Chaudhary, R (On the Application Of) v Bristol Crown Court & Anor

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.

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.

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.

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.

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 determination or separation on those premises within a reasonable period;

(c)

whether the determination or separation would (or would if carried out on those premises) involve damage to property;

(d)

the apparatus or equipment that it would be necessary or appropriate to use for the carrying out of the determination or separation; and

(e)

in the case of separation, whether the separation—

(i)

would be likely, or

(ii)

if carried out by the only means that are reasonably practicable on those premises, would be likely,

to prejudice the use of some or all of the separated seizable property for a purpose for which something seized under the power in question is capable of being used.

Section 59 of the 2001 Act provides:

Application to the appropriate judicial authority

(1)

This section applies where anything has been seized in exercise, or purported exercise, of a relevant power of seizure.

(2)

Any person with a relevant interest in the seized property may apply to the appropriate judicial authority, on one or more of the grounds mentioned in subsection (3), for the return of the whole or a part of the seized property.

(3)

Those grounds are—

(a)

that there was no power to make the seizure;

(b)

that the seized property is or contains an item subject to legal privilege that is not comprised in property falling within section 54(2);

[…]

(4)

Subject to subsection (6), the appropriate judicial authority, on an application under subsection (2), shall—

(a)

if satisfied as to any of the matters mentioned in subsection (3), order the return of so much of the seized property as is property in relation to which the authority is so satisfied; and

(b)

to the extent that that authority is not so satisfied, dismiss the application.

(5)

The appropriate judicial authority—

(a)

on an application under subsection (2),

[…]

may give such directions as the authority thinks fit as to the examination, retention, separation or return of the whole or any part of the seized property.

(6)

On any application under this section, the appropriate judicial authority may authorise the retention of any property which—

(a)

has been seized in exercise, or purported exercise, of a relevant power of seizure, and

(b)

would otherwise fall to be returned,

if that authority is satisfied that the retention of the property is justified on grounds falling within subsection (7).

(7)

Those grounds are that (if the property were returned) it would immediately become appropriate—

(a)

to issue, on the application of the person who is in possession of the property at the time of the application under this section, a warrant in pursuance of which, or of the exercise of which, it would be lawful to seize the property; or

(b)

to make an order under—

(i)

paragraph 4 of Schedule 1 to the 1984 Act,

[…]

under which the property would fall to be delivered up or produced to the person mentioned in paragraph (a).

Section 60 of the 2001 Act provides:

Section 61 of the 2001 Act provides:

Section 8 of the 1984 Act provides:

Section 15 of the 1984 Act provides:

Section 16(8) of the 1984 Act provides:

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

It is contended that a warrant issued to enter and search premises and a search conducted thereafter under the warrant are unlawful unless, first, the warrant clearly identifies, as far as practicable, the articles or individuals sought (section 15(6)) and, second, the search does not exceed the purpose for which the warrant was issued (section 16(8)). Mr Alun Jones Q.C., for the claimant, particularly relies on Regina v Chief Constable of the Warwickshire Constabulary and another, Ex parte Fitzpatrick and others [1999] 1 WLR 564 (analysed below) in support of these contentions. It is submitted that without substantive compliance with these provisions the searches and the seizures are unlawful.

It is argued by the applicant that, since the warrants failed to comply with section 15(6), by virtue of section 15(1) of the 1984 Act the entry and searches were unlawful: the representatives of HMRC were trespassers and they had no power to seize property pursuant to section 59(3) of the 2001 Act. In consequence, it is suggested that any copies taken of items that were seized should be returned under section 63(1)(b) of the 2001 Act.

Mr Jones submits that section 15(6) of the 1984 Act is to be strictly interpreted, and that “the authority to seize items must be contained and found only in the warrant, without recourse to any other document, and the warrant must inform both the searches and occupiers of premises of the limits of the authority conferred by the judge”. Mr Jones relies on a number of decisions of this court in support of the proposition that in the absence of substantive compliance with the terms of this section, the search is rendered unlawful: R (Anand) v HMRC [2012] EWHC 2989 (Admin) [14] – [26]; R (van Der Pijl and De Greef) v Kingston Crown Court and others [2012] EWHC 3745 (Admin), [51] – [67]; R (Hoque and Das) v City of London Magistrates’ Court [2013] EWHC 725 (Admin), [7] – [14]; R (Cheema) v Nottingham and Newark Magistrates’ Court and HMRC [2013] EWHC 3790 (Admin); and R (Lees and Morgan) v Solihull Magistrates’ Court and HMRC [2013] EWHC 3779 (Admin). In Anand the warrant authorised a search for:

Pitchford LJ, giving the lead judgment of the court, observed:

It is suggested that the jurisprudence has led to the position that if a warrant contains words such as “any other items which appear relevant to the offences under consideration” it is likely to fall foul of the following principles: i) anyone interested in the exercise of a warrant should know the limits of the powers of the search or seizure that have been granted by reference to the terms of the warrant; ii) the warrant must identify as far as practicable the articles to be sought; and iii) the person executing the warrant should not be left to decide whether any particular item is of substantial value or relevance (Cheema [48] and [49]).

