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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Scottish Ministers, Re An Interim Administration Order [2007] ScotCS CSOH_41 (23 February 2007)
URL: http://www.bailii.org/scot/cases/ScotCS/2007/CSOH_41.html
Cite as: [2007] CSOH 41, [2007] ScotCS CSOH_41

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OUTER HOUSE, COURT OF SESSION

 

[2007] CSOH 41

 

P223/05

 

 

OPINION OF LORD EMSLIE

 

in the Petition of

 

THE SCOTTISH MINISTERS

 

Petitioners;

for

an interim administration order in terms of the Proceeds of Crime Act 2002

 

ญญญญญญญญญญญญญญญญญ________________

 

 

 

 

 

Petitioners: Sheldon; R Henderson

Thirteenth respondent: Party

 

23 February 2007

Introduction

[1] For the purposes of the Proceeds of Crime Act 2002 ("the Act") the petitioners are the enforcement authority in relation to Scotland. In these civil proceedings commenced in February 2005, they have obtained from the court an interim administration order to secure the temporary preservation of certain property and assets alleged to be "recoverable" under Part 5 of the Act. Fifteen holders of such property and assets are named as respondents, together with various holders of "associated" property and a number of "interested parties". In Part I of the schedule the first respondent is named as Russell Stirton residing at an address in Milngavie, and the thirteenth respondent is named and designed as "Alexander Ferguson Anderson, residing at 37 Cowan Wynd, Uddingston, Glasgow". Article 5 of the relevant petition goes on to allege serious criminal conduct against inter alios both of these men, and in article 6 it is alleged that the various items of property specified in Part II of the schedule are, or represent, property obtained through such unlawful conduct and thereby qualifying as "recoverable".

[2] On 4 March 2005 answers were lodged jointly on behalf of the first and thirteenth respondents in which it was admitted (at paragraph 2): (i) that the respondents were the persons mentioned in Part I of the schedule to the Act; (ii) that they were persons whom the petitioners thought held the property mentioned in parts II and III of the schedule; and (iii) that the property was "recoverable" or "associated" property within the meaning of the Act. Paragraph 6.9 further admitted that the thirteenth respondent had purchased the property at 37 Cowan Wynd, Uddingston, Glasgow; paragraph 6.10 admitted that the thirteenth respondent was a director of a company Pineloch Ltd; and paragraph 6.11 admitted inter alia that the first and thirteenth respondents had together purchased certain property at 911 Springburn Road, Glasgow. Various other admissions relative to the thirteenth respondent appeared elsewhere in these answers, notably at paragraph 5.9 where the thirteenth respondent admitted having sold the property at 37 Cowan Wynd to the fourteenth respondent. The answers for the first and thirteenth respondent have remained unaltered throughout the currency of these proceedings.

[3] In 2005 the first and thirteenth respondents mounted an extensive challenge, on several different grounds, to the validity of the present proceedings and of the interim administration order granted thereunder. When that challenge was rejected by the Lord Ordinary on 26 January 2006 a reclaiming motion was marked, but after sundry procedure that reclaiming motion was finally abandoned on 25 January 2007.

 

Parties' submissions

[4] A motion has now been enrolled by the thirteenth respondent in which he seeks recall of the interim administration order vis-เ-vis his own interest on grounds which have not previously been advanced by him in this process. Before me it was argued, with clarity and restraint, that the present petition and subsequent order had all along been directed against the wrong person and were thus fundamentally invalid. "Alexander Ferguson Anderson" was now known to be a real person living in Glasgow whose date of birth was 10 January 1953. Unlike the thirteenth respondent, "Alexander Ferguson Anderson" had several serious criminal convictions, and it was believed that without inappropriate reliance on the name, date of birth and criminal history of this other person the interim administration order quoad the thirteenth respondent would never have been granted. If a criminal warrant in the name of the wrong person could not have been sustained, the same should apply to the present order which involved material encroachment on the thirteenth respondent's property rights.

[5] According to the thirteenth respondent the confusion had begun in 2004 when he and the first respondent appeared together on petition in the Sheriff Court charged with certain drugs offences. Although in reality the man then brought to court and remanded in custody was the thirteenth respondent, the criminal petition bore to proceed against "Alexander Ferguson Anderson ... date of birth 10 January 1953 ... 37 Cowan Wynd, Uddingston, Glasgow". While the address for the thirteenth respondent was correct, the name and date of birth were not. There was no connection between the two men although they knew each other. "Alexander Ferguson Anderson" did not live at 37 Cowan Wynd, Uddingston, and the thirteenth respondent's middle names of "Thomson" and, he thought, "Moffat" did not resemble "Ferguson". The thirteenth respondent used no aliases. Although eventually nothing came of these criminal proceedings, the Crown then sought and obtained a restraint order in the same (wrong) name, purporting to freeze certain property and assets belonging to the thirteenth respondent, and the present interim administration order was granted (again in the wrong name) on the same day as the restraint order was formerly recalled.

