Lamb v Revenue and Customs Prosecutions Office

Under the Criminal Justice Act 1988, a management receiver may be appointed where there is a good arguable case that property is realisable property, even before a confiscation order. After a confiscation order has determined the defendant’s interest as between the prosecutor and defendant, an unresolved third-party ownership claim does not remove jurisdiction. The third party may later vindicate its interest. The court’s discretion should consider the need to preserve value, the existing evidence, the management of the property and likely costs. A possible condition requiring the prosecutor to bear costs where a third party proves wholly ownership was identified, but the issue was left open.

Stephen Lamb appealed against the judgment and order of Mr C M G Ockelton, sitting as a deputy High Court judge in the Administrative Court, which appointed a management receiver over property and personal assets treated as the realisable property of Stephen Pigott under the Criminal Justice Act 1988.

Lamb, an interested third party, argued that the court lacked jurisdiction while his asserted legal and beneficial ownership remained unresolved. Alternatively, he argued that appointing a receiver was an improper exercise of discretion because he could manage the property and might bear wasted receivership costs. The central issues were whether the receivership order was jurisdictionally available and whether it was reasonable to make it pending determination of Lamb’s ownership claim.

The appeal was dismissed. Rix LJ delivered the judgment, with Wilson LJ and Waller LJ agreeing.

1. Section 77(8) of the Criminal Justice Act 1988 gave the Administrative Court jurisdiction to appoint a management receiver. Before a confiscation order, the appropriate threshold was a good arguable case on the documents that the assets were realisable property, as explained in CPS v Compton [2002] EWCA Civ 1720.
2. The Crown Court had already determined, as between the RCPO and Pigott, that the property was realisable property. That determination was not binding on Lamb, but it was sufficient for the purposes of the management receivership. A third-party ownership claim could be determined later without depriving the court of jurisdiction.
3. The statutory scheme contemplated this result. Sections 74, 82 and 102(7) allowed property to remain realisable where the defendant held any interest or had made a qualifying gift, while preserving the ability of third parties to retain or recover their interests. Section 80(8) and RSC Order 115 rule 7(4)(c) confirmed that detailed declarations concerning third-party interests were principally relevant at the enforcement stage. The contrary submission would prevent restraint, receivership or confiscation orders until every ownership issue had been resolved.
4. The judge had not finally determined ownership between Lamb and Pigott. His discretion to appoint a receiver was therefore properly exercised. The existing findings supported Pigott’s interest, the property had been occupied by squatters, and Lamb had not adequately demonstrated that outgoings, insurance or management were being dealt with. The likely receivership costs were relatively modest and could potentially be met from other realisable assets.
5. Ordinarily, a receiver may have a lien over receivership assets for remuneration and expenses, as discussed in Capewell v HMRC [2007] UKHL 2 and Heath Sinclair in his capacity as the former receiver v Louis Glatt [2009] EWCA Civ 176. The court left open whether a special condition under section 77(8) could require the RCPO to bear costs if Lamb ultimately proved that Pigott had no interest at all.

• Court of Appeal (Civil Division): dismissed Lamb’s appeal and upheld the appointment of a management receiver.
• Administrative Court, Queen’s Bench Division: on 21 October 2008, Mr C M G Ockelton, sitting as a deputy High Court judge, appointed a management receiver under section 77(8) of the Criminal Justice Act 1988.