The claimant suggests that Crane J in R (Energy Financing Team Ltd) v Director of Serious Fraud and Bow Street Magistrates’ Court [2005] 1 WLR 1316; [2005] EWHC 1626 (Admin) correctly stated that “[…] a warrant should be capable of being understood by those carrying out the search and by those whose premises are being searched, without reference to any other document” [37].

Mr Jones suggests that an important observation in this regard is to be found in McGrath v Chief Constable of the Royal Ulster Constabulary [2001] UKHL 39; [2001] 3 WLR 312 at [16], namely that “[…] the person executing a warrant should follow and be entitled to rely on the face of the warrant. He may not act outside the terms of the warrant. […] he should not be held to have acted unlawfully if he carries out the instruction which appears from the face of the warrant. It is not for him to question that instruction if it is clear.” It is contended that these warrants are a particularly egregious example of imprecise drafting and that no relevant individual would have been able to identify the materials he was obliged to deliver in response to an order to produce under paragraph 4 of schedule 1, namely:

A particularly notable demonstration that the warrants violated section 15(6)(b) is said to be contained in the wording that enabled the seizure of items “deemed relevant” by the searching officers, given Mr Davies had applied in the warrant to search both premises for:

Mr Jones criticises the judge’s overall conclusion in this context, namely that:

It is suggested that the way the items are referred to in the warrant (the “cash, business records […] etc.”set out above) is unintelligible, and it would not have provided the individuals conducting the searches with the guidance they needed. Given the broad terms in which the warrants were framed, it is argued that power was impermissibly delegated to the investigators to determine the relevance of the items at the premises and, additionally, the warrants failed to define the offences that were under investigation. It is argued that the effect of this wording was to delegate the question of which documents might be seized to the HMRC officers. Furthermore, the offences that were said to be under investigation were not defined. It is argued that the words “that may contain evidence that relates to all sources of […]” tended to encourage “speculative seizure”. Mr Jones highlights the contents of the property control sheets as evidence of unnecessary breadth of the seizures.

In consequence, it is argued that any copies of the seized material must be returned by virtue of section 63(1)(b) of the 2001 Act.

Mr Jones emphasises that his challenge is both on the basis of suggested irrationality and on the approach of the judge to the law. Moreover, it is argued that the judge was wrong to indicate that “there must be a sense of reality and proportion” [53] and that:

A balance therefore has to be struck between compliance with the statutory requirements, which provide the protection for the property owner, and the state of knowledge of those carrying out an investigation into suspected and fraudulent activities. [54]

It is argued that a judge of the Crown Court is competent under section 59 to rule that there was no power to make a seizure by reason of a breach of section 15 or 16 because the warrant is bad on its face or because the search exceeded the purpose for which the warrant had been issued. However, it is accepted he is not competent to rule that there was no power to seize because the statutory pre-conditions for the grant of a warrant set out in section 8 or schedule 1 of the 1984 Act were not satisfied. Mr Jones contends that the critical distinction between these two situations is that in the former the judge would not be acting in an appellate capacity as regards a decision of a fellow Crown Court judge, whereas in the latter a decision of the second judge would have that effect. Accordingly, it is argued that Judge Bromilow had jurisdiction to determine that the search warrants were in breach of section 15(6) of the 1984 Act and that the searches – contrary to section 16(8) of the 1984 Act – went beyond the purpose for which the warrants were issued. It follows that Mr Jones accepts that on a section 59 application, it is not open to an individual to challenge the decision-making powers of the court, because this would make the hearing before the judge on the application an appeal against the decision of the judge who granted the warrant.

In support of the submission that a judge of the Crown Court is able to rule under section 59 that a warrant is bad on its face, Mr Jones has relied on a passage in the judgment of Stanley Burnton LJ in R (Dulai)v Chelmsford Magistrates’ Court (DC) [2012] EWHC 1055 (Admin); [2013] 1 WLR 220 at 232:

37.

