Serious Organised Crime Agency v Agidi & Anor

The Serious Organised Crime Agency (“SOCA”) seeks the recovery, under the provisions of Part 5 of the Proceeds of Crime Act 2002 (“the Act”), of property worth approximately £1,225,707 (all of which is subject to a Property Freezing Order granted by Collins J on 18 February 2009 - as varied by Master Eastman on 26 February 2010), as follows:-

The First Respondent (hereafter Mr Agidi) is now aged 68. In March 2002, after 35 years’ service, latterly in positions of high rank, he retired from the Nigerian Federal Civil Service. During his years as a civil servant Mr Agidi was paid, in total, the equivalent of about £21,600. On retirement he was paid a gratuity worth the equivalent of about £12,700. He has since been paid a pension the equivalent of about £283 per month.

The Second Respondent (hereafter Mrs Agidi) is now aged 66. She is Mr Agidi’s third wife. They are both now living in Nigeria. Mr Agidi was diagnosed with prostate cancer in about 2005/2006, and remains in poor health.

This claim was formally issued in July 2009, against the background, inter alia, that:-

The main thrust of SOCA’s case is that each item sought to be recovered derives from the proceeds of corruption in Nigeria. Its principal assertion is that Mr Agidi and others were involved in corrupt relationships with two companies that obtained multi-million US dollar contracts from the FRN – namely Skoda Export Limited (“Skoda” – based in Praha in the now Czech Republic), and Sagem SA (“Sagem” – based in France). It is further asserted that the relevant credits to the bank accounts in London controlled by Mr Agidi were bribes or rewards resulting from those corrupt relationships, and were thereafter either kept by Mr Agidi for the use of himself and Mrs Agidi, or were withdrawn and distributed by him in cash to others involved in the corruption. In the alternative (and, as will become apparent, controversially) it is asserted that if a relevant credit was not the product of the alleged corrupt relationships with Skoda or Sagem, it must, by inference from all the circumstances, and in accordance with the approach in Anwoir and others [2008] 4 All ER 582, have been a bribe or reward which was the product of a corrupt relationship with another or others, and/or the product of money laundering.

The principal thrust of Mr Agidi’s case, put forward in a statement dated 19 February 2010, is that his dealings with Skoda and Sagem were legitimate, and that the items of property sought are not recoverable. In a statement made in the cash forfeiture proceedings, Mr Agidi asserted that U$ 20,000 of the cash seized after his arrest on 10 November 2003 belonged to Mrs Agidi, and that £7,800 of it belonged to his daughter Anne Ihonor.

Mrs Agidi, in a statement dated 19 January 2010, asserts that she knows nothing about the facts, nor of the allegations made by SOCA. Beyond that, she advances no independent case.

The hearings in this case took place over a number of days in July and November 2010, during which, amongst other things, I heard evidence on two occasions from Chris Spencer, a Financial Investigator employed by SOCA, and also from Dr. Tunde Ogowewo, an expert in Nigerian Law.

During the hearings the following issues arose for resolution, namely whether:-

I propose first to set out my findings of fact, and then to deal with each of the above-mentioned issues in turn.

I found both Chris Spencer and Dr. Ogowewo to be honest and reliable witnesses. Against that background, I make the following findings of fact, some of which have already been referred to above, on the basis of the evidence and on the balance of probabilities (s.241(3) of the Act), but with the considerable gravity of the allegations firmly in mind – adopting the approach in Re H (Minors)(Sexual Abuse : Standard of Proof) [1996] AC 563, 586/7.

Mr Agidi was born in October 1942. He became a civil servant in Nigeria on 15 March 1967. Having, whilst so employed, obtained various academic qualifications, he was posted to the High Commission in London in 1974, rising to become the Minister – Counsellor (Economics). After his return to Nigeria in about 1979/1980, he held various posts including Principal Secretary in the Executive Office of the President. In 1987 he began working in the Federal Ministry of Education – initially as the Principal Secretary (Policy) [1987-1990], rising to the Deputy Director (Policy), Deputy Director (Special Duties) and Director (Policy). He was also (at one stage) the Special Assistant to the Federal Minister of Education. In June 1998 he was posted to the Ministry of Internal Affairs as the Director of the National Civic Registration Directorate, overseeing the implementation of the National Identity Card Project. The military dictatorship in Nigeria ended in 1999. In October/November 2001 Mr Agidi was posted to the Executive Office of the President as Director of Public Affairs. He retired on 15 March 2002.

Mr Agidi’s total earnings whilst in employment as a civil servant, gratuity on retirement, and pension, were or are in the equivalent of the Sterling sums set out in paragraph 2 above. Until 2002 the most that Mr Agidi ever earned in a year was the equivalent of about £754. In 2002, until his retirement in March, he was paid the monthly equivalent of a salary of £4,470 per annum.

From 1989 onwards Mr Agidi was both a public officer in the service of the Federation of Nigeria, and a member of the Civil Service of the Federation. As such, he was under a duty to conform with the Constitutional Code of Conduct provided, at first, under the 1979 Constitution, and then (from 29 May 1999) under the 1999 Constitution. In each case the duty was enforced by legislation. He was thus subject, inter alia, to the following prohibitions or requirements:-

In addition, from at least February 1999 onwards, there were wide-ranging criminal offences under the laws of both Lagos State and the Federal Capital Territory (where Mr Agidi was based) prohibiting both bribery and corruption. The offences, overall, were essentially the same as those applicable in England and Wales. In particular, and whether as a principal, secondary party or conspirator:-

In the period 1974-1984, Mr Agidi opened a bank account in his own name at the then Midland Bank, Central Hall Westminster Branch in London. The account was later taken over by HSBC as account no. 71071769 (“the Agidi 710 account”).

Mr Agidi’s first wife was Ruth Pauline Okoh. They parted in the 1990’s, after which she remained living in Nigeria. Prior to that, a US Dollar account in her name was opened at the same branch of the then Midland Bank in London. Mr Agidi was a signatory on the account, and was, at all material times, in sole control of it. The account was later taken over by HSBC as account no. 35272243 (“the Okoh account”).

In 1989, whilst Mr Agidi was the Principal Secretary (Policy) at the Ministry of Education, Skoda entered into a contract with the Ministry for the supply of equipment for four Federal Polytechnics and eight Federal Technical Colleges. Under the terms of the contract, Skoda was to be paid a total of U$ 40 million. Thereafter, Skoda supplied equipment in accordance with the contract, but there were delays in payment being made. In the period after the signing of the contract in 1989, if not before, Mr Agidi became involved in an ongoing corrupt relationship with Skoda, during which he managed to keep the project afloat. In 1995/1996 as Deputy Director (Special Duties) in the Ministry of Education, Mr Agidi made representations to the Minister for substantial payments to be released to Skoda.

At some point prior to 1997, Mr Agidi also opened a US Dollar account in his own name at the same branch of the Midland Bank. The account was later taken over by HSBC as account no. 35201077 (“the Agidi 352 account”).

No bank statements are available for the Agidi 352 account prior to October 1997, nor for the Okoh account prior to February 1999, nor for the Agidi 710 account prior to June 1999.

As already indicated above, in June 1998 Mr Agidi left the Ministry of Education and was appointed Director of the National Civic Registration Directorate, which was part of the Ministry of Internal Affairs.

On 27 August 1998, Mr Agidi entered into the first of five written agreements with Skoda – all of which were nothing more than thinly veiled attempts to put a respectable face on what was, by then, a corrupt relationship of long standing, by the payment of “fees” which were, in reality, bribes or rewards to Mr Agidi and others. The third and fifth agreements were found at Mr and Mrs Agidi’s home at 17A Adeyemi Lawson Street in Lagos in Nigeria when it was searched by the Nigerian authorities in December 2003. From those agreements, it is clear that, as part of the attempt to disguise the reality, Mr Agidi entered into each in the guise of Orion Consult World Wide Network (“Orion”). The first agreement was entitled “Consultancy Agreement”, and provided for both Orion, as “Prime Consultant”, and a “Consultancy Group” to be paid a substantial percentage of any monies paid to Skoda under the 1989 contract, and in repayment of loans made by Skoda to the FRN. In September 1998, there was a meeting between Mr Agidi and Skoda in Praha to discuss this first agreement.

On 31 December 1998 a letter was written to Skoda, on behalf of the “Consultancy Group”, indicating that a repayment of loans in the total sum U$ 2,250,000 had recently been made to Skoda, and that a remittance under the 1989 contract of U$ 3,150,000 was in the course of being processed. The letter reminded Skoda that it should fulfil its part of the obligations under the “Consultancy Agreement” by preparing payments for “consultancy fees” in relation to both sums.

On 22 January 1999 Mr Agidi, in his guise as Orion, entered into the second written agreement with Skoda. It was entitled “Revised Consultancy Agreement” and under it, by way of “consultancy fees”, he was to receive 22% of any further monies paid by the FRN to Skoda under the 1989 contract.

