including the 2^nd to 4th Claimants) which had apparent merit.

This was one of those cases described by Nolan LJ in R v. Central Criminal Court, ex p. AJD Holdings [1992] Crim LR 669

It may well be that in many cases it would be impossible to draw a clear line between what was and what was not practicable in the particular case.

I have come to the view, by a narrow margin, that this warrant identified the articles sought so far as practicable; and it follows that the warrant was not unlawful.

Section 16 also includes the following,

(5)

where the occupier of premises which are to be entered and searched is present at the time when a constable seeks to execute a warrant to enter and search, the constable –

(a)

shall identify himself to the occupier and, if not in uniform, shall produce to him documentary evidence that he is a constable;

(b)

shall produce the warrant to him; and

(c)

shall supply him with a copy.

The facts in relation to this aspect of the case are not substantially in dispute. The evidence of Gareth Neaves was that he arrived with another officer at the home of the 3rd Claimant at 0630 on 14 September and was admitted to the house by the 3rd Claimant. He asked to see the warrant, but was immediately arrested. At 0642 Mr Neaves held out a copy of the warrant for him to read and explained its contents. Mr Neaves did not give the 3rd Claimant a copy of the warrant since he intended to endorse it before leaving a copy at the premises. When the officers left the premises after carrying out the search, they left a copy of the warrant with the 3rd Claimant’s wife.

Mr Bowers submitted that, since the officer failed to hand over the warrant until the searches were completed, there had been a breach of section 16(5)(c); and that by reason of section 15(1) the entry and search of premises under the warrant was unlawful. The breach had the consequence that the 3rd Claimant could not have known whether there was any lawful authority to enter the premises and was unable to monitor the seizure of property.

He referred to a passage in the judgment of Latham LJ in R (Rednapp and another) v. Commissioner of the City of London Police and another [2008] EWHC 1177 at [21]

It is further agreed that the second Claimant was not shown that her address was on was on the warrant. The police explained this by saying that they did not wish her to know what other addresses were being searched. In my view that is no answer. The second claimant was entitled to be shown the warrant. What any householder wants to be satisfied about if his house is to be searched is not only that there is a warrant in existence, but also that it refers to his or her address ... In my judgment, accordingly, the execution of the warrant was not valid; the requirements of section 16(5) of PACE were not satisfied.

In that case the Court quashed the warrant.

He also referred to R (Bhatti and others) v Croydon Magistrates Court and others [2010] EWHC 522 where a copy of the writ was not provided to the householder. Having reviewed the authorities as to the effect of non-compliance with s.16(5)(c), Elias LJ concluded at [31]

It seems to me that the wording of section 15(1) is plain and non-compliance renders entry, search and seizure unlawful. Whether or not the property can be admitted in a criminal trial raises separate issues. It depends on whether the property is available to the prosecution at that time and admissibility will be determined in the normal way, subject to section 78 of the 1984 Act.

Mr Bird accepted that the 3rd Claimant had not been supplied with a copy of the Warrant. The reason for this was that it had been decided to arrest him. It was after his arrest and caution that he was told that that the officers intended to carry out the search; and at that stage he was shown the copy warrant. He was not given a copy because Mr Neaves mistakenly thought that it was necessary to endorse it as being executed before a copy was handed over.

Section 16(5) exists so that the occupier of premises may know that those executing the warrant have lawful authority to do so, and can see before the search begins what property may be seized under the warrant. The use of the word ‘shall’ in subsections 16(5)(a)-(c) makes it clear that the acts required of the officer executing the warrant are mandatory.

It follows that there has been a breach of section 16(5). The next question is what should follow?

On one view, the consequence of a breach should invariably be that the Court declares the execution of the warrant to have been unlawful and that any material obtained in the search should be returned, leaving the executing authority to try to obtain and execute further warrants if so advised. This was the approach of the Divisional Court in the Bhatti case at [32], where Elias LJ set out the reasons for adopting such an approach and cited a number of authorities in support of such a course.