[6] Against that background, it was argued that a serious mistake had been made by the authorities from an early stage. Without obvious explanation, the case had been directed against the wrong person to the material prejudice of both the thirteenth respondent and, it was suggested, the real "Alexander Ferguson Anderson". Judging by the terms of a letter from solicitors acting for the interim administrator, the proceedings continued to be conducted in the wrong name because this was the name specified in the present petition under which it was granted. Having been made aware of the problem in 2004 and 2005, prison officers and the police had chosen to ignore it, and the petitioners and others could now have no legitimate excuse for the persistence of the error. In these circumstances, according to the thirteenth respondent, the only proper course would be to dismiss the proceedings insofar as they related to him, and in particular to recall the interim administration order to that extent. Cases such as Ford v Muirhead 1858 20D 949 and Wolthekker v Northern Agricultural Company 1862 1M 211 confirmed that affected individuals might have a right of action where warrants and diligences were wrongfully obtained.

[7] In reply, counsel for the petitioners maintained that neither these petition proceedings, nor the ongoing interim administration, were fatally flawed. While acknowledging that the purported middle name "Ferguson" was indeed an error, he contended that since this matter had not been raised by the thirteenth respondent at any prior stage it could not properly be founded on now. It was important to note that the thirteenth respondent's forename and surname were correctly stated, as was his address where admittedly no other "Alexander Anderson" lived. Neither the interim administration petition nor the subsequent petition for a recovery order mentioned any date of birth, and indeed the recovery petition correctly named the thirteenth respondent as "Alexander Anderson". When the former petition was personally served on the thirteenth respondent at his stated address, he took no objection to its terms and under rule of court 16.11 his entry into the process had barred any further objection to the regularity of his citation. Moreover, in the answers which were lodged on his behalf in March 2005, the thirteenth respondent had not only failed to raise any issue regarding his true identity, but had made significant admissions positively connecting himself with certain of the properties and other assets to which the petition related. On 31 March 2005, shortly after the answers were lodged, certain funds were released from the scope of the interim administration order on the thirteenth respondent's application.

[8] In the course of the debate which took place before Lord Macfadyen over several days in 2005, attention was drawn to the erroneous attribution of previous convictions to the thirteenth respondent in article 5.1 of the petition. That error was, with apologies, corrected by amendment in October 2005, and the court attached no further significance to the matter. Again, in the grounds of appeal relative to his subsequent reclaiming motion, the thirteenth respondent raised no difficulty regarding the name in which the petition and consequent order proceeded. Ignoring the prior criminal proceedings which had come to nothing, and which were not in any event a necessary pre-requisite to civil proceedings under Part 5 of the Act, the thirteenth respondent could have no legitimate cause for complaint regarding what was truly no more than the inclusion of an erroneous middle name for someone who was otherwise correctly named and designed in the proceedings. Moreover, that middle name no longer appeared in the recovery petition which was now pending, and after serving its purely protective purpose the interim administration petition was substantially spent.

[9] Esto the court took the view that any material problem arose here, the petitioners would wish an opportunity to cure it by means of a simple amendment. That could cause no prejudice to the thirteenth respondent given the terms of his answers, and also given his repeated assertion that he would not object if the present proceedings were recalled and then immediately recommenced under the correct name. More importantly, section 260(4) of the Act imposed a mandatory requirement on the court to afford all interested parties an opportunity to be heard before varying or recalling an interim administration order, and in addition section 255A would entitle the petitioners to seek an immediate prohibitory order regarding any recoverable property to which the interim administration order might cease to relate. Accordingly, if the court was minded to grant some relief to the thirteenth respondent at this stage, the case should be put out for further consideration of (i) the precise extent to which the interim administration order should be affected by any such relief, and (ii) the consequential measures which might then require to be taken.

Discussion

[10] This is not in my view an entirely straightforward matter. On the one hand it is agreed that, since the thirteenth respondent has no middle name "Ferguson", paragraph 13 of Part I of the schedule to the petition is technically incorrect. From February 2005 onwards the interim administration has apparently proceeded in the same name, and in challenging that state of affairs the thirteenth respondent relies on the general proposition that - in certain circumstances at least - the validity of warrants, diligences and similar intrusive orders must depend on their being formally correct. However, the only decided cases which he cited concerned the scope of the averments required in support of claims for damages or compensation, and he very fairly accepted that no such claim was before the court at this time.