On 16 February 1999 the Okoh account received a direct credit from a named Skoda account of U$ 500,000. This was a bribe or reward which was the product of the corrupt relationship between Mr Agidi and Skoda, and thus was property obtained through unlawful conduct.

On 23 May 1999 the Okoh account received two credits in the total sum of U$ 334,050. Although neither was directly from a named Skoda account, by inference these credits were also bribes or rewards which were the product of the corrupt relationship between Skoda and Mr Agidi, and thus each was or represented property obtained through unlawful conduct.

The three above-mentioned corrupt credits were withdrawn from the Okoh account and, by inference, were converted into sterling and transferred to the Agidi 710 account, from which they were then transferred out to money market accounts, and then back into the Agidi 710 account, where they continued to represent property obtained through unlawful conduct.

In the meanwhile, on 28 May 1999, Mr Agidi, again in his guise as Orion, entered into the third written agreement with Skoda. This was entitled “Addendum II to consultancy fees agreement Czech $40million supply of science equipment contract”. The agreement indicated that as “Prime Consultant” Orion had previously been entitled to 22% by way of “consultancy fees”, but now agreed to the involvement of a “new consultant group” to facilitate the speedy payment of the then outstanding sum of U$ 29,750,000 due to Skoda under the contract. Orion also agreed that the “new consultant group” should receive 15% of any amount paid, and that Orion itself would receive not less than 7%. The contract recorded that the “Prime Consultant” had “managed to keep the project afloat all through the very dark turbulent management years”, and that therefore a 7% “consultancy fee payment” was the “barest minimum acceptable”. The agreement was expressed to be contingent upon the “new consultant group” achieving part payment of the outstanding sum within three months, or full payment within six months – with provision for the automatic cancellation of the agreement and reversion to the January 1999 agreement (with Orion alone receiving 22%) if the “new consultant group” failed to perform.

On 23 August 1999, at one point, there was a credit balance of over £627,000 in the Agidi 710 account – all of which, by inference, represented the product of the above-mentioned or other corrupt payments by Skoda, and thus represented property obtained through unlawful conduct. £577,703.32 of that balance was then transferred to a money market account, leaving a remaining credit balance of £50,000 (which continued to represent property obtained through unlawful conduct).

The purchase price of the house at 84 Hurstwood Road was £273,000. It was paid in part in cash and in part by funds from the Agidi 710 account, as follows:-

The purchase of the house at 84 Hurstwood Road was completed, in the sole name of Mr Agidi, on 6 October 1999. Its purchase had been funded in whole by property which represented property that Mr Agidi had obtained though unlawful conduct – i.e. his corrupt relationship with Skoda.

In the period between 29 November 1999 and 11 May 2000 there was a further series of substantial credits to, and withdrawals from, the Okoh account, as follows:-

As to the above-mentioned credits to the Okoh account:-

In consequence of the above-mentioned credits from the Okoh account to the Agidi 710 account on 29 November 1999, 14 December 1999, 17 March 2000 and 16/17 May 2000, there was a credit balance in the Agidi 710 account of over £2 million, which represented bribes or rewards which were the product of the corrupt relationship between Mr Agidi and Skoda. In the period between 16/17 May 2000 and 4 October 2000 the majority of this balance was regularly transferred out to money market accounts and then transferred back into the Agidi 710 account.

On 4 October 2000 £1,500,000 of that balance (still representing the product of the corrupt relationship between Mr Agidi and Skoda) was transferred to HSBC Life (Europe) Limited in the purchase of an International Life Bond in the joint names of Mr and Mrs Agidi. The money was divided into five policies, each with a value of £300,000.

In the period from June 2000 until September 2002 substantial credits continued to be made the Okoh account which, whether direct from a named Skoda account (23 March 2001 U$ 38,809.50; 30 May 2001 U$ 15,766; 27 December 2001 U$ 57,988; 7 May 2002 U$ 57,535 & U$ 58,893; 18 September 2002 U$ 58,893 & U$ 57,535), or from other overseas accounts, were bribes or rewards which were the product of the corrupt relationship between Mr Agidi and Skoda. Again, substantial sums were also withdrawn from the account – whether in cash, or by way of drafts or transfers. It is however unnecessary to go into any further details.

On 9 & 10 August 2001 Mr Agidi and Skoda met in Praha. At the conclusion of the meeting the fourth written agreement between them was signed. Again, this took the guise of a “Consultancy Agreement” between Skoda and Orion as “Prime Consultant”. Mr Agidi agreed to ensure that the outstanding balance due to Skoda under the 1989 contract of U$ 29,750,000 would be included in the year 2002 Budget of the FRN, and to ensure that, at the barest minimum, equipment worth U$ 11,000,000 would be paid for through foreign exchange transmission in the year 2002. In return, Mr Agidi was to receive a substantial percentage of the monies paid.

In early October 2001, Mr Agidi opened a third bank account in his own name at the now HSBC Westminster Branch. This was a High Interest Savings Account no. 91314637 (“the Agidi 913 account”).

On 12 October 2001 (and thus whilst he was still a civil servant) the fifth written agreement between Skoda and Mr Agidi was signed. This took the guise of a “Consultancy Fees Agreement” between Skoda and Orion as the “Prime Consultant”. Having referred to the terms of the August 2001 agreement, this agreement indicated that if Orion achieved the barest minimum payment of U$ 11,000,000 to Skoda in 2002, then Skoda would retain Orion’s services, and Orion would expand “the scope and quantum of transactions” of Skoda in relation to the 1989 contract beyond 2002, and otherwise. Skoda agreed that, in accordance with a requirement of the Federal Ministry of Education, it would grant a discount of 10% on goods supplied in 2002. Evidence of the admittance of the project into the 2002 Budget of the FRN was to be proved by the end of March 2002. Orion was to be paid 23% of any payment released to Skoda by 30 June 2002 by way of an “agency fee”.

A document entitled “Public Relations Fees in 2001 on USD 29.75Mil” was later found by the Metropolitan Police at the house at 84 Hurstwood Road in November 2003. It was, in truth, a list of who (within the National Assembly, the Federal Ministry of Education, the Federal Ministry of Finance and various other bodies) was to receive what bribes or rewards to ensure the payment of the ourstanding monies to Skoda.

In March 2002 Mr Agidi retired from the Civil Service. (I will outline the legal significance of this when dealing with the relationship between Mr Agidi and Sagem below).

The corrupt relationship between Mr Agidi and Skoda continued until at least September 2002. The last credits by way of bribe or reward from a Skoda account to the Okoh account took place on 18 September 2002 (see paragraph 36 above).

As to the HSBC Life (Europe) International Life Bond, which was bought for £1,500,000 in October 2000 using funds which were the product of the corrupt relationship between Mr Agidi and Skoda:-

As late as September 2003, a senior employee of Skoda (in an e-mail that Mr Agidi was copied into) stated that:

“The only solution for IndustrySkoda Ltd to survive is not in unsure future business, but in approved Education Project for Federal Polytechnics in which Mr Agidi is involved and IndustrySkoda got promise of N 300m from federal budget.”

As already indicated, in June 1998 Mr Agidi left the Federal Ministry of Education and became the Director of the National Civic Registration Directorate, which was part of the Ministry of Internal Affairs.

As such, Mr Agidi assumed responsibility for the National Identity Card Project. The Project, which was a long-standing one, was put out to tender. Mr Agidi was the Chairman of the Tenders Analysis sub-committee and participated in pre-contract negotiations. The tenders were eventually narrowed down to those from five companies – including Sagem, and a Nigerian company called Officetron Ltd (“Officetron”). Officetron, and another Nigerian company called Maurang Co Ltd (“Maurang”), were owned by a Mr Adelagun. By no later than 2001, Mr Agidi became involved in a corrupt relationship with Sagem and Mr Adelagun. This was thus at a time when he was already involved in the long-standing corrupt relationship with Skoda, which (as set out above) continued until at least September 2002.

In about May/June 2001, when Mr Agidi was away from work, the other members of the Tender Analysis sub-committee removed Sagem from the short list of five. On his return, Mr Agidi ensured that Sagem was restored to the short list. Thereafter, as he later admitted in Metropolitan Police interview, Mr Agidi was one of those responsible for advising that the contract should be awarded to Sagem. Indeed, he wrote letters to the Ministry of Internal Affairs and to the Permanent Secretary in very strong support of Sagem. Others involved in connection with the award of the contract included Chief Afolabi and Mr Akwanga (a Government Minister). In the event, the President of Nigeria chose to award the contract to Sagem. The contract was duly signed on 22 August 2001. It provided that Sagem was to be paid a total of U$ 216 million.

The vehicles used to pay bribes to Mr Agidi resulting from his corrupt relationship with Sagem and Mr Adelagun were Officetron, Maurang and Orion.

