Shaw, R (On the Application Of) v Cheshire Constabulary

MR JUSTICE OUSELEY: This is a renewed application for permission to apply for judicial review following its refusal on paper by Wilkie J. There is potentially, as he recognised, a delay or want of promptness point but he dealt with the merits and I shall do likewise.

The challenge is to a decision or sequence of decisions which have been taken by the Cheshire Constabulary not to prosecute or not to investigate further allegations of fraud which the claimant makes against Mr Goodstone, who was at the relevant time a partner in Addleshaw Goddard.

The matter arises briefly in this way. The claimant in 2003 was looking to buy a company from the corporate owner. He, at considerable expense, underwent the necessary process of investigation and had a business plan prepared for him which he passed to Pinsent Masons, who were acting for him. On the other side, acting for the vendor of the business were Addleshaw Goddard through Mr Goodstone. The claimant then found that the deal was off the table. He was concerned that the eventual purchasers of the company had obtained information about his bid and plans. He brought proceedings against them. He failed at considerable expense.

Shortly after those proceedings, an acquaintance of his, who had had connections with the eventual purchasers of the company, gave him information which led him to believe that Pinsent Masons had passed to Addleshaw Goddard his business plan and that Addleshaw Goddard had passed his business plan on to the eventual other buyers. Those other buyers, armed with his information and business intentions, were able to realise how this loss-making company could be turned round. He asked Pinsent Masons whether that had happened. Following an initial denial that any such thing could have happened, Pinsent Masons investigated their email traffic and it was found that they had indeed sent an email to Mr Goodstone in which the business plan was one of the two enclosures.

The fact that this had happened had been known to Mr Shaw at the time of the failed purchase. As soon as he queried why this had happened in strong terms, he was told that the email had been recalled, which he understood then to mean that it had been recalled unopened and so no damage was done. The only email produced in the course of the proceedings against the purchasers was the follow-up email in which no business plan was disclosed. He thought that is where matters had been left. But having had this conversation with his acquaintance after the failure of his proceedings against the buyer, and having approached Pinsent Masons again, they revealed that the email had in fact been sent and although marked recalled it became clear that the business plan had been sent and that Mr Goodstone had at least been in a position to open it.

Proceedings were commenced against Pinsent Masons in relation to the loss of the business opportunity. During the course of those proceedings, a witness statement was produced by Mr Goodstone in which he said that he had never requested a copy of the business plan (there had been some suggestion from the then sender at Pinsent Masons that he had) and that after he had been told it had been sent in error he had instructed his secretary to delete it. He denied that it had been sent on to anybody else. His secretary also made a statement filling in the gaps in communication between Pinsent Masons and Mr Goodstone about this.

During the course of those proceedings as well, Mr Shaw sought non-party disclosure from Addleshaws in relation to their email records. Their disclosure statement said that they had located the backup tapes but it had not been possible successfully to mount the backup tapes, by which it is thought they meant to get them to play, and accordingly the search had not produced any results. They had also conducted a search of the email archive, which had produced no results, and Mr Shaw said would not have done so had emails been deleted. Finally, they were able to find the metadata for the later of the emails sent by Pinsents to Addleshaw Goddard on the relevant date but no metadata in relation to the earlier one at 14.53, which was the one that had enclosed the business plan. That too would have been the case if that email had been deleted, as Mr Goodstone said it had been.

These proceedings, on top of the heavy costs of the failed ones, were beginning to weigh heavily and an agreement was reached whereby the proceedings were brought to an end against Pinsent Masons.

In 2012, after those proceedings had ended, Mr Shaw sought the assistance of the police. He alleged that the actions of Mr Goodstone had involved theft or fraud. He explained to the police the position and asked them to investigate. The ending of the litigation of Pinsent Masons had prevented that litigation being a route for such an investigation.

He did not achieve what he wanted from the police. Detective Sergeant Kidd carried out an investigation between November and January 2103 and told him that the police had concluded the investigation should be discontinued as the application for a production order from the Crown Court to obtain the tapes would be most unlikely to be successful and even if obtained, that the relevant data could not be found on the tapes. Mr Shaw continued to request investigation. Detective Sergeant Kidd carried out further investigations before repeating on 2 May 2014 that no further investigation would be carried out. He asked the Chief Constable to investigate and the Police and Crime Commissioner, and the Staff Officer to the Chief Constable looked into how the allegation had been handled but in December informed the claimant that there was insufficient evidence for a prosecution and the matter was now closed. He took it up again via his MP and was told again that the matter had been closed.

What Mr Shaw complains of is that the police ought to have pursued the question of whether the tapes could be obtained by a production order under section 345 of the Proceeds of Crime Act 2002, which is the route they considered would not be likely to achieve anything. He also contended that the police ought to interview two named individuals. These individuals were not Mr Goodstone and his secretary but men who had been employed in the IT department of Addleshaws and who would have understood how Addleshaws' backup system operated.

The police took the view that they had the statement from the partner at Addleshaws and his secretary saying that they had deleted the email and not opened it and not passed it on. They had evidence from Addleshaws in the disclosure statement that the tape could not be played and it would only be on the tape that any opening of the email and any transmission of it, for example via a Blackberry, would be found. It was on that basis that the police took the view, with the advice of the Cheshire Constabulary solicitor, that an application for a production order would not be successful. Mr Shaw says that he would be prepared to pay for an external expert to examine the tapes, that it is not reasonable to suppose that Addleshaws' backup system is so defective as they describe, and that playing the tapes on the face of it is a fairly simple task for fairly simple tapes. The police had a duty to be fair and to pursue investigations in the interests of justice.