Parliament's object in conferring the section 59 power on the Crown Court was to provide a speedy and relatively cheap means to challenge the exercise of the relevant powers of seizure and to seek the return of property seized. On any basis, the Crown Court has power to determine whether the requirements of a lawful seizure other than the validity of a search warrant have been satisfied (for example, whether it was reasonably practicable to determine at the time of the search whether what had been found was evidence of a crime), including, in the case of an entry to premises without a warrant, whether that entry (which may have been made in order to effect an arrest rather than to effect a search) was lawful. The effect of the Council's submission is that where a warrant has been issued, the lawfulness of its issue is the only issue that the Crown Court cannot address. If this is right, there is an unfortunate division of jurisdiction: in cases in which there is a challenge to a relevant warrant, the claimant must bring proceedings for judicial review in the Administrative Court to quash the warrant; in all other cases the Crown Court has complete jurisdiction.

Mr Jones argues that the section 59 procedure is supposed to provide a cheap remedy and it would be contrary to good public administration if in these circumstances it is necessary to commence judicial review proceedings.

In developing the contention that the judge was able to rule that there was no power to make a seizure by reason of a breach of section 15 or 16, it was necessary for Mr Jones to address R (Goode) v Nottingham Crown Court [2013] EWHC 1726 (Admin), a case in which this court gave guidance in respect of applications under section 59 of the 2011 Act. His principal submission in this regard is that although the court in Goode indicated that the Crown Court has no jurisdiction on an application under section 59 to consider whether the statutory preconditions for granting a warrant had been satisfied, it nonetheless remains open to the judge to rule that a warrant is bad on its face. Alternatively, it is argued by Mr Jones that if the court in Goode, contrary to his principal submission, decided that a judge is unable to determine whether a warrant is bad on its face, any remarks to this effect were obiter dicta and were wrong.

Mr Jones contends that this court generally tends to make a declaration of illegality whenever sections 15 and 16 of the 1984 Act are breached, whilst it will quash the warrant if the statutory pre-conditions necessary to issue it have not been met. It is suggested that this divergence in approach is the result of what are described as the broad terms of section 15(1) of the 1984, on the one hand, and the specific provisions of section 8 of the 1984 Act, on the other. In support of this argument, Mr Jones relies on the decision in Goode, in that, although the court declined to quash a warrant or to grant a formal declaration, it nonetheless held that in one respect the search and seizures were unlawful because of one of the suggested breaches of section 15. The reason for this approach was that the application had not been brought promptly. Pitchford LJ in giving the lead judgment put the matter thus:

45.

It is conceded on behalf of the Chief Constable that each of the warrants was defective on the first ground (viz. neither warrant named the officer who made the application). It is further conceded that the effect of section 15(1) is to render the entries onto property and the searches unlawful. In the circumstances of the present case, however, it is submitted on behalf of the Chief Constable that the breach was technical only. The claimant was himself present at the search which took place in his own home. He would have had no difficulty, if it was relevant, in discovering the identity of the officer who made the application. No prejudice has resulted to the claimant from the fact that the officer was not named in either warrant. I accept these submissions. Section 15(1) in its terms operates to render interference with the claimant's property under the authority of the warrant unlawful but it does not render the warrant itself unlawful. The claimant is seeking discretionary relief from the court. It is most improbable, in my view, that on this ground a court would make an order quashing the warrant after its execution.

[…]

Conclusion

48.

In my judgment the only ground of challenge to these warrants which has legal merit is the omission of DI Kennedy's name as the applicant on the face of the warrants. It is my view that the breach of section 15(6)(a) was so technical that in the circumstances of the present case there is no prospect that the court would use its discretionary powers either to quash the warrants or to make a declaration of invalidity. Having regard to the exceptional period of delay before these proceedings were issued and the prejudice which inevitably results to good administration I would refuse permission to proceed to review.

In support of the argument that judicial review is not the only means of challenging seizures pursuant to a warrant that is alleged to be bad on its face, it is submitted that a court in a private law action for trespass to land and goods is entitled to make its own determination concerning section 15(1). In this regard, Mr Jones suggests that Bell v Greater Manchester Police [2005] EWCA Civ 902 – a case involving a warrant that was said to have been obtained on a misleading basis and in breach of section 15(6) – is not binding because it “says nothing about section 59”. The court in that case found that section 6 of the Constables Protection Act 1751 provides protection from suit, unless malice is alleged. Mr Jones emphasizes that no one appeared in the case, save for the appellant who was in person. Similarly, Mr Jones seeks to distinguish R (Energy Financing Team Ltd) (supra) on the basis that section 59 was not considered. The Divisional Court in that case held that a district judge has no jurisdiction to reconsider the grant of a warrant at the instance of person affected by it, and in giving the lead judgment Kennedy LJ observed:

Mr Jones argues that a judge exercising his powers under section 78(1) Police and Criminal Evidence Act 1984 would be entitled to exclude evidence which he considered had been unlawfully obtained following a breach of section 15(6), absent a favourable decision on an application for judicial review regarding the legality of the warrant or the search. It is submitted that there is no sustainable reason why the High Court alone is entitled to “adjudicate on section 15(1)” and that, on a 15(6) or a 15(8) argument, the Crown Court judge is not acting as a court of appeal from a decision to issue a warrant but instead he is “only holding that the entry and search was, by virtue of section 15(1), unlawful”.

It is contended that if the searches and seizures went beyond the purpose for which the warrants were issued, the court has power by virtue of section 16(8) and 15(1) of the 1984 Act and section 59(3) of the 2001 Act to make appropriate orders. It is argued that the searches and seizures under the warrants were “so grossly in excess of the authority given by those warrants” that they were entirely unlawful. As to the facts, when the warrants were issued two notices under section 50 of the 2001 Act were served, for computers and “paperwork [that] relates to M Chaudhary and CIS”. The second defendant suggested that it was not practicable to review the material on site due to the quantity of the material. There has been a disagreement as to the extent of the documentation that was subject to the duty to secure under sections 60 and 61 of the 2001 Act, and particularly whether the reference to CIS meant “companies”, thereby (as it is suggested was originally indicated by Mr Davies) resulting, if that was correct, in a very large quantity of material that was held subject to the duty to secure. However, when this was ventilated in correspondence, the second defendant argued that the second section 50 notice only applied to one box of files that concerned a particular civil action.

It is the claimant’s contention that all the files seized contained substantial quantities of legally privileged material (see the statement of Mr Nadeem Ullah, the claimant’s solicitor, and the examples he has provided). It is suggested there was no attempt to remove legally privileged material before the files were seized.

Mr Jones accepts that the LPP material lies at the heart of this ground of appeal. He submitted that the courts are divided on the issue of excessive seizure. He relies particularly on the decision of Jowitt J in Regina v Chief Constable of the Warwickshire Constabulary and another, Ex parte Fitzpatrick and others [1999] 1 WLR 564, to the effect that:

It is submitted that in this respect Fitzpatrick is good law, although there has been disapproval expressed of other aspects of the decision in later cases (for instance, as regards removing property for detailed examination and sifting elsewhere, in order to determine if it came within the scope of the warrant).

Otherwise, as I have indicated, the judge is criticised for having decided that he was unable to deal with the issue of “excessive seizure” [66]. Therefore, it is submitted, the judge failed to rule on the claimant’s argument that the searches had gone far beyond the purpose of the warrant and that the entry, searches and seizures were unlawful. It was emphasised that the officers knew legally privileged material (as well as excluded and irrelevant material) was likely to be present, and they nonetheless searched for, and seized, files regardless of their contents. It is suggested the judge incorrectly limited his observations to such matters as his view that the officers acted in good faith and they were aware of issues relating to legal professional privilege. It is observed that this was not a decision as to whether there had been a breach of section 16(8) of the 1984 Act.

The claimant relies on a passage of the decision of Stadlen J in R (on the application of El-Kurd) v Winchester Crown Court [2011] EWHC 1853 (Admin):

65.

[…] However I have no doubt that in the exercise of the judicial discretion conferred by Section 59(6) any court or other appropriate judicial authority faced with an application for retention of unlawfully seized property will be astute to subject to the most rigorous examination the circumstances leading up to and surrounding the illegality of the initial seizure. Any suggestion of bad faith or even that the police or other agency adopted a less than rigorous and scrupulous approach to the drawing up and the execution of the initial warrant is likely to weigh heavily against the exercise of the discretion in favour of authorising retention.

It is argued that the judge should have ruled on these matters, and he erred in not acceding to the claimant’s application. In the result, it is contended that the decision of the judge should be quashed and all the property taken and retained, including copies, should be returned to the claimant. Mr Jones submits there is no realistic prospect that a Crown Court judge, applying the correct test, would find that a section 59(6) order should be made in favour of the second defendant.