As already indicated above, in October/November 2001 Mr Agidi moved from the National Civic Registration Directorate to the Executive Office of the President, and on 15 March 2002 he retired.

In the period between 29 May 1999 and his retirement, Mr Agidi failed to comply with his obligation to complete an Asset Declaration Form for Public Officers – thereby hiding the existence of the various bank accounts in London under his control.

Under Nigerian law, having retired from the civil service, Mr Agidi was entitled, absent improper conduct, to profit from the exploitation of his fund of knowledge and expertise gained as a civil servant, by rendering consultancy services to third parties, even if the terms were unusually generous. That said, it was nevertheless at all material times a crime in Nigeria for a retired public official to receive, in retirement, anything that he corruptly agreed to receive or obtained whilst employed as a public official, whether for himself or any other person, and whether relating to things done, or omitted, or any favour shown, or to be done, or omitted, or shown, or relating to any matter connected with the functions, affairs or business of any Government department etc. in which he was employed. Equally, at all material times, it was a crime in Nigeria for a retired public official to be otherwise involved in offences of bribery or corruption – whether as a principal offender, secondary party or conspirator.

On 21 March 2003, six days after his retirement, Mr Agidi, in his guise as the Chairman/CEO of Orion, put forward a proposal to Officetron for “Project Consultancy” in relation to the implementation of the National Identity Card contract. In the proposal, Orion was described as:

“An extremely well established company in Nigeria with a great wealth of knowledge and experience in similar and related projects”.

In return, inter alia, for making available its extensive contacts in the public sector to Officetron, and to all other companies involved in the project, in order to ensure the “smooth implementation of the project”, Orion sought a “consultancy service fee” of 10% of the total contract fee. This was, in fact, nothing more than the beginnings of attempts to disguise the reality of what was already an ongoing corrupt relationship of long-standing between Mr Agidi, Sagem and Mr Adelagun, and the equally long-standing agreement between them that consequent corrupt payments (whether to Mr Agidi and/or others through him) would not be made until after Mr Agidi had retired.

On 17 April 2002 a “Consultancy Agreement” was signed between Mr Agidi (as “the Consultant”) and Officetron. Officetron was said to be the local representative of Sagem for the implementation of the National Identity Card Project. Mr Agidi agreed to provide his services to Officetron, Sagem and other companies involved in the project. In return, Officetron was to pay Mr Agidi a fee of U$ 3,500,000 for such services over an initial period of 2 years. Again, this was part of the attempt to disguise the reality of the long-standing agreement that corrupt payments (whether to Mr Agidi and/or to others through him) would not be made until after Mr Agidi retired.

On 6 June 2002 (some three months before receipt of his last corrupt payment from Skoda) Mr Agidi received his first corrupt payment from Sagem. It was in the sum of U$ 922,945, and was credited to the Okoh account from an Officetron account. It thus was or represented property obtained through unlawful conduct. On 24 June 2002 U$ 454,500 of this was withdrawn in cash. Two days later, another U$ 454,000 of it was also withdrawn in cash.

On 24 July 2002 Orion Worldwide Consult Limited was registered with Companies House in Nigeria. The Directors were said to be Mr Agidi, his daughter Anne Ihonor and Ruth Okoh.

On 16 August 2002 Orion Worldwide Consult Limited was also incorporated in the United Kingdom. Four days later Mr Agidi, who was said to be an “Investment Consultant”, was appointed as a Director. His daughter Anne Ihonor was appointed as Company Secretary.

On 10 December 2002 Mr Agidi, in his role as the Managing Director of Orion, applied to the HSBC Branch at Westminster (where his three personal accounts and the Okoh account were already held) for two business accounts in the name of Orion. The principal business of Orion was said to be “consultancy on investment of technical and industrial equipment”, and its principal countries of business were said to be the Czech Republic and France (i.e. the countries where Skoda and Sagem were based). Mr Agidi indicated that he had been banking with the Midland/HSBC since the 1970s. Mr Agidi further indicated that he was putting £1,500,000 in capital (raised from “profit on consultancy”) into the business and that the estimated turnover of the business for the next twelve months was £1,000,000. Mr Agidi stated that his own income in the last year was £200,000.

In consequence of the application, a US dollar deposit account no. 57844666 was opened in the name of Orion (“the Orion 578 account”), as was a US dollar business current account no. 51319469 (“the Orion 513 account”).

On 13 February 2003, following two earlier “invoices” from Officetron to Sagem in the total sum of U$ 6,914,745, Sagem transferred U$ 5,039,198 to Officetron. This was a corrupt payment.

There then followed three transfers from Officetron and Maurang accounts to the new Orion accounts. These payments were all bribes or rewards for Mr Agidi and/or others, and were the product of the long-standing corrupt relationship between Mr Agidi, Sagem and Mr Adelagun, and thus were or represented property obtained through unlawful conduct, as follows:-

Thus in the period from 6 June 2002 to 13 June 2003 there were, in all, four transfers of bribes or rewards from Officetron and Maurang accounts to accounts in London under the control of Mr Agidi in the total sum of U$ 3,000,115 (the equivalent of about £1,703,000), the great majority of which was withdrawn in cash.

In the meanwhile, the Independent Corrupt Practices Commission (“the ICPC”) in Nigeria (which had been established in 2000) had arrested and charged six people, including Mr Adelagun and Mr Akwanga (one of the Government Ministers involved in connection with the award of the contract – see paragraph 47 above), with corruption offences in relation to the award and implementation of the Sagem contract. Mr Adelagun, in statements, named Mr Agidi as one of those who had been paid “in order to avoid problems in implementing the project”. The ICPC alerted the Metropolitan Police to Mr Agidi’s involvement. The outcome, if any, of the charges brought by the ICPC is not clear.

On 14 October 2003, notwithstanding the sums that had passed through its accounts, Orion submitted a return to Companies House in the UK indicating that, in the period between August 2002 and August 2003, it had not traded, nor received any income, nor incurred any expenditure.

As indicated above, on 10 November 2003 Mr Agidi made three significant cash withdrawals from the accounts under his control in London, as follows:-

When, later that day, Mr Agidi was arrested by the Metropolitan Police, he was found to be in possession of the £150,000, and of US dollars and Euros to the equivalent value of £10,000 (which, by inference, were the product of his corrupt relationship with Sagem and Mr Adelagun). All the cash, including the dollars, belonged to Mr Agidi not his wife.

When the house at 84 Hurstwood Road was searched, Sterling, US dollars and Euros were found, mainly in three envelopes, to a total value of £91,700.47. This cash, by inference, represented the product of Mr Agidi’s corrupt relationships with Skoda and/or with Sagem and Mr Adelagun. All the cash was his. None of it belonged to his wife or daughter.

Also found at the house at 84 Hurstwood Road was the document entitled “Public Relation Fees in 2001 on USD 29.75Mil” relating to Skoda (see paragraph 40 above).

Mr Agidi was interviewed by the Metropolitan Police on 24 November 2003. He said, amongst other things, that:-

In December 2003, when the ICPC searched Mr and Mrs Agidi’s house at 17A Adeyemi Lawson Street in Lagos, they found two Skoda invoices to the FRN dated June 1996, and at least two of the five written agreements between Orion and Skoda (see paragraph 22 above).

Mr Agidi was interviewed again by the Metropolitan Police on 27 January 2004. On this occasion he declined to answer questions.

In April 2004 the house at 84 Hurstwood Road was conveyed from Mr Agidi’s sole name into the joint names of Mr and Mrs Agidi.

On 24 August 2004 Orion was dissolved in the UK. All returns to Companies House had indicated that it was dormant, and that it had had no business activities.

In September 2004 the French authorities carried out arrests, searches and interviews in Paris in connection with the Sagem contract. Some form of proceedings followed, but their nature and outcome are unclear.

On 26 September 2005 the Metropolitan Police began proceedings under s.298(1) of the Act seeking the forfeiture of the cash that had been seized on and after Mr Agidi’s arrest in November 2003.

On 5 October 2005 the Metropolitan Police charged Mr Agidi with seven offences – two under s. 93C (1) of Criminal Justice Act 1998, and the remainder under s. 327(1) of the 2002 Act. The offences covered the period from June 2002 to November 2003, and were concerned with the Sagem related credits, and sample related cash withdrawals, together with the £150,000 withdrawal on 10 November 2003. In consequence, the cash forfeiture proceedings were adjourned.

On 24 October 2005 Newman J granted a Restraint Order under the provisions of the Criminal Justice Act 1988. The Order was varied by Sullivan J (as he then was) on 23 August 2006.