I have understood why Mr Shaw says what he says and his feeling that the police are not pursuing a case where he is very firmly of the view that solicitors are getting away with it, if I can put it colloquially but I think it expresses his feeling.

The role of the courts in relation to the review of decisions not to prosecute and of the conduct of an investigation were considered in the case of the R(Bermingham) v Director of Serious Fraud Office [2006] EWHC 2000 (Admin), [2007] QB 727 at paragraphs 63 and 64 in the judgment of Laws LJ, with which I agreed. The principle is that in the absence of a wholly exceptional case, the court would not intervene to examine by way of judicial review a discretionary decision by the Director of the SFO to investigate or not to investigate fraud.

The decision is a little different here. The police have investigated and have come to a conclusion. The courts have set their face against reviewing a decision not to prosecute, again except if there are very exceptional circumstances. The decisions of the proper authorities as to whether or not to prosecute involve their judgment as to sufficiency of evidence and as to the public interest. There are a number of considerations which they bring into balance and their powers are broad.

In my judgment, in terms of the decision not to prosecute and not to investigate further, the decision cannot be characterised as unlawful in such a way as to require the police further to intervene.

Mr Shaw goes a little further. He identifies specific steps by way of investigation which he says the defendant should take at the order of the court. One is the seeking of a production order and second is the interviewing of the two former Addleshaw Goddards IT experts.

The court would only in the most truly exceptional circumstances be involved in any form of instructions as to how an investigation was to be carried out. It would be a very, very unusual case indeed. I am not aware of any decision containing such an order. I am aware on the other hand of a number of decisions which have emphasised that the courts should not get involved in requiring an investigation to take specific steps. It follows as well as that if specific steps are not to be taken at the behest of the court, there is nothing further that Mr Shaw seeks should be done by way of investigation and must therefore accept the decision which the police have come to.

I appreciate this comes as unwelcome to him, I do not think it comes as a surprise but this application for permission is dismissed.

Thank you very much, Mr Shaw, Mr Capewell.

MR CAPEWELL: My Lord, I am grateful. We do, you may have seen from the skeleton, make an application for our costs of the preparation of the acknowledgement of service.

MR JUSTICE OUSELEY: How much is that?

MR CAPEWELL: I accept that that was not made in the acknowledgement of service itself. I have a statement which I can hand up. It comes to £1,693.60, which is the costs of my instructing solicitor preparing the AOS, and in the ordinary way we ask for those costs.

MR JUSTICE OUSELEY: In the ordinary way, you are expected to ask for them in the AOS, are you not?

MR CAPEWELL: That is not what is said in Mount Cook, I accept that that is what was suggested in Ewing, the later case, and I have to accept that that was not done.

MR JUSTICE OUSELEY: But you say it is not required by Mount Cook?

MR CAPEWELL: It is not required by Mount Cook, and indeed there is no Rule or Practice Direction to that effect of course.

MR JUSTICE OUSELEY: Has Mr Shaw seen this?

THE CLAIMANT: I've seen It but I didn't really understand it because, you know, it appears to be the solicitors' costs.

MR JUSTICE OUSELEY: They are the costs for producing the acknowledgement of service, not Mr Capewell's costs for being here but the costs of the acknowledgement of service. You have got that acknowledgement of service.

THE CLAIMANT: So Mr Capewell's costs are not anywhere?

MR JUSTICE OUSELEY: Well, they are somewhere, they are in the public purse but not at your cost.

THE CLAIMANT: I would have thought these solicitors —

MR JUSTICE OUSELEY: It is the acknowledgement of service costs. You have got the acknowledgement of service. So it is not the skeleton argument either.

THE CLAIMANT: I would have thought that those costs are in the public purse as well.

MR JUSTICE OUSELEY: No, the normal rule is in judicial review that if you do not get permission, you do not have to pay for the costs of the renewal hearing, that is the normal rule, but you do have to pay, normal rule, the costs of the acknowledgement of service because they are required to produce it.

THE CLAIMANT: To be honest, I don’t have any problem with that.

MR JUSTICE OUSELEY: The amount with VAT actually comes up to £2,031.

THE CLAIMANT: Yes, it does, my Lord.

MR JUSTICE OUSELEY: Can you recover that?

THE CLAIMANT: No.

MR JUSTICE OUSELEY: 8 hours at £217 an hour.

MR CAPEWELL: I don't have a problem with it.

MR JUSTICE OUSELEY: All right, you will pay £2,031.12.

THE CLAIMANT: May I just raise one further point. Is it possible for me to appeal this particular decision?

MR JUSTICE OUSELEY: It is. Whether it is an appeal or a further application —

MR CAPEWELL: It is a renewal in front of the Court of Appeal.

THE CLAIMANT: So that is down to me.

MR JUSTICE OUSELEY: That is down to you. All bets are off if you try there in costs terms.

THE CLAIMANT: It’s something I need to think about.

MR JUSTICE OUSELEY: Just let me make this point to you. You have had one go, you have had another go, I think you have had a sympathetic hearing from me. If you persist, having lost, you will not get a sympathetic hearing unless you have got a really good point of law, an arguable one. Review of decisions about investigation and prosecution and how to conduct an investigation are ones that you will find the courts have set their face against because otherwise we would spend our time directing the CPS and the police force on how to conduct their business at the behest of victims and criminals alike and it just is not going to happen. We are a court, not a - although sometimes it feels like it — general repository for everybody who is aggrieved about anything.

THE CLAIMANT: I have had a sympathetic hearing and I am sure the court understands my view.

MR JUSTICE OUSELEY: I understand entirely but I would strongly discourage you.

THE CLAIMANT: Thank you.

MR JUSTICE OUSELEY: Thank you very much.