It is highlighted that the claimant did not seek to challenge by way of judicial review the grant of the warrants on 2 September 2011 or otherwise to impugn their legality at the time they were issued. Against that background, it is emphasised that this application is not a judicial review of the decision of Judge Hagen to grant those warrants. Further, it is urged on us that this application should not be treated as a review of the legality of the warrants. Instead, the ambit of the present hearing should be restricted to consideration of the judge’s approach to section 59, and particularly whether he applied the law correctly and whether he was entitled to reach the conclusions set out above.

The second defendant argues that the judge was right to rule that he could not go behind the terms of the warrant and find that any of the material had been unlawfully seized. It is argued that the claimant has wrongly asserted that the judge decided that he had no jurisdiction under section 59 to determine whether the searches went beyond the purposes for which the warrants had been issued: indeed, as set out above the second defendant conceded that there was jurisdiction for the court to consider an application when it was submitted that the seizure of material was conducted outside the scope of the warrant.

As to the argument that a warrant is susceptible to attack because it is “bad on its face”, it is suggested that the appropriate challenge to a warrant on the grounds of unlawfulness is to apply for judicial review of the decision to grant the warrant. Furthermore, the judge was correct to rule that he was unable to adjudicate on the lawfulness of a warrant issued by a judge of equivalent jurisdiction. In Goode, Pitchford LJ directly addressed this issue:

It is suggested that the central contention advanced before the lower court was that the warrants were unlawful because they failed to comply with section 15(6) of the 1984 Act, as reflected in the claimant’s written Application. It is highlighted that the claimant’s case was that the section provides that the warrant should identify (as far as practicable) the articles that are sought, and that the claimant’s submission was that this requirement was infringed: the particulars were insufficient because the warrants were too widely drawn. On this basis, the warrants were unlawful and the items that were seized fell to be returned. The second defendant, therefore, emphasises that the claimant did not dispute that there was a statutory power to seize property.

Against that background, the second defendant draws our attention to the decision in R v (Cheema) v Nottingham and Newark Magistrates’ Court and Her Majesty’s Revenue and Custom [2013] EWHC 3790 (Admin). King J, in giving the judgment of the court, observed as follows:

25.

The limitations of the consequences of any quashing order should be noted. Unlike the consequences of non compliance with section 15 or 16 which are provided for by the express terms of section 15(1), the quashing of any warrant cannot render unlawful any prior entry or search or seizure in reliance upon the authority of the warrant, to found, for example, a civil claim for damages for trespass. At most it would render continuing possession of anything seized unlawful. It is well established that a warrant issued by a magistrate under section 8 (as with any warrant purportedly issued in exercise of an existing statutory power) is valid unless and until it is quashed. Until quashed, it remains a lawful authority and justification for any entry or seizure if such is in accordance with its terms. See Goode para 52; McGrath v Chief Constable of the Royal Ulster Constabulary [2001] UK HL 39, [2001] 3 WLR 31.

On this basis it is contended that given the claimant’s argument was essentially based on the alleged unlawfulness of the warrant itself, and given the basis of the claimant’s case under section 59 is that the warrant was unlawful due to alleged defective drafting, Judge Bromilow was correct to decide that he had no jurisdiction to go behind the order of Judge Hagen.

It is contended that the judge was entitled to conclude that the warrants complied with section 15(6) of the 1984 Act, and that he approached the matter on a correct legal basis. In particular, it is suggested he was right to decide that each search and seizure must be assessed in light of the particular circumstances of the case and that the wording of the warrant must be read as a whole. In the context of this case, it is argued that the judge correctly decided that there needs to be a sense of reality and proportion and that in this case the searches and seizures involved a vast quantity of documents, files and papers, some of which were stored on computers. Against that background it is argued that the judge sustainably observed at paragraph 55 of his judgment:

Having regard to the description of the premises, the descriptions of the records and documents, the identity of the four persons to whom such records and documents might belong as well as the identity of the two limited companies, I consider that the objective bystander would be able to identify the articles sought and be able to produce them.

It is suggested that the court must decide whether the seizures were in excess of the warrant and that the extent of the material removed that is covered by legal professional privilege renders them unlawful. It is argued that the greater part of this material was on a computer seized under section 50 of the 2001 Act. It was “imaged” and returned to the claimant. The investigators have not viewed this “image” because HMRC has asked the claimant to identify the file paths for the files that are covered by legal professional privilege in order to delete them. The claimant has not assisted HMRC although he appears to accept that the files are identifiable. The second defendant suggests that a small number of paper files were seized, and independent counsel has been retained to review the claim management files that HMRC wishes to retain (about two lever arch files). It is argued that this court is unable to make a determination on the allegations made as to the quantity of material seized, particularly since the claimant has failed to identify which files on the computer are potentially covered by legal professional privilege.