Owing to his ill-health, Mr Agidi was not tried until 2 July 2007. The case was heard by HH Judge Price and a jury in the Southwark Crown Court. The prosecution put its case upon the basis that the requisite criminal conduct was that of Mr Adelagun, not that of Mr Agidi. It sought to prove, as hearsay, the statements made by Mr Adelagun to the ICPC. Unsurprisingly, the learned Judge ruled that the statements were inadmissible. On 11 July, after the conclusion of the prosecution case, the learned Judge further ruled that, although “the payments made to Mr Agidi, particularly having regard to the explanations that he gave, are, to say the least, malodorous” the prosecution had failed to prove that Mr Adelagun’s conduct was criminal. Accordingly he ruled that there was no case to answer on all the charges.

The prosecution appealed. However, on 4 December 2007, the Court of Appeal upheld Mr Agidi’s acquittal – albeit noting that the case could have been put on a different and fuller basis from the outset, probably with better prospects of success.

In consequence of the decision of the Court of Appeal the Restraint Order lapsed, and (shortly after 4 December 2007) the Metropolitan Police referred the case to the Director of the Assets Recovery Agency, which then had responsibility for conducting civil recovery proceedings. The referral was accompanied by some documentation, including a full Case Summary, but not the actual evidence. The Metropolitan Police indicated that they were intending to re-activate the cash forfeiture proceedings. In April 2008 the Assets Recovery Agency merged with SOCA, which took over responsibility (as an enforcement authority) for conducting civil recovery proceedings. Initial consideration centred on the house at 84 Hurstwood Road and other funds that had passed through the HSBC accounts. Despite requests, the Metropolitan Police did not supply SOCA with the actual evidence available to them (some 3,500 pages of papers) until July 2008.

In the meanwhile, on 12 December 2007, the Metropolitan Police duly re-activated the cash forfeiture proceedings.

On 11 March 2008 Mr Agidi made a statement in the cash forfeiture proceedings. He asserted, inter alia, that:-

In June 2008 the Metropolitan Police supplied the FRN with copies of all the relevant papers in the case. It will be recalled (see paragraph 79 above) that the Metropolitan Police did not supply its evidence to SOCA until the following month.

On 24 July 2008 there was a settlement of the cash forfeiture proceedings. It was agreed that £171,367.53 of the total (including interest) of £287,577.66 should be forfeited, and the Magistrates Court made an order to that effect under s.298 of the 2002 Act. The basis of the settlement is unclear. It left a balance of £116,310.13 which was potentially available to Mr Agidi. However, no formal order was made under s.297(2) of the 2002 Act releasing that balance to him.

By this stage the FRN was contemplating bringing civil proceedings against Mr Agidi. On 18 July 2008 it contacted SOCA and obtained confirmation that SOCA did not object. On 28 July the Metropolitan Police informed SOCA of the outcome of the cash forfeiture proceedings. In the result, SOCA closed its investigation on 30 July 2008.

On 31 July 2008 the FRN sought and obtained a Freezing Order from Briggs J. Then, in August 2008, the FRN duly launched civil proceedings seeking declarations that it was the true owner and entitled in equity to the HSBC Life (Europe) Limited Investment Capital Bond, the house at 84 Hurstwood Road, and all other property representing bribes, secret profits, or which had been obtained by abuse of position, together with an account, and damages. The FRN’s claims were thus cast wider than those now made by SOCA.

On 13 January 2009 the FRN’s civil proceedings were settled by written agreement, and without any admission of liability or wrongdoing by Mr Agidi. Under the terms of the agreement he was required to redeem the Investment Capital Bond and to pay 20% of the amount received to the FRN. That amounted, in the end, to £146,606.84. The agreement was expressed to be in full and final settlement of all claims between the parties, and to compound all civil proceedings and all criminal proceedings that might be contemplated or might arise out of payments alleged to have been made by Skoda and Sagem. In fact, there was no power, under Nigerian law, to compound such criminal offences. Under Nigerian law, the effect of the settlement was to “release” the remaining property from the constructive trust in its favour argued for by the FRN, and to “gift” it to Mr Agidi. On 11 February 2009 the FRN informed SOCA of the settlement.

SOCA then decided to take action. On 18 February 2009 Collins J made a Property Freezing Order in favour of SOCA, together with a Disclosure Order under s. 357 of the 2002 Act requiring Mr and Mrs Agidi to comply with the requirements of any authorised notice in writing served upon them by SOCA.

On 26 March 2009 Mr Agidi made a statement in relation to the Property Freezing Order setting out details of his assets worldwide. In addition to 84 Hurstwood Road, he identified three properties in Nigeria – namely 88 Mariere Street, Agbor, Delta State (said to have been inherited in 1980 and retained as a family house without tenants); Admiralty Way, Lekki Phase 1 (said to have been acquired in his sole name using family funds in 1990, and to have resident tenants); House No 5, 2012 Road, Festac Town, Lagos (of which he was the registered proprietor, but the beneficial owner of which was said to be his sister Maria Orumgbe). He did not mention the house at 17A Adeyemi Lawson Street in Lagos.

On 7 April 2009 Chris Spencer (acting on behalf of SOCA and in accordance with the Disclosure Order) issued a Disclosure Notice addressed to Mr Agidi. The Notice required that Mr Agidi should provide, inter alia,:-

This information was required to be supplied by 28 April 2009. That was later extended to 29 May 2009. On 12 June 2009 SOCA wrote to the solicitors then representing Mr Agidi pointing out his ongoing failure to comply with the Disclosure Notice.

On 31 July 2009 SOCA issued these proceedings. They are based largely, though by no means entirely, upon the evidence eventually disclosed to SOCA by the Metropolitan Police, together with detailed witness statements made by Chris Spencer on 30 July 2009 & 14 July 2010 (which include the product of the tracing work done by SOCA in relation, in particular, to the funds used to purchase the house at 84 Hurstwood Road).

Bennett J gave directions in these proceedings on 1 December 2009. He ordered, inter alia, that Mr & Mrs Agidi should file their response to the claim by 4pm on 4 February 2010, or be debarred thereafter from filing a response or any evidence, and also that there should be compliance with the Disclosure Notice by 4 January 2010.

On 31 December 2009 Mr Agidi made the first of three witness statements in these proceedings. He sought, inter alia, an extension of time until 4 February 2010 to comply with the requirements of the Disclosure Notice. He asserted that, as a result of serious ill-health, he had not been able to gain access to the necessary documents, or otherwise to deal with matters.

On 19 January 2010 Mr Agidi made his second witness statement in these proceedings. He indicated that his health had worsened, and that he could not concentrate enough to respond to Mr Spencer’s witness statement of 30 July 2009. He said that he wished to rely upon what he had said to the Metropolitan Police. He also produced a copy of the written agreement settling the civil proceedings with the FRN.

Mrs Agidi made a witness statement on the same date, saying that she knew nothing about the facts and allegations set out in Mr Spencer’s witness statement of 30 July 2009.

On 9 February 2010 Master Eastman extended time for Mr and Mrs Agidi to serve their response to the claim to 4pm on 5 March 2010, and ordered that there would be no further extension of time granted in the case.

On 19 February 2010 Mr Agidi made a third witness statement. He stated, inter alia, that the only real property that he had was the house at 84 Hurstwood Road. He indicated that he had given instructions for all remaining monies in relation to the International Life Bond to be transferred to England. (This was done and the monies transferred are now represented by the credit, as at 27 October 2010, of £587,157.64 held in a Citibank account, which represents property obtained through unlawful conduct – i.e. his corrupt relationship with Skoda). Mr Agidi asserted that he had never taken any commission or bribe from Skoda, and that the sums from Sagem were received after he had retired, and were legitimate consultancy fees. He pointed out that he had not been charged with any criminal offence in Nigeria. He said that he had settled both the cash forfeiture proceedings and the FRN’s proceedings because of his poor health, and that he had instructed his lawyers to negotiate an amicable settlement with SOCA.

On 26 February 2010 the trial in these proceedings was fixed for 26 July 2010 (although, in the event, it was not listed until 28 July 2010).

On 23 July 2010 Stadlen J granted an application by SOCA to be permitted to adduce and file in evidence a report and two witness statements by the expert in Nigerian law Dr Ogowewo – requiring that any written questions that Mr and Mrs Agidi wished to put to Dr Ogowewo were to be put within 7 days of service.

Mr Agidi never did comply with the Disclosure Notice, despite Bennett J’s Order to do so.

SOCA has acted in good faith throughout.

Paragraph 4 of the Property Freezing Order granted by Collins J on 18 February 2009 provided that it might be subject to an initial exclusion for the release of restrained funds in a sum not exceeding £3,000 to meet reasonable legal costs in taking advice and complying with Order, preparing a statement of assets, and applying for the Order to be varied or set aside. The Order also made provision for written notice to be given to SOCA in respect of any request for the release of a further sum to pay for legal representation.

By an Application Notice dated 27 July 2010 Mr and Mrs Agidi sought:-

The application was supported by a witness statement from Mr and Mrs Agidi’s solicitor, Ozan Fahri of Messrs Hoffman-Bokaei. The statement indicated, inter alia, that:-

The application was further supported by statements from Mr & Mrs Agidi’s family’s lawyer Chief Uwechue (dated 26 July) and from Mrs Agidi (dated 27 July).