However, this case has a number of features that distinguish it from other cases. First (at this stage of the argument), there was a valid copy of the warrant in contrast to the position in R v. Chief Constable of Lancashire, ex p. Parker [1993] QB 577 and the Bhatti case. Secondly, the warrant was both produced for his inspection and held out so that the 3rd Claimant could read it. The 3rd Claimant knew that there was a warrant which referred to his address. This, as Latham LJ said in the Rednapp case at [21], was an important safeguard. Thirdly, the 3rd Claimant had already been arrested at the time the obligation under section 16(5)(c) arose.

Paragraph 6.8 of PACE Code B provides that, if the occupier is present, copies of the warrant shall ‘if practicable’ be given to them before the search is begun. The Codes of Practice issued pursuant to the powers in sections 66 and 67 of PACE cannot override the express provisions of the statute; but they do suggest that the impracticality of handing over a copy of the warrant should not inevitably lead to the grant of what is discretionary relief. In these circumstances I would confine the 3rd Claimant’s relief to a declaration that there was a breach of section16(5)(c), leaving it open to the 3rd Claimant to argue what the consequences may by an application to the Crown Court under s.59 CJPA for the return of property unlawfully seized or, in the event of a prosecution, under s.78 of PACE.

This is a new Ground for which permission is sought.

As I have already noted, the Claimants’ Legal Advisors took issue with the lawfulness of the warrants on 14 September, before they had even been executed.

Later on the same day their Solicitors wrote giving notice of an intention to issue Judicial Review Proceedings and to apply for an injunction. The letter concluded by calling for HMRC to give an undertaking not to look at seized material until 4 pm on 16 September.

In its response (also dated 14 September) HMRC stated that it would object to the grant of any interim relief and asked that any application should be made on notice.

On 15 September the Claimants’ solicitor again asked for an undertaking which would preserve the status quo until 4 pm on 16 September, and ended the letter by enquiring whether HMCS had copied any of the material, in the light of its knowledge of the challenge to the legality of the warrants.

HMRC replied on the same date, refusing to give the undertaking, pointing out that it had a statutory obligation to examine material as soon as ‘reasonably practical’ (see section 53(2)(a) of the CJPA) and that the Claimants’ interest had to be balanced against a public interest in fighting crime.

It is unnecessary to set out the further correspondence: each party had set out its position at this stage. The Claimant then applied to the Administrative Court for urgent interim relief; and the history of the proceedings from that point has already been described.

It was apparent that at the date of this hearing, most if not all of the seized material had been copied.

Mr Pickup and Mr Bowers submitted that parties would be left in an impossible position if public authorities, such as HMRC, refuse to provide undertakings designed to preserve the status quo until the Court can determine the legality of the conduct under challenge. HMRC must have known that the Claimants would not be able to obtain timeous relief preventing them from benefiting from an illegal act; and its refusal to give an undertaking was an unlawful and perverse use of its powers. The effect was to undermine the statutory protections conferred by sections 8,15 and 16 of PACE.

Mr Bird submitted that HMRC was under no obligation to give the undertaking sought. As he trenchantly expressed it in his skeleton argument,

The officers’ duty was to execute the warrant, not to back off because a suspect or his solicitors (or even counsel) made representations to them.

He pointed out that the warrants were valid orders until such time as the Court declared otherwise; that no cross-undertaking not to destroy or remove documents had been offered, although (even if it had) it would have been difficult to enforce without entry to the premises; and that two Judges of the Administrative Court, having heard argument, had refused to order an injunction restraining the examination and copying of material.

HMRC were also entitled to the view that the reason why the Claimants wished for any investigation to be halted was that the material incriminated either them or the suspect officers with whom they had been associating.

If the conduct of a prosecuting authority is perverse or malicious then the Court will intervene; but in the usual case where there is an issue to be determined, the Court will not act in a way that inhibits a criminal investigation. That is not to say that administrative misconduct, if it exists, will not be taken into account. It may be highly relevant to the exercise of a judicial discretion. However, in my view, the Claimants are not able to rely on any free-standing public law basis for reviewing HMRC’s decision not to stop inspecting the seized material in this case. Neither Nicol J nor Silber J were prepared on the facts of the case to enjoin HMRC from acting as they did; and nothing I have heard has persuaded me that their approach was wrong.

It follows that in my judgment permission should be refused on all Grounds save Ground 4, which succeeds to the extent set out in [77] above.

I agree.