In summary, as regards the documentation, it is the second defendant’s case that some 260 paper files have been returned to the claimant’s solicitor, and otherwise the client files were stored on a computer that was returned to the claimant in 2012; the “Virk” file (highlighted by the claimant) was a computer file and it is untypical; material covered by legal professional privilege was not deliberately seized and those conducting the searches had been instructed to remove anything within this category; and the quantity of material was very considerable. It is suggested that the judge’s conclusions on these issues were entirely sustainable. He said:

66.

This ground is another challenge to the legality of the search and seizure; I have already concluded that it is not open to me to adjudicate on this point.

67.

However I am able to make these observations having heard argument and evidence about the search and seizures that took place.

68.

I accept the evidence given by HMRC employees who planned and took part in the execution of the search warrants. I have borne in mind that when they gave their oral evidence they were being asked about events that occurred more than two years ago.

69.

In respect of the practicalities of the search, I was impressed by the oral evidence of Mr Moorcroft and Mr Lane; they were acting in good faith – their integrity has not been challenged – and [they] were aware of the issue of LPP. They and their colleagues were faced with vast amounts of materials including personal files and they knew and understood their powers under section 50.

70.

This ground relates to the seizure of items containing LLP material. HMRC accept that firstly in planning Operation Sorus, it was likely to face claims of LPP at some of the locations – see page 10 of the briefing document, secondly LLP material was identified and/or considered to be identified during the course of the searches and thirdly LPP material was seized and removed from the locations.

71.

Mr Jones contends that vast quantities of LPP material have been seized in the approximately 35,000 files that were sized when the warrants were executed. This is described in the evidence of Mr Ullah (p227).

72.

While there is a dispute about the quantities of such material, the Respondent does not argue with the general proposition, as required by section 53 and upon an application made under section 59, for LPP material to be secured and returned. Mr Davies made this position clear during the course of his oral evidence.

73.

I accept that HMRC never set out to seize LPP material; the documents covered by LPP in a claim file were of no interest to HMRC in terms of its investigations into fraud.

74.

I am in no doubt that both parties are capable of resolving the issue of the return of any LPP material; they have both expressed the wish to do.

It is argued by the second defendant that the judge was entitled to make these findings and that they were reasonable.

In the alternative, Mr Fletcher for the second defendant argues that that, even if some material covered by legal professional privilege was outside the scope of the warrant, that did not render the entire search unlawful. In this regard he relies on the judgment of this court in R v Chesterfield Justices, ex parte Bramley [2000] QB 576; [2000] 1 All ER 411 in which Kennedy LJ stated:

LP material

9.

I turn now to consider relevant material which is or maybe subject to LP, as qualified by section 10(2). Here the position is, as it seems to me, relatively straight forward. Section 8(2) entitles a constable to seize material which is within the scope of a properly drawn warrant which has been properly obtained unless he has reasonable grounds for believing the item in question to be subject to LP. Whether or not he has such grounds at the time of seizure must be a question of fact, to be decided in the context of any given case. Obviously it will help to avoid difficulties later if agreement can be reached at the time of the search as to what is and what is not subject to LP. If that is not possible the constable who is conducting the search would be wise to package separately for later examination items which are relevant, but which he believes may be subject to LP. If his state of mind is such that he believes the items to be subject to LP then he must not seize them - Section 19(6) - but a constable is not bound to accept at face value a claim to LP, whether it is raised by an owner or by an owner's lawyer. In some rare cases, for example when a search is being made of the office of a lawyer who is not himself suspected of any criminality, if LP is claimed the constable may have reasonable grounds for accepting the claim without further enquiry, but in almost any other case the constable will have to examine the item to some extent to test the claim, and of course if no claim is made the constable will have to examine the item before he can possibly have reasonable grounds for believing it to be subject to LP. If as a result of later examination after seizure, or perhaps as a result of legal advice, a constable obtains reasonable grounds for believing an item to be subject to LP he must return the item forthwith without further examination, but his seizure of it will not have been illegal because at the time of seizure he had no reasonable grounds for believing the item to be subject to LP. This is where, with respect, like the Divisional Court in Popely 4th October 1999 unreported, I venture to differ from the decision in Gross, where it was said at page 23B that “removal of legally privileged material from the premises which are the subject of the warrant is not permitted”. In that case the warrant was obtained under section 9 Schedule I to the 1984 Act, but nothing seems to turn on that.