It will be recalled that in his statement of 26 March 2009 (see paragraph 88 above) Mr Agidi had identified three properties in Nigeria (88 Mariere Street, Admiralty Way, and House No.5) as being part of his assets. No encumbrance at all had been mentioned in relation to the first two properties. His sister had been said to be the beneficial owner of the third. As to these three properties, the statements of Chief Uwechue and Mrs Agidi, between them, now asserted that:-

In support of the application Mr Hines, on behalf of Mr and Mrs Agidi, drew my attention to the judgment of Henderson J in SOCA v John Szepietowski & others [2009] EWHC 344 (Ch) in which, at paragraphs 12-21, Henderson J considered the provisions relating to exclusions in connection with interim receiving orders and, in particular, s. 252 of the Act, together with the Proceeds of Crime Act 2002 (Legal Expenses in Civil Recovery Proceedings) Regulations 2005, SI 2005 No.3382, and the relevant Practice Direction. Henderson J concluded, in short, that in such cases:-

On behalf of SOCA, Mr Hall accepted that the principles identified by Henderson J applied in this case. Otherwise he opposed the application. He submitted that it was clear that Mr Agidi owned property to which the Property Freezing Order did not apply, and from which he could reasonably be expected to meet his legal costs. Mr Hall relied, inter alia, upon the following:-

In refusing the application for release and/or variation, I reached the firm conclusion, about which I had no doubt, that Mr Agidi owned property of substantial value (houses and/or credits in bank accounts) to which the Property Freezing Order did not apply, and from which he could reasonably be expected to meet his legal costs. Against the background set out above, and notwithstanding the desirability of Mr Agidi being represented in these proceedings, I concluded, in the exercise of my discretion, that the balance came down in favour of refusing the application - thereby ensuring that the right of SOCA to recover property obtained through unlawful conduct was not unduly prejudiced.

In the event, after my ruling, an agreement was reached between the parties whereby SOCA consented to the release of £8,000 to those representing Mr and Mrs Agidi, thereby resulting in them continuing to appear for Mr & Mrs Agidi during the hearings before me in both July and November 2010. In addition, SOCA funded the posing of some 24 questions on behalf of Mr and Mrs Agidi to the expert witness Dr Ogowewo (see below).

Grounds

Mr Hines invited me to exercise the court’s powers, under CPR 3.4(2) and s.19(2)(b) of the Senior Courts Act 1981, to strike out SOCA’s statement of claim as an abuse of process. He advanced four grounds, namely:-

Aspects of the authorities relied upon

In developing these grounds, Mr Hines drew my attention to a number of passages in the authorities that he had cited.

In R v Clarke (above) Rose LJ observed:

“Of course, the Crown’s indivisibility may well be pertinent to a claim for abuse of process if, for example, the CPS were to prosecute when the Revenue, in accepting settlement from a taxpayer, had told him with the concurrence of the CPS, that he would not be prosecuted by anyone.”

In Attorney-General’s Reference No. 44 of 2000 (above) Rose LJ observed, at paragraph 37:

“It does not seem to us that there is, so far as the prosecution of criminal offences in the name of the Crown are concerned, any sensible distinction to be drawn between the Crown Prosecution Service, the Customs and Excise or the Inland Revenue. In our judgment, if the Crown, by whatever means the Crown is prosecuting, make representations to a defendant on which he is entitled to rely and on which he acts to his detriment by, as in the present case, pleading guilty in circumstances in which he would not otherwise have pleaded guilty, that can properly be regarded as giving rise to a legitimate expectation on his part that the Crown will not subsequently seek to resile from those representations, whether by way of the Attorney-General exercising his personal statutory duties under section 36 or otherwise. For this purpose the Crown and its agents are indivisible.”

I should perhaps add in relation to these passages, and given Mr Hines’ additional reliance on R v Croydon Justices ex p Dean (above) at p. 778 E/F, that in Abu Hamza [2007] 1 Cr. App. R. 27 the Court of Appeal ruled that, in criminal proceedings, it was not likely to constitute an abuse of process to proceed with a prosecution unless there had been an unequivocal representation by those with the conduct of the investigation or prosecution of a case that the defendant would not be prosecuted, and the defendant had acted on that representation to his detriment. See also, in this regard, Gripton [2010] EWCA Crim 2260 in which the court applied an “affront to justice” test.

Continuing with the passages to which Mr Hines drew my attention, in Hunter v Chief Constable West Midlands Police (above) Lord Diplock stated at p. 541:

“Collateral attacks upon a final decision of a court of competent jurisdiction may take a variety of forms. It is not surprising that no reported case is to be found in which the facts present a precise parallel with those of the instant case. But the principle applicable is, in my view, simply and clearly stated in those passages from the judgment of A L Smith LJ in Stephenson v Garnett [1898] 1 QB 677, at 680 to 681, and the speech of Lord Halsbury LC in Reichel v Magrath [1889] 14 AC 665 at 668 which are cited by Goff LJ in his judgment in the instant case. I need only repeat an extract from the passage which he cited from the judgment of A L Smith LJ:

‘The court ought to be slow to strike out a statement of claim or defence and to dismiss an action as frivolous and vexatious, yet it ought to do so when, as here, it has been shown that the identical question sought to be raised has been already decided by a competent court.’

The passage from Lord Halsbury’s speech deserves repetition here in full:

I think it would be a scandal to the administration of justice if, the same question having been disposed of by one case, the litigant were to be permitted by changing the form of the proceedings to set up the same case again.’”

In Johnson v Gore Wood & Co (above) the claimant in the first action had been the corporate embodiment of the claimant who brought the second action in his own name. at p.31/2 Lord Bingham said:

“It may very well be … that what is now taken to be the rule in Henderson v Henderson has diverged from the ruling which Wigram VC made, which was addressed to res judicata. But Henderson v Henderson abuse of process, as now understood, although separate and distinct from cause of action estoppel and issue estoppel, has much in common with them. The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as a whole. The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. I would not accept that it is necessary, before abuse may be found, to identify any additional element such as a collateral attack on a previous decision or some dishonesty, but where those elements are present the later proceedings will be much more obviously abusive, and there will rarely be a finding of abuse unless the later proceeding involves what the court regards as unjust harassment of a party. It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before.

….

An important purpose of the rule is to protect a defendant against the harassment necessarily involved in repeated actions concerning the same subject matter. A second action is not the less harassing because the defendant has been driven or thought it prudent to settle the first; often, indeed, that outcome would make a second action the more harassing.”

In Aldi Stores Ltd v WSP Group Plc and others (above) Thomas LJ stated, at paragraph 11:

“It seems to me clear that no distinction should be drawn as a matter of law between cases where the original action concludes by settlement and where it concludes by judgment. The course of the original action and whether it resulted in a settlement or a trial are but part of the facts to be considered alongside all the other facts.”

Whilst Mr Hines relied upon the acceptance by Stanley Burnton J (as he then was) in Assets Recovery Agency v Kean (above) that the Johnson test was applicable to abuse of process applications brought in relation to civil recovery proceedings (see paragraph 41 of the judgement), it should be noted that Stanley Burnton J went on to indicate at paragraphs 43 and 55 that:

“…The ARA is not to be identified with the CPS. True both are emanations of the Crown. True, both are concerned with crime and its proceeds. But they have different objects, powers and discretions…. The ARA exercises its powers in the public interest. If the property (and the proceeds of its mortgage) were indeed obtained with the proceeds of crime, it is in the public interest that Mr Kean should be deprived of them. That possible result should not be put at risk by reason of lack of care or misjudgement on the part of the ARA which is far from serious…”

In Secretary of State for Trade and Industry v Bairstow (above), as applied by the Privy Council in Calyon v Michailaidis (above), Morritt V-C stated, at paragraph 38:

“If the parties to the later civil proceedings were not parties to or privies of those who were parties to the earlier proceedings then it will only be an abuse of the process of the court to challenge the factual findings and conclusions of the judge or jury in the earlier action if (i) it would be manifestly unfair to a party to the later proceedings that the same issues should be relitigated or (ii) to permit such relitigation would bring the administration of justice into disrepute.”

Mr Agidi’s arguments

As to the first ground, Mr Hines argued, in particular, that:-

As to his second ground, Mr Hines argued that:-

As to his third ground Mr Hines argued, in particular, that:-

As to his fourth ground, Mr Hines repeated that it would manifestly unfair to Mr Agidi to re-litigate the same issues, and that to do so would bring the administration of justice into disrepute.

SOCA’s arguments

In response, Mr Hall submitted, in short, that:-

As to the first ground advanced on behalf of Mr Agidi, Mr Hall submitted that:-

As to the second ground, Mr Hall submitted that:-

As to the third ground, Mr Hall submitted that:-

As to the fourth ground, Mr Hall submitted that:-

Discussion

Section 2A of the Act, under the heading “Contribution to the reduction of crime” provides that:

“(1)

A relevant authority must exercise its functions under this Act in the way which it considers is best calculated to contribute to the reduction of crime.