[11] On the other hand, these are civil proceedings in which the primary focus (derived from section 256 of the Act) is on the identification of "recoverable" property and assets, rather than on the identity of their current holders or of those individuals whose alleged criminal conduct in the past is narrated. For the best part of two years, moreover, the thirteenth respondent has failed to raise the present issue in these proceedings despite having inevitably been aware of the error regarding his own name and of the potential for confusion with a third party having extensive criminal convictions. On the contrary, by entering the process with full answers on the merits of the application, he thereby barred any possible objection to the regularity of his citation in terms of rule 16.11 of the Rules of Court. Furthermore, these answers contain the important admissions, mentioned earlier in this opinion, which directly contradict the challenge which the thirteenth respondent seeks to develop at this time.

[12] It may be that, as the thirteenth respondent maintains, the issue of his true identity was raised at some point in the past with prison staff and/or with the police, but in my view what matters for present purposes is that he has formally taken the opposite course. In particular his answers confirm acceptance that he, the thirteenth respondent, is a correct recipient of the petition, and indeed that he is the correct person against whom any interim administration order relating to 37 Cowan Wynd, Uddingston, Glasgow and certain other allegedly "recoverable" property and assets would fall to be granted. As regards the subsequent recovery petition, which could in law have been instituted independently and without any preceding interim administration order being in force, it seems to be accepted that the thirteenth respondent is therein correctly named and designed.

[13] Over and above that, it would in my opinion be wrong to judge the validity of free-standing civil proceedings by reference to prior criminal proceedings on which they do not depend. By February 2005 these criminal proceedings were on the point of lapsing, and the related restraint order was formally recalled before the present petition was presented to the court. As it seems to me, these considerations again serve to confirm the relative lack of substance of the error of which the thirteenth respondent now complains. Furthermore, notwithstanding the thirteenth respondent's ex parte assertions, I am not prepared to impute bad faith to the police, prison service, Crown Office or petitioners in respect of the persistence of the error from 2004 onwards. There is no evidence before me as to the circumstances in which that error first arose, or in which it remained undetected until recently, and it is not without significance that the thirteenth respondent himself did not pick it up, or at least did not choose to make any issue of it in this process, until the present time.

[14] At all events I am not persuaded that, as a matter of discretion, I should at this late stage recall or vary an order, the validity of which has (in the particular respect now complained of) gone unchallenged for the best part of two years. Much water has flowed under the bridge since the order was first granted in February 2005, with considerable expense incurred both in disputed court proceedings and in connection with the interim administration itself. As it seems to me, questions of personal bar may well arise in such circumstances, but since I was not addressed on that matter I prefer to rest this aspect of my judgement on the simple proposition that the thirteenth respondent's present application comes too late. In any case I do not think it would be appropriate to set aside important proceedings, brought in the public interest, by reason of what is in my view an essentially minor and curable complaint. If hypothetically the true situation had been brought to the attention of the Lord Ordinary at the time when the original motion for an interim administration order was made, it is to my mind highly improbable that he would (as the thirteenth respondent suggested) have refused to grant any such order vis-เ-vis the thirteenth respondent. Much more likely, in my opinion, is that the Lord Ordinary would simply have allowed Part I of the schedule to the petition to be amended before granting the same order against inter alios the thirteenth respondent by reference to his correct name.

[15] A further relevant consideration is in my view the difficulty of identifying any prejudice suffered, or likely to be suffered, by the thirteenth respondent arising out of the circumstances of which he now complains. As reflected in his own answers to the petition, there has never been any dispute that he is de facto the individual against whom certain allegations of criminal conduct are directed in article 5, and whose property at 37 Cowan Wynd, Uddingston, Glasgow and elsewhere is being pursued as "recoverable". The attribution of an incorrect middle name does not, in other words, appear to have created any actual confusion in his own mind (or, I suspect, in anyone else's) regarding the intended scope of the petitioners' claims. As the thirteenth respondent himself said more than once in the course of the discussion before me, he would not object if, on dismissal of the present petition and order, identical proceedings in his correct name were to be recommenced on the same day. As against that, however, his insistence that any corrective amendment of the existing proceedings would be strongly opposed is somewhat difficult to understand. For their part, the petitioners' intention is to pursue the existing recovery proceedings which contain no error as to the thirteenth respondent's name. If the present interim administration order were to be recalled vis-เ-vis the thirteenth respondent, they would apply at once for a prohibitory order under section 255A of the Act in order to safeguard all relevant property and assets pending completion of the recovery proceedings. In the absence of an effective interim administration order, it is in my view more than likely that the court would look favourably on protective measures designed to support the free-standing recovery proceedings. Taking all these considerations into account, I do not consider that the thirteenth respondent would suffer any measurable prejudice if his motion were to be refused, nor would he be likely to secure any worthwhile advantage in the event of its being granted.

Decision

[16] For all of these reasons, I am satisfied that the thirteenth respondent's motion is ill-founded and must be refused.

 

 

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