Serious Organised Crime Agency v Szepietowski & Ors, Court of Appeal - Chancery Division, February 27, 2009, [2009] EWHC 344 (Ch)
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Serious Organised Crime Agency v Szepietowski & Ors, Court of Appeal - Chancery Division, February 27, 2009, [2009] EWHC 344 (Ch)
Neutral Citation Number: [2009] EWHC 344 (Ch)
Case No: HC08C00118IN THE HIGH COURT OF JUSTICECHANCERY DIVISIONRoyal Courts of JusticeStrand, London, WC2A 2LLDate: 27/02/2009Before :THE HONOURABLE MR JUSTICE HENDERSON- - - - - - - - - - - - - - - - - - - - -Between :- - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - -Ms Sarah Harman (instructed by the SOCA Legal Department) for the ClaimantMr David Sonn (Solicitor) and Mr Daniel Hochberg (instructed by Messrs Sonn Macmillan Walker) for the First, Third and Fourth DefendantsHearing dates: 18 and 19 February 2009- - - - - - - - - - - - - - - - - - - - -JudgmentMr Justice Henderson : Introduction1. This is my judgment on an application by the first, third and fourth defendants (``the Applicants'') pursuant to section 252 of the Proceeds of Crime Act 2002 (``POCA 2002'' or ``the 2002 Act'') for further exclusions from the interim receiving order made by Collins J on 27 July 2005 in order to enable them to meet legal expenses. The application is made by an application notice dated 3 December 2008, which first came before me together with a number of other applications on 9 and 10 December. I decided on that occasion to adjourn it until the Applicants had made and filed statements of assets as required by paragraph 7A.2 of the Practice Direction relating to Civil Recovery Proceedings which was published in CPR Update 30 in February 2003 and is to be found in volume 2 of the White Book at pp 1525ff. (``the Practice Direction''). By paragraph 6 of the order which I made on that date, and which was entered on 15 December after its detailed terms had been agreed between the lawyers on each side, I directed each of the Applicants by no later than 4 pm on 31 December 2008 to serve on the claimant, the Serious Organised Crime Agency (``SOCA''), a witness statement verified by a statement of truth containing the information specified in the second schedule to the order. I also directed that further consideration of the application should be adjourned to the first open date after 12 January 2009, with a time estimate of one day. 2. The background to the application, very briefly, is that SOCA seeks a civil recovery order under the 2002 Act in respect of the property which now represents a sum of US $2.4 million which was remitted to the UK from Turkey in August 1999 by Mr Eddie Sower, also known as Jamie Mitchell (``the Turkish money''). SOCA alleges that the Turkish money had been obtained by unlawful conduct (principally drug trafficking) and was recoverable property within the meaning of section 266 of the 2002 Act. The money was paid into the client account of a small, two partner firm of solicitors with offices in Weybridge and London called De Verney Brooke Taylor. The Weybridge office was run by one of the partners, Mr John Szepietowski, who is the first defendant in the present proceedings and one of the three Applicants. 3. With the assistance of Mr Szepietowski, an offshore trust and corporate structure was established to hold the Turkish money. The structure took the form of a Manx discretionary trust, which held all the shares in a company incorporated in the British Virgin Islands which itself had nominee directors, but was under the de facto control of Mr Szepietowski. The declaration of trust establishing the Manx trust was executed by Mr Szepietowski as the sole original trustee on 1 September 1999. The settlement was known as the Heritage Investment Trust. The only named beneficiary was Mr Mitchell himself, although the trustees had power to add further beneficiaries. The original trust fund was described as consisting of two shares of one US dollar each in an unnamed BVI company. It is common ground that the company in question was in fact the fourth defendant, Countess Investments Limited (``Countess BVI''). 4. It appears that approximately two thirds of the Turkish money was lent in or about September 1999 by Countess BVI to a company called Plevna Trade Limited (``Plevna''), another offshore company under the control of a Mr Anthony David Tummond. The purpose of the loan was to enable Plevna to purchase some land...See the full content of this document
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