(2)

In this section “a relevant authority” means-

(a)

SOCA,

….

(3)

In considering under subsection (1) the way which is best calculated to contribute to the reduction of crime a relevant authority must have regard to any guidance given to it by-

(a)

in the case of SOCA, the Secretary of State,

….

(4)

The guidance must indicate that the reduction of crime is in general best secured by means of criminal investigations and criminal proceedings.”

S. 240, under the heading “General Purpose of this Part”, provides that:

“(1)

This Part has effect for the purposes of-

(a)

enabling the enforcement authority to recover, in civil proceedings before the High Court or Court of Session, property which is, or represents, property obtained through unlawful conduct,

(b)

enabling cash which is, or represents, property obtained through unlawful conduct, or which is intended to be used in unlawful conduct, to be forfeited in civil proceedings before a magistrates’ court or (in Scotland) the sheriff.

(2)

The powers conferred by this Part are exercisable in relation to any property (including cash) whether or not any proceedings have been brought for an offence in connection with the property.”

S. 241 provides that:

“Unlawful conduct

(1)

Conduct occurring in any part of the United Kingdom is unlawful conduct if it is unlawful under the criminal law of that part.

(2)

Conduct which—

(a)

occurs in a country [or territory] outside the United Kingdom and is unlawful under the criminal law [applying in that country or territory], and

(b)

if it occurred in a part of the United Kingdom, would be unlawful under the criminal law of that part,

is also unlawful conduct.

(3)

The court or sheriff must decide on a balance of probabilities whether it is proved—

(a)

that any matters alleged to constitute unlawful conduct have occurred, or

(b)

that any person intended to use any cash in unlawful conduct.”

S. 243(1) provides that:

“(1)

Proceedings for a recovery order may be taken by the enforcement authority in the High Court against any person who the authority thinks holds recoverable property.”

The legislative purpose behind these and other provisions of Part 5 of the Act, as originally applying to the Assets Recovery Agency, but now to SOCA (since the Agency merged into it in April 2008), had been considered in a number of cases.

The Queen (Director of the Assets Recovery Agency) v He & Chen [2004] EWHC 3021 (Admin) involved a wide general attack on Part 5 of the Act, and a need to consider how its provisions should be construed. At paragraph 33 of his judgment, Collins J said;

“..But it is important that the scheme is understood, and that it is apparent that the powers given to the Director are wide-ranging and the purpose behind this part of the Act is, as I have indicated, to enable property which has been obtained by means of criminal conduct to be recovered from the person, or persons, who were involved in that criminal conduct, whether or not a prosecution has ensued or been successful.”

In The Queen (Director of the Assets Recovery Agency) v T & Others [2004] EWHC 3340 (Admin), against the background that criminal proceedings had been stayed as an abuse of process, the defendants sought to argue that the civil recovery proceedings should also be struck out as an abuse of process. In the course of his judgment Collins J said:

“20.

But the fact, even if it were established, that there had been bad faith in the manner in which the prosecution had conducted the criminal proceedings, would not enable the defendants successfully to argue that it was an abuse of process to bring proceedings under Part V. The reason is simply this; these proceedings are civil proceedings instituted by the Director who is an independent person. Of course she will use and rely on material provided to her by prosecuting authorities, but her responsibility is to investigate and to decide whether a claim should be brought and if it is, to put before the court the evidence which she believes will support that claim. The fact, if it be a fact, that a Crown Court has decided that the prosecution of individuals has been carried out in an oppressive or dishonest manner, and so amounted to an abuse of process, cannot of itself automatically, as it were, spill over into the Part V claim so as to require it to be regarded as an abuse of the process. It seems to me that it would be almost impossible for that to be, of itself, a reason to strike out a claim under Part V.

21.

I am not prepared to say that there could never be any circumstances, because my experience is that if one says that then a case comes along which produces, or which is based on, facts which do justify it. At the moment I find it difficult to think of any. Of course, if the prosecution was badly tainted, this may well lead the Director to the view that it is not possible to put forward evidence to support a claim. So be it. That is obviously a matter which she will have to consider on its merits in any case. But I am far from persuaded that even if the Crown Court judge had based his decision on any malpractice by the police, it in itself would have justified this strike out. But of course he did not.

22.

I appreciate the argument that there is considerable oppression as the matter is viewed from the point of view of the defendants. They were acquitted, they believed that was the end of the matter, they heard a judge state that in his view the system had gone wrong and the prosecution should not proceed. Unfortunately, the law is now such that these Part V proceedings can be brought. If the Director feels that she is able to establish that particular property has been obtained through unlawful means, then she can take these proceedings. It is in the public interest, so Parliament has decided, that no-one shall profit from ill-gotten gains, if they can be identified.”

In Director of Assets Recovery Agency v Singh [2005] 1 WLR 3747 the Court of Appeal was concerned with whether the making of a confiscation order, later quashed on appeal, precluded the subsequent making of a civil recovery order. At paragraph 19 of the judgment Latham LJ identified the purpose behind the enactment of Part 5 of the Act, as follows:

“.. The clear intention of Parliament was to ensure that, so far as possible, criminals should be deprived of the possibility of benefiting from their crimes. In construing any statute we are now encouraged to search for Parliament’s purpose: see Lord Bingham of Cornhill in R (Quintavalle) v Secretary of State for Health [2003] 2 AC 687, para 8. Whilst recognising that Lord Steyn, at para 21, urged caution in relation to certain categories of statute, in the present case the meaning of the words and the purpose of the legislature are both abundantly clear and march hand in hand. To permit the technicality which resulted in the confiscation order being quashed to preclude recovery by the civil recovery route would be to perpetuate a mischief which the 2002 Act was clearly designed to prevent.”

In The Queen (Director of the Assts Recovery Agency & Others) v Green & Others [2005] EWHC 3168 (Admin), the issue was what the Director was required to allege and prove by way of unlawful conduct. In the course of his judgment Sullivan J (as he then was) said:

“3.

The Act forms part of a government initiative to tackle increasing crime across the United Kingdom. In his submissions on behalf of the Director, Mr Crow relied upon the following publications in order to identify the particular legislative purposes of the Act and the mischief to which Part 5 of the Act is addressed. (1) The Working Group on Confiscation, Third Report: Criminal Assets published by the Home Office Organised and International Crime Directorate with a foreword by the Home Secretary in November 1998. (2) Recovering the Proceeds of Crime - a policy and innovation unit (PIU) report published in June 2000 with a foreword by the Prime Minister. (3) Criminal Justice: The Way Ahead Cmnd 5074 presented to Parliament by the Home Secretary in February 2001. (4) Proceeds of Crime Bill -- Draft Clauses, Cmnd 506, published with a foreword by the Home Secretary in March 2001.

4.

Mr Crow submitted that four relevant points emerge from this pre-statutory material.

(1)

The previous regime for confiscation and forfeiture was proving to be inadequate because successful and sophisticated criminals were extremely difficult to convict and extremely good at distancing themselves from the coal face of crime and in disguising the proceeds of crime. Hence the need for civil recovery proceedings to make it easier for the state to ensure that crime did not, and was seen not to, pay.

(2)

The existing powers of confiscation and forfeiture were tied to limited kinds of offences (for example drug trafficking), whereas in reality professional criminals were likely to be engaged in a range of different kinds of criminal activity which might vary over time. It was therefore likely that it would be difficult to establish what property had been derived from which crime or crimes. Accordingly, there was a need for civil recovery to embrace all crimes without discrimination.

(3)

The purpose of civil recovery proceedings is to recover property which represents the proceeds of crime, not to prove particular criminal guilt in relation to particular acts against particular individuals.

(4)

In order to ensure that a civil recovery scheme was proportionate it would be necessary to incorporate a number of safeguards, thus, for example, the onus of establishing unlawful conduct to the civil standard of proof should rest upon the Director. The respondents should be entitled to public funding and to compensation in certain circumstances if the court eventually decides that the property sought by the Director is not recoverable. In addition, civil recovery should not be seen as the soft option in place of criminal proceedings.

5.

It is unnecessary to cite lengthy passages from these four documents because there is no real dispute as to the legislative purpose of the Act, the mischief to which Part 5 was directed, or the context in which it was enacted. Although the terminology varies, all four documents recognise that "a careful balance has to be struck between the civil rights of the individual and the need to ensure that the State has the tools to protect society by tackling crime effectively": see for example paragraph 5.3 of the PIU report.”

I have already cited, at paragraph 119 above, the relevant aspects of the judgment of Stanley Burnton J (as he then was) in Assets Recovery Agency v Kean (decided in 2007) in which he ruled that the ARA was not to be identified with the CPS, and that the ARA exercised its powers in the public interest.