That leaves the problem of what is to be done if a difference of opinion persists as to whether an item seized was relevant (i.e. within the warrant) or was subject to LP (as qualified by section 10(2)) and, if so, whether at the time of seizure the constable had reasonable grounds for believing the item be subject to LP. In my judgment as the law stands those issues can only be ventilated by means of an action for trespass to goods, or perhaps in some cases by means of proceedings for judicial review. The latter course is not usually satisfactory, and either course may tend to slow up a criminal investigation which should be proceeding as quickly as possible. So there would seem to be a need for a special inter partes procedure to bring the matter speedily before a circuit judge. Protocols of the type shown to us in draft could have a valuable role to play, not least in preserving the material in a suitable state until it has been adjudicated upon, but in the end they cannot provide a quick solution where there is a dispute

.

Effect of Exceeding Powers

10.

If an item is taken which falls outside the scope of the warrant, or which the constable executing the warrant has reasonable grounds for believing to be subject to legal privilege, what is the result? In R v Southwark Crown Court ex parte Sorsky Defries 6th July 1995 unreported, it was said, at page 17F of the transcript, that any transgression renders the search unlawful “and the seizure of the documents actually covered by the warrant unlawful as well”. The only authority offered for that proposition seems to be section 16(8) of the Act — the provision which requires that search only be a search to the extent required for the purpose for which the warrant is issued. The same line of reasoning seems to have been used by this court in R v Chief Constable of Warwickshire ex parte Fitzpatrick (1988) 1 All E R 65 at 76, but in my judgment section 16(8) is irrelevant. It only confines the area of search. It has nothing to do with seizure and the fact that something has been seized which should have been left behind does not necessarily mean that the search was too extensive. I accept, of course, that any failure to comply with the requirements of either section 15 or section 16 renders the whole process of entry and search unlawful - see section 15(1) - but in any normal case it seems to me that if documents are seized only some of which should have been seized—

(1)

the search remains valid for those documents within the scope of the warrant, but—

(2)

documents which should not have been seized must be returned and there may be a liability in damages arising out of their seizure.(emphasis added)

Arising out of the claimant’s section 59 application, this court needs to decide whether the judge had the authority to determine if the warrant failed to give the prosecution the requisite authority because it was too widely drafted. As set out above, it is suggested that the warrant potentially permitted the seizure of unlimited material. In this regard it needs to be emphasised that the power to search and seize solely derived from the warrant which was granted by a Crown Court judge.

As Mr Jones recognised, Bell v Greater Manchester Police [2005] EWCA Civ 902 is an authority that does not assist his argument that the judge was wrong to determine that he did not have jurisdiction to rule on the suggested unlawfulness of the warrant. In that case, one of the arguments raised by the appellant was whether the warrant properly identified the material that was the subject of the search when it merely referred to “documentary/computer evidence”, and it was suggested that this infringed the requirements of section 15 (6) (b) of the 1984 Act. Sir Mark Potter P. decided, inter alia, that although he considered that this was an arguable point:

35.

Finally, I consider that the judge was right in any event to take the view that the proper avenue for challenge to the validity of the warrant was by way of proceedings for judicial review and that, as the judge held, Mr Bell's failure to appeal against the striking out of his claim that the warrant had been maliciously applied for, put paid to his efforts to attack the validity of the warrant before the judge.

Mr Jones emphasises that the only the appellant appeared in that case, in person, and he submits that this authority is not an obstacle to a judge of the Crown Court finding that a warrant was bad on its face.

In my view the jurisprudence on this issue is clear: the only route to challenge whether a warrant is lawful is by way of judicial review. In particular, in Goode at paragraph 51 Pitchford LJ, having highlighted that it is a judicial act to issue a warrant, disavowed the notion that a court of equal jurisdiction has the power to invalidate the judicial act of another and he expressly approved the obiter dicta observation by Stanley Burnton LJ in Dulai that the Crown Court did not have jurisdiction to examine the circumstances of the issue of a warrant by a magistrates court (“[…] in cases in which there is a challenge to a relevant warrant, the claimant must bring proceedings for judicial review in the Administrative Court to quash the warrant […]” [37]). In unequivocal terms Pitchford LJ determined that a challenge to seizure under section 59(3)(a) “does not enable the applicant to challenge the validity of the warrant in the Crown Court”. This matches entirely the decision of Sir Mark Potter in Bell thatthe proper avenue to challenge the validity of a warrant is by way of judicial review. For my part, I agree entirely with this approach, and whether or not some of these observations were, strictly speaking, obiter dicta, they undoubtedly reveal the correct approach – it is not open to a Crown Court judge on a section 59 application to decide that a warrant issued by another Crown Court judge was unlawful, whether the suggestion is that it was “bad on its face” or otherwise. In either situation, this would constitute a challenge to the validity of the warrant and (to borrow the words of Pitchford LJ) a court of equal jurisdiction does not enjoy the power to declare invalid the judicial act of another.