In The Queen (Director of the Assets Recovery Agency) v E & B (see paragraph 126(4) above) the issue was whether the stopping of criminal proceedings as an abuse of process (because of police connivance in the crime alleged) made the consequent civil recovery proceedings an abuse of process as well. At paragraph 5 of his judgment Mitting J said:

“...What a respondent must show if he is to succeed in demonstrating that civil recovery proceedings are an abuse of process is precisely that. The failure of a prosecution, whether it be because of acquittal or a stay of proceedings, as Miss Ritchie concedes, cannot by itself produce the conclusion that civil recovery proceedings are an abuse. I simply do not understand the argument that because it is unfair to prosecute so it must be unfair to deprive an alleged criminal of the proceeds of criminal activity. As Miss Ritchie concedes, the fact that police officers have stood by while brothel keeping continues does not make the activity lawful. If it is unlawful it seems to me that, save in circumstances the like of which I cannot at present conceive as at all likely to occur, it will not be an abuse of process or of power for the Director to seek to deprive an alleged criminal of the proceeds of his crimes.”

In Olupitan & Makinde v The Director of the Assets Recovery Agency [2008] EWCA Civ 104 a confiscation order had been quashed on appeal, and the Court of Appeal was concerned with a consequent civil recovery order. At paragraph 63 of the judgment Sir Igor Judge P (as he then was) said:

“The Proceeds of Crime Act 2002 created a process by which the Assets Recovery Agency was vested with power in civil proceedings to recover property which was or which represented property obtained "by or in return" for unlawful conduct. Unsurprisingly, property not so obtained was excluded from the ambit of the legislation, and where property was obtained in part by unlawful conduct and in part from innocent sources, the property obtained from innocent sources, too, was excluded from the recovery process. The legislative purpose was plain: so far as possible those whose conduct was unlawful, as defined in the Act, should be deprived of its fruits.”

Finally, in Director of Assets Recovery Agency v Virtosu & another [2009] 1 WLR 2808 the issue was whether the Director could rely solely upon a French conviction to prove unlawful conduct. At paragraph 19 of his judgment Tugendhat J said:

“The legislative purpose of the 2002 Act is discussed and set out in the “Recovering the Proceeds of Crime: A Performance and Innovation Unit Report June 2000 issued by the Cabinet Office (“the Report”). The report is referred to by Latham LJ in Singh v Claimant of the Assets Recovery Agency [2005] EWCA Civ 580 para 9. It is available at http://www.cabinetoffice.gov.uk/upload/assets/www.cabinetoffice.gov.uk/strategy/crime.pdf . It is a long document which is also summarised by Janet Ulph LLM in “Commercial Fraud” (OUP 2006) para 4.45, to whom I am in indebted. The Report states that the civil forfeiture route is not to be adopted as a “soft option” in place of criminal proceedings (para 5.24). The rationale for civil forfeiture is stated at para 5.12-5.14:

“5.12

The proposed civil forfeiture regime is intended to provide:

• a reparative measure — taking away from individuals that which was never legitimately owned by them; and

• a preventative measure — taking assets which are intended for use in committing crime.

5.13

Although civil forfeiture is not intended as a punitive measure, it can be expected to be keenly felt and strongly resisted by individuals who have grown accustomed to having possession of their unlawful assets … the large body of anecdotal evidence from UK and other overseas law enforcement [shows] that individuals associated with criminal activities are as concerned about losing their assets as they are about losing their liberty, in some cases more so.

5.14

Like other forms of asset recovery, civil forfeiture is a disincentive to crime — more effective recovery of unlawful assets will act to reduce the anticipated reward in the risk/reward trade-offs that some criminals make (as explained in Chapter 3). And it reinforces the rule of law — by demonstrating that the justice system will work effectively to remove illegal gains (also explained in Chapter 3). In addition, it:

• opens up a new route to tackling assets that are currently beyond the reach of the law. Civil forfeiture should be used in particular to disrupt the activities of organised crime heads who are remote from crimes committed to their order, yet enjoy the benefits; and

• should allow the recovery of unlawful assets held in the UK, but derived from crime committed overseas.”

Whilst, generally, if the court is satisfied that any property is “recoverable”, it must make a recovery order (s. 266(1)), the Act sets our various exceptions and protections which limit the ability of SOCA and other enforcement authorities to obtain recovery orders, for example:-

Thus I concluded that it was plain that, whilst recognising that the reduction of crime is in general best served by means of criminal investigations and proceedings, and subject only to the various exceptions and protections set out in the Act itself, the legislative purpose behind the civil recovery provisions in the Act is to enable SOCA (and other enforcement authorities), in the public interest and as far as possible, to deprive those whose conduct has been unlawful of the fruits of that conduct.

There was no dispute that SOCA had brought these proceedings within the relevant limitation period. Clearly, in the terms of s.243(1) (above), it thought that Mr & Mrs Agidi held recoverable property. On the evidence then before me, it appeared clear that SOCA had acted in good faith throughout (a finding that I later made after considering all the evidence). The circumstances in which the proceedings were brought were not, in my view, in conflict with the legislation and its purpose at all. The reverse was plainly the position.

Against that background, and it being clear that there was no order under s.297 for the release of the balance of the cash to Mr Agidi, I rejected (for the reasons advanced in argument by Mr Hall - see paragraphs 125-129 above) each of the four grounds upon which it was suggested that I should strike out SOCA’s statement of claim as an abuse of process. The onus had been on Mr Agidi to establish abuse and, in my view, he had not come within measurable distance of doing so.

It will be recalled that it was only on 23 July 2010, five days before the trial, that Stadlen J granted an application by SOCA to be permitted to adduce and to file in evidence a report and two witness statements from the expert in Nigerian law Dr Ogowewo. The statements were made in March 2006 and June 2007 in connection with the prosecution of Mr Agidi. They dealt with Nigerian law in relation to the prohibition of corrupt practices in the period from June 2002 to November 2003 (Sagem). The report, which was dated 13 July 2010, dealt with the prohibition in relation to such practices in the period from 1999 onwards (Skoda & Sagem). Stadlen J’s Order required that any written questions to Dr Ogowewo should be put within 7 days of service (i.e. up to two days into the trial).

The immediate background to the granting of the Order was that SOCA first put Mr & Mrs Agidi’s lawyers on notice of the application on 17 June 2010. They had then served the application on 14 July 2010. In the result, those representing Mr & Mrs Agidi had not been able to take instructions about the report, let alone to pose written questions, by the time of the trial.

Against that background, Mr Hines opposed the admission of the evidence. He pointed out that the Court of Appeal has emphasised the importance of disclosing an expert report promptly. He also pointed out the need (if the evidence was admitted) for him to have to apply for an adjournment so as to be able to deal with it. In developing his argument he (rightly) drew my attention to the factors set out in CPR 3.9 – namely, the administration of justice; whether the application had been made promptly; whether there was a good explanation for the failure to serve the evidence sooner; compliance with other rules; whether the failure was caused by SOCA or its legal representatives; the trial date; the effect that the failure would have on each party; and the effect that relief would have on each party.

However, by that stage in the hearings in July 2010, having dealt with the arguments in relation to the exclusion of funds from the property Freezing Order and abuse of process, it had become clear that (given the lack of further available time) there would have, in any event, to be an adjournment until the autumn. In those circumstances Mr Hall submitted that rather than rule against the admissibility of the evidence, it would instead be appropriate to adjourn - thereby providing Mr & Mrs Agidi with a full opportunity to deal with it. I accepted this argument, particularly against the background that, in my view, Dr Ogowewo’s evidence was relatively formal and straightforward.

In the result, as indicated above, SOCA thereafter bore the expense of Mr & Mrs Agidi’s lawyers asking written questions of Dr Ogowewo. There were some 24 questions in all. Equally, Mr & Mrs Agidi’s lawyers were able to continue representing them at the adjourned hearing in November 2010, during which Dr Ogowewo gave evidence without objection, and was cross-examined.

General Approach

In general terms, only property which was originally obtained through unlawful conduct, or which represents such property, together with any profits accruing from it, is recoverable – see ss. 304(1), 305(1), 307(2).

As indicated in paragraph 5 above, SOCA’s principal assertion is that each item sought to be recovered derives from the proceeds of corruption in Nigeria. In particular, it is asserted that Mr Agidi and others were involved in corrupt relationships with Skoda and Sagem, and that the relevant credits to the bank accounts in London controlled by Mr Agidi were bribes or rewards resulting from those corrupt relationships, and were thereafter either kept by Mr Agidi for the use of himself and Mrs Agidi, or were withdrawn and distributed by him in cash to others involved in the corruption.

In the alternative, as also indicated in paragraph 5 above, it is asserted that if a relevant credit was not the product of the alleged corrupt relationships with Skoda and Sagem it must, by inference and in accordance with the approach in Anwoir & others (above), have been a bribe or reward which was a product of a corrupt relationship with another or others, and/or was the product of money laundering.

Anwoir & others was a money laundering case, but the principle that it establishes, namely that the fact that property was derived from crime can be proved either by direct evidence or by evidence of the circumstances in which the property was handled giving rise to an appropriate inference that it could only be derived from crime, is plainly applicable in civil recovery proceedings – see e.g. Director of the Assets Recovery Agency v Olupitan [2008] EWCA Civ 104 and the judgment of Griffith-Williams J at first instance in Serious Organised Crime Agency v Gale & Others [2009] EWHC 1015 (QB).

Clearly, both the principal and the alternative bases upon which SOCA seeks to advance its case amount, in law, to the provision of sufficient notice as to the kind of unlawful conduct sought to be proved – see The Queen (Director of the Assets Recovery Agency) v Green & Others (above), as approved in Director of the Assets Recovery Agency v Szepietowski [2007] EWCA Civ 766, and Olupitan & Makinde v The Director of the Assets Recovery Agency (above).

Equally clearly, on either basis, the corrupt conduct alleged, if proved, amounts to unlawful conduct under the criminal law of both Nigeria and England & Wales.

That said, the full breadth of the alternative basis only emerged with any real clarity during the course of Mr Hall’s closing speech. It was strenuously objected to by Mr Hines, who suggested that its late emergence made it impossible for him to deal with it. I will address that contention below.

My findings of fact

I have already set out my findings of fact in paragraphs 12 - 101 above.

It is obviously important to stand back from the detail, and to look at the broad picture provided by the facts as I have found them to be. Mr Agidi earned only a very modest salary throughout the relevant period. Up to 29 May 1999 he should not have controlled nor had any bank account in London at all. Thereafter, and until his retirement, he should have reported details of credits in such accounts, but failed to do so. Throughout the relevant period vast sums of money flowed through the various accounts in London - very large sums of which were withdrawn in cash. Mr Agidi was employed in positions which provided him with the opportunity for corrupt conduct and the consequent receipt of bribes or rewards (whether received for himself and his wife and/or for others). The money flows and the withdrawals in cash alone are redolent, to an overwhelming degree, with the stench of corrupt bribes or rewards. No other credible explanation has been put forward for them. Mr Agidi’s attempts to provide innocent explanations in his police interview on 24 November 2003 (paragraph 69 above) and in his statement in the cash forfeiture proceedings (paragraph 81 above) are risible, and only serve to further strengthen the conclusion that the various credits were the product of corruption – particularly when regard is had to the positions of those to whom he admits making cash payments and to the positions of those referred to in the “Public Relations Fees in 2001” document found at 84 Hurstwood Road. In July 2008 he accepted the forfeiture of £171,367 in cash, when it could only be forfeited if it was the product of unlawful conduct, or intended for use in unlawful conduct. In addition, Mr Agidi failed to comply with the requirements of the Disclosure Notice (paragraph 89 above), thereby (even making allowance for his ill health) leading to further adverse inferences in connection with the issues raised in the Notice.

Consideration of the broad picture, and thus in effect of part of the alternative basis upon which SOCA seeks to advance its case (particularly in connection with some of the credits alleged to be the product of a corrupt relationship with Skoda, but not sent from named Skoda accounts), was always going to be part of the process of deciding whether SOCA had proved the principal basis of its case. Thus the broad picture, and the inferences to be drawn from it, was always something that Mr Agidi was going to have to prepare to deal with in these proceedings. Hence I reject Mr Hines’ contention that he was disadvantaged by the late articulation of the full breadth of alternative basis, at least as far as corruption (as opposed to money laundering) is concerned.

That said, and having considered the detail of the evidence, I concluded (as will already be obvious from my findings of fact) that SOCA had proved, to the requisite standard, its principal assertion that the relevant credits to the bank accounts in London controlled by Mr Agidi were bribes or rewards resulting from specific corrupt relationships between first him and Skoda, and then him and Sagem (and Mr Adelagun), and that the bribes or rewards were thereafter either kept by Mr Agidi for the use of himself and Mrs Agidi, or were withdrawn and distributed by him in cash to others involved in the corruption. Thus the dispute about the alternative basis is largely irrelevant.

As to Skoda, the facts that influenced my conclusion included the following:-

In my findings of fact I have indicated, in each relevant instance, whether a credit to the Okoh account came direct from a named Skoda account as a product of the corrupt relationship, or whether I concluded, by inference, in the case of credits from other accounts, that they were also a product of that same corrupt relationship. If, in any of the latter instances, I had not been satisfied to the requisite standard that a particular credit was the product of the corrupt relationship with Skoda, I would have had no hesitation in concluding (for the reasons already referred to above, and notwithstanding Mr Hines’ objections) that it must have been the product of one or more other corrupt relationships.

As to Sagem (and Mr Adelagun), the facts that influenced my conclusions included the following:-

Hence I concluded that it was proved to the relevant standard that each relevant credit to the Okoh and Orion accounts was the product of a corrupt relationship with either Skoda or Sagem and Mr Adelagun (i.e. that each credit was or represented property obtained through the unlawful conduct alleged), and that each was thereafter kept by Mr Agid for the use of himself and Mrs Agidi, or were withdrawn and distributed by him in cash to others involved in the corruption.

That provides the necessary foundation stone for SOCA’s claim. However, it is necessary to go on to consider whether, given my particular findings of fact, SOCA has proved that each item of property sought is indeed recoverable. I will deal with each in turn.

84 Hurstwood Road

My findings of fact in relation to the specific funds used in the purchase of this house, and the ownership of the house thereafter are set out in paragraphs 25-27, 29-31 & 71 above. I concluded that the purchase had been funded in whole by property which represented property that Mr Agidi had obtained through unlawful conduct – i.e. his corrupt relationship with Skoda.

Only one of the sums involved requires further comment, namely the £199,000 temporary overdraft that was, by inference, secured in consequence of the impending return of the £577,703.32 plus interest from the money market account(s) (which represented property obtained through the corrupt relationship with Skoda). SOCA submitted that, against that background, I should find that the £199,000 represented property obtained through unlawful conduct upon the basis that the purchase should be regarded as financed by the totality of the funds held by Mr Agidi at the bank, including those in money market accounts (all of which funds represented property obtained through the corrupt relationship with Skoda); and/or because the overdraft was only advanced because of the money market funds and thus was a profit accruing from the Skoda bribes; and/or because, however the finance was structured, Mr Agidi was engaged in money-laundering the proceeds of the Skoda bribes (as he plainly was), and the £199,000 was obtained through part of that money laundering. In reaching my overall conclusion about the £199,000 it seemed to me that there was force in each of these submissions.

The conveyance of the house into the joint names of Mr and Mrs Agidi in April 2004 does not preclude the making of the order. Nor do any of the exceptions or protections in the Act. The increase in the value of the house since its purchase is a profit accruing from property obtained through unlawful conduct. Accordingly, the house is recoverable property.

£587,157.64 (Citibank account)

My specific findings of fact in relation to the funds that make up this sum of money, which must be set against the background of my findings in relation to the house at 84 Hurstwood Road, are set out in paragraphs 32-35, 43 & 97 below.

I concluded that this sum (made up in part by funds returned by Mr Agidi representing the International Life Bond, and in part by profits accruing from those funds – i.e. interest up to 27 October 2010) represented property obtained by Mr Agidi though unlawful conduct (i.e. his corrupt relationship with Skoda).

There are no relevant exceptions or protections in relation to either Mr or Mrs Agidi. It follows that the whole sum, together with any interest that has accrued since 27 October 2010, is recoverable property.

£90,048.29 (Citibank account)

My specific findings of fact in relation to the funds that make up this sum of money, which must be set against the background of my findings in relation to both the house at 84 Hurstwood Road and the £587,157.64 held in the same Citibank account, are set out in paragraphs 43, 60-61 & 64-66 below.

I concluded that this sum (made up in part by funds representing the remainder of the cash sums recovered after Mr Agidi’s arrest, and in part by profits accruing from those monies – i.e. interest up to 27 October 2010) represented property obtained by Mr Agidi though unlawful conduct (i.e. his corrupt relationships with both Skoda and Sagem & Mr Adelagun).

As with the other sums, there are no relevant exceptions or protections in relation to either Mr or Mrs Agidi. It follows that the whole of this sum, together with any interest that has accrued since 27 October 2010, is recoverable property.

For the reasons set out above, SOCA succeeds in its claim for the recovery of the house at 84 Hurstwood Road, and for the recovery of all the monies held in the Citibank account (including any interest earned since 27 October 2010). I therefore propose to make a recovery order vesting all the property in the nominated trustee for civil recovery.

The parties must, if possible, agree a draft Order. Unless either party invites a further hearing, I propose to resolve any remaining dispute (including further submissions as to costs) on the basis of written submissions made within 14 days of the handing down of this judgment.