It follows that I agree entirely with the judge’s conclusion:

45.

In my judgment the submissions of Mr Fletcher must succeed and I conclude that the Crown Court has no jurisdiction to consider the lawfulness and validity of the warrants issued by Judge Hagen on 8.9.2011. In reaching that conclusion I have had particular regard to the guidance of Pitchford LJ in Goode.

It is implicit in Mr Jones’s submissions on this application that if we reject his argument that the judge erred when he decided he did not have jurisdiction to rule on the validity of the warrants, his case on section 15(6) inevitably also fails, because it would have been impermissible for Judge Bromilow to adjudicate on whether the warrant sufficiently identified the articles that were sought. That challenge would also need to have been addressed by way of judicial review.

It was for the claimant to make out that the searches and seizures went beyond the purpose for which the warrants were issued, as regards the computer material and the paper files. We note at the outset that there was no claim in this context for a year, and during that time the second defendant was asking the claimant to give search words in order to conduct searches as regards the computer material. 

 The computers were returned and these seizures were covered by the section 50 notice, including the disputed Virk file.

The judge accepted the evidence of Mr Gillfedder, Mr Moorcroft and Mr Davies, that only 260 client paper files were seized. These have been returned save for two documents from each file. The first document in each case related to the signed mandate provided to the company by the client of ACHL for the solicitor to pay ACHL a fee of £350 out of any compensation payment. This fee was in addition to the referral fee paid by the solicitor to ACHL, and it potentially constituted a second stream of income which HMRC believes has not been declared by ACHL. The second document is the ACHL claim form which contains factual details of the client’s name, address and accident. This was retained because it provided the context in which the client authorised the fee and it gave certain identifying information. When taking this material those carrying out the searches inserted pink copies in the file wherever a document had been retained.  In all this material filled about 2 lever arch files. Mr Jones suggests these documents are covered by LPP, because they were prepared in contemplation of litigation. It is the second defendant’s case that these documents were originally looked at because no point as regards privilege was taken. Once the issue of LPP was raised, the files were returned in full in September 2013.

The evidence for the second defendant was that the officers had been instructed that prior to seizure they were to remove all legally privileged material. It was not their intention to take any documents that were covered by LPP.

I consider that Kennedy LJ in Bramley correctly doubted the decision in Fitzpatrick, as set out above, that a search is rendered unlawful if there is any transgression, in the sense that an item is taken that falls outside the scope of the warrant. I have already cited the relevant passage from Bramley above, and the reasoning set out therein seems to me to be entirely persuasive. As Kennedy LJ observed “section 16(8) […] only confines the area of search. It has nothing to do with seizure and the fact that something has been seized which should have been left behind does not necessarily mean that the search was too extensive” [10]. There is no sustainable basis in law for contending that whenever there has been a more than de minimis breach of section 16(8) the entirety of the entry, search and seizure under that warrant was unlawful. Instead, the particular documents which were taken in excess of the warrant’s authorisation should be returned and there may be liability in damages.

On the facts of this case, I do not consider that the claimant has made out his case. The judge was entitled to accept the evidence called by the second defendant, and by implication he found there had not been any material breach of section 16(8). The computer material was covered by the section 50 notice, and, as regards the 260 client paper files, the only relevant documents were returned once the issue of legal professional privilege was raised. Even if those documents should not have been taken, following the decision of Kennedy LJ in Bramley, the seizure of them would have no effect on the overall legality of the search and seizure. On the evidence before the judge, there was no outstanding material that fell to be returned. Judicial review is a discretionary remedy and there is no sustainable basis for granting relief in these circumstances.

The Court of Appeal is presently considering whether an application under section 59 is a “criminal cause or matter” for the purposes of section 18 Senior Courts Act and section 1 Administration of Justice Act 1960 (Panesar and others: 2014/2830, 2014/2900 and 2014/2901). This is directly relevant to the power of the judge to award costs in the present case. I would adjourn this part of the application until the Court of Appeal has handed down its decision in Panesar. I would then give the applicant 7 days to file any additional submissions on this issue, with 7 days for the second defendant to file submissions in response. I propose that our decision on this discrete issue is handed down in writing thereafter